Consulting Services Agreement

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CONSULTING SERVICES AGREEMENT

Commonwealth of Kentucky

THIS CONSULTING SERVICES AGREEMENT (this "Agreement") is made and entered into as of the [____] day of [________________], 20[____] (the "Effective Date"), by and between:

CLIENT:
Name: [________________________________]
Address: [________________________________]
City, State, ZIP: [________________________________]
Entity Type: ☐ Individual ☐ Sole Proprietorship ☐ LLC ☐ Corporation ☐ Partnership ☐ Other: [________________]
State of Organization: [________________________________]
Federal Tax ID/EIN: [________________________________]

(hereinafter referred to as "Client")

AND

CONSULTANT:
Name: [________________________________]
Address: [________________________________]
City, State, ZIP: [________________________________]
Entity Type: ☐ Individual ☐ Sole Proprietorship ☐ LLC ☐ Corporation ☐ Partnership ☐ Other: [________________]
State of Organization (if applicable): [________________________________]
Federal Tax ID/EIN or SSN: [________________________________]
Kentucky Business Registration (if applicable): [________________________________]

(hereinafter referred to as "Consultant")

Client and Consultant are sometimes referred to herein individually as a "Party" and collectively as the "Parties."

RECITALS

WHEREAS, Client desires to engage Consultant to provide certain consulting and professional services as more particularly described herein and in the Statement of Work attached hereto as Exhibit A; and

WHEREAS, Consultant represents that it possesses the necessary qualifications, skills, experience, expertise, and professional licenses (if required) to perform such consulting services in compliance with all applicable laws and professional standards; and

WHEREAS, Consultant desires to provide such consulting services to Client upon the terms and conditions set forth in this Agreement; and

WHEREAS, the Parties intend to establish an independent contractor relationship and not an employment, partnership, joint venture, or agency relationship;

NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE 1: DEFINITIONS

1.1 "Affiliate" means, with respect to any Party, any entity that directly or indirectly controls, is controlled by, or is under common control with such Party, where "control" means the ownership of more than fifty percent (50%) of the voting securities or equivalent ownership interest.

1.2 "Business Day" means any day other than a Saturday, Sunday, or a day on which banks in the Commonwealth of Kentucky are authorized or required to close.

1.3 "Change Order" means a written document signed by authorized representatives of both Parties that modifies the scope, schedule, fees, or other terms of a Statement of Work.

1.4 "Confidential Information" means any and all non-public information, in any form or medium, disclosed by either Party to the other Party, whether orally, in writing, electronically, or by inspection, that relates to the disclosing Party's business, products, services, research, development, trade secrets, know-how, personnel, customers, suppliers, vendors, finances, pricing, business strategies, marketing plans, technical data, inventions, processes, or other proprietary matters. Confidential Information includes, without limitation, information that qualifies as a "trade secret" under the Kentucky Uniform Trade Secrets Act, KRS § 365.880 et seq.

1.5 "Deliverables" means any and all work product, reports, analyses, recommendations, assessments, documents, data, software, code, designs, specifications, presentations, inventions, discoveries, improvements, or other materials created, developed, prepared, or produced by Consultant in connection with the performance of the Services, as specified in the applicable Statement of Work.

1.6 "Effective Date" means the date first written above.

1.7 "Intellectual Property" or "Intellectual Property Rights" means all patents, patent applications, copyrights, copyright registrations, trademarks, trademark registrations, service marks, trade names, trade dress, trade secrets, know-how, inventions, discoveries, improvements, ideas, designs, processes, techniques, methodologies, formulae, algorithms, software, databases, and other intellectual property rights, whether registered or unregistered, anywhere in the world.

1.8 "Pre-Existing Materials" means any materials, methodologies, tools, templates, frameworks, software, libraries, know-how, techniques, or other intellectual property owned by Consultant prior to the Effective Date or developed by Consultant outside the scope of this Agreement.

1.9 "Services" means the consulting and professional services to be provided by Consultant as described in Article 2 hereof and in the Statement of Work attached hereto as Exhibit A, including any subsequent Statements of Work executed by the Parties.

1.10 "Statement of Work" or "SOW" means the document attached hereto as Exhibit A, and any subsequent statements of work executed by the Parties, which describe the specific Services, Deliverables, timelines, milestones, acceptance criteria, and fees applicable to each engagement.

1.11 "Work Product" means all Deliverables, inventions, discoveries, improvements, ideas, concepts, techniques, methods, processes, designs, works of authorship, documentation, and other work product conceived, created, developed, prepared, or reduced to practice by Consultant in connection with or arising out of the performance of the Services.

ARTICLE 2: SCOPE OF SERVICES

2.1 Engagement. Client hereby engages Consultant, and Consultant hereby accepts such engagement, to perform the Services described in the Statement of Work attached hereto as Exhibit A. The Parties may execute additional Statements of Work from time to time, each of which shall be subject to the terms of this Agreement.

2.2 Standard of Performance. Consultant shall perform the Services:

(a) In a professional, diligent, workmanlike, and timely manner;

(b) Consistent with the highest standards and practices in Consultant's industry or profession;

(d) Using personnel with the appropriate skills, training, qualifications, and experience;

(e) In compliance with all applicable federal, state, and local laws, rules, regulations, ordinances, and professional standards, including the laws of the Commonwealth of Kentucky; and

(f) Free from material defects and errors.

2.3 Service Deliverables. Consultant shall provide the Deliverables specified in each Statement of Work in accordance with the delivery schedule, format requirements, and acceptance criteria set forth therein.

2.4 Additional Services. Any services not specifically described in an executed Statement of Work shall be documented in a written amendment or a new Statement of Work signed by both Parties before being performed.

2.5 Consultant Personnel.

(a) Consultant shall assign qualified personnel to perform the Services. Key personnel shall not be removed or replaced without Client's prior written consent.

(b) Client may request replacement of unsatisfactory personnel. Consultant shall promptly replace such personnel at no additional cost.

(c) Consultant may engage subcontractors with Client's prior written consent, provided Consultant remains fully responsible for such subcontractors' performance and ensures they are bound by confidentiality and IP obligations at least as restrictive as this Agreement.

2.6 Client Cooperation and Responsibilities. Client shall:

(a) Provide reasonable and timely access to Client's personnel, facilities, systems, information, data, and resources;

(b) Designate a representative as the primary point of contact;

(d) Ensure that all information provided to Consultant is accurate and complete;

(e) Perform Client responsibilities identified in the Statement of Work in a timely manner.

2.7 Change Orders. Either Party may request changes to the scope, schedule, or other aspects of the Services. No change shall be effective unless documented in a written Change Order signed by both Parties.

2.8 Project Management. Unless otherwise specified, Consultant shall provide regular status reports, promptly notify Client of any issues or delays, and participate in project meetings as reasonably requested.

ARTICLE 3: TERM AND TERMINATION

3.1 Term. This Agreement shall commence on the Effective Date and shall continue for an initial term of [________________] (the "Initial Term"), unless earlier terminated in accordance with this Article 3.

☐ No Automatic Renewal: This Agreement shall expire at the end of the Initial Term unless the Parties execute a written extension.

☐ Automatic Renewal: This Agreement shall automatically renew for successive [________________] periods (each, a "Renewal Term"), unless either Party provides written notice of non-renewal at least [____] days prior to the expiration of the then-current term.

3.2 Statement of Work Term. Each Statement of Work shall have its own term. Expiration or termination of a Statement of Work shall not affect the validity of this Agreement or any other Statement of Work.

3.3 Termination for Convenience.

(a) Either Party may terminate this Agreement or any Statement of Work upon [____] days' prior written notice.

(b) Upon termination for convenience by Client, Client shall pay Consultant for all Services satisfactorily performed through the effective date of termination and all non-cancelable expenses properly incurred.

3.4 Termination for Cause. Either Party may terminate this Agreement immediately upon written notice if:

(a) The other Party commits a material breach and fails to cure within [____] days after written notice;

(b) The other Party commits an incurable material breach;

(d) The other Party engages in fraud, gross negligence, or willful misconduct.

3.5 Termination for Non-Payment. Consultant may terminate upon [____] days' written notice if Client fails to pay any undisputed amount when due and such failure continues for [____] days after written notice.

3.6 Effect of Termination. Upon termination or expiration:

(a) Consultant shall immediately cease performing the Services;

(b) Consultant shall deliver to Client within [____] days all completed and partially completed Deliverables, Client materials, and Confidential Information;

(d) Each Party shall return or destroy the other Party's Confidential Information;

(e) Licenses granted for completed and paid-for Deliverables shall survive;

(f) Articles 1, 5, 6, 8, 9, 10, and 13 shall survive termination.

3.7 Transition Assistance. Upon request and at Client's expense, Consultant shall provide reasonable transition assistance for up to [____] days following termination.

ARTICLE 4: COMPENSATION AND PAYMENT TERMS

4.1 Fee Structure. Client shall pay Consultant the fees set forth in the applicable Statement of Work (check all that apply):

☐ Fixed Fee: Total fixed fee of $[________________], payable as follows: [________________________________].

☐ Hourly Rate:

Senior Consultant/Principal: $[________] per hour
Consultant: $[________] per hour
Associate/Analyst: $[________] per hour
Administrative/Support: $[________] per hour
Not-to-Exceed Amount: $[________________]

☐ Daily Rate: $[________] per day (minimum [____] hours per day).

☐ Monthly Retainer: $[________] per month for up to [____] hours. Additional hours at $[________] per hour. Unused hours ☐ shall ☐ shall not roll over.

☐ Milestone-Based: Payment upon completion and acceptance of milestones per the Statement of Work.

☐ Value-Based/Success Fee: [________________________________].

☐ Blended Rate: $[________] per hour regardless of personnel.

4.2 Rate Adjustments.

(a) Fee rates shall remain fixed for the Initial Term.

(b) For Renewal Terms, Consultant may increase rates by up to [____]% upon [____] days' written notice.

4.3 Expenses and Reimbursement.

(a) Client shall reimburse Consultant for reasonable, pre-approved out-of-pocket expenses including travel, lodging, meals, materials, and third-party fees.

(b) Expense Thresholds:

Up to $[________]: No pre-approval required
Exceeding $[________]: Prior written approval required
Monthly cap: $[________]

4.4 Invoicing.

(a) Consultant shall submit invoices:
☐ Monthly, by the [____] day of the following month
☐ Bi-weekly
☐ Upon completion of each milestone
☐ Upon completion of the Services
☐ Other: [________________________________]

(b) Each invoice shall include invoice number, date, SOW reference, billing period, description of Services, hours, rates, expenses, total amount due, and payment instructions.

(c) Invoices submitted to:
Contact: [________________________________]
Email: [________________________________]
Address: [________________________________]

4.5 Payment Terms.

(a) Client shall pay all undisputed amounts within [____] days of receipt of a proper invoice.

(b) Payments made by:
☐ Check payable to [________________________________]
☐ ACH/Electronic Transfer to:
Bank Name: [________________________________]
Routing Number: [________________________________]
Account Number: [________________________________]
☐ Wire Transfer to: [________________________________]
☐ Credit Card (subject to [____]% processing fee)
☐ Other: [________________________________]

4.6 Late Payment Interest. Pursuant to KRS § 360.010, any amounts not paid when due shall bear interest at the rate of:

☐ Eight percent (8%) per annum (Kentucky statutory default rate under KRS § 360.010); or

☐ [____]% per annum as agreed by the Parties (not to exceed the maximum rate permitted by Kentucky law); or

☐ The lesser of one and one-half percent (1.5%) per month or the maximum rate permitted by Kentucky law

from the due date until paid in full.

4.7 Disputed Invoices.

(a) Client shall notify Consultant in writing within [____] days of receipt of a disputed invoice;

(b) Client shall pay all undisputed amounts on time;

4.8 Taxes.

(a) Consultant shall be solely responsible for all federal, state, and local taxes arising from the compensation paid under this Agreement.

(b) Client shall not withhold any taxes from payments to Consultant.

(d) Client shall issue IRS Form 1099 as required by law.

(e) Unless otherwise specified, all fees are exclusive of Kentucky sales and use taxes. If applicable, Client shall pay such taxes or provide a valid exemption certificate.

(f) Kentucky Limited Liability Entity Tax (LLET): Consultant acknowledges that if Consultant is a limited liability entity (LLC, limited partnership, S corporation, or limited liability partnership) doing business in Kentucky, Consultant may be subject to the LLET imposed under KRS § 141.0401. Consultant shall be solely responsible for all LLET obligations.

4.9 Records and Audit.

(a) Consultant shall maintain accurate records for [____] years following termination.

(b) Upon reasonable notice, Client may audit Consultant's records related to invoices.

(c) If an audit reveals an overcharge of more than [____]%, Consultant shall reimburse the overcharged amount plus reasonable audit costs.

ARTICLE 5: CONFIDENTIALITY AND TRADE SECRETS

5.1 Confidentiality Obligations. Each Party (as "Receiving Party") agrees to:

(a) Hold in strict confidence all Confidential Information of the other Party (as "Disclosing Party");

(b) Not disclose any Confidential Information to any third party without prior written consent;

(d) Not copy or reproduce Confidential Information except as reasonably necessary;

(e) Take all reasonable precautions to prevent unauthorized disclosure.

5.2 Protective Measures. The Receiving Party shall protect Confidential Information using at least reasonable care, shall limit access to those with a legitimate need to know, and shall ensure all such persons are bound by appropriate confidentiality obligations.

5.3 Exclusions. Confidentiality obligations shall not apply to information that:

(a) Is or becomes publicly available through no fault of the Receiving Party;

(b) Was rightfully in the Receiving Party's possession prior to disclosure, without obligation of confidentiality;

(d) Is independently developed without use of or reference to the Disclosing Party's Confidential Information; or

(e) Is approved for release by the Disclosing Party in writing.

5.4 Required Disclosure. If compelled by law to disclose Confidential Information, the Receiving Party shall provide prompt notice to the Disclosing Party, cooperate in seeking a protective order, and disclose only the minimum amount required.

5.5 Trade Secrets Under Kentucky Law. The Parties acknowledge that certain Confidential Information may constitute "trade secrets" as defined under the Kentucky Uniform Trade Secrets Act (KUTSA), KRS § 365.880 et seq. With respect to such trade secrets:

(a) The confidentiality obligations shall continue for as long as such information remains a trade secret;

(b) Each Party shall implement and maintain reasonable measures to preserve trade secret status;

(c) Under KRS § 365.880, a "trade secret" means information, including a formula, pattern, compilation, program, device, method, technique, or process, that derives independent economic value from not being generally known or readily ascertainable by proper means and is the subject of efforts that are reasonable under the circumstances to maintain its secrecy;

(d) Remedies under KUTSA include injunctive relief (KRS § 365.882), actual damages, unjust enrichment, or a reasonable royalty (KRS § 365.884), and attorney's fees for willful and malicious misappropriation or bad faith claims (KRS § 365.886);

(e) Pursuant to KRS § 365.884(2), if willful and malicious misappropriation exists, the court may award exemplary damages in an amount not exceeding twice the actual damages;

(f) The statute of limitations for misappropriation claims is three (3) years under KRS § 365.890.

5.6 Return or Destruction of Confidential Information. Upon termination, each Party shall return or destroy all Confidential Information and certify in writing that it has done so.

5.7 Injunctive Relief. The Parties acknowledge that breach of confidentiality may cause irreparable harm, and the non-breaching Party shall be entitled to seek injunctive relief.

5.8 Duration of Confidentiality Obligations. Except for trade secrets, the confidentiality obligations shall survive for [____] years after termination.

ARTICLE 6: INTELLECTUAL PROPERTY AND WORK PRODUCT

6.1 Ownership of Work Product. All Work Product created by Consultant in performing the Services shall be the sole and exclusive property of Client. Consultant hereby irrevocably assigns all right, title, and interest in all Work Product worldwide.

6.2 Work Made for Hire. To the extent any Work Product constitutes a "work made for hire" under 17 U.S.C. § 101 et seq., Client shall be the author and owner. To the extent it does not so qualify, Consultant assigns all copyrights to Client.

6.3 Assignment of Inventions. Consultant assigns all inventions, discoveries, and innovations conceived or developed in connection with the Services or using Client's Confidential Information.

6.4 Further Assurances. Consultant agrees to execute documents, cooperate in patent/copyright prosecution, assist in legal proceedings, and grants Client an irrevocable power of attorney for these purposes.

6.5 Consultant's Pre-Existing Materials.

(a) Consultant retains all right, title, and interest in Pre-Existing Materials (listed in Exhibit B, if applicable).

(b) Consultant grants Client a non-exclusive, perpetual, irrevocable, royalty-free, worldwide license, with the right to sublicense, to use Pre-Existing Materials incorporated into the Deliverables.

6.6 Third-Party Materials. Consultant shall not incorporate third-party materials without Client's prior written consent. If consented, Consultant shall identify all such materials, obtain necessary licenses, and indemnify Client.

6.7 Moral Rights. To the extent permitted by law, Consultant waives moral rights in the Work Product.

6.8 Client Materials. Client retains all right, title, and interest in Client Materials. Consultant shall use them only for performing the Services.

6.9 Residual Knowledge. Consultant may use general skills, knowledge, and experience retained in unaided memory, provided this is not construed as a license to Client's Confidential Information or IP.

ARTICLE 7: INDEPENDENT CONTRACTOR STATUS

7.1 Independent Contractor Relationship. The relationship between Client and Consultant is that of independent contractor. Nothing in this Agreement creates a partnership, joint venture, agency, franchise, or employer-employee relationship.

7.2 Control and Discretion. Consultant shall have sole control over the manner, means, and methods of performing the Services, including time, place, sequence of tasks, tools, equipment, and personnel. Client shall only specify the desired results.

7.3 Kentucky Independent Contractor Classification. The Parties intend that Consultant shall be classified as an independent contractor under Kentucky law. Kentucky applies the "economic realities" test for workers' compensation purposes (KRS § 342.640) and a multi-factor analysis examining six factors:

(a) Permanency of the Relationship: This Agreement establishes a defined term with a specific scope of Services, not a permanent employment arrangement;

(b) Degree of Skill Required: Consultant's specialized skills and expertise are significant and not those of an unskilled worker;

(c) Investment in Equipment or Materials: Consultant furnishes its own tools, equipment, office space, and materials;

(d) Opportunity for Profit or Loss: Consultant bears the risk of profit or loss depending on its own skill and management;

(e) Degree of Employer's Right to Control: Client does not control the manner or means of Consultant's work, only the desired outcomes and results;

(f) Whether the Service is an Integral Part of the Employer's Business: The Services are not part of Client's core business operations.

The Parties further acknowledge that all of the following support independent contractor status:

Consultant maintains its own business location and offices;
Consultant provides services to multiple clients;
Consultant advertises and holds itself out to the public;
Consultant has its own business licenses, insurance, and tax registrations;
Consultant controls its own work schedule;
Consultant can hire its own employees or subcontractors.

7.4 No Employee Benefits. Consultant shall not be entitled to any employee benefits from Client, including health insurance, retirement benefits, paid leave, workers' compensation, unemployment insurance, stock options, or bonuses.

7.5 Taxes and Withholding.

(a) Client shall not withhold any taxes from payments to Consultant.

(b) Consultant shall be solely responsible for all taxes arising from compensation received, including federal and state income taxes, self-employment taxes, and Kentucky LLET obligations (if applicable under KRS § 141.0401).

7.6 No Authority to Bind. Consultant shall have no authority to bind Client without prior written consent.

7.7 Consultant's Business Expenses. Consultant shall bear all its own business expenses except for approved reimbursements under Section 4.3.

ARTICLE 8: REPRESENTATIONS AND WARRANTIES

8.1 Mutual Representations and Warranties. Each Party represents and warrants that:

(a) It is duly organized, validly existing, and in good standing;

(b) It has full power and authority to enter into and perform this Agreement;

(d) This Agreement is a valid and binding obligation;

(e) Performance will not violate any applicable law or existing agreement;

(f) There is no pending or threatened litigation affecting performance.

8.2 Consultant's Representations and Warranties. Consultant represents and warrants that:

(a) Consultant possesses necessary qualifications, skills, and licenses to perform the Services;

(b) The Services will be performed in a professional, workmanlike manner in compliance with all applicable laws;

(d) Consultant has not granted conflicting rights in the Work Product;

(e) Consultant holds all required Kentucky licenses, permits, and registrations;

(f) Performance does not conflict with any obligation to a third party;

(g) All personnel are legally authorized to work in the United States;

(h) Any software delivered will be free from malicious code;

(i) For a period of [____] days following acceptance, Deliverables will conform to specifications. Consultant shall correct non-conformities at no additional cost.

8.3 Client's Representations and Warranties. Client represents and warrants that it has the authority to grant access to its facilities, systems, and information, will provide accurate information, and owns or has the right to use all Client Materials.

8.4 Disclaimer. EXCEPT AS EXPRESSLY SET FORTH HEREIN, NEITHER PARTY MAKES ANY WARRANTY, EXPRESS, IMPLIED, OR STATUTORY, INCLUDING WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, OR NON-INFRINGEMENT.

ARTICLE 9: INDEMNIFICATION

9.1 Indemnification by Consultant. Consultant shall indemnify, defend, and hold harmless Client Indemnitees from all Losses arising out of or relating to:

(a) Any breach of representations, warranties, covenants, or obligations by Consultant;

(b) Negligent, reckless, or intentionally wrongful acts or omissions of Consultant;

(d) Failure to comply with applicable laws;

(e) Claims relating to Consultant's independent contractor classification;

(f) Personal injury or property damage caused by Consultant;

(g) Breach of confidentiality.

9.2 Indemnification by Client. Client shall indemnify, defend, and hold harmless Consultant Indemnitees from all Losses arising out of or relating to:

(a) Any breach of representations, warranties, or obligations by Client;

(b) Negligent, reckless, or intentionally wrongful acts or omissions of Client;

(d) Unauthorized use of the Work Product.

9.3 Indemnification Procedures. The Indemnified Party shall provide prompt notice, allow the Indemnifying Party to control the defense, cooperate at the Indemnifying Party's expense, and not settle without consent.

9.4 IP Infringement Remedies. If any Deliverable is subject to an infringement claim, Consultant shall at its expense: (a) procure the right to continue use; (b) replace with a non-infringing equivalent; or (c) modify to be non-infringing. If none is commercially reasonable, Client may terminate and receive a refund.

ARTICLE 10: LIMITATION OF LIABILITY

10.1 Limitation on Consequential Damages. EXCEPT FOR BREACHES OF ARTICLES 5 (CONFIDENTIALITY) AND 6 (INTELLECTUAL PROPERTY), CLAIMS UNDER ARTICLE 9 (INDEMNIFICATION), IP INFRINGEMENT, AND FRAUD, GROSS NEGLIGENCE, OR WILLFUL MISCONDUCT, NEITHER PARTY SHALL BE LIABLE FOR INDIRECT, INCIDENTAL, SPECIAL, CONSEQUENTIAL, PUNITIVE, OR EXEMPLARY DAMAGES.

10.2 Cap on Liability. Subject to the same exceptions, total cumulative liability shall not exceed:

☐ Option A: Total fees paid during the twelve (12) months preceding the event; or

☐ Option B: Total fees paid or payable under the applicable SOW; or

☐ Option C: $[________________]; or

☐ Option D: [____] times the fees paid or payable under the applicable SOW.

10.3 Minimum Liability Floor. Each Party's liability shall not be limited below $[________________].

10.4 Application. These limitations apply regardless of legal theory and even if a Party was advised of the possibility of such damages. They do not limit liability for death or personal injury, intentional misconduct, or amounts owed for Services performed.

10.5 Essential Basis of Bargain. THE PARTIES ACKNOWLEDGE THAT THESE LIMITATIONS REFLECT A FAIR ALLOCATION OF RISK AND ARE AN ESSENTIAL PART OF THE BARGAIN.

ARTICLE 11: INSURANCE REQUIREMENTS

11.1 Insurance Coverage. Throughout the term, Consultant shall maintain at its sole expense the following coverages from insurers licensed in Kentucky with an A.M. Best rating of A- or better:

(a) Commercial General Liability:

Per Occurrence: Not less than $[________________]
General Aggregate: Not less than $[________________]

(b) Professional Liability (Errors and Omissions):

Per Claim: Not less than $[________________]
Annual Aggregate: Not less than $[________________]
If claims-made, tail coverage for [____] years.

As required by Kentucky law (KRS § 342.001 et seq.) if Consultant has employees
Employers' Liability: Not less than $[________________] per accident

(d) Business Automobile Liability (if applicable):

Combined Single Limit: Not less than $[________________] per accident

(e) Cyber Liability (if applicable):

Per Claim: Not less than $[________________]

11.2 Additional Insured. Client shall be named as an additional insured on Consultant's CGL policy.

11.3 Waiver of Subrogation. Consultant shall cause its insurers to waive subrogation rights against Client.

11.4 Primary Coverage. Consultant's insurance shall be primary and non-contributory.

11.5 Certificates. Upon request, Consultant shall provide certificates of insurance and [____] days' advance notice of any cancellation or material change.

11.6 No Limitation. Insurance requirements do not limit Consultant's liability.

ARTICLE 12: RESTRICTIVE COVENANTS

12.1 Applicability. This Article 12 applies only if checked:

☐ Restrictive Covenants Apply

12.2 Non-Solicitation of Employees. During the term and for [________________] following termination, Consultant shall not solicit, recruit, hire, or induce any employee of Client with whom Consultant had material contact during the Services.

12.3 Non-Solicitation of Clients/Customers. During the term and for [________________] following termination, Consultant shall not solicit any customer or business partner of Client with whom Consultant had material contact or about whom Consultant received Confidential Information, for the purpose of providing competitive services.

12.4 Non-Competition. During the term and for [________________] following termination, within the geographic area of [________________________________], Consultant shall not engage in any competing business as described in: [________________________________].

12.5 Kentucky Non-Compete Enforceability.

(a) Kentucky courts enforce non-compete agreements when they are reasonable in scope, duration, and geographic area, and when supported by adequate consideration. The restrictions must protect a legitimate business interest, including trade secrets, Confidential Information, customer relationships, or goodwill.

(b) Kentucky applies a reasonableness test, weighing the restriction against the hardship imposed on the restricted party and the public interest. Duration of one to two (1-2) years is generally considered reasonable by Kentucky courts.

(c) Kentucky courts may "blue pencil" or reform overbroad restrictive covenants to make them enforceable, rather than voiding them entirely.

(d) Adequate consideration for a non-compete entered into at the inception of the consulting relationship may include the engagement itself, access to Confidential Information, and other business opportunities.

(e) Note Regarding Pending Legislation: The Kentucky legislature has considered bills to restrict non-competes for lower-wage workers (including independent contractors). The Parties should verify current legislative status before relying on the enforceability of any restrictive covenant herein.

12.6 Reasonableness Acknowledgment. Consultant acknowledges the restrictive covenants are reasonable and necessary to protect Client's legitimate business interests.

12.7 Tolling. If Consultant violates any restrictive covenant, the duration shall be extended by the period of violation.

ARTICLE 13: DATA PROTECTION AND PRIVACY

13.1 Data Protection Obligations. If Consultant receives, accesses, processes, or stores personal information in connection with the Services, Consultant shall:

(a) Comply with all applicable federal, state, and local privacy and data protection laws;

(b) Implement and maintain reasonable safeguards to protect personal information;

(d) Not disclose personal information to third parties without Client's consent;

(e) Promptly notify Client of any actual or suspected data breach.

13.2 Kentucky Data Breach Notification. Pursuant to KRS § 365.732:

(a) Consultant shall notify Client without unreasonable delay, and in no event later than forty-eight (48) hours after discovery, of any breach of the security of data involving personal information of Kentucky residents;

(b) "Personal information" under KRS § 365.720 includes a Kentucky resident's first name or first initial and last name in combination with one or more of the following unencrypted data elements: Social Security number, driver's license number, account number or credit/debit card number (with required security code), or individual taxpayer identification number;

(c) Notification to affected Kentucky residents must be made in the most expedient time possible and without unreasonable delay, consistent with any law enforcement investigation;

(d) If more than 1,000 Kentucky residents must be notified, the entity must also notify all consumer reporting agencies and the Kentucky Attorney General;

(e) Notification may be by written notice, email, or substitute notice if cost exceeds $250,000 or more than 500,000 persons are affected;

(f) Consultant shall cooperate with Client in fulfilling all notification obligations.

13.3 Data Security Standards. Consultant shall encrypt personal information during transmission and at rest, maintain access controls, conduct security assessments, and maintain a written information security program.

13.4 Data Return and Destruction. Upon termination, Consultant shall return or securely destroy all personal information and certify in writing.

ARTICLE 14: DISPUTE RESOLUTION

14.1 Informal Resolution. The Parties shall first attempt to resolve disputes through good faith negotiation. If unresolved within thirty (30) days of notice, either Party may proceed with formal dispute resolution.

14.2 Formal Dispute Resolution. (Select one)

☐ Option A: Litigation. Disputes may be submitted to the courts specified in Section 15.2.

☐ Option B: Mediation Then Litigation. Mediation administered by [________________________________] in [________________], Kentucky. Costs shared equally. If unresolved within [____] days, either Party may proceed to litigation.

☐ Option C: Binding Arbitration. Arbitration administered by [________________________________] in [________________], Kentucky. Single arbitrator for disputes under $[________________]; three arbitrators otherwise. Arbitrator's decision final and binding.

☐ Option D: Mediation Then Arbitration. Mediation first, then arbitration if unresolved.

14.3 Injunctive Relief. Either Party may seek injunctive relief from any court of competent jurisdiction without first engaging in informal dispute resolution.

14.4 Continued Performance. During dispute resolution, the Parties shall continue performing to the extent practicable.

14.5 Attorneys' Fees. The prevailing Party shall be entitled to recover reasonable attorneys' fees and costs.

ARTICLE 15: GENERAL PROVISIONS

15.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Kentucky, without regard to conflict of laws principles.

15.2 Jurisdiction and Venue. Any action shall be brought exclusively in the state courts located in [________________] County, Kentucky, or the United States District Court for the [________________] District of Kentucky. Each Party submits to exclusive jurisdiction and waives objections to venue.

15.3 Waiver of Jury Trial. EACH PARTY HEREBY KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT. EACH PARTY ACKNOWLEDGES IT HAS READ AND UNDERSTANDS THIS WAIVER AND HAS HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL.

15.4 Entire Agreement. This Agreement, including all Exhibits, Statements of Work, and Change Orders, constitutes the entire agreement and supersedes all prior agreements.

15.5 Amendment. This Agreement may be amended only by written instrument signed by both Parties.

15.6 Waiver. No waiver shall be effective unless in writing. No failure or delay in exercising any right shall operate as a waiver.

15.7 Severability. If any provision is held invalid, it shall be modified to the minimum extent necessary to make it enforceable. The invalidity of any provision shall not affect the remaining provisions.

15.8 Assignment.

(a) Consultant shall not assign without Client's prior written consent.

(b) Client may assign to an Affiliate, successor by merger, or purchaser of substantially all assets.

15.9 Notices. All notices shall be in writing and deemed given when delivered personally, by confirmed email, one (1) Business Day after overnight courier, or three (3) Business Days after certified mail.

If to Client:
Attention: [________________________________]
Email: [________________________________]
Address: [________________________________]

If to Consultant:
Attention: [________________________________]
Email: [________________________________]
Address: [________________________________]

15.10 Force Majeure. Neither Party shall be liable for failure to perform (other than payment obligations) due to circumstances beyond its reasonable control. If a Force Majeure Event continues for more than [____] days, either Party may terminate.

15.11 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts. Pursuant to the Kentucky Uniform Electronic Transactions Act, KRS § 369.101 et seq., electronic signatures shall be given the same legal effect as original signatures.

15.12 Headings. Headings are for convenience only.

15.13 Construction. This Agreement shall be construed without regard to any presumption against the drafting Party.

15.14 Publicity. Neither Party shall issue press releases regarding this Agreement without the other Party's prior written consent.

15.15 Third-Party Beneficiaries. This Agreement benefits only the Parties and their permitted successors and assigns.

15.16 Order of Precedence. In the event of conflict: (a) Amendments; (b) this Agreement; (c) Change Orders; (d) Statements of Work; (e) Exhibits.

15.17 Export Compliance. The Parties shall comply with all applicable export control laws.

15.18 Anti-Corruption. Each Party warrants compliance with the Foreign Corrupt Practices Act and applicable anti-corruption laws.

ARTICLE 16: KENTUCKY-SPECIFIC PROVISIONS

16.1 Independent Contractor Classification Under Kentucky Law.

(a) Economic Realities Test (Workers' Compensation): For purposes of KRS § 342.640, Kentucky applies the "economic realities" test examining six factors: (1) permanency of the relationship; (2) degree of skill required; (3) worker's investment in equipment or materials; (4) worker's opportunity for profit or loss; (5) degree of the alleged employer's right to control the manner of work; and (6) whether the service is an integral part of the alleged employer's business. If analysis reveals the worker is economically dependent on the alleged employer's business, the worker is an employee.

(b) Common Law Right-to-Control Test: Kentucky also applies the common law right-to-control test in certain contexts, examining whether the employer retains the right to direct the manner and means by which the work is accomplished.

(c) Worker Classification (KRS § 336.700 et seq.): Kentucky law prohibits misclassification of workers and imposes penalties on employers who knowingly misclassify employees as independent contractors, including fines up to $1,000 per violation for first offenses and up to $5,000 per violation for subsequent offenses.

(d) The Parties represent and warrant that the engagement described herein satisfies all applicable Kentucky independent contractor tests, and that the factors supporting independent contractor status documented in Section 7.3 are accurate and truthful.

16.2 Non-Compete Enforceability in Kentucky.

(a) Kentucky courts enforce non-compete agreements that are reasonable in scope, duration, and geographic area when they protect a legitimate business interest such as trade secrets, Confidential Information, or customer goodwill.

(b) Kentucky applies a reasonableness test weighing the employer's interests, the hardship on the restricted party, and the public interest.

(c) Restrictions of one to two (1-2) years are generally considered reasonable. Geographic restrictions should be limited to areas where the consultant actually provided services or had access to confidential business information.

(d) Kentucky courts have authority to "blue pencil" or reform overbroad covenants.

(e) For non-competes entered into during an existing relationship, additional consideration beyond continuation of the relationship may be required.

16.3 Kentucky Uniform Trade Secrets Act (KUTSA).

(a) Under KRS § 365.880, a "trade secret" means information that derives independent economic value from not being generally known or readily ascertainable by proper means and is the subject of reasonable efforts to maintain its secrecy.

(b) Types of misappropriation include unauthorized acquisition by improper means (e.g., copying electronic files, removing documents, obtaining access by misrepresentation), unauthorized disclosure, and unauthorized use.

(c) KRS § 365.882 provides for injunctive relief, including orders to maintain secrecy and to compel affirmative acts to protect trade secrets.

(d) KRS § 365.884 provides for damages including actual loss, unjust enrichment, and a reasonable royalty. Willful and malicious misappropriation may be subject to exemplary damages up to twice the actual damages.

(e) KRS § 365.886 permits an award of attorney's fees for willful and malicious misappropriation or bad faith claims.

(f) The statute of limitations for trade secret misappropriation claims is three (3) years (KRS § 365.890).

16.4 Kentucky Data Breach Notification Requirements.

(a) KRS § 365.732 requires persons or entities that own or license computerized data containing personal information to notify affected Kentucky residents of a security breach in the most expedient time possible and without unreasonable delay.

(b) "Personal information" includes a resident's name combined with an unencrypted Social Security number, driver's license or state ID number, financial account number with access code, or individual taxpayer identification number.

(c) If more than 1,000 Kentucky residents must be notified, the entity must also notify consumer reporting agencies and the Kentucky Attorney General.

(d) Kentucky's definition of "breach of the security of the system" means unauthorized acquisition of unencrypted and unredacted computerized data that compromises the security, confidentiality, or integrity of personally identifiable information.

16.5 Kentucky Interest Rate Limitations.

(a) The legal rate of interest in Kentucky is eight percent (8%) per annum under KRS § 360.010.

(b) Parties to a written contract may agree to a higher rate; however, KRS § 360.010 provides that interest after default on a written contract shall accrue at the legal rate unless a different rate is specified in the contract.

(c) Kentucky usury laws (KRS § 360.010 et seq.) impose limits that vary by the type of transaction. The Parties shall ensure any interest rate specified in this Agreement complies with all applicable Kentucky usury limits.

16.6 Kentucky Limited Liability Entity Tax (LLET).

(a) Pursuant to KRS § 141.0401, all corporations and limited liability pass-through entities doing business in Kentucky are subject to the LLET.

(b) The LLET is calculated as the lesser of $0.095 per $100 of Kentucky gross receipts or $0.75 per $100 of Kentucky gross profits, subject to a minimum of $175.

(c) Consultant acknowledges that if it is a limited liability entity doing business in Kentucky, LLET obligations are the sole responsibility of Consultant.

16.7 Kentucky E-Signatures. Pursuant to KRS § 369.101 et seq. (Kentucky Uniform Electronic Transactions Act), electronic signatures have the same legal effect as original signatures when both parties consent to conduct transactions electronically.

ARTICLE 17: SIGNATURES

IN WITNESS WHEREOF, the Parties have executed this Consulting Services Agreement as of the Effective Date first written above.

CLIENT:

[________________________________]
(Print Name of Entity)

By: [________________________________]
Print Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]

CONSULTANT:

[________________________________]
(Print Name of Entity or Individual)

By: [________________________________]
Print Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]

OPTIONAL NOTARIZATION

COMMONWEALTH OF KENTUCKY
COUNTY OF [________________]

Before me, the undersigned notary public, on this [____] day of [________________], 20[____], personally appeared [________________________________], known to me (or proved to me on the basis of satisfactory evidence) to be the person whose name is subscribed to the within instrument and acknowledged to me that he/she executed the same in his/her authorized capacity, and that by his/her signature on the instrument the person, or the entity upon behalf of which the person acted, executed the instrument.

WITNESS my hand and official seal.

[________________________________]
Notary Public, Commonwealth of Kentucky
My Commission Expires: [__/__/____]

[NOTARY SEAL]

EXHIBIT A: STATEMENT OF WORK

STATEMENT OF WORK NO. [____]

Effective Date: [__/__/____]

This Statement of Work ("SOW") is entered into pursuant to the Consulting Services Agreement dated [__/__/____] (the "Agreement") between:

Client: [________________________________]
Consultant: [________________________________]

Capitalized terms used but not defined herein have the meanings in the Agreement.

1. PROJECT OVERVIEW

Project Name: [________________________________]

Project Description:
[________________________________]
[________________________________]

Project Objectives:
☐ [________________________________]
☐ [________________________________]
☐ [________________________________]

2. SCOPE OF SERVICES

2.1 [Service Category/Phase 1]: [________________________________]
☐ [________________________________]
☐ [________________________________]
☐ [________________________________]

2.2 [Service Category/Phase 2]: [________________________________]
☐ [________________________________]
☐ [________________________________]

2.3 Out of Scope:
☐ [________________________________]
☐ [________________________________]

3. DELIVERABLES

No.	Deliverable	Description	Format	Due Date
1	[________________________________]	[________________________________]	[____]	[__/__/____]
2	[________________________________]	[________________________________]	[____]	[__/__/____]
3	[________________________________]	[________________________________]	[____]	[__/__/____]
4	[________________________________]	[________________________________]	[____]	[__/__/____]

4. PROJECT TIMELINE AND MILESTONES

SOW Term: [__/__/____] through [__/__/____]

Milestone	Description	Target Date	Payment Trigger
M1: Project Kickoff	[________________________________]	[__/__/____]	☐ Yes ☐ No
M2: [________________]	[________________________________]	[__/__/____]	☐ Yes ☐ No
M3: [________________]	[________________________________]	[__/__/____]	☐ Yes ☐ No
M4: Project Completion	[________________________________]	[__/__/____]	☐ Yes ☐ No

5. COMPENSATION

☐ Fixed Fee: Total: $[________________]

[____]% upon execution
[____]% upon Milestone [____]
[____]% upon final acceptance

☐ Time and Materials:

Role	Rate	Est. Hours	Est. Total
[________________]	$[________]	[____]	$[________________]
[________________]	$[________]	[____]	$[________________]

Not-to-Exceed: $[________________]

☐ Monthly Retainer: $[________] for [____] hours; additional at $[________]/hour.

Expense Budget: $[________________]

Total SOW Value: $[________________]

6. CLIENT RESPONSIBILITIES

☐ Primary Contact: [________________________________]
☐ Systems/Data Access: [________________________________]
☐ Timely Approvals: Response time: [____] Business Days

7. KEY PERSONNEL

Role	Name	Email	Phone
Client Project Manager	[________________________________]	[________________________________]	[________________________________]
Consultant Project Lead	[________________________________]	[________________________________]	[________________________________]

8. ACCEPTANCE CRITERIA

☐ Conform to SOW specifications
☐ Free from material defects
☐ [________________________________]

Review period: [____] Business Days. Cure period: [____] Business Days.

9. SOW SIGNATURES

CLIENT:

By: [________________________________]
Print Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]

CONSULTANT:

By: [________________________________]
Print Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]

EXHIBIT B: PRE-EXISTING MATERIALS

Item	Description	Ownership
[________________________________]	[________________________________]	Consultant
[________________________________]	[________________________________]	Consultant

☐ No Pre-Existing Materials are anticipated to be incorporated into the Deliverables.

EXECUTION CHECKLIST

Agreement Setup:
☐ All bracketed fields completed
☐ Party information accurate and complete
☐ Effective Date inserted

Term and Termination (Article 3):
☐ Initial Term specified
☐ Renewal option selected
☐ Notice and cure periods specified

Compensation (Article 4):
☐ Fee structure selected and rates specified
☐ Invoice frequency selected
☐ Payment terms specified
☐ Late payment interest rate selected (within KRS § 360.010 limits)
☐ LLET obligations acknowledged (if applicable)

Confidentiality (Article 5):
☐ Duration of confidentiality obligations specified

Warranties (Article 8):
☐ Warranty Period specified

Liability (Article 10):
☐ Liability cap option selected

Insurance (Article 11):
☐ Coverage amounts specified

Restrictive Covenants (Article 12):
☐ Determined applicability
☐ If applicable, duration, scope, and geography specified
☐ Reviewed for Kentucky reasonableness standards

Dispute Resolution (Article 14):
☐ Option selected

Kentucky-Specific (Article 16):
☐ Economic realities test factors reviewed
☐ Non-compete provisions reviewed under Kentucky law
☐ Interest rate confirmed within Kentucky limits
☐ LLET implications considered

Final Review:
☐ Reviewed by Kentucky-licensed legal counsel
☐ Both Parties have executed copies
☐ IRS Form W-9 provided
☐ Insurance certificates provided (if applicable)

This template is intended for use under the laws of the Commonwealth of Kentucky. The statutory citations referenced herein were current as of the last updated date and should be verified before execution. This document does not constitute legal advice and should be reviewed by qualified legal counsel before use.

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About This Template

A contract is a written record of what two or more parties agreed to and what happens if someone does not follow through. Clear language, defined terms, and clean signature blocks keep disputes small and enforceable. The most common mistakes in contracts come from vague promises, missing details about timing or payment, and skipping standard protective clauses like governing law and dispute resolution.

Important Notice

This template is provided for informational purposes. It is not legal advice. We recommend having an attorney review any legal document before signing, especially for high-value or complex matters.

Last updated: March 2026

Consulting Services Agreement