10-A02 - Sample Agreement.docx

VENDING MACHINE SERVICES CONTRACT

This VENDING MACHINE SERVICES CONTRACT (Agreement) is entered into effective as of _______, 20____ (Effective Date) by and between THE UNIVERSITY OF TEXAS HEALTH SCIENCE CENTER AT SAN ANTONIO (University), an agency and institution of higher education authorized by the laws and Constitution of the State of Texas, and _______________________________________ (Contractor), a _____________________

RECITALS

University desires certain products and services be made available on the University’s campus (Campus) by means of vending machines for the benefit and convenience of its students, faculty, staff and visitors;

Contractor represents that it has the knowledge, ability, equipment, and personnel to conduct vending machine operations on Campus; and

University, in reliance on Contractor’s representations, is willing to contract with Contractor on the terms and conditions of this Agreement.

For and in consideration of the mutual benefits and covenants contained in this Agreement, the parties agree as follows:

TERMS AND CONDITIONS

Section 1. TERM AND EXTENSION

The term of this Agreement (Term) will commence on the Effective Date and expire on August 31, 2027, unless earlier terminated pursuant to the terms and conditions of this Agreement.

This Agreement may be extended for up to five (5) years, by written agreement of University and Contractor.

Section 2. CONTRACTOR’S OBLIGATIONS

2.1 Preparation Activities; Schedule.

Contractor’s activities (Preparation Activities) to be performed in preparation to provide vending machine operations on Campus and the related schedule for performance of the Preparation Activities are set forth in Exhibit A attached and incorporated for all purposes.

2.2 Commencement of Work.

As of the Effective Date of this Agreement, Contractor will, in accordance with the terms and conditions of this Agreement, commence performance of vending machine operations at Campus locations (collectively, Locations) more particularly identified in Exhibit B attached and incorporated for all purposes, through Contractor’s vending machines and related equipment (collectively, Equipment) dispensing the products (collectively, Products) listed in Exhibit C attached and incorporated for all purposes. The Preparation Activities, vending machine operations and all other services, duties and obligations required to be performed by Contractor under this Agreement will sometimes be collectively referred to as “Work.”

2.3 Limited Access; Location License.

Contractor, its employees, representatives, agents, and subcontractors, will have the right to use and access only the Locations to perform Work and will have no right to use or access any other University facilities. University will permit Contractor to use the Locations in accordance with the license contained in this Section. University licenses the Locations in their current, “as is” condition to Contractor for use by Contractor and its employees, representatives, agents, and subcontractors in the performance of Work and for no other purpose. This is a non‑exclusive license to use the Locations. University may enter the Locations at any time for any reason. No unlawful activities will be permitted in the use of the Locations. Contractor will comply with all applicable federal, state and local laws, rules, regulations, ordinances and orders (collectively, Applicable Laws), as well as the Rules and Regulations of the Board of Regents of The University of Texas System, the Administrative Rules of The University of Texas System (UT System) and the institutional rules and regulations and policies of the University (collectively, University Rules), in connection with the use of the Locations. Contractor will cause all of its employees, representatives, agents, and subcontractors to observe and comply with all Applicable Laws and University Rules.

Contractor will not modify, alter or repair the Locations or any other University facilities without the prior written approval of University and with project management of renovations by University.

Contractor will not harm the Locations or make any use of the Locations that is offensive as determined by University. Upon expiration or termination of this Agreement for any reason, Contractor will remove Equipment and Contractor’s other effects, repair any damage caused by the removal, and peaceably deliver up the Locations in clean condition and in good order, repair and condition, ordinary wear and tear excepted. Any personal property of Contractor not removed within two (2) days after expiration or termination of this Agreement will be deemed abandoned by Contractor and University may dispose of the property in any manner it chooses, with no liability or reimbursement obligation to Contractor.

Contractor will not suffer any mechanic's lien to be filed against the Locations or the adjoining facilities by reason of any work, labor, services, or materials performed at or furnished to the Locations for Contractor. Nothing in this Agreement will be construed as the consent of University to subject University’s estate in the Locations or adjoining facilities to any lien.

Contractor has inspected the Locations and agrees that the Locations are sufficiently equipped for Contractor to provide Work in accordance with the terms and conditions of this Agreement.

UNIVERSITY WILL NOT BE RESPONSIBLE FOR INTERRUPTIONS IN UTILITY SERVICE TO THE LOCATIONS. HOWEVER, UNIVERSITY WILL EXERCISE REASONABLE DILIGENCE IN PURSUING THE RESTORATION OF INTERRUPTED UTILITY SERVICE.

UNIVERSITY WILL NOT BE LIABLE TO CONTRACTOR OR CONTRACTOR’S EMPLOYEES, REPRESENTATIVES, AGENTS, SUBCONTRACTORS, GUESTS OR INVITEES (COLLECTIVELY, CONTRACTOR PARTIES), FOR ANY LOSS, EXPENSE, OR DAMAGE, EITHER TO PERSON OR PROPERTY SUSTAINED BY REASON OF ANY CONDITION OF LOCATIONS, CAMPUS OR ADJOINING GROUNDS OR FACILITIES, OR DUE TO ANY ACT OF ANY EMPLOYEE, REPRESENTATIVE, AGENT, SUBCONTRACTOR, GUEST OR INVITEE OF UNIVERSITY, OR THE ACT OF ANY OTHER PERSON WHATSOEVER. UNIVERSITY, ITS EMPLOYEES, REPRESENTATIVES, AGENTS, SUBCONTRACTORS, GUESTS AND INVITEES WILL NOT BE LIABLE FOR, AND CONTRACTOR WAIVES, ALL CLAIMS FOR DAMAGE TO PERSON OR PROPERTY SUSTAINED BY ANY CONTRACTOR PARTIES, RESULTING FROM ANY ACCIDENT OR OCCURRENCE IN OR UPON LOCATIONS, CAMPUS OR ADJOINING GROUNDS OR FACILITIES. CONTRACTOR WILL PAY ON DEMAND UNIVERSITY’S EXPENSES INCURRED IN ENFORCING ANY OBLIGATION OF CONTRACTOR UNDER THIS LICENSE.

2.4 Change in Locations.

The Locations may be changed from time to time upon written agreement of the parties documented through an amendment to this Agreement in accordance with Section 13.

2.5 Products.

2.5.1 Products Vended.

Contractor will offer for sale only Products that University has approved as to brand, size, sales price and royalties.

2.5.2 Applicable Laws; Product Standards; Perishable Products.

Contractor will ensure that all Products will conform in all respects to Applicable Laws relating to the standards or specifications of those Products. All Products intended for human consumption will be fresh and suitable for human consumption in all respects. Contractor will identify perishable Products by means of coded markings with explanatory “keys” required to read Contractor’s coding system. On the Effective Date, Contractor will deliver to University a written report with a list of all coded markings and explanatory “keys.” Contractor will deliver to University an updated version of that report within five (5) days after Contractor changes the coding system or any explanatory “key.”

2.5.3 Sales Prices for Products.

Contractor will not increase the sales prices charged for Products above the sales prices designated in Exhibit C. University and Contractor may, by mutual agreement, adjust Product sales prices through an amendment to this Agreement in accordance with Section 13.

2.5.4 Change in Products.

If it becomes desirable to change the Products to be vended by Contractor, then the Products to be deleted, the Products to be added and associated sales prices, royalties, location and type of vending machine, will be negotiated between Contractor and University and documented through an amendment to this Agreement in accordance with Section 13.

2.6 Equipment.

2.6.1 Type of Equipment; Compliance with Applicable Laws.

Contractor will provide, install and operate all Equipment. Equipment operated on Campus by Contractor will be new or like‑new models, will contain coin changers and dollar bill reader/changers, and will be of a size and type acceptable to University. Contractor will operate and maintain credit card and debit card readers on all Equipment. All Equipment will be installed and operated in conformity with Applicable Laws and University Rules.

2.6.2 On-Call Service.

Contractor will provide on-call maintenance and repair service for Equipment twenty-four (24) hours a day, seven (7) days a week, at no cost to University. Contractor will make available to University a toll-free telephone number for service calls, and will respond with service technician on-site within four (4) hours after a service call placed between 7:30 AM and 5:30 PM, Monday through Friday, except holidays (collectively, working days and each a working day), and within twenty-four (24) hours after a service call placed at all other times. Contractor will keep at least one on-duty supervisor available each working day, and at least one on‑call supervisor available at all other times.

2.6.3 Maintaining Equipment.

Contractor will service all Equipment as often as is necessary to keep all Equipment properly supplied and in good working order. Contractor will maintain a program of regular preventive maintenance and replacement of worn, damaged, or malfunctioning Equipment. University may require Contractor to replace Equipment that cannot be returned to service within four (4) working days after a service call is placed. Replacement equipment will be of a type and condition at least equal to the type and condition of Equipment being replaced. Contractor will keep all Equipment in a neat and sanitary condition. Contractor will clean all spills that occur while filling, cleaning, or maintaining Equipment, clean Equipment each time Contractor restocks or services Equipment, and remove packaging and waste from Campus after each service call. Contractor will cooperate with University to promptly remedy any sanitary problems related to Equipment.

2.6.4 Inspecting and Restocking Equipment.

Contractor will inspect and restock Equipment as is reasonably necessary to meet the demands of the University, based on volume of sales at the Locations.

2.6.5 Operating Notices.

Contractor will affix to all Equipment a prominent notice containing instructions on how to (1) operate Equipment, (2) report malfunctions, (3) comment on Product quality, and (4) request refunds.

2.7 Refunds.

Contractor will provide University up to three (3) separate cash funds in the amount of $10.00 each, which will be used by University for making refund payments available at Campus locations designated by University. Contractor will make additional funds available to University as required to maintain each fund at a level adequate to pay refunds promptly upon submission of a refund claim. Contractor will supply a written form, mutually agreeable to both parties, to be used as a voucher for submitting refund claims. The form will include space for claimants to identify (1) the type of Equipment, (2) the Location, (3) the amount of the loss, (4) a description of how the loss occurred, (5) the date of the loss, (6) the claimant's name and signature, and (7) the date of the refund claim.

2.8 Auxiliary Enterprise.

Contractor, at its sole cost and expense, will comply with all requirements of Subchapter C, Chapter 2252, Texas Government Code, including the provision of financial statements, payment statements derived from sales tax reports, and bonds.

2.8.1 Financial Statement.

In accordance with §2252.062, Texas Government Code, Contractor will submit to University on or before the Effective Date, two (2) copies of Contractor’s most recent financial statement prepared by a certified public accountant on the Effective Date.

2.8.2 Payment Statement.

In accordance with §2252.063, Texas Government Code, Contractor will submit to University, no later than the 15th day after the end of each contract year, an annual payment statement derived from all of Contractor’s sales tax reports for its operations during the preceding contract year. The annual payment statement must be certified by a certified public accountant licensed in the State of Texas. “Contract year” means that period of time beginning on the Effective Date and ending August 31, 2027, and each twelve (12) month period thereafter, during the term of this Agreement.

2.8.3 Performance Bond.

In accordance with §2252.064, Texas Government Code, Contractor will provide University with a performance bond for each contract year during the term of this Agreement. The amount of the performance bond during the term of this Agreement will be equal to Fifty Thousand Dollars ($50,000). Thereafter, the amount of the performance bond will be adjusted at the beginning of each contract year to the amount of the Royalty payable to University from the previous contract year. The performance bond will be issued by a surety company authorized to do business in the State of Texas and acceptable to University in all respects. The performance bond will be made payable to University and conditioned upon Contractor’s prompt and faithful performance of Work.

2.9 Costs of Operation.

Contractor will pay all costs for installing, operating, stocking, servicing, and replacing the Equipment; provided, however, subject to Section 2.3, University will provide Contractor with electricity and water for operation of Equipment on Campus. University will not be responsible for any money shortages that result from theft, burglary, inoperable or malfunctioning Equipment, or any other cause.

2.10 Energy-Saving; Energy Management.

Pursuant to §2165.058, Texas Government Code:

2.10.1 Internal Energy Saving or Management Device.

Contractor will activate and maintain any internal energy saving or energy-management device or option that is already part of or contained in the Equipment.

2.10.2 External Energy Saving or Management Device.

Contractor will use an external energy-saving or energy-management device in all Equipment that (a) operates with a compressor, and (b) does not have an activated and operational internal energy-saving or energy-management device or option.

2.10.3 Expenses.

Contractor is responsible for any and all expenses associated with the acquisition, installation, or maintenance of all energy-saving devices required by this Section.

2.10.4 Exception.

This Section 2.10 does not apply to any Equipment that contains a perishable food product, as defined by §96.001, Texas Civil Practice and Remedies Code.

2.11 Signs.

Contractor will not post signs or posters at the Locations or elsewhere on Campus. Contractor may only engage in marketing or promotional activity on Campus, that in each instance, (a) fully complies with Applicable Laws and University Rules, (b) has received University’s advance written approval, and (c) qualifies as “use or acknowledgement” as defined in Treasury Regulations 26 C.F.R. 1.513-4(c)(2)(iv).

2.12 Student Evaluation.

Contractor will comply with requirements of §51.945, Texas Education Code, and all University Rules regarding students’ involvement in the evaluation of the performance of Contractor, by periodically holding meetings or forums to provide University’s students with a reasonable opportunity to discuss the performance of Contractor. Contractor will obtain University’s prior written approval concerning the date, time and location for each meeting or forum at least thirty (30) days in advance.

2.13 University’s Right to Refuse Entry and Eject; Identification Badges; Background Checks; Certification.

2.13.1 Right to Refuse Entry and Eject.

University has the right to (a) require identification from any person on University’s Campus, (b) refuse entry to persons having no legitimate business on Campus, and (c) eject any undesirable person refusing to leave peaceably on request. Contractor will cooperate with all authorized University representatives in the exercise of University’s rights described in this Section.

2.13.2 Identification Badge.

Contractor will provide each of Contractor’s employees, representatives, agents and subcontractors with an identification badge and will cause each employee, representative, agent and subcontractor to prominently display the badge on his or her person at all times while on Campus.

2.13.3 Background Check.

Each individual who is assigned to perform any of Contractor‘s duties and obligations under this Agreement will be an employee of Contractor or an employee of a subcontractor engaged by Contractor and previously approved by University in writing. Contractor is responsible for the performance of all individuals performing Work under this Agreement. Prior to commencing any Work on Campus, Contractor will at its expense (a) provide University with a list ("List") of all individuals who may be assigned to perform Work, and (b) have an appropriate criminal background screening performed concerning each individual. Contractor will determine on a case-by-case basis whether each individual is qualified to provide Work. Contractor will not knowingly assign any individual to provide Work who has a history of criminal conduct unacceptable for a university campus, including violent or sexual offenses. Contractor will update the List each time there is a change in the individuals assigned to perform Work.

2.13.4 Certification.

Prior to commencing any Work under this Agreement, Contractor will provide University a letter signed by an authorized representative of Contractor certifying compliance with Section 2.13.3. Contractor will provide University with an updated certification letter each time there is a change in the individuals assigned to perform Work.

Section 3. COMMISSIONS PAYMENTS, RECORDS AND REPORTS

3.1 Commissions. Contractor will pay University a commission (“Commission”) on net revenue generated by Services, all as more particularly provided in Exhibit D attached and incorporated for all purposes. The term “net revenue" will mean revenue after exclusion of applicable sales taxes or fees that Contractor is required to pay by Texas law. Provided, however, before any such fees are applied to the calculation of net revenue, Contractor must provide University with documentation verifying all such fees and their applicability to Contractor’s performance under this Agreement, including Contractor's identification of all applicable Texas law(s) or regulations regarding such fees.

3.2 Payment and Report.

Commissions shall be remitted by Contractor to the University within thirty (30) days of the end of each 4-week accounting period established by Contractor. Contractor shall make all pertinent revenue and sales records respecting the Vending Machines available to University. University agrees that it is responsible for reviewing such records. Contractor will make all Commission checks payable to “The University of Texas Health Science Center at San Antonio”, and will deliver the checks to University’s Sr. Director of Supply Chain Management.

3.3 Accurate Records.

Contractor will keep accurate records of all sales on Campus. Contractor will make all records related to the Work available to University upon written request during the Term of this Agreement and for up to four (4) years after the expiration or termination of this Agreement. Contractor will permit authorized representatives of University to accompany Contractor's employees during cash collection and counting activities and to randomly examine the receipts of Equipment operated by Contractor.

3.4 Form of Reports.

All reports required or given under this Agreement will be presented in forms satisfactory to University in all respects.

3.5 Payment Card Industry Standards.

University is required to validate compliance on a periodic basis with all applicable Payment Card Industry Data Security Standards (collectively, PCI DSS) promulgated by the Payment Card Industry Security Standards Council (PCI SSC), including the PCI Software Security Framework (SSF). The compliance validation process requires University to undergo an assessment of (1) all system components used to process, store or transmit cardholder data, and any other components that reside on the same network segment as those system components, as well as (2) all related processes used to process, store or transmit cardholder data, (collectively, System Components in Scope). Some or all System Components in Scope have been outsourced to Contractor under this Agreement. Contractor will cause its agents and subcontractors to comply with all terms of this Section applicable to Contractor. Contractor will achieve and maintain compliance under the current versions of PCI DSS and SSF published on the PCI SSC website for service providers and payment applications and with any future additions or changes to the PCI DSS or SSF promulgated by the PCI SSC. As evidence of compliance, Contractor will provide to University on or before the Effective Date and within ten (10) days after each anniversary of the Effective Date during the term of this Agreement, a copy of Contractor’s annual attestation of compliance signed by a Qualified Security Assessor (QSA) as more particularly described on the PCI SSC website.

If Contractor is unable to provide the required attestations of compliance, Contractor will permit University or University’s QSA to assess all System Components in Scope that are hosted or managed by Contractor or by Contractor’s agents or subcontractors. Contractor will create and maintain reasonably detailed, complete and accurate documentation describing the systems, processes, network segments, security controls, and dataflow used to receive, transmit, store and secure cardholder data. The documentation will conform to the most current version of PCI DSS. Contractor will, upon written request by University, make the documentation and the individuals responsible for implementing, maintaining and monitoring System Components in Scope available to (1) QSAs, forensic investigators, consultants and attorneys retained by University to facilitate the validation of University’s PCI DSS compliance, and (2) University’s information technology, information security, audit, compliance and other staff.

Contractor will retain the documentation for at least one (1) year after termination of this Agreement.

3.6 As a government entity, University is obligated by statute to re-solicit, or to leverage eligible Group Purchasing Organization contracts, to continue this service upon expiration or termination of this agreement. Awarded Proposer agrees that if the Signed Agreement expires or is terminated for any reason, then, at University’s option, Awarded Proposer will continue to perform the NAME OF SERVICES in accordance with the terms and conditions of the Signed Agreement until University contracts with a new qualified and experienced contractor(s) to perform the NAME OF SERVICES or is able to perform the NAME OF SERVICES in-house; provided, that, Awarded Proposer will not be required to continue performing the NAME OF SERVICES for more than four (4) months after expiration or termination of the Signed Agreement.

Awarded Proposer agrees to cooperate with, and assist, University’s efforts to transition to another contractor(s) or to perform the NAME OF SERVICES in-house.

Section 4. LICENSES, TAXES, APPLICABLE LAWS AND UNIVERSITY RULES

4.1 Licenses and Taxes.

Contractor will obtain, maintain in effect, and pay the cost of all licenses, permits, certifications, and inspections required in connection with Contractor’s performance of Work. Contractor will pay all taxes (including sales, excise and payroll taxes), payroll deductions, employee benefits, fines, penalties, or other payments required by Applicable Laws in connection with Contractor’s performance of Work. Contractor will file proper sales tax returns with and remit sales tax payments to the Texas Comptroller of Public Accounts.

4.2 Applicable Laws and University Rules.

Contractor will comply with, and will cause its employees, representatives, agents, and subcontractors to comply with, all Applicable Laws and University Rules.

4.3 Health and Safety Inspections.

CONTRACTOR WILL PROVIDE UNIVERSITY WITH COPIES OF ALL HEALTH AND SAFETY INSPECTION REPORTS RELATED TO THE WORK IN ANY WAY WITHIN THREE (3) DAYS AFTER CONTRACTOR RECEIVES THE REPORTS.

4.4 Remedies.

In the event University reasonably believes that Contractor is not in compliance with Applicable Laws and reasonably determines that a violation of Applicable Laws creates an imminent health hazard or immediate threat to the health and safety of University’s Campus community or the public, University may immediately (a) perform any cleaning or other services deemed necessary by University (Contractor will reimburse University for all reasonable costs, including overtime costs.), (b) report Contractor’s non-compliance with Applicable Laws to any governmental body or authority, and (c) at University’s option, (i) require Contractor to cure the violation within a timeframe that is acceptable to University, or (ii) suspend Contractor’s performance of Work, and/or (iii) terminate this Agreement without notice or opportunity to cure. Upon receipt of written notice of suspension or termination of this Agreement, Contractor will immediately cease performance of Work under this Agreement.

Section 5. INSURANCE

5.1 Contractor, consistent with its status as an independent contractor will carry and will cause its subcontractors to carry, at least the following insurance, with companies authorized to do insurance business in the State of Texas or eligible surplus lines insurers operating in accordance with the Texas Insurance Code, having an A.M. Best Rating of A-:VII or better, and in amounts not less than the following minimum limits of coverage:

5.1.1 Workers’ Compensation Insurance with statutory limits, and Employer’s Liability Insurance with limits of not less than $1,000,000:

Workers’ Compensation policy must include under Item 3.A. of the information page of the Workers’ Compensation policy the state in which Work is to be performed for University.

5.1.2 Commercial General Liability Insurance with limits of not less than:

The required Commercial General Liability policy will be issued on a form that insures Contractor’s and subcontractor’s liability for bodily injury (including death), property damage, personal, and advertising injury assumed under the terms of this Agreement.

5.1.3 Business Auto Liability Insurance covering all owned, non-owned or hired automobiles, with limits of not less than $1,000,000 single limit of liability per accident for Bodily Injury and Property Damage;

If a separate Business Auto Liability policy is not available, coverage for hired and non-owned auto liability may be endorsed on the Commercial General Liability policy.

Contractors transporting hazardous materials must provide the MCS-90 endorsement and CA9948 Broadened Pollution Liability endorsement on the Business Auto Liability policy. Policy limits must be in line with Federal requirements.

5.1.4 Umbrella/Excess Liability Insurance with limits of not less than $2,000,000 per occurrence and aggregate with a deductible of no more than $10,000. The Umbrella/Excess Liability policy will be excess over and at least as broad as the underlying coverage as required under Sections 5.1.1 Employer’s Liability; 5.1.2 Commercial General Liability; and 5.1.3 Business Auto Liability. Inception and expiration dates will be the same as the underlying policies. Drop down coverage will be provided for reduction or exhaustion of underlying aggregate limits and will provide a duty to defend for any insured.

5.1.5 Professional Liability (Errors & Omissions) Insurance with limits of not less than $1,000,000 each occurrence, $3,000,000 aggregate. Such insurance will cover all Work performed by or on behalf of Contractor and its subcontractors under this Agreement. Renewal policies written on a claims-made basis will maintain the same retroactive date as in effect at the inception of this Agreement. If coverage is written on a claims-made basis, Contractor agrees to purchase an Extended Reporting Period Endorsement, effective twenty-four (24) months after the expiration or cancellation of the policy. No Professional Liability policy written on an occurrence form will include a sunset or similar clause that limits coverage unless such clause provides coverage for at least twenty-four (24) months after the expiration or termination of this Agreement for any reason.

5.1.6 Directors’ and Officers’ Liability Insurance with limits of not less than $1,000,000 per claim. The coverage will be continuous for the duration of this Agreement and for not less than twenty-four (24) months following the expiration or termination of this Agreement.

5.2 Contractor will deliver to University:

5.2.1 After the execution and delivery of this Agreement and prior to the performance of any Work by Contractor, evidence of insurance on a Texas Department of Insurance (TDI) approved certificate form (the Acord form is a TDI-approved form) verifying the existence and actual limits of all required insurance policies; and, if the coverage period shown on the current certificate form ends during the Term, then prior to the end of the coverage period, a new certificate form verifying the continued existence of all required insurance policies.

5.2.1.1 All insurance policies (with the exception of workers’ compensation, employer’s liability and professional liability) will be endorsed and name the Board of Regents of The University of Texas System. The University of Texas System and University as Additional Insureds for liability caused in whole or in part by Contractor’s acts or omissions with respect to its on-going and completed operations up to the actual liability limits of the required insurance policies maintained by Contractor. Commercial General Liability Additional Insured endorsement including ongoing and completed operations coverage will be submitted with the Certificates of Insurance. Commercial General Liability and Business Auto Liability will be endorsed to provide primary and non-contributory coverage.

5.2.1.2 Contractor hereby waives all rights of subrogation against the Board of Regents of The University of Texas System, The University of Texas System and University. All insurance policies will be endorsed to provide a waiver of subrogation in favor of the Board of Regents of The University of Texas System, The University of Texas System and University. No policy will be canceled until after thirty (30) days' unconditional written notice to University. All insurance policies will be endorsed to require the insurance carrier providing coverage to send notice to University thirty (30) days prior to any cancellation, material change, or non-renewal relating to any insurance policy required in this Section 5.

5.2.1.3 Contractor will pay any deductible or self-insured retention for any loss. Any self-insured retention must be declared to and approved by University prior to the performance of any Work by Contractor under this Agreement. All deductibles and self-insured retentions will be shown on the Certificates of Insurance.

5.2.1.4 Certificates of Insurance and Additional Insured Endorsements as required by this Agreement will be mailed, faxed, or emailed to the following University contact:

Name: Eric R. Walls, Sr. Director of Supply Chain Management

Address: 7703 Floyd Curl Dr.

San Antonio, TX 78229

Email Address: buscontracts@uthscsa.edu

5.3 Contractor’s or subcontractor’s insurance will be primary to any insurance carried or self‑insurance program established by University or the University of Texas System. Contractor’s or subcontractor’s insurance will be kept in force until all Work has been fully performed and accepted by University in writing except as provided in this Section 5.3.

5.3.1 Professional Liability Insurance coverage written on a claims-made basis requires Contractor to purchase an Extended Reporting Period Endorsement, effective for twenty-four (24) months after the expiration or cancellation of the policy.

5.3.2 Directors and Officers Liability Insurance coverage written on a claims-made basis requires Contractor to purchase an Extended Reporting Period Endorsement, effective for twenty-four (24) months after the expiration or cancellation of the policy.

Section 6. INDEMNIFICATION

TO THE FULLEST EXTENT PERMITTED BY LAW, CONTRACTOR WILL INDEMNIFY, PROTECT, DEFEND WITH COUNSEL APPROVED BY UNIVERSITY, AND HOLD HARMLESS UNIVERSITY AND UT SYSTEM, AND THEIR RESPECTIVE AFFILIATED ENTERPRISES, REGENTS, OFFICERS, DIRECTORS, ATTORNEYS, EMPLOYEES, REPRESENTATIVES AND AGENTS (COLLECTIVELY, INDEMNITEES) FROM AND AGAINST ALL DAMAGES, LOSSES, LIENS, CAUSES OF ACTION, SUITS, JUDGMENTS, EXPENSES, AND OTHER CLAIMS OF ANY NATURE, KIND, OR DESCRIPTION, INCLUDING REASONABLE ATTORNEYS’ FEES INCURRED IN INVESTIGATING, DEFENDING OR SETTLING ANY OF THE FOREGOING (COLLECTIVELY, CLAIMS) BY ANY PERSON OR ENTITY, ARISING OUT OF, CAUSED BY, OR RESULTING (1) FROM CONTRACTOR’S PERFORMANCE UNDER OR BREACH OF THIS AGREEMENT OR (2) IN WHOLE OR IN PART FROM ANY NEGLIGENT ACT, NEGLIGENT OMISSION OR WILLFUL MISCONDUCT OF CONTRACTOR, ANYONE DIRECTLY EMPLOYED BY CONTRACTOR OR ANYONE FOR WHOSE ACTS CONTRACTOR MAY BE LIABLE. THE PROVISIONS OF THIS SECTION WILL NOT BE CONSTRUED TO ELIMINATE OR REDUCE ANY OTHER INDEMNIFICATION OR RIGHT WHICH ANY INDEMNITEE HAS BY LAW OR EQUITY. ALL PARTIES WILL BE ENTITLED TO BE REPRESENTED BY COUNSEL AT THEIR OWN EXPENSE.

IN ADDITION, CONTRACTOR WILL INDEMNIFY, PROTECT, DEFEND WITH COUNSEL APPROVED BY UNIVERSITY, AND HOLD HARMLESS INDEMNITEES FROM AND AGAINST ALL CLAIMS ARISING FROM INFRINGEMENT OR ALLEGED INFRINGEMENT OF ANY PATENT, COPYRIGHT, TRADEMARK OR OTHER PROPRIETARY INTEREST ARISING BY OR OUT OF THE PERFORMANCE OF SERVICES OR THE PROVISION OF GOODS BY CONTRACTOR, OR THE USE BY INDEMNITEES, AT THE DIRECTION OF CONTRACTOR, OF ANY ARTICLE OR MATERIAL; PROVIDED, THAT, UPON BECOMING AWARE OF A SUIT OR THREAT OF SUIT FOR INFRINGEMENT, UNIVERSITY WILL PROMPTLY NOTIFY CONTRACTOR AND CONTRACTOR WILL BE GIVEN THE OPPORTUNITY TO NEGOTIATE A SETTLEMENT. IN THE EVENT OF LITIGATION, UNIVERSITY WILL REASONABLY COOPERATE WITH CONTRACTOR. ALL PARTIES WILL BE ENTITLED TO BE REPRESENTED BY COUNSEL AT THEIR OWN EXPENSE.

Section 7. REPRESENTATIONS AND WARRANTIES

7.1 Organization and Authority.

Contractor represents it is duly organized, validly existing and in good standing under the laws of the state of its incorporation or organization and is duly authorized and in good standing to conduct business in the State of Texas, it has all necessary power and has received all necessary approvals to execute and deliver this Agreement, and the individual executing this Agreement on behalf of Contractor has been duly authorized to act for and bind Contractor.

7.2 Tax Certification.

If Contractor is a taxable entity as defined by Chapter 171, Texas Tax Code (Chapter 171), then Contractor certifies that it is not currently delinquent in the payment of any taxes due under Chapter 171, or that it is exempt from the payment of those taxes, or that it is an out-of-state taxable entity that is not subject to those taxes, whichever is applicable.

7.3 Payment of Debt or Delinquency to the State.

Pursuant to §§2107.008 and 2252.903, Texas Government Code, Contractor agrees that any payments owing to Contractor under this Agreement may be applied directly toward any debt or delinquency that Contractor owes the State of Texas or any agency of the State of Texas regardless of when it arises, until such debt or delinquency is paid in full.

7.4 Texas Family Code Child Support Certification.

Pursuant to §231.006, Texas Family Code, Contractor certifies that it is not ineligible to receive the award of or payments under this Agreement and acknowledges that this Agreement may be terminated and payment may be withheld if this certification is inaccurate.

7.5 No Conflict.

Contractor has not entered into, and during the Term of this Agreement will not enter into, any other agreements that would conflict with Contractor’s obligations under this Agreement or prevent it from fully complying with the provisions of this Agreement.

7.6 Undocumented Workers.

The Immigration and Nationality Act (8 United States Code 1324a) (Immigration Act) makes it unlawful for an employer to hire or continue employment of undocumented workers. The United States Immigration and Customs Enforcement Service has established the Form I-9 Employment Eligibility Verification Form (I-9 Form) as the document to be used for employment eligibility verification (8 Code of Federal Regulations 274a). Among other things, Contractor is required to: (1) have all employees complete and sign the I-9 Form certifying that they are eligible for employment; (2) examine verification documents required by the I-9 Form to be presented by the employee and ensure the documents appear to be genuine and related to the individual; (3) record information about the documents on the I-9 Form, and complete the certification portion of the I-9 Form; and (4) retain the I-9 Form as required by law. It is illegal to discriminate against any individual (other than a citizen of another country who is not authorized to work in the United States) in hiring, discharging, or recruiting because of that individual's national origin or citizenship status. If Contractor employs unauthorized workers during performance of this Agreement in violation of the Immigration Act then, in addition to other remedies or penalties prescribed by Applicable Laws, University may terminate this Agreement in accordance with Section 10. Contractor represents and warrants that it is in compliance with and agrees that it will remain in compliance with the provisions of the Immigration Act.

7.7 Contractor Certification regarding Boycotting Israel.

Pursuant to Chapter 2271, Texas Government Code, Contractor certifies Contractor (1) does not currently boycott Israel; and (2) will not boycott Israel during the Term of this Agreement. Contractor acknowledges this Agreement may be terminated and payment withheld if this certification is inaccurate.

7.8 Contractor Certification regarding Business with Certain Countries and Organizations.

Pursuant to Subchapter F, Chapter 2252, Texas Government Code, Contractor certifies Contractor is not engaged in business with Iran, Sudan, or a foreign terrorist organization. Contractor acknowledges this Agreement may be terminated and payment withheld if this certification is inaccurate.

7.9 Contractor Verification Regarding Discrimination Against Firearm Entities or Trade Associations.

Pursuant to Chapter 2274, Texas Government Code, Contractor verifies (1) it does not have a practice, policy, guidance, or directive that discriminates against a firearm entity or firearm trade association and (2) it will not discriminate during the term of this Agreement against a firearm entity or firearm trade association. Contractor acknowledges this Agreement may be terminated and payment withheld if this verification is inaccurate.

7.10 Contractor Verification Regarding Boycotting Energy Companies.

Pursuant to Chapter 2276, Texas Government Code, Contractor verifies (1) it does not boycott energy companies and (2) it will not boycott energy companies during the term of this Agreement. Contractor acknowledges this Agreement may be terminated and payment withheld if this verification is inaccurate.

7.11 Contractor Certification Regarding COVID-19 Vaccination.

Pursuant to Section 161.0085, Texas Health and Safety Code (enacted by SB 968, 87th Texas Legislature, Regular Session (2021)), Contractor certifies that it does not require a customer to provide any documentation certifying the customer's COVID-19 vaccination or post-transmission recovery on entry to, to gain access to, or to receive service from Contractor’s business. Contractor acknowledges this Agreement may be terminated and payment withheld if this certification is inaccurate.

7.12 Certification Required by Texas Governor Executive Order GA-48.

Pursuant to Executive Order GA-48 of the Governor of Texas effective November 19, 2024, Contractor certifies that it and, if applicable, any of its holding companies or subsidiaries, is not:

Section 8. RELATIONSHIP OF PARTIES

For all purposes of this Agreement and notwithstanding any provision of this Agreement to the contrary, Contractor is an independent contractor and is not a state employee, partner, joint venturer, or agent of University. Contractor will not bind nor attempt to bind University to any agreement or contract. As an independent contractor, Contractor is solely responsible for all taxes, withholdings, and other statutory or contractual obligations of any kind, including workers’ compensation insurance.

Section 9. NOTICES

Except as otherwise provided in this Section, all notices, consents, approvals, demands, requests or other communications provided for or permitted to be given under any of the provisions of this Agreement will be in writing and will be sent via registered or certified mail, overnight courier, confirmed facsimile transmission (to the extent a facsimile number is set forth below), or email (to the extent an email address is set forth below), and notice will be deemed given (i) if mailed, when deposited, postage prepaid, in the United States mail, (ii) if sent by overnight courier, one business day after delivery to the courier, (iii) if sent by facsimile (to the extent a facsimile number is set forth below), when transmitted, and (iv) if sent by email (to the extent an email address is set forth below), when received:

Environmental Health & Safety

or other person or address as may be given in writing by either party to the other in accordance with this Section.

Notwithstanding any other requirements for notices given by a party under this Agreement, if Contractor intends to deliver written notice to University pursuant to §2251.054, Texas Government Code, then Contractor will send that notice to University as follows:

The University of Texas Health Science Center at San Antonio

with copy to: The University of Texas Health Science Center at San Antonio Attn: Jennifer Cerecero, Executive Director Environmental Health & Safety

or other person or address as may be given in writing by University to Contractor in accordance with this Section.

Section 10. DEFAULT AND TERMINATION

10.1 Termination Without Cause.

This Agreement may be terminated by University without cause by giving Contractor not less than thirty (30) days written notice of University’s intention to terminate this Agreement as of a specified date. In the event this Agreement is terminated by University before the end of the then current contract year, the Royalty will be paid by Contractor to University (on a pro-rata basis through the effective date of termination) in accordance with Section 3 of this Agreement.

10.2 Termination for Default.

Except as provided in Section 4.4, in the event of a material failure by a party to this Agreement to perform in accordance with the terms of this Agreement (default), the other party may terminate this Agreement upon thirty (30) days’ written notice of termination setting forth the nature of the default; provided, that, the default is through no fault of the terminating party. Termination will not be effective if the default is fully cured prior to the end of the thirty (30) day period. If Contractor fails to cure any default within thirty (30) days after receiving written notice of default, University will be entitled (but will not be obligated) to cure the default and will have the right, at University's option, to collect any and all reasonable expenses incurred in connection with the curative actions from Contractor or to set off the expenses against any amounts due to Contractor under this Agreement.

10.3 No Release of Liability.

Termination of this Agreement under Sections 4.4, 10.1 or 10.2 will not relieve Contractor or any of its employees, representatives, agents, or subcontractors from liability for any default under the terms of this Agreement or any other act or omission.

10.4 Transition Period.

If this Agreement expires or is terminated for any reason, then at University’s option, Contractor will continue to perform Work in accordance with the terms of this Agreement until University contracts with a new qualified and experienced vendor(s) to perform Work or is able to perform Work in-house; provided, that, Contractor will not be required to continue performing Work for more than three (3) months after expiration or termination of this Agreement. Contractor will cooperate with, and assist, University’s efforts to transition Work to another vendor(s) or to perform Work in-house.

10.5 Continuing Obligations.

The expiration or termination of this Agreement will not relieve either party of any obligations under this Agreement that by their nature survive expiration or termination.

Section 11. NO OTHER RIGHTS

Except as expressly granted in this Agreement, nothing in this Agreement is intended to entitle either party to claim any right, title or interest in, or right to use, the name of the other party, the name or existence of any property or facility owned by the other party (or any portion thereof), or any other names, designs, logos, symbols, trademarks, service marks, representations or other identification of the other party.

Section 12. ASSIGNMENT AND SUBCONTRACTING

12.1 Assignment and Subcontracting.

Except as specifically provided in Exhibit E, Historically Underutilized Business Subcontracting Plan, attached and incorporated for all purposes, Contractor's interest in this Agreement (including Contractor’s duties and obligations under this Agreement, and any amounts due to Contractor under this Agreement) may not be subcontracted, assigned, delegated, or otherwise transferred to a third party, in whole or in part, and any attempt to do so will (a) not be binding on University; and (b) be a default under this Agreement for which Contractor will be subject to all remedial actions provided by Texas law, including Chapter 2161, Texas Government Code, and 34 TAC §§20.285(h)(4), 20.585 and 20.586. The benefits and burdens of this Agreement are assignable by University.

12.2 Historically Underutilized Business Subcontracting Plan.

Contractor agrees to comply with and to use good faith efforts to subcontract Work in accordance with the Historically Underutilized Business Subcontracting Plan (HSP) (ref. Exhibit E). Contractor will maintain records documenting its compliance with the HSP and submit a progress assessment report (PAR) to University in the format required by the Texas Comptroller of Public Accounts or successor entity (collectively, Texas Comptroller). Submission of a PAR will be required as a condition for any payments by University under this Agreement. If University’s HUB Office/Department determines that Contractor has failed to comply with the HSP, University will notify Contractor of the deficiencies and give Contractor an opportunity to submit documentation and explain why its failure to comply with the HSP should not be attributed to a lack of good faith effort by Contractor. Any deficiencies identified by the University must be rectified by the Contractor prior to the next reporting period. If University’s HUB Office/Department determines that Contractor failed to implement the HSP in good faith, University, in addition to any other remedies, may report nonperformance to the Texas Comptroller in accordance with Texas law, including 34 TAC §§20.285(h)(4), 20.585 and 20.586. University may also terminate this Agreement for default and make a claim against Contractor.

12.2.1 Changes to the HSP.

If at any time during the term of this Agreement, Contractor desires to change the HSP or to perform or subcontract any part of this Agreement in a manner that…