Terms of Service Agreement for Custom Digital Services

The following Terms of Service apply to all custom digital services provided by Patmos Hosting Inc.  (“Patmos”, “we”, “us”, “our”) to Clients (“Client”, “you”, “your”). 

1. ENGAGEMENT AND AUTHORIZATION. You are engaging us in the role of an independent contractor, and not as employees. As part of this engagement, you hereby agree and consent to allow us to provide you with all of the services customarily performed by a digital agency, including consulting, branding, design, development, strategy, and digital marketing. All such services will be provided by us in the context of work authorized by a separately executed Work Order. To the extent that our work requires access to Privileged Systems, you agree to facilitate our access to these systems so as not to delay work that is covered by this Agreement. You further authorize us to use screenshots, descriptions, and depictions of all work produced or undertaken in our own promotional and portfolio materials in any and all media, provided, however, that any materials used do not include the identifiable image or likeness of any minor individual or any confidential information. Any material specifically covered by any separate non-disclosure agreements that may exist shall be governed by that non-disclosure agreement.

2. LENGTH OF AGREEMENT. The terms of this Agreement shall govern all Work Orders and Change Orders (either an “Order” or, collectively, “Orders”) between the Client and Patmos in perpetuity unless and until it is canceled (see Paragraph 13, below).

3. SCOPE OF WORK. The scope of work for any Work Order shall be determined in mutual discussion between you and us. We understand that all Clients have different needs. Work Orders for Flex Retainers and Ad-Hoc Hourly work allow for maximum flexibility in scope during the course of work; however, since these are variable pricing contracts, you acknowledge and agree that changes to the scope of work or new discoveries during the course of work may cause initial estimates to be exceeded, leading to higher than anticipated costs. Fixed Price Agreements are fixed in both scope and price and do not allow for any changes to be made without a signed Change Order.

4. BILLING AND PAYMENT TERMS. You agree to pay us for all services provided as part of all Orders. All invoices are considered due on the invoice date and must be paid within fifteen (15) days via check, money order, wire transfer, or credit card payment (fees may apply). Balances outstanding after thirty (30) days or more from the date of issue will be charged interest at the rate of 1.5% per month beginning thirty (30) days after the issue date. All payments to Patmos will be net, free of any tax withholdings or bank charges. You are solely responsible for any such additional changes, to the extent that they are not Backup Withholding as directed by a taxing agency. Specifically, fees for any payments remitted through PayPal, Stripe, or any other payment processors that assess a fee shall be your responsibility and shall be invoiced separately as necessary.

You agree to remit all payments to the address specified on invoices or Orders. We reserve the right to assign any and all receivables to one or more third parties, and you agree to make payment to any party at any address specified by Patmos, provided that the third party(ies) is an entity in good standing, and that such payment will not violate any law or commercial code governing businesses in the State of Missouri or your registered state (if applicable). If you wish to pay by wire transfer, please contact us for wire instructions.

Professional Fees are the labor costs of services and are specified in all Orders.

Out-of-pocket Expenses are customary expenditures in the provision of custom digital services. These are costs we incur in the process of performing our obligations, but which are not part of Professional Fees. Unless otherwise specified in an Order or approved in writing by the Client, Out-of-pocket Expenses will not exceed five percent (5%) of Professional Fees per Order, or $150 per month when operating on an Ad-Hoc Work Order. The list below highlights common examples; however, this list is not comprehensive, and all relevant Out-of-pocket Expenses will be billed as they are incurred:

• Travel (including transportation, lodging, and meals)
• Courier & mail services
• Printing & photocopies
• Specific equipment required for a given scope of work

Out-of-pocket Expenses can occasionally be anticipated in advance, and we will make commercially reasonable efforts to alert you when such costs are expected; however, you acknowledge and agree that, from time-to-time, anticipating these expenses may not be reasonable in a timely manner and such costs may be incurred by us when and as needed. Out-of-pocket Expenses will be billed without any additional markup.

All Third Party Fees incurred during delivery of an Order shall be your sole responsibility. Third Party Fees include any fees paid to a third party for the use of or access to APIs, software licenses, web servers, e-mail servers, database servers, advertising providers, stock photography providers, or any other products or services not considered Out-of-pocket Expenses or Professional Fees. If we incur such costs on your behalf, these costs will be passed on to you plus a standard administrative charge of 10% of the total reimbursable cost. If you prefer to pay these charges yourself, you agree to do so in a timely manner so as not to delay our ability to deliver work.

You are responsible for any duties, customs fees, taxes, and related penalties, fines, audits, interest and back-payments relating to your purchase of our services, including but not limited to national, state or local sales taxes, use taxes, value-added taxes (VAT) and goods and services taxes (GST) (collectively, "Taxes"). To the extent permitted by law, or unless explicitly stated otherwise, all fees do not include applicable Taxes. If we become obligated to pay or collect Taxes in connection with your purchase of services, you are responsible for those Taxes, and we may collect payment either through an invoice or at the time of purchase.

If any payment is rejected or returned for any reason, including chargeback or NSF, payment shall be deemed late as of the original invoice date and an administrative fee of $35 shall apply in addition to any late charges that are accrued.

5. PAYMENT OF INITIAL DEPOSIT & PAYMENT IN FULL. Unless otherwise specified in an Order, the payment schedules below shall apply.

Fixed Retainers and Maintenance Base Costs: We endeavor to issue invoices for Fixed Retainers and Maintenance Base Costs on or about the fifteenth of the preceding month; however,  Fixed Retainers and Maintenance Base Costs are due in full on the first day of each month of service, whether or not an invoice is issued.

Flex Retainers: For all Flex Retainers, you agree to pay in four equal installments of twenty-five percent (25%) of all Professional Fees. The first payment is due upon execution of the Order, the second payment once one-quarter (25%) of the Flex Retainer has been utilized, the third payment once one-half (50%) of the Flex Retainer has been utilized, and and the final payment once three-quarters (75%) of the Flex Retainer has been utilized. In the event that twelve (12) months have passed since the Flex Retainer was ordered, any uninvoiced amount will be immediately due and payable and unused hours from the Flex Retainer will expire. Any hours remaining in a Flex Retainer one calendar year after the Flex Retainer has been ordered will expire. For Flex Retainers of 1,000 hours or more, at least half (50%) of the hours must be used within six (6) months from the date of the Order; any unused hours will expire.

In the event that, by no fault of Patmos, it appears that it may become impossible or impractical for Patmos to deliver a Flex Retainer’s hour balance in the time remaining during the Flex Retainer’s six-month or one-year period, Patmos may require that the Client make use of hours from the block. Any such requirement will be issued in good faith and will be communicated in writing no less than two (2) weeks before a required action date. In the event that the Client is unable or unwilling to make use of the Flex Retainer hours in a timely manner, those hours will be forfeited.

In the event that, by no fault of the Client, Patmos is unable to deliver Flex Retainer hours in advance of their expiration at six-months or one-year, the Flex Retainer shall enter an Exception Period. During the Exception Period, Patmos shall suspend the expiration window. The Exception Period shall immediately end either 1) when Patmos has delivered sufficient hours to meet the expiration threshold or 2) when Patmos has completed all work requested by the Client prior to entering the Exception Period. In the latter case, any remaining expirable-hours will immediately expire. Failure of the Client to request sufficient work to fill available hours does not qualify for an Exception Period, and during an Exception Period, no new work may be added to the Backlog.

Ad-Hoc: Payment for one-half (50%) of the estimated initial hourly effort for Ad-Hoc Orders is due in advance. Once the pre-paid balance has been earned by Patmos through the delivery of hours, additional ad-hoc hours will be invoiced, in arrears, on a monthly basis.

Fixed Price Agreements: Payment schedules for Fixed Price Agreements are most often specified in an individual Order, but by default are payable one-half (50%) up front, and one half (50%) upon our delivery of a finished product.

Should your account become delinquent by more than forty-five (45) days, we reserve the right to stop all work until your account becomes current. In the event that we need to undertake collection activities, you agree to pay all fees related to those collection activities.

6. OWNERSHIP OF CODE & DESIGN ELEMENTS. Upon completion of any Order, ownership of, and rights to, all final artwork and rendered animations shall be transferred to you, subject to the terms of any licenses governing elements obtained from third parties. We retain all ownership and rights to all intermediate artwork and to all Code created during the Project. All such Code owned by us is hereby licensed to you for use in perpetuity without limitation, restriction or fee, except as provided for below, upon completion of the associated Order. We are free to use all such Code for any and all other Orders, with the exception that we will not use code developed specifically for you if we happen to work with one of your direct competitors within two (2) years. Code that we own and license to you may not be resold or re-licensed by you unless expressly approved in writing by us. Third party products, including open source items, shall be governed by their respective licenses.

In the event that you wish to sell, lease, or transfer any Code owned by us or governed by the terms of this Agreement, the sale, lease, or transfer of such code by the Client to any third party for any reason will be subject to a payment to us in the amount equal to fifty percent (50%) of the total Professional Fees paid by you to us related to such Code. We will provide assistance in any such sale, lease, or transfer as requested by you and shall be paid for such assistance at our current ad-hoc hourly rate then in effect for services provided to you or, if no rate is in effect, then at our ad-hoc rate in effect at the time. The sale, lease or transfer of our Code will be effectuated by way of a license issued by Patmos. All permission or approval required to be provided by Patmos will be provided in writing and will not be unreasonably withheld.

We are often asked why we have these sale/transfer terms. We believe that you should be able to use all of the work that we produce for you; however, in order to keep costs lower and maximize our team’s efficiency, we may reuse work we’ve done for other clients in your deliverables, or we may reuse work we do for you when delivering work for future clients. Our permissive license makes this a good fit for most cases; however, it can cause issues in the event that you wish to sell or transfer the Code in the future, since that Code may be in use elsewhere. If, during the preparation of an Order, you know that you are likely to pursue the sale of any work we deliver for you, it is in your best interest to provide us with that information up front, as this will help to reduce the effort associated with its transfer in the future.

7. COPYRIGHTS, TRADEMARKS, AND INTELLECTUAL PROPERTY. The protection of intellectual property is of the utmost importance to us. As such, you represent to us and unconditionally guarantee that any text, graphics, photos, videos, recordings, designs, trademarks, artwork, or other creative furnished to us for use during delivery of an Order are owned by you, or that you have permission from the rightful owner to use each of these elements, and that you will furnish us with proof of such ownership or permission upon our request. You further agree that you will not use any work that we create for you to violate the intellectual property rights of others. You agree to hold harmless, protect, and defend us and our subcontractors from any claim or suit arising from the use of any elements you have furnished to us or from your ongoing use of the work product we deliver.

The Stock Art Use Agreement outlines our use of all stock imagery and is hereby incorporated into this Terms of Service and you agree to be bound by its terms.

With the exception of Stock Art, we represent and unconditionally guarantee that all elements we provide, including Patmos-owned Code, are owned by us or that we have permission from the rightful owner to use each of these elements, and will hold harmless, protect, and defend you from any claim or suit arising from the use of such elements furnished by us, so long as your usage complies with all applicable laws and licenses.

8. MAINTENANCE. Unless specifically provided for in an Order, all additional work, including bug fixes, will require a separate Work Order.

9. CLIENT OR THIRD PARTY MODIFICATIONS. We are not responsible for assessing, remediating, or repairing any damage done by you or any other party through the use or mis-use of work product that we deliver, whether these are the result of actual modifications to our deliverables or the result of changes to ancillary systems or assets on which the deliverables rely. In the event that you require our assistance to assess, remediate, or repair and you do not have a current Order with us under which such work can be performed, a separate Work Order will be required.

10. CONTACT. Due to the collaborative nature of Orders governed by this Agreement, there exists the expectation that all parties will respond promptly to inquiries, requests for information, or requests for approval of design and functional elements. Unless otherwise agreed to by the parties, you agree to provide us with responses to inquiries within three (3) business days. Your failure to provide adequate feedback within this time frame will significantly delay Orders. In this case, any SLA provided by Patmos as part of an Order shall not apply until adequate feedback has been received.

11. WEB HOSTING. Unless a separate web hosting agreement is included as part of an Order, you must provide your own web hosting, and you are solely responsible for the performance of your selected provider. We are unable to guarantee that the work product we deliver to you will function in every environment you might select. As such, if you are not entering into a web hosting agreement with us, you are advised to consult with us before engaging with any specific provider.

12. CHANGE ORDERS & ADDITIONAL PROJECTS. Flex Retainer and Ad-Hoc Work Orders provide the flexibility to operate without Change Orders or to add new work at a later date. Unless already provided for in an Order, all changes to the scope or timing of Orders governed by this Agreement shall require you to sign a Change Order. Any such executed Change Orders shall be governed by the terms of this Agreement.

13. TERMINATION. This Agreement, or any individual Order governed by this Agreement, may be terminated at any time and for any reason by either party, unless specifically restricted in an individual Order.

Regardless of the reason for termination, any fees unpaid by the Client for work actually performed by Patmos prior to termination are still due and payable.

In the event that we terminate this Agreement (or any Order covered by it) for our convenience, and not as a result of your breach, we will refund to you a pro-rata amount for any fees paid but for which work has not been performed by Patmos. Any outstanding invoices that you owe to us are still due.

In the event that you terminate this Agreement (or any Order covered by it) for your convenience, and not as a result of our breach, the following terms will apply based on the type of Order, unless otherwise specified in the Order.

Fixed Retainers and Maintenance Base Costs: When operating on a month-to-month basis you may cancel at any time before the following month of service begins and your Order will be canceled effective at the end of the current month of service. Any fees already paid are non-refundable, and any unpaid fees for past or current months of service are still due. When operating on any timeline other than month-to-month, terms governing termination will be defined in the Order.

Flex Retainers: You may elect to either, 1) buy out the remaining balance of the Flex Retainer, or 2) pay the difference between the discounted hourly rate you received in the Flex Retainer and the ad-hoc hourly rate that would have been applicable had all work been conducted on an ad-hoc basis. For the purposes of illustration, if you ordered a Flex Retainer of 1,000 hours for $189,000 when our ad-hoc hourly rate was $225, but then terminated this Agreement for convenience after we had delivered only 667 hours, you could elect either to buy out the remaining Flex Retainer for ($189,000 / 3) = $63,000.00 or to pay the difference between the ad-hoc and discounted hourly rate: ($225.00 - $189.00) * 667 = $36.00 * 667 = $24,012.00. When calculating your total balance due, any amounts you have already paid, but which have not yet been earned by us will be applied first. Any remaining balance, including for any outstanding invoices, will then be due.

Ad-Hoc: All ad-hoc hourly work that has been accrued but not billed at the time of termination shall be immediately payable to Patmos. All other outstanding balances you owe us will still be due.

Fixed Price Agreements: Any amounts paid under a fixed price agreement are non-refundable, and any milestones that have been started but not completed must be paid in full. All other outstanding balances you owe us will still be due.

14. FORCE MAJEURE. A party is not liable for failure to perform the party's obligations if such failure is as a result of Acts of God (including fire, flood, earthquake, storm, hurricane or other natural disaster), war, invasion, act of foreign enemies, hostilities (regardless of whether war is declared), civil war, rebellion, revolution, insurrection, military or usurped power or confiscation, terrorist activities, nationalization, government sanction, blockage, embargo, labor dispute, strike, lockout or interruption or failure of electricity, internet, or telephone service.

If a party asserts Force Majeure as an excuse for failure to perform the party's obligation, then the non-performing party must prove that the party took reasonable steps to minimize delay or damages caused by foreseeable events, that the party substantially fulfilled all non-excused obligations, and that the other party was notified of the likelihood or actual occurrence of the event in a timely manner.

15. LEGAL LIMITS. Final, delivered work products will be fit for the intended purpose as specified in individual Orders; however, we provide no warranty, express or implied, that the functions of our deliverable(s) will meet your ongoing requirements or that the operation of the deliverables will be uninterrupted or error-free. We are unable to test all deliverables under every possible use case that might exist. You acknowledge that all software will have bugs or show unexpected performance under various conditions that were not foreseen or tested. In no event will we be liable to you or any third party for any damages, including any lost profits, lost savings or other incidental, consequential or special damages arising out of the operation of or inability to use or operate any Order deliverables, even if we have been advised of the possibility of such damages.

We provide no warranty as to the performance of any third parties, including external software developers, API providers, web hosts, email hosts, or database hosts. Failure on the part of any third party to provide adequate service shall not be cause for termination of this Agreement without full payment to us.

In no case shall our liability for any individual Order exceed the contractual value of that Order. In the event of ad-hoc hourly work, our total liability shall in no case exceed the total calculated value of all invoices you have paid under the relevant Ad-Hoc Work Order.

16. ASSIGNMENT. Except as already provided in Paragraph 4, neither party may assign any of its rights or obligations hereunder, whether by operation of law or otherwise, without the prior written consent of the other party (not to be unreasonably withheld). Notwithstanding the foregoing, either party may assign this Agreement in its entirety (including all Orders), without consent of the other party, in connection with a merger, acquisition, corporate reorganization, or sale of all or substantially all of its assets not involving a direct competitor of the other party. Any attempt by a party to assign its rights or obligations under this Agreement in breach of this section shall be void and of no effect.

17. DEFINITIONS. For the purposes of this Agreement, Appendix A contains common terms and their definitions.

18. SEVERABILITY. If any provision of this Agreement shall be unlawful, void, or for any reason unenforceable, then that provision shall be deemed severable from this Agreement and shall not affect the validity and enforceability of any remaining provisions.

19. ELECTRONIC COMMERCE LAWS. From time to time governments enact laws and levy taxes and tariffs affecting Internet electronic commerce. You agree that you are solely responsible for complying with such laws, taxes, and tariffs, and will hold harmless, protect, and defend us and our subcontractors from any claim, suit, penalty, tax, or tariff arising from your exercise of Internet electronic commerce.

20. CHOICE OF LAW. The enforcement, performance, discharge, lack of performance and formation of this Agreement is governed by, and construed and enforced in accordance with, the law of the State of Missouri of the United States of America, regardless of any applicable conflict-of-law rules to the contrary. The law of the State of Missouri shall prevail in any disputes between the parties.

21. DISPUTE RESOLUTION. We don’t like conflict, but once in a while, disputes arise that need to be resolved. Patmos and the Client agree to attempt to resolve any disputes directly. If the parties are unable to resolve such disputes within thirty (30) days, any dispute arising under this Agreement shall be settled in accordance with the expedited procedures set forth in the Judicial Arbitration and Mediation Service, Inc. (“JAMS”) Comprehensive Arbitration Rules and Procedures as those Rules exist on the effective date of this Agreement, including Rules 16.1 and 16.2 of those Rules , by a single neutral Arbitrator appointed in accordance with such Rules. The arbitration shall take place in Kansas City,MO in the English language and the arbitral decision may be entered in any court with jurisdiction. The prevailing party in any action or proceeding to enforce the Agreement shall be entitled to costs and attorneys’ fees. This clause shall not preclude parties from seeking provisional remedies in aid of arbitration from a court of appropriate jurisdiction.

22. MUTUAL NON-DISCLOSURE. Both parties agree to protect the confidentiality of any information provided to the other party in a manner consistent with the way they would protect the confidentiality of their own information, but in no event with anything less than reasonable care. Information that each party considers confidential shall be expressly declared or marked as such. Unless expressly permitted by an individual Project Agreement or approved separately in writing, neither party will use, distribute, display, or otherwise share in any way either 1) information marked or declared as confidential, or 2) material provided to the other party during the course of any Project that would not otherwise be available to the general public.

23 BENEFIT OF SERVICES. You acknowledge that the benefit of all services that we provide are received by you in the State of Missouri.

24. FAIR AGREEMENT. The language of all parts of the Agreement shall, in all cases, be construed as a whole, according to its fair meaning and not strictly for or against any party.

25. SURVIVABILITY. The provisions of paragraphs 4, 5, 6, 7, 8, 14, 15, 16, 19, 20, 21, 22, 23 and 24 will survive any termination or expiration of this Agreement.

26. BUSINESS DAYS. Our regular business days / business hours are Monday to Friday, 8 a.m. to 5 p.m. Mountain Time, with the exception of the following Holidays:

• New Year’s Day (January 1, or when observed)
• Memorial Day
• Independence Day (July 4, or when observed)
• August 15
• Labor Day
• November 1
• Thanksgiving Day
• Day after Thanksgiving
• December 8
• Christmas Eve (December 24, or when observed)
• Christmas Day (December 25, or when observed)
• New Year's Eve (December 31, or when observed)

In addition to these specified dates, please note that our services are never available on Sundays or any day designated as a Holy Day of Obligation by the Roman Catholic Archdiocese of Denver.

Any references to business days or business hours shall be understood in light of this schedule. For purposes of illustration, “within one business day” of 10 a.m. on October 31, 2017, would be before 10 a.m. on November 2, 2017; and “within one business day” of 10 a.m. on November 2, 2017, would be before 10 a.m. on November 3, 3017.

27. CHANGES. We sometimes have to change the legal terms under which we provide our custom digital services. When any such changes are made, we will post a revised version of this Agreement. You agree to be bound by this Agreement both now and as amended in the future. We may provide notice of revisions, such as by sending an email notification to the email address listed in your account or by updating the “Last Updated” date at the beginning of this Agreement. Your continued use of our services after the new terms take effect will be subject to the new terms, so if you disagree with the changes in the new terms, you should terminate use of our services. Customizations or exceptions to this Agreement for individual Clients are rare and are valid only with a written amendment signed by an authorized Officer of Patmos Hosting.

28. ENTIRE AGREEMENT; BINDING EFFECT. This Agreement, with all inclusions and relevant Orders, represents the entire understanding between the parties and shall govern all Orders for custom digital services between the parties. Should any work be requested for which the terms of the Agreement are not sufficient, a supplemental Agreement must be executed. This Agreement shall be binding upon and shall inure only to the benefit to the parties hereto and their respective successors and assigns. Nothing in this Agreement, express or implied, is intended to confer or shall be deemed to confer upon any persons or entities not parties to this Agreement, any rights or remedies under or by reason of this Agreement. Fee calculations provided in this Agreement are for the purposes of illustration only and do not necessarily represent our actual rates. All actual rates are specified in approved Work Orders, which shall be considered part of this Agreement between the parties.