**Exhibit 10.31**

 
| ** ** | ***TEXT  OMITTED AND FILED SEPARATELY**                    |
|------------|------------------------------------------------------------|
| ** ** | **Confidential  Treatment Requested**                      |
| ** ** | **Under  17 C.F.R. Section 200.80(B)(4), 200.83 and** |
| ** ** | **240.24b-2**                                              |

 

**FedEx Contract No. 06-0037**

 

**EQUIPMENTPURCHASE, LICENSE AND SERVICES AGREEMENT**

 

THIS EQUIPMENT PURCHASE, LICENSE AND SERVICESAGREEMENT (the “Agreement”) is made on this the 29th day of August, 2005 (the “EffectiveDate”), between **FEDEX CORPORATE SERVICES, INC.**, aDelaware corporation (“FedEx”), and **TIME AMERICA, INC**,an Arizona corporation (“Contractor”).

 

**ARTICLE 1**

**DEFINITIONS**

 

In addition to words and terms elsewhere defined in this Agreement, thefollowing words and terms as used in this Agreement shall have the followingmeanings, unless some other meaning is apparent from the context in which thewords and terms are used:

 

**Section 1.01.  Affiliate. **Anyentity that, directly or indirectly, controls, is controlled by or is undercommon control with FedEx, where “control” is defined as the ownership of atleast fifty percent (50%) of the equity or beneficial interests of such entity,but only for so long as such control exists. Any Affiliate may place orders under this Agreement.

 

**Section 1.02.  Delivery. **Receipt by FedEx of the any Equipmentand/or Software ordered pursuant to the terms and conditions of this Agreement.

 

**Section 1.03.  Documentation. **All textual material relating to theSoftware, including flow charts, operating instructions, and related technicalinformation and specifications, plus all maintenance modificationsthereto.  Documentation shall alsoinclude customary end-user materials, such as user manuals, in both hard copyand machine readable format.

 

**Section 1.04.  Equipment. **The time-keeping related equipment listedin Exhibit A which is attached hereto and incorporated herein byreference and which may be ordered from time to time by FedEx pursuant to theterms and conditions of this Agreement.

 

**Section 1.05.  Excusable Delay.**  Any delay in Contractor’s performanceoccasioned by causes beyond its reasonable control and not occasioned by itsintentional acts, fault or negligence, and including acts of God or publicenemies, industrial or civil disturbances, orders of any governmental ormilitary entity having authority to act, or failure of suppliers for one of theforegoing reasons to provide parts and components to Contractor timely.

 

**Section 1.06.  Initial Order.**  The initial order of Equipment, Software andMaintenance Services ordered by FedEx under this Agreement as set forth in Exhibit Bof this Agreement.

 

**Section 1.07.  Installation Date. **The date upon which FedEx is notified byContractor in writing that any Equipment and/or Software ordered under thisAgreement has been installed by Contractor as required

 

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under the Professional Services Agreement between the parties datedcontemporaneously herewith (FedEx Contract No. 06-0036), is functioningand is able to perform substantially the function for which it is intended.

 

**Section 1.08.  Location. **The specific retail location at which theEquipment and/or Software must be delivered. Each Location will be specified either in the applicable Purchase Ordersubmitted by FedEx or in a subsequent written directive from FedEx.

 

**Section 1.09.  MNDA. **The Mutual Non-Disclosure Agreement by and between the parties datedMay 23, 2003, a copy of which is attached hereto as Exhibit F.

 

**Section 1.10.  Maintenance Services.**  The maintenance and support services that maybe ordered from time to time by FedEx described in Exhibit C ofthis Agreement which is attached hereto and incorporated herein by reference.

 

**Section 1.11.  Purchase Order. **A written or electronic orderingcommunication issued subsequent to the Effective Date by FedEx to Contractorauthorizing the purchase of the Equipment or Maintenance Services andspecifying the quantity and the Purchase Price of the Equipment ordered.

 

**Section 1.12.  Purchase Price.**  The price for any Equipment, Software orMaintenance Services ordered from time to time by FedEx pursuant to the termsand conditions of this Agreement as based upon the  schedule set forth in Exhibit A.

 

**Section 1.13.  Software. **The computer programs described in Exhibit Aconsisting of a series of instructions and statements in object code form,along with any related materials and technical data including, but not limitedto, Documentation provided for use in connection with the Software.  The term shall also include any customconfiguration of the Software developed for FedEx by Contractor pursuant to theProfessional Services Agreement dated August 29, 2005.

 

**Section 1.14.  Specifications.**  The technical and operational specificationsto which the any ordered Equipment and/or Software must conform as specified inExhibit D which is attached hereto and incorporated herein byreference.

 

**ARTICLE 2**

**TERM AND TERMINATION**

 

**Section 2.01.  Term.**  The term of this Agreement shall commenceupon the date of execution of this Agreement by both parties and shall expirenot later than August 1, 2008 (the “Initial Term”), unless earlierterminated as provided in this Agreement. Upon FedEx’s request, this Agreement may be extended upon the same termsand conditions for additional successive periods of one (1) year (“ExtensionTerm”).

 

**Section 2.02.  Termination.**  The Agreement and/or any Purchase Order hereundermay be terminated by FedEx at will, with or without cause, upon not less thanthirty (30) days prior written notice to Contractor.

 

(a)           Inthe event of termination of the Agreement by FedEx, FedEx shall be liable forany Software and any finished or in-process Equipment ordered prior to theeffective date of termination. In the event of a material breach by Seller,FedEx shall have the immediate right to terminate this Agreement without anyliability for any finished or in-process Equipment.

 

(b)           In the event FedExterminates any Maintenance Services, Contractor shall, within thirty (30) days

 

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of the effective date of such termination, return to FedEx the proratedportion of any fees which may have been paid in advance by FedEx for suchServices.

 

**ARTICLE 3**

**LICENSES**

 

**Section 3.01.  Software License. **Subject to the payment of the LicenseFees specified in Exhibit A, Contractor hereby grants to FedEx, andFedEx hereby accepts, subject to the terms and conditions of this Agreement, anirrevocable, perpetual, non-exclusive, transferable, unlimited and world-widelicense to use, and to allow its subcontractors to use the Software inconnection with the performance of services for FedEx.  FedEx shall have the right to install, at nocharge, a back-up copy of the Software for archival and disaster recoverypurposes.

 

**Section 3.02.  Documentation License**.  With any Software licensed by FedExhereunder, Contractor shall provide one (1) complete set of easy tounderstand system, technical and user Documentation.  Contractor shall supply current, updatedDocumentation with each update or upgrade to a licensed Software provided toFedEx under this Agreement.  Contractorhereby grants to FedEx the right and license to copy the Documentation(including manuals and updates thereto) for end-user training or otherwise asnecessary in connection with the use of the licensed Software.  Documentation will be distributed only toemployees of FedEx or to third parties who are under a Non-Disclosure Agreementwith FedEx.

 

**Section 3.03.  Right to Use, Move or Transfer Licenses**.  Any license granted hereunder may betransferred by FedEx internally or to an Affiliate.  No license from Contractor cannot betransferred outside of FedEx without the express written approval ofContractor.

 

**ARTICLE 4**

# **ORDERSAND PAYMENT**

# ** **

**Section 4.01.  Orders.**  FedEx may order Equipment, Software orMaintenance Services under the terms of this Agreement by issuance of PurchaseOrders, or such other means acceptable to both parties (collectively referredto as “Purchase Orders”).  The termscontained herein apply to all orders for the purchases of Equipment, Softwareor Maintenance Services by FedEx.  In theevent of a conflict between the terms of a Purchase Order and the terms of thisAgreement, the terms of this Agreement shall control.  No terms contained in any Purchase Order orany acceptance or confirmation or similar document issued by Company shall bebinding on the parties unless specifically agreed to in writing by bothparties.

 

(a)           TheInitial Order under this Agreement is set forth in Exhibit B whichis attached hereto and incorporated herein by reference.  Accordingly, this Agreement shall serve as aPurchase Order and confirmation for such initial purchase without the necessityfor the issuance of any further ordering or invoicing documentation.

 

(b)           Other than the Initial Order set forth in Exhibit B,this Agreement does not obligate FedEx to order any minimum or maximumquantities of Equipment, Software or Maintenance Services and FedEx assumes nocommitment, financial or otherwise, except for specific the Equipment orServices that may be ordered from time to time by FedEx on a duly executedPurchase Order.

 

**Section 4.02.  Payment.**  For any Equipment, Software or MaintenanceServices ordered under this Agreement, FedEx shall pay to Contractor a feebased on the price schedule set forth in Exhibit A (the “PriceSchedule”), as set forth on an applicable Purchase Order.

 

(a)           ThePrice Schedule shall remain in effect for the Initial Term of theAgreement. Thereafter, during any Extension Term, prices shall not increase bymore than Five Percent (5%) of the prices

 

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charged during the preceding contract period or of theConsumer Price Index-All Urban Consumers for the previous year, whichever isless.

 

(b)           Subjectto Section 5.02, Contractor shall submit each invoice for Equipment andSoftware to FedEx upon shipment. Thereafter, each invoice shall be due and payable within thirty (30)days of Delivery or within forty-five (45) days of invoice date, whicheveroccurs first.

 

(c)           Alltaxes, excises, duties and assessments whatsoever (except taxes levied orassessed against Contractor based upon gross receipts or net income or taxesimposed upon the privilege of doing business or exercising a franchise) arisingout of the sale and delivery of the Equipment to FedEx (the “Taxes”) shall bethe responsibility of FedEx.  Such Taxes,if any, shall be added to the Equipment Purchase Price as a separate item.

 

(i)            Contractorshall invoice FedEx for the sales or use Taxes it is responsible for collectingand paying on the sale of Equipment (or any other taxes asserted pursuant to Section 8.01)by separately stating the amount and percent of such Taxes in each invoicepresented to FedEx for payment (or the final invoice, if agreed to by FedEx andContractor).  FedEx shall pay such Taxesto Contractor in accordance with the payment procedures set out in Section 4.02(b),unless (i) the validity or application of the Taxes is contested by FedExin good faith, or (ii) FedEx is permitted to make a direct payment to theTaxes to the taxing authority, and FedEx notifies Contractor of its intentionto do so. Contractor shall defend, indemnify and hold harmless FedEx againstany failure of Contractor to remit such taxes to the appropriate authorities.

 

(ii)           Contractorshall, upon FedEx’s written request and at its expense, assist FedEx incontesting the validity or application of any Taxes.  Contractor agrees that if it receives arefund of all or part of any Taxes (including interest and penalties)previously paid by FedEx, it shall promptly remit the refund to FedEx.

 

**ARTICLE 5**

**DELIVERY, TITLE AND RISK OF LOSS**

 

**Section 5.01****.  Delivery.**  Upon receiptof a Purchase Order or other written instructions from FedEx specifying aLocation for Delivery, Contractor will ship Software within ninety (90) daysand Equipment within one hundred eighty (180) days.  Contractor will ship the Equipment and/orSoftware using a FedEx–provided shipping account number or other means ofshipping provided by FedEx which shall be used solely for shipments to FedEx oran Affiliate.  The Equipment shall beshipped by Contractor to the Location(s) described in the applicable PurchaseOrder.

 

**Section 5.02.  Inspection and Acceptance Testing by FedEx. **Upon receipt of the Equipment and/orSoftware, FedEx shall have the right to inspect the Equipment.  In the event the Equipment does not conformto the Purchase Order, FedEx shall so notify Contractor in writing of anynon-conformity.  Contractor shall thenhave a cure period of five (5) calendar days to remedy the cause of suchnonconformity and resubmit the Equipment and/or Software to FedEx.  If at the end of the cure period theEquipment and/or Software does not conform to the requirements of thisAgreement, FedEx may at its option either:

 

(a)           Rejectthe Equipment and/or Software, whereupon Contractor shall promptly remove theEquipment and/or Software from the Location and immediately remit to FedEx anyamount previously paid by FedEx to Contractor for the Equipment and/orSoftware; or

 

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(b)           Conditionallyaccept the Equipment and/or Software, subject to the negotiation of anyequitable reduction in the price of the Equipment and/or Software as a resultof such nonconformity.  If such reductionis not agreed upon within ten (10) calendar days following FedEx’selection to conditionally accept the Equipment and/or Software, FedEx may thenelect to reject the Equipment and/or Software as provided above.

 

**Section 5.03.  Title and Risk of Loss.**  Risk of loss, damage to, or destruction ofany Equipment shall transfer from Contractor to FedEx upon Delivery of theEquipment to FedEx in accordance with this Article 5.  Title to the Equipment shall transfer toFedEx upon FedEx’s acceptance of such Equipment.

 

**ARTICLE 7**

# **CONTRACTOR’SWARRANTIES**

# ** **

**Section 7.01.  Contractor’s Warranties.**  Contractor warrants and represents that:

 

(a)           Equipment Warranties

 

(i)            Thatthe Equipment shall be free from defects in design, material or workmanship fora period of twelve (12) months following the Installation Date;

 

(ii)           Thatthe Equipment will conform to the Specifications set forth in the relatedDocumentation and as provided in Exhibit D for a period of twelve(12) months following the Installation Date; and

 

(iii)          TheEquipment shall conform to any applicable laws.

 

(b)           Software Warranties

 

(i)            Thatthe Software will perform in the manner specified in its applicablespecifications as set forth in the related Documentation;

 

(ii)           Thatthe media upon which the Software is provided shall be free of defects inmaterials and workmanship;

 

(iii)          ThatContractor will provide timely system Releases, error corrections and suchimprovements as may be necessary to maintain compatibility with any operatingsystem changes in which the Software operates, provided that FedEx is athen-current subscriber to Maintenance Services.

 

(c)           ServicesWarranty – all Services shall be performed according to the terms andconditions of this Agreement and in conformity with accepted standards ofContractor’s profession;

 

**Section 7.02.  Additional Warranties. **In addition to the Warranties set forthin Section 7.01, Contractor warranties that:

 

(a)           FedExshall receive full legal and beneficial title to the Equipment, free and clearof any and all security interests, liens, claims, charges or encumbrances andthat Contractor has full power and lawful authority to sell the Equipment toFedEx without conflict with any rights of a third party;

 

(b)           FedEx’spossession, use and enjoyment of the Equipment shall not infringe theintellectual property rights of any third party;

 

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(c)           Anyservices ordered by FedEx will be performed by qualified, careful, andefficient employees; and

 

(d)           AllInstallation and Maintenance Services furnished under this Agreement will be ofhigh quality and workmanship.

 

**Section 7.03.  Exclusions. **Contractor does not warrant any componentor software supplied by FedEx or its suppliers. This warranty may be voided by:  (i) misuse,accident, vandalism (meaning the willful or malicious destruction or defacementof the Equipment), or modification caused by FedEx or a third-party); (ii) unsuitablephysical or operating environment; (iii) unauthorized maintenance by FedExor the retail store at the Location; (iv) removal or alteration of partidentification; or (v) failure caused by a product for which Contractor isnot responsible.

 

**Section 7.04.  Warranty Service. **In the event that any Service and/or anyEquipment or part is not in conformity to the above warranties, Contractorshall, within two (2) business days after such notification or discoverythereof and at no expense to FedEx, re-perform the Service or repair the defector replace the Equipment or any parts thereof at its sole expense withEquipment or parts of equal or better quality satisfactory to FedEx.  To obtain warranty service, FedEx must followthe notice and return procedures set forth in Exhibit E.

 

**ARTICLE 8**

# **SERVICES**

# ** **

**Section 8.01.  Maintenance Services. **Subject to the payment of any requiredfees, Contractor shall provide Maintenance Services (as defined in Exhibit C)to FedEx and shall correct and repair any failure, malfunction, defect ornonconformity in any Equipment provided hereunder, following notification byFedEx to Contractor of such failure, malfunction, defect or nonconformity whichprevents the Equipment from performing in accordance with the warranties, documentation,specifications and other materials provided to FedEx hereunder.  Contractor shall exert reasonable anddiligent efforts to provide a suitable repair or replacement within the timeframes outlined in Exhibit C. All maintenance shall include reasonable and diligent efforts to providea suitable correction or replacement in a timely manner based on the nature ofthe problem and the impact on FedEx.

 

(a)           FedEx shallhave the right to renew or order additional Maintenance Services (pursuant tothe price schedule set forth in Exhibit A) under the sameterms and conditions at any time throughout the Term of this Agreement.  FedEx shall not be required to purchase orrenew any Maintenance Services at any time and failure to obtain or renew anysuch services shall not affect any rights to any Equipment acquired by FedExunder this Agreement.

 

(c)           Theannual services period for any initial or renewal order of Maintenance Servicesplaced by FedEx shall commence as of the date set forth in FedEx’s PurchaseOrder.  The fees for any MaintenanceServices for any services period of less than a full fiscal year shall beprorated for such period.  If FedExshould agree to purchase On-Site Maintenance Services subsequent to theWarranty Period, payment will be due within thirty (30) days following thebeginning of the maintenance period designated in the applicable PurchaseOrder.

 

**Section 8.02.  Time and Material Repair Services. **In the event FedEx is not entitled toWarranty Service and elects to forego purchasing Maintenance Services,Contractor agrees, upon request of FedEx, to provide on-site repair andreplacement services for any Equipment on a time and materials basis at therates specified in Exhibit A or as may be otherwise agreed by theparties in writing.

 

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**ARTICLE 9**

# **INDEMNIFICATION**

# ** **

**Section 9.01.  General Indemnification.**  Contractor agrees to indemnify, defend andhold harmless FedEx, its affiliates and their shareholders, directors,officers, agents and employees from any and all liabilities, damages, losses,expenses, demands, claims, suits or judgments, including reasonable attorneys’fees, and expenses, for the death of or bodily injury to any person and for theloss of, damage to or destruction of any property in any manner arising out of (i) thenegligent or intentional acts or omissions of Contractor, its agents, employeesor any person for whose acts or omissions Contractor, its agents, employees orsubcontractors may be responsible, or (ii) Contractor’s breach of thisAgreement.

 

**Section 9.02.  Patent Indemnification. **Contractor shall indemnify, defend andhold harmless FedEx, its directors, officers, employees and agents, from andagainst any claim that the Equipment or any part thereof (excluding anyFedEx-provided software) or the use, lease or sale of any item delivered or tobe infringes any United States or foreign patent, including process, copyrightor other proprietary right.  Contractorshall pay any royalties and other costs related to the settlement of such claimand the cost in damages, including attorney’s fees, finally awarded as a resultof any suit based on such claim.

 

(a)           FedExshall promptly notify Contractor of any such claim and shall give Contractorsuch assistance and information as is available to FedEx for the defense ofsuch claim, and FedEx will not settle or compromise any such claim withoutContractor’s prior written consent.  Anyassistance or information furnished by FedEx at the request of Contractor shallbe at Contractor’s expense. Notwithstanding, Contractor will not consent to any injunction, decree,judgment or settlement which would have the effect of preventing FedEx’s use ofany Equipment without FedEx’s prior written consent.

 

(b)           Ifthe use of any Equipment delivered under this Agreement is enjoined as a resultof a suit based on any claim of infringement of a United States or foreignpatent, copyright or other proprietary right, Contractor shall, at its option,but in no event later than thirty (30) days after FedEx’s use of the Equipmentis so enjoined, (i) negotiate a license or other agreement with theclaimant so that the Equipment is no longer subject to such injunction, (ii) modifythe Equipment so that it becomes non-infringing, provided such modification canbe accomplished without materially affecting the performance of the Equipment, (iii) replacethe Equipment with non-infringing Equipment of equal or better performance andquality, subject to the prior approval of FedEx or (iv) repurchase theEquipment for the Equipment Purchase Price paid by FedEx under this Agreement.

 

**ARTICLE 10**

# **PERMITS,LICENSES, LAW & REGULATIONS**

# ** **

**Section 10.01.  Contractor’s Responsibilities.**  Contractor shall be responsible forfamiliarizing itself and complying with all laws, ordinances, rules,regulations and orders of any public authority having jurisdiction over theEquipment.  Contractor shall be liablefor and shall indemnify and hold harmless FedEx against any resulting fines,penalties, judgments or damages, including reasonable attorney’s fees, arisingout of Contractor’s failure to comply with any such laws, ordinances, rules,regulations and orders.

 

**Section 10.02.  FedEx’s Responsibilities**.  FedEx agrees to obtain and pay for allnecessary licenses or permits as may be necessary to complete the Installationof the Equipment being sold hereunder. In the event FedEx fails to do so, Contractor shall not be obligated toinstall the Equipment until FedEx has obtained all necessary permits and licensesfor the Installation.

 

**ARTICLE 11**

# **DELAYS,DEFAULTS, REMEDIES**

# ** **

**Section 11.01.  Events of Default.**  If any one or more of the following Events ofDefault shall happen,

 

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then this Agreement and/or any Purchase Order hereunder may beterminated in whole or in part at the option of the party not in defaultalthough such termination shall not be deemed an election of remedies:

 

(a)           Ifeither party shall fail in the due and punctual payment of any sum due to theother, which failure shall not be cured within thirty (30) business days afterreceipt of notice that such payment is late;

 

(b)           Ifeither party shall fail in the performance of any of its obligations containedin this Agreement or shall breach any warranty hereunder, which failure orbreach shall not be cured within thirty (30) business days after receipt ofnotice from the other party;

 

(c)           Ifeither party shall file a voluntary petition in bankruptcy, or shall beadjudicated a bankrupt or insolvent, or shall file any petition or answerseeking any reorganization, composition, readjustment, liquidation or similarrelief for itself under any present or future statutes, law or regulation ofthe United States, or shall seek or consent to or acquiesce in the appointmentof any trustee, or shall make any general assignment for the benefit ofcreditors, or shall admit in writing its inability to pay its debts generallyas they become due; or

 

(d)           Ifa petition shall be filed against either party seeking any reorganization,composition, readjustment, liquidation or similar relief under any present orfuture statute, law or regulation of the United States and such petition shallremain un-dismissed or un-stayed for an aggregate of sixty (60) days (whetheror not consecutive), or if any trustee, receiver or liquidator of either partyis appointed, which appointment shall remain un-vacated or un-stayed for anaggregate of sixty (60) days (whether or not consecutive).

 

**Section 11.02.  Delays. **Contractor shall not be responsible toFedEx for any Excusable Delay in the performance of its duties under thisAgreement.  Contractor shall promptlynotify FedEx when an Excusable Delay has occurred or is likely to occur, ineach case specifying to the extent practicable the estimated duration of suchExcusable Delay.

 

**Section 11.03.  Remedies. **Upon the occurrence of an Event ofDefault by any party, the other shall have all the rights and remediesavailable to FedEx under this Agreement and the laws of Tennessee.  If any Excusable Delay shall result in a delayof more than thirty (30) business days in delivery of any of the Equipment orMaintenance Services, FedEx may partially or completely cancel this Agreementby notice to Contractor without penalty, and Contractor shall promptly refundto FedEx monies previously paid by FedEx to Contractor for cancelled Equipmentor Maintenance Services.

 

**ARTICLE 12**

# **DISCLOSUREOF INFORMATION**

# ** **

Except as otherwise provided in this Agreement, the use and disclosureby one party of the other party’s Confidential Information shall be governed byand subject to the terms and conditions of that certain Mutual Non-DisclosureAgreement between the parties dated May 23, 2003 (the “MNDA”) (a copy ofwhich is attached hereto as Exhibit F), which is incorporatedherein by reference. As used in this Agreement, the term “ConfidentialInformation” shall have the meaning ascribed to the term in the MNDA.  Moreover, if the Expiration Date of the MNDAas stated in Section 5 therein is earlier than the Completion Date of thisAgreement, then the Expiration Date of the MNDA shall be extended tocoterminate with the term hereof, but the obligations of confidentiality shallcontinue thereafter in accordance with the terms of the MNDA.

 

**ARTICLE 13**

# **MISCELLANEOUS**

# ** **

**Section 13.01.  Assignment.**  This Agreement shall insure to the benefit ofand be binding upon each of

 

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the parties and their respective successors and assigns, but neitherthe rights nor the duties of either party under this Agreement may bevoluntarily assigned or delegated without the prior written consent of theother party, except that FedEx may assign all or any part of its rights anddelegate its duties under this Agreement to a company directly or indirectlycontrolling, controlled by, or under common control with FedEx.

 

**Section 13.02.  Change of Control.**  In addition to such other rights as FedEx mayhave, FedEx shall have the right to immediately terminate this Agreement uponany change (i) in the ownership or voting control of fifty-one percent(51%) or more of the capital stock or assets of Contractor, if a corporation,or (ii) in the ownership of Contractor or its assets, if not acorporation.  Contractor shall notifyFedEx in writing at least thirty (30) days before any such change in control ofthe capital stock, business, or assets of Contractor

 

**Section 13.03.  Amendments.*** *Except as otherwise provided, thisAgreement shall not be modified except by written agreement signed on behalf ofFedEx and the Contractor by their respective authorized officers.

 

**Section 13.04.  Severability.**  If any provision of this Agreement is held tobe invalid, illegal or unenforceable, the validity, legality and enforceabilityof the remaining provisions shall in no way be affected or impaired.

 

**Section 13.05.  No Waiver.** The failure of either party at any time torequire performance by the other of any provision of this Agreement shall in noway affect that party’s rights to enforce such provision, nor shall the waiverby either party of any breach of any provision of this Agreement be taken orheld to be a waiver of any further breach of the same provision or any otherprovision.

 

**Section 13.06.  Public Release of Information.**  Without FedEx’s prior written approval,Contractor shall not (a) refer to its selection by FedEx in anyadvertising, publicity release or sales presentation in such a manner as tostate or imply that any deliverables or Services provided hereunder areendorsed or preferred by FedEx; (b) use the name, service marks, ortrademarks of FedEx or any of its Affiliates; nor (c) release any pressreleases or other information revealing the existence of the Agreement or itsterms and conditions.  As used in this Section 13.06,the term “FedEx” shall include, without limitation, FedEx Corporation and itssubsidiaries and affiliates, both direct and indirect.  Except as may be necessary to comply with anyreporting requirements under federal or state securities law, Contractor shallnot disclose any details of this Agreement to any party except as may beauthorized in writing by an authorized officer of FedEx.

 

**Section 13.07.  Insurance.**** Contractor shall maintain, and furnish toFedEx certificates evidencing, insurance coverage sufficient to cover the typesand levels risks arising from the subject matter of this Agreement.  Such insurance shall be written by insurancecompanies licensed to do business in the state where the Maintenance Service isperformed, shall be in form and substance satisfactory to FedEx, and shall providethat insurance will not be subject to cancellation, termination, or changeexcept after thirty (30) days written notice to FedEx.

 

**Section 13.08.  Safety, Order, and Security.**** Contractor shallenforce strict discipline and good order among its employees and shall take allnecessary precautions in the performance of its obligations to insure thesafety of all persons and property. Contractor will comply with all security rules made by FedEx or theretail Location, and upon request and subject to applicable laws, willcooperate with FedEx and the retail Location in the investigation of any ofContractor’s employees suspected of theft or other wrong doing with respect toFedEx or the retail Location and their respective property.

 

**Section 13.09.  Further Assurances.**  Each party agrees to take such actions,provide such documents, and

 

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do such things as may reasonably be requested to assure the performanceof the other party’s obligations under this Agreement.

 

**Section 13.10.  Notices.*** *All notices, approvals, requests,consents and other communications given pursuant to this Agreement shall be inwriting and shall be deemed effective when received if hand-delivered, sent viaovernight service or sent by United States certified or registered mail, addressedas follows:

 
| If to FedEx:          |   | Line Haul System Support                       |   | Project & Engineering Support      |
|-----------------------|--------|------------------------------------------------|--------|---------------------------------------------|
|                  |   | FedEx Corporate Services, Inc.            |   | Federal Express Corporation                 |
|                  |   | 2955 Republican Drive, 2nd Floor               |   | 3620 Hacks Cross Road Building - B2         |
|                  |   | Memphis, Tennessee 38118                       |   | Memphis, Tennessee 38125          |
|                  |   | Attention: Managing Director - IT              |   | Attention: Managing Director                |
|                  |   |                                           |   |                                        |
| With a copies to:     |   | Legal Technology Transactions                  |   | Bus Services Sourcing & Supply Mgt |
|                  |   | FedEx Corporation                              |   | Federal Express Corporation                 |
|                  |   | 3620 Hacks Cross Road – B3                |   | 80 FedEx Parkway                            |
|                  |   | Memphis, Tennessee 38125                       |   | Collierville, Tennessee 38017               |
|                  |   | Attention: Managing Director                   |   | Attention: Wendy Davison                    |
|                  |   |                                           |   |                                        |
| If to the Contractor: |   | Time America, Inc.                        |   |                                        |
|                  |   | 8840 East Chaparral Road – Suite 100 |   |                                        |
|                  |   | Scottsdale, Arizona 85250                      |   |                                        |
|                  |   | Attention: Craig Smith, CFO                    |   |                                        |

 

**Section 13.11.  Section Headings and Captions.**  All section headings and captions usedin this Agreement are for convenience of reference and shall not affect theinterpretation of this Agreement.

 

**Section 13.12.  Exhibits.**  All Exhibits described in this Agreementshall be deemed incorporated in and made a part of this Agreement, except thatif there is any inconsistency between this Agreement and the provisions of anyExhibit, the provisions of this Agreement shall control.  Terms used in an Exhibit and also usedin this Agreement shall have the same meaning in the Exhibit as in thisAgreement.

 

**Section 13.13.  Counterparts.*** *This Agreement may be executed inany number of counterparts and each fully executed counterpart shall be deemedan original.

 

**Section 13.14.  Survival of Terms. **The provisions of this Agreement which bytheir nature extend beyond that expiration or earlier termination of thisAgreement shall survive and remain in effect until all obligations aresatisfied.  Specifically, all of theContractor’s obligations to indemnify FedEx shall survive this Agreement.

 

**Section 13.15.  Governing Law.**  This Agreement shall be deemed entered intowithin and shall be governed by and interpreted in accordance with the laws ofTennessee, and the parties submit to the jurisdiction of any appropriate courtwithin Tennessee for adjudication of disputes arising from this Agreement.

 

**Section 13.16.  Entire Agreement.**  This Agreement supersedes all priorunderstandings, representations, negotiations and correspondence between theparties, constitutes the entire agreement between them with respect to thematters described, and shall not be modified or affected by any course ofdealing, course of performance or usage of trade.

 

To signify their mutual intent to be legally bound by this Agreement, FedExand Contractor have caused

 

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their authorized representatives to execute this Agreement as of theEffective Date.

 

 
| **FEDEX CORPORATE SERVICES, INC.** | ** ** | **TIME AMERICA, INC.** |
|------------------------------------|------------|------------------------|
| ** **                         | ** ** | ** **             |
|                               |       |                   |
| BY:                                |       |                   | BY: |
|                               |       |                   |
| PRINTED NAME:                      |       |                   | PRINTED NAME: |
|                               |       |                   |
| TITLE:                             |       |                   | TITLE: |
|                               |       |                   |
| DATE:                              |       |                   | DATE |
|                                    |            |                        |  |  |  |

 

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**Exhibit A****to the****Equipment Purchase, License and Services Agreement****between****FedEx Corporate Services, Inc. (“FedEx”) andTime America, Inc. (“Contractor”)****dated August 29, 2005**

 

**PRICE LIST****FOR****EQUIPMENT, SOFTWARE LICENSES AND MAINTENANCESERVICES**

 
| **MFG #** | ** ** | **EQUIPMENT DESCRIPTION** | ** ** | **UNIT COST** |
|-----------|------------|---------------------------|------------|---------------|
| 68-50100  |       | [*]                       |       | [*]           |
| 68-50105  |       | [*]                       |       | [*]           |
| 68-50200  |       | [*]                       |       | [*]           |
| 68-50300  |       | [*]                       |       | [*]           |
| 68-50400  |       | [*]                       |       | [*]           |
| 68-50405  |       | [*]                       |       | [*]           |
| 68-50500  |       | [*]                       |       | [*]           |
| 68-50505  |       | [*]                       |       | [*]           |
| 68-50600  |       | [*]                       |       | [*]           |
| 68-50305  |       | [*]                       |       | [*]           |
| 68-50700  |       | [*]                       |       | [*]           |
| 68-20000  |       | [*]                       |       | [*]           |
| 68-21000  |       | [*]                       |       | [*]           |
| N  / A    |       | [*]                       |       | [*]           |
| 68-59999  |       | [*]                       |       | [*]           |

 

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*              MiscellaneousSupplies will include: cabling from micro to hand readers, cabling betweenmicros when in series; junction boxes; wire connectors; hangers to securewiring; wire ties for organizing wiring; nuts, bolts, screws, anchors; anddrill bits, tools for installation.

 
| **MFG #** | ** ** | **SOFTWARE DESCRIPTION** | ** ** | **UNIT COST** |
|-----------|------------|--------------------------|------------|---------------|
| 68-11005  |       | [*]                      |       | [*]           |
| 68-10000  |       | [*]                      |       | [*]           |
| 68-11000  |       | [*]                      |       | [*]           |
| 68-11000  |       | [*]                      |       | [*]           |
| N  / A    |       | [*]                      |       | [*]           |

 

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| **MFG Part #** | ** ** | **SERVICES DESCRIPTION **** | ** ** | **UNIT COST** |
|---------------------|------------|-----------------------------|------------|---------------|
| N/A                 |       | [*]                         |       | [*]           |
| N/A                 |       | [*]                         |       | [*]           |

 

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* *          Inthe event FedEx does not purchase annual Maintenance Services, technicalsupport by phone only is available at a cost of $[*] per hour (one hour minimum) or as may be otherwise agreed bythe parties pursuant to a separate agreement or amendment.  This charge does not include the cost ofreplacement hardware or access to Contractor’s enhanced, upgraded softwareofferings.

 

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**Exhibit B****to the****Equipment Purchase, License and Services Agreement****between****FedEx Corporate Services, Inc. (“FedEx”) andTime America, Inc. (“Contractor”)****dated August 29, 2005**

 

**INITIAL ORDER**

 

Delivered within ninety(90) business days of the Agreement Effective Date.

 
| **MFG Part #**     | ** ** | **Description** | ** **     | **Qty**    | ** ** | **Unit Cost** | ** ** | **Total Cost** | ** ** |
|-------------------------|------------|-----------------|----------------|------------|------------|---------------|------------|----------------|------------|
| 68-10000                |       | [*]             |           | [*]        |       | [*]           |       | [*]            |       |
| 68-10000                |       | [*]             |           | [*]        |       | [*]           |       | [*]            |       |
| 68-11000                |       | [*]             |           | [*]        |       | [*]           |       | [*]            |       |
| **TOTAL  LICENSE FEES** | ** ** | **$**           | **187,500.00** | ** ** |
|                         |            |                 |                |            |            |               |            |                |            |  |

 

**PAYMENT TERMS FOR INITIAL ORDER**

 

Notwithstanding anything to the contrary set forth in the Agreement,for this Initial Order only, the required License Fees shall be paid inincrements and FedEx’s obligation to pay each increment shall be conditionedupon the achievement of the specified performance milestone and FedEx’sacceptance of the same.  The paymentincrements shall be made as follows:

** **

| Upon FedEx’s written  acceptance of Equipment performance after  pilot test program using [*]                     |   | $ | 10,000.00  |   |
|------------------------------------------------------------------------------------------------------------------------|--------|---|------------|--------|
| Upon FedEx’s written  notice to Contractor of FedEx’s decision to  implement [*] additional  Equipment units |   | $ | 177,500.00 |   |
| **TOTAL  LICENSE FEES**                                                                                                |   | $ | 187,500.00 |   |

 

All invoices for theforegoing Fees shall be submitted to the following address:

 

Line Haul System Support

FedEx Corporate Services, Inc.

2955 Republican Drive,2nd Floor

Memphis, Tennessee 38118

Attention:  Managing Director - IT

 

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**Exhibit C****to the****Equipment Purchase, License and Services Agreement****between****FedEx Corporate Services, Inc. (“FedEx”) andTime America, Inc. (“Contractor”)****dated August 29, 2005**

 

**DESCRIPTION OF MAINTENANCESERVICES**

 

A.            **BasicFeatures.**  Provided that FedExis current in its payment of fees for Maintenance Services as required underthe Agreement, Contractor shall provide maintenance coverage and technicalsupport services for the Equipment and Software (including any customconfigurations and/or any special interfaces developed by Contractor forFedEx), at no additional charge. Maintenance Services will include, but not be limited to, the following:

 

•      24/7 availability ofContractor personnel to provide unlimited, direct telephone support at [*].

 

•      Delivery and installation ofany fix, update, upgrades or enhancement to the Equipment and Software providedthat the decision to perform any such installation shall be within the solediscretion of FedEx.

 

•      Assistance in the periodiccleaning of Equipment.

 

•      Standard error correctionand maintenance modifications to the Equipment and Software.

 

All services are performed by Contractor on a remote or on-site basis,as required.  Depending upon theLocation, Contractor may use sub-contractors to deliver Maintenance Servicessubject to prior approval of FedEx and sub-contractors compliance with FedExsecurity procedures.

 

B.            **FedEx’sMaintenance Obligations.**  FedEx’s failure to meet its maintenanceresponsibilities hereunder shall constitute a breach of this Agreement byFedEx, and service hereunder shall cease until which time the FedExcomplies.  FedEx’s maintenanceobligations are as follows:

 

•      FedEx’spersonnel shall not attempt repairs to the Software and Equipment.

 

•      FedExshall perform weekly back-ups of the software data files.

 

C.          **Response Times:**

 
| **Initial Notification of Problem** |   | Contractor  respond within fifteen (15) minutes of call                                                                                                                                                                                                                                    |
|-------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ** **                          |   |                                                                                                                                                                                                                                                                                       |
| ** **                          |   | Contractor  resolution provided within two (2) hours.                                                                                                                                                                                                                                 |
| ** **                          |   |                                                                                                                                                                                                                                                                                       |
| **Critical Problem**                |   | For  issues involving a security system associated with the Software, a Contractor  technician will be dispatched to provide on-site assistance within four  (4) hours of problem notification in the event a resolution is not  provided within the stated two (2) hour period. |
| ** **                          |   |                                                                                                                                                                                                                                                                                       |
| **Non-Critical Problem**            |   | Contractor  resolution provided within twenty-four (24) hours                                                                                                                                                                                                                              |

 

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**Exhibit Dto theEquipment, License and Services AgreementbetweenFedEx Corporate Services, Inc. (“FedEx”) and Time America, Inc. (“Contractor”)dated August 29, 2005**

 

**EQUIPMENT SPECIFICATIONS**

 

1.             [*] will be manufactured by Contractorand will contain Software that is compatible with the FedEx [*] requirements.

 

2.             [*]

 

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**Exhibit E****to the****Equipment, License and Services Agreement****between****FedEx Corporate Services, Inc. (“FedEx”) andTime America, Inc. (“Contractor”)****dated August 29, 2005**

 

**INSTRUCTIONSFORWARRANTY OR MAINTENANCE SERVICE FOR EQUIPMENT**

 

1.             **Problem Reporting**:  FedEx will contact Contractor Support Line[(800) 561-6366] when a problem is incurred with the Equipment.

 

2.             **Initial Troubleshooting**:  Contractor will troubleshoot the problemduring the support call.

 

3.             **For the****[*] and associated components**:  If the problem cannot be remedied, Contractorwill issue an RMA number for the defective Equipment which should be placed onthe shipment to Contractor at the following address:

 

Time America, Inc.

8840 East Chaparral Road – Suite 100

Scottsdale, Arizona 85250

 

Contractor will return thefully repaired or replaced [*]to FedEx using a FedEx-approvedshipping method

 

4.             **For the****[*] and associatedcomponents**:  Contractor will provide on-siteservice (at no extra charge to FedEx). If replacement is required, Contractor will order the replacement partand have it installed within two (2) business days of the problemnotification.

 

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**Exhibit F****to the****Equipment, License and Services Agreement****between****FedEx Corporate Services, Inc. (“FedEx”) andTime America, Inc. (“Contractor”)****dated August 29, 2005**

 

**MUTUAL NON-DISCLOSURE AGREEMENT**

 

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