Sourced Consultant Agreement
Date of Last Revision: April 15, 2024
This is a Sourced Consultant Agreement (“Agreement”) by and between you, the entity agreeing to the terms of and executing this Agreement (“you” or “Client”) and Altera Consulting Co., Ltd., a Japanese company, with a mailing address at 1-8-16-1017 Kaga, Itabashi-ku, Tokyo 173-0003, Japan (“Altera”).
In consideration of the mutual covenants, terms, and conditions set forth in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the above-named parties agree as follows:
1. Service; Work and COPs; Client Cooperation
1.1 Service. Altera is a company that matches its clients with select freelancers. More specifically, Altera curates and operates a proprietary network of select independent contractors (individually and collectively, “Consultant”). Altera matches and sources such Consultant to its clients on a time and materials, staff augmentation basis. You agree that Altera will find and match Consultant in Altera’s consultant network using commercially reasonable efforts and make such Consultant available to you, facilitate payments between you and Consultant, and facilitate (if you request) with onboarding or related administrative tasks in connection with a Consultant engagement (the “Service”). If Client further sources any Consultant sourced under this Agreement to any of Client’s end clients (each an “End Client”) or has such Consultant work for or with such End Client, then the additional terms in Exhibit A will apply and be incorporated into this Agreement.
1.2. Work and COPs. Altera will provide its Service (consisting of the matching and sourcing of the Consultant as described above) to you in accordance with a Consultant Outline Plan (“COP”). All executed COPs will be incorporated into this Agreement. Each COP will provide a brief description of the work to be provided to you by Consultant (“Work”), as well as the COP start date, the fees for the Work, and other relevant material information.
1.3. Client Cooperation. You understand that the performance of all Work by Consultant depends in significant part on your actions. Consultant will report directly to your designee (“Client Contact”). Such Client Contact will provide such Consultant with necessary information, assistance, specifications, and requirements for such Consultant’s Work and will establish your expectations pursuant to reasonable and lawful instructions. The Client Contact will be responsible for setting, reviewing, and monitoring the project schedule, work schedules, work outputs and/or other tangible results created by Consultant and provided to you under this Agreement (“Work Output”), and all other aspects of Consultant’s Work under a COP and coordinating the same directly with the Consultant. Consultant will otherwise be responsible for the method, manner, and means of performing the Work. You acknowledge and agree that Altera will not oversee Consultant or the performance of Consultant’s Work and will not control or direct Consultant. Accordingly, you agree that Altera will not be in a position to – and expressly does not – warrant or guarantee the quantity, quality, or timeliness of the Work or that any Consultant will meet any deadline established or desired by you.
1.4. No Paid Time Off. You will not be liable to pay for any vacation time or other personal days off that you agree Consultant can take, provided that you notify Altera in writing to enable proper invoicing for actual Consultant time worked/not worked.
2. Fees; Billing
2.1. Invoices; Payment Terms. Altera will invoice you monthly for Service provided during the immediately preceding monthly period. You also agree to pay Altera all pre-approved (by you), actual and reasonable travel, lodging, and other out-of- pocket expenses incurred in connection with the Service or the Work. Invoiced sums will be due to Altera Net 30 from the date of Altera’s invoice. Altera will apply payments received according to remittance instructions (if any) provided to Altera by Client. If Altera does not receive remittance instructions, Altera will make reasonable efforts to obtain remittance instructions and if none are received Altera will first apply payments to Client’s oldest outstanding invoice(s). Any stated fee should be received in full by Altera. All transfer fees, conversion fees or banking charges incurred by Client should not be borne by Altera.
2.2. Methods of Payment; Late Payments. All payments will be made in Japanese Yen and paid electronically via bank wire, or Wise. Amounts past due more than thirty (30) days will incur interest at a rate of 1.5% per month, or the maximum rate permitted by law whichever is the highest, from the date they became due and payable. In the event of any action by Altera to collect any unpaid, undisputed (in good faith) past due amounts, you will reimburse Altera’s costs of collection, including attorneys’ fees and arbitration or court costs.
3. Limited Cooling Off Period for Introduced Consultant
You agree that Altera would be considerably harmed if Altera were to invest its time, energy, and resources to recruit, screen and curate its talent network and introduce its Consultant to you only for you and Consultant to circumvent Altera and enter into a direct or indirect arrangement outside of Altera. Therefore, you agree that you will not, directly yourself or indirectly through others, encourage or solicit to hire, or otherwise hire or engage for the performance of services (except via Altera under this Agreement) those individual Consultant who are introduced to you by or through Altera in connection with this Agreement (i) during the period of time of such Consultant’s Work for you under this Agreement and eighteen (18) months thereafter; or (ii) if you elect not to engage such introduced Consultant under or in connection with this Agreement, then within eighteen (18) months of the date such Consultant is first introduced by Altera to you (the relevant time period under (i) or (ii) with respect to such individual Consultant, the “Cooling Off Period”). For the avoidance of doubt, this restriction is not a general non-solicitation provision and will not apply to Altera’s entire talent network but is narrowly tailored in scope and duration to apply to those individual Consultants that are introduced to you by or through Altera. You further agree that during the applicable Cooling Off Period, you will not refer Consultant to subsidiaries, parent companies, partnerships, holding companies, affiliated entities, or investors related to you in any form without processing such requests through Altera’s regular client intake processes. Client also agrees that it will not try to circumvent Altera by inducing any such Consultant to refer, provide names, or recruit other individuals or entities to work for, or provide services to, Client or any third parties (except via Altera) nor will Client cooperate with any efforts of such Consultant to do the same. For the further avoidance of doubt, any Cooling Off Period(s) applicable to any individual Consultant(s) will survive termination of this Agreement until the expiry of such respective Cooling Off Period(s), if any.
4. Client Option to Buyout Altera and Hire Consultant Outside of Altera
4.1. During the term of a COP or Cooling Off Period applicable to a particular Consultant, you may elect to directly or indirectly engage or employ Consultant outside of Altera subject to: (a) your prior written notice to Altera; (b) the right for Altera to arrange for a reasonable wind-down period for the affected Consultant; and (c) your full payment of the Buyout Fee (defined below). A wind-down period may be thirty (30) days, but may be reasonably adjusted by Altera based on such Consultant’s commitments to Altera, or, if any, commitments to other Altera clients.
4.2. With respect to each Client-Hired Consultant, Altera will invoice and you will pay Altera a buyout fee of Six Million Japanese Yen (JPY 6,000,000) within thirty (30) days of hiring or engaging such Consultant outside of Altera (“Buyout Fee”).
4.3. As used herein, “Client-Hired Consultant” means a Consultant who: (1) is introduced to you by Altera and/or the Consultant provides Work to you, and (2) is hired or engaged directly by you, or is engaged indirectly by you via others, to provide services to you outside of Altera, during the Cooling Off Period applicable to such Consultant.
4.4. For the avoidance of doubt, no Buyout Fee will be payable or owed in respect of an individual Consultant following the expiration of the applicable Cooling Off Period for such Consultant.
5. Termination
5.1. Material Breach. If there is a material breach of this Agreement or a particular COP by a party, the other party may terminate this Agreement in its entirety or the affected COP(s) by giving the breaching party written notice and a ten (10) business day cure period.
5.2. For Convenience. Each party also may terminate this Agreement or a COP at any time, with or without cause, upon twenty (20) business days’ prior written notice to the other party.
5.3. Survival. Sections 2, 3, 4, 5, 6.2, 6.3, 7, 8 and 9 will survive termination of this Agreement.
5.4. Payment of Amounts Due or Accrued. Upon termination of this Agreement or a COP, you will pay Altera all amounts due or accrued under the Agreement or such COP, as the case may be, as of the effective date of such termination.
6. Warranties & Disclaimer
6.1. General. Altera represents and warrants that each Consultant has been qualified under Altera’s proprietary talent screening system. Altera and Client hereby represent and warrant that they each have full power, right, and authority to enter into this Agreement and to carry out its obligations.
6.2. Not a Technology Development Contract. You acknowledge that this is not a technology development contract. You are solely responsible for the development of your technology and products, including Consultant’s Work and Work Output that may be incorporated therein. You agree that you will provide Consultant with all applicable processes, policies, and resources necessary for Consultant’s Work. You are solely responsible for acquiring all rights and licenses to any software, code, tools, information, documentation, or other materials and intellectual property that you acquire from third parties (excluding Consultant) necessary for the Consultant to complete the Work. Except as stated in Sections 6 and 7, you assume all risks with respect to your technology and products, including all Work, Work Output and materials incorporated therein.
6.3. Except as provided in Section 6.1, Altera makes no representation or warranty of any kind, express or implied, with respect to its Service, or Consultant’s Work and Work Output, arising from or relating to this Agreement. Altera disclaims any other representations and warranties, including any implied warranties of merchantability, fitness for a particular purpose, non-infringement, and any representations or warranties arising from course of dealing, course of performance, or usage of trade.
6.4. Representation and confirmation of no relation with Anti-Social Forces.
Each Party represents and confirms as follows:
- It and/or its officer and major shareholder, are not presently and will not be in the future a person, group or member thereof who is an organized crime group or an enterprise related to an organized crime group or any other similar group (hereinafter categorically referred to as “Anti-Social Forces”).
- It and/or its related party shall not utilize Anti-Social Forces.
- It and/or its related party shall not be cooperative or involved with Anti-Social Forces by providing them finance or beneficial treatment, etc.
- It and/or its related party shall have no relation with Anti-Social Forces.
In case a Party is found in breach of the preceding paragraph, the other Party may terminate a whole or part of this Agreement forthwith without any prior notice. In such case the Party in breach shall immediately compensate the other Party for any damages incurred thereby.
7. IP Ownership & Licenses
7.1. Assignment of Inventions; Client Ownership Rights. Except for the licensed rights described in Section 7.2, Altera assigns to you all right, title, and interest owned by and vested in Altera or the Consultant, in and to all Work Output provided to you together with all intellectual property rights Altera or the Consultant has (including, to the extent applicable, patents, copyrights, trade secrets, and moral rights). Altera will reasonably assist you, at your request and expense, to further evidence, record, perfect, and maintain, any rights assigned hereunder.
7.2. Grant of License Rights to Client. In addition to the provisions of Section 7.1, if intellectual property of Altera or Consultant is reasonably necessary to use Work Output, Altera grants to you a non-exclusive, royalty-free, perpetual, irrevocable, sublicensable, worldwide right and license to fully exercise and exploit Altera’s or Consultant’s intellectual property and to make derivative works of the same solely for the use of the Work Output obtained from the Consultant.
8. Confidentiality
8.1. Protection of Proprietary Information. All business, technical or financial information disclosed by a party to the other party under this Agreement will be the “Proprietary Information” of the disclosing party. All Work Output provided by Consultant to you under this Agreement is your Proprietary Information. The Proprietary Information of Altera includes the names, contact information, Altera’s screening and selection criteria for, rates and particular skills of each Consultant in Altera’s network. Each party will hold in confidence and not disclose or, except in performing its obligations under this Agreement, use any Proprietary Information of the disclosing party. Nothing, however, prohibits Altera from reusing the know-how accumulated while providing the Service, or that Consultant may retain providing the Work in their unaided memories, for Altera’s business including to provide services to Altera’s other clients. Memory is considered unaided with respect if a person (1) has not memorized any Proprietary Information to intentionally evade the confidentiality obligations contemplated by this Section; and (2) does not incorporate any Proprietary Information of Client for the purpose of such reuse.
8.2. Customary Exclusions. Proprietary Information does not include any information the receiving party can document: (a) is or becomes generally available to the public without restriction through no fault of the receiving party; (b) was in the receiving party’s possession or known by it without restriction prior to receipt from the disclosing party; (c) was rightfully disclosed to the receiving party by a third party without restriction; or (d) was independently developed by the receiving party without use or reference to any Proprietary Information. The receiving party may make disclosures required by law or court order if the receiving party provides (to the extent permitted by applicable law) the disclosing party with prompt, advance written notice of disclosure and an opportunity to limit or prevent disclosure.
8.3. Return of Proprietary Information. As requested by the disclosing party, the receiving party will (and Altera will use commercially reasonable efforts to cause Consultant to) promptly return to the disclosing party (or, at disclosing party’s election, destroy) all Proprietary Information of the other party (including furnishing Work Output to Client, provided Client has paid Altera all undisputed, in good faith, fees due). Despite the foregoing, the receiving party is not required to destroy any Proprietary Information stored in a party’s backup/disaster recovery systems or required to be retained to comply with applicable law or regulatory requirements. All such retained information will be subject to the terms of this Section 8 for as long as such information is held by the receiving party.
9. General
9.1. Publicity. After Consultant’s engagement has started, Altera may refer to Client on Altera’s website or other marketing material which displays customers of Altera, or may use Client as a reference; provided, however, that Client may decline or revoke this permission, by emailing [email protected]. Altera will cease such publicity on its website within ten (10) business days of its receipt of such opt-out notice. The parties may issue a public statement relating to this Agreement at any time following Consultant’s engagement upon each party’s reasonable prior review and written consent.
9.2. Relationship of Parties; Taxes. Altera is an independent contractor of Client and the parties are not authorized to and will not attempt to bind the other party. You acknowledge that the Consultant to be sourced to you under this Agreement are independent contractors and not employees of Altera. Altera is only responsible to remit the fees and compensation payable to the Consultant and payment of Altera’s income taxes in connection with this Agreement. You are responsible for all other taxes and assessments, if any, in respect of this Agreement or any Work or Work Output, including, without limitation, any sales, value-added, use or similar taxes, duties, or levies. Client will pay the full invoice amount and will not withhold therefrom any amount based on any tax, duty, levy, or assessments.
9.3. Choice of Law; Dispute Resolution; Venue. This Agreement is made under, and will be governed, construed, and enforced in accordance with, the laws of Japan, without giving effect to principles of choice or conflicts of law that would result in the application of the laws of any other jurisdiction. To the maximum extent permitted by law, any dispute, claim, or controversy arising out of or relating to this Agreement, including the negotiation, breach, termination, enforcement, interpretation, or validity thereof, or the scope or applicability of this agreement to arbitrate, will be submitted to the Tokyo District Court for binding arbitration in Tokyo, Japan by a single arbitrator. The arbitrator will be selected by the Japan Commercial Arbitration Association (JCAA) in an impartial manner determined by it. The language of the arbitration will be Japanese. Any arbitration conducted pursuant to the terms of this Agreement will be governed by the Japanese Arbitration Act and will be administered by the JCAA pursuant to its Commercial Arbitration Rules. The arbitrator will have complete authority to render any and all relief, legal and equitable, appropriate under Japanese law. This arbitration provision will not preclude parties from seeking provisional remedies in aid of arbitration from a court of appropriate jurisdiction. Without limiting the foregoing and in furtherance thereof, judgment on an arbitration award may be entered in any court of competent jurisdiction. If any matter arising under or related to this Agreement, including its negotiation, breach, termination, enforcement, interpretation, or validity, or the scope or applicability of this agreement to arbitrate, is not arbitrable as a matter of applicable law (or if a party attempts to assert a claim in court against the other party over any matter arising under or relating to this Agreement), then the courts of Japan will have exclusive jurisdiction. The parties hereby submit to the exclusive jurisdiction of such courts and irrevocably waive any claim of inconvenient forum. The parties hereby irrevocably waive any right to trial by jury.
9.4. No Consequential Damages; Limitations of Liability.
9.4.1. No Consequential Damages. NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY FOR ANY INCIDENTAL, CONSEQUENTIAL, INDIRECT, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES (INCLUDING DAMAGES FOR LOSS OF BUSINESS, LOSS OF PROFITS OR THE LIKE) ARISING OUT OF OR RELATING TO THIS AGREEMENT, SUCH PARTY’S PERFORMANCE HEREUNDER, THE USE OR INABILITY TO USE ANY SERVICE, WORK, OR WORK OUTPUT, OR ANY INTERRUPTION OR DISRUPTION OF OR BY ANY OF THE FOREGOING, EVEN IF A PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES AND REGARDLESS OF THE CAUSE OF ACTION (WHETHER IN CONTRACT, TORT, BREACH OF WARRANTY OR OTHERWISE).
9.4.2. Limitation of Liability. NOTWITHSTANDING ANY OTHER PROVISION IN OR MADE A PART OF THIS AGREEMENT, AND EXCEPT ONLY WITH RESPECT TO LIABILITIES THAT MAY NOT BE LIMITED OR EXCLUDED AS A MATTER OF APPLICABLE STATUTORY OR CASE LAW, THE AGGREGATE LIABILITY OF EACH PARTY WITH REGARD TO OR ARISING UNDER THIS AGREEMENT WILL IN NO EVENT EXCEED THE FEES PAID BY YOU TO ALTERA UNDER THIS AGREEMENT DURING THE SIX (6) MONTHS IMMEDIATELY PRECEDING THE DATE ON WHICH SUCH CLAIM FIRST ARISES; PROVIDED THAT THE LIMITATIONS OF LIABILITY SET FORTH IN THIS SECTION 9.4.2. WILL NOT BE CONSTRUED OR INTERPRETED TO LIMIT YOUR PAYMENT OBLIGATIONS UNDER THIS AGREEMENT.
9.5. Limitations on Assignment. Neither party will have the right to assign this Agreement to another party without the other party’s written consent, except that either party may, upon written notice to the other party (and without the other party’s consent), assign this Agreement in its entirety to a parent company, any subsidiary of a parent company, or an affiliate in a common control group in connection with a corporate reorganization, entity conversion, acquisition, merger, or sale of or substantially all of its assets; provided that such assignee agrees in writing to be bound by the terms and conditions of this Agreement.
9.6. No Third-Party Beneficiaries. This Agreement is solely intended for the benefit of the parties hereto and their respective successors and permitted assignees and is not intended to benefit, and may not be enforced by, any other entity or person, including, without limitation, any Consultant or End Client, as the case may be.
9.7. Complete Agreement; Amendments; Additional Agreement. This Agreement, inclusive of all COPs, constitutes the entire understanding between the parties regarding the subject matter of this Agreement and supersedes and completely replaces any prior written or oral agreement or any discussions or written communications with you, any of your agents or representatives and Altera and any of its agents and representatives. This Agreement will take precedence over any COP unless and solely to the extent that the parties state in such COP that they intend to override a specific term of this Agreement. No waiver, change to, or amendment of this Agreement or a COP will be effective unless it is in writing and signed by the parties.
9.8. Notices. Any notices to Altera in connection with this Agreement will be made by email transmitted to [email protected], with a copy via nationally recognized carrier to: “Attn: Contract Administration” at Altera’s address above. Notices to you will be made by email or nationally recognized carrier to the email or address which you provide to Altera and/or is otherwise associated with your account, and will be deemed to have been given when sent by Altera to the email provided to Altera or delivered by such nationally recognized carrier at the mailing address provided by you and/or associated with your account.
9.9. Drafting. Neither party will be deemed the drafter of this Agreement for the purposes of interpreting any ambiguity in this Agreement. The section and subsection headings used in this Agreement are for convenience only and will not be used in interpreting this Agreement.
9.10. Severability. If any provision of this Agreement is determined to be illegal or unenforceable, that provision will be first revised to give the maximum permissible effect to its original intent or, if such revision is not permitted under applicable law or decisional case law, that specific provision will be eliminated so that this Agreement will otherwise remain in full force and effect and enforceable.
9.11. Authority to Bind.
Altera provides the Service to you subject to this Agreement. By accepting this Agreement, you acknowledge that you have read, understood, and agree to be bound by the terms and conditions herein. You further acknowledge that this Agreement is a contract between you and Altera, even if it is electronic and is not physically signed by you and Altera, and that the terms and conditions of this Agreement govern your receipt of the Service and Altera’s provision thereof. You represent that you have the authority to contractually bind the company, business, or other legal entity (“Client Entity”) on whose behalf you are accepting this Agreement, in which case, for clarification, the terms “you” or “your” or “Client” refer to such Client Entity. IF YOU DO NOT HAVE SUCH AUTHORITY TO CONTRACTUALLY BIND SUCH CLIENT ENTITY TO THIS AGREEMENT, OR IF YOU DO NOT AGREE WITH THE TERMS AND CONDITIONS OF THIS AGREEMENT, YOU MUST NOT ACCEPT THIS AGREEMENT AND YOU MAY NOT RECEIVE THE SERVICE.
Exhibit A - End Client Terms
In accordance with Section 1.1 of the Agreement, these additional terms and conditions (“End Client Terms”) will only apply if Client further sources any Consultant sourced under this Agreement to any End Client or has such Consultant work for or with such End Client.
General Application. Client acknowledges and agrees that these End Client Terms supplement the terms and conditions in the main body of the Agreement and do not replace, limit, or diminish any of Client’s obligations therein.
Cooling Off Period and Buyout. Client will be responsible for any violation by End Client of the terms in Section 3 (Limited Cooling Off Period for Introduced Consultant) and Section 4 (Client Option to Buyout Altera and Hire Consultant Outside of Altera) of the Agreement, including, without limitation, for payment of any Buyout Fee(s) resulting from End Client directly or indirectly engaging or employing Client-Hired Consultant.
Representations. Client represents, warrants and agrees that (i) End Client will not further source Consultant, whether to another entity, individual, organization or otherwise, and End Client will only engage Consultant to provide services for End Client’s internal business purposes, and (ii) Client has obtained substantially similar representations as are set forth in Sections 6.4 and 6.5 of the Agreement from each End Client to whom any Consultant is sourced through Client.
Confidentiality. Client may disclose to End Client only that portion of the Proprietary Information of Altera required to be disclosed solely for purposes of Client receiving the Services and/or End Client receiving the Work, provided that End Client is bound by a written agreement with confidentiality and use restrictions at least as stringent as those set forth in the Agreement and applicable to End Client’s receipt and use of such Proprietary Information.
Indemnification. CLIENT WILL INDEMNIFY, DEFEND AND HOLD HARMLESS ALTERA AND ITS MEMBERS, MANAGERS, EMPLOYEES, AGENTS AND REPRESENTATIVES FROM AND AGAINST ANY END CLIENT CLAIMS AND DAMAGES ARISING, DIRECTLY OR INDIRECTLY, FROM THIS AGREEMENT, THE SERVICE, THE WORK AND/OR TALENT. THE LIMITATIONS OF LIABILITY SET FORTH IN SECTION 9.4.2. OF THE AGREEMENT WILL NOT BE CONSTRUED OR INTERPRETED TO LIMIT CLIENT’S FOREGOING INDEMNIFICATION OBLIGATION.
