2-A02 Terms and Conditions.docx

APPENDIX TWO - TERMS AND CONDITIONS

1. Payment.

University agrees to pay fees due under this Agreement in accordance with the Texas Prompt Payment Act (Act), Chapter 2251, Texas Government Code. Pursuant to the Act, payment shall be deemed late on the 31st day after the later of: 1) the date the University receives the goods under this Agreement, 2) the date the performance of the services under this Agreement is completed, or 3) the date University receives an invoice for the goods or services. University will be responsible for interest on overdue payments equal to the sum of: 1) one percent, plus 2) the prime rate as published in the Wall Street Journal on the first day of July of the preceding fiscal year (University’s fiscal year begins September 1) that does not fall on a Saturday or Sunday. University will have the right to verify the details set forth in Contractor's invoices and supporting documentation, either before or after payment, by (a) inspecting the books and records of Contractor at mutually convenient times; (b) examining any reports with respect to the Project; and (c) other reasonable action. The cumulative amount of all payments will not exceed the amount of this Agreement.

Section 51.012, Texas Education Code, authorizes University to make payments through electronic funds transfer methods. Contractor agrees to accept payments from University through those methods, including the automated clearing house system (ACH). Contractor agrees to provide Contractor’s banking information to University in writing on Contractor letterhead signed by an authorized representative of Contractor. Prior to the first payment, University will confirm Contractor’s banking information. Changes to Contractor’s bank information must be communicated to University in accordance with Section 9 in writing at least thirty (30) days before the effective date of the change and must include an IRS Form W-9 signed by an authorized representative of Contractor.

Contractor will submit a Historically Underutilized Business Subcontracting Plan progress assessment report (PAR) to the University with each invoice as required by 34 TAC 20.285(g). The PAR is a condition for payment. (Ref. Section 29.)

2. Prompt Payment Discount.

Notwithstanding any other provision of this Agreement, University is entitled to a discount of ____% (Prompt Payment Discount) off of each payment that University submits within ____ days after University’s receipt of Contractor’s invoice for that payment.

3. Tax Exemption.

University (a State agency) is exempt from Texas Sales & Use Tax on Work in accordance with §151.309, Texas Tax Code and 34 Texas Administrative Code (TAC) §3.322. Pursuant to 34 TAC §§3.322(c)(4) and (g)(3), this Agreement is sufficient proof of University’s tax exempt status and University is not required to provide further evidence of its exempt status.

4. Contractor's Obligations.

4.1 Contractor will perform Work in compliance with (a) all Applicable Laws, and (b) the Board of Regents of The University of Texas System Rules and Regulations (http://www.utsystem.edu/offices/board-regents/regents-rules-and-regulations),http://www.utsystem.edu/bor/rules.htm the rules, regulations, and policies of The University of Texas System (https://www.utsystem.edu/sites/policy-library), and the institutional rules, regulations and policies of University ((http://uthscsa.edu/compliance/policies.asp) (collectively, University Rules). Contractor represents and warrants that neither Contractor nor any firm, corporation or institution represented by Contractor, or anyone acting for Contractor or any such firm, corporation or institution, (1) has violated the antitrust laws of the State of Texas, Chapter 15, Texas Business and Commerce Code, or federal antitrust laws, or (2) has communicated directly or indirectly the content of Contractor’s response to University’s procurement solicitation to any competitor or any other person engaged in a similar line of business during the procurement process for this Agreement.

4.2 Contractor represents and warrants that (a) it will use commercially reasonable efforts to perform Work in a good and workmanlike manner and in accordance with commercially reasonable standards of Contractor’s profession or business, and (b) all Work performed will be of the quality that prevails among similar businesses engaged in providing similar services in major United States urban areas under the same or similar circumstances.

4.3 Contractor will call to University’s attention in writing all information in any materials supplied to Contractor (by University or any other party) that Contractor regards as unsuitable, improper or inaccurate in connection with the purposes for which the material is furnished.

4.4 University at all times is relying on Contractor's skill and knowledge in performing Work. Contractor represents and warrants that Work will be accurate and free from any material defects. Contractor's duties and obligations under this Agreement will not be in any way diminished by reason of any approval by University. Contractor will not be released from any liability by reason of any approval by University.

4.5 Contractor will, at its own cost, correct all material defects in Work as soon as practical after Contractor becomes aware of the defects. If Contractor fails to correct material defects in Work within a reasonable time, then University may correct the defective Work at Contractor’s expense. This remedy is in addition to, and not in substitution for, any other remedy for defective Work that University may have at law or in equity.

4.6 Contractor will maintain a staff of properly trained and experienced personnel to ensure satisfactory performance under this Agreement. Contractor will cause all persons connected with Contractor directly in charge of Work to be duly registered and licensed under all Applicable Laws. Contractor will assign to the Project a designated representative who will be responsible for administration and coordination of Work.

4.7 Contractor represents and warrants it is duly organized, validly existing and in good standing under the laws of the state of its organization; it 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.

4.8 Contractor represents and warrants that neither the execution and delivery of this Agreement by Contractor nor the performance of its duties and obligations under this Agreement will (a) result in the violation of any provision of its organizational documents; (b) result in the violation of any provision of any agreement by which it is bound; or (c) conflict with any order or decree of any court or other body or authority having jurisdiction.

4.9 If this Agreement requires Contractor’s presence on University's premises or in University’s facilities, Contractor agrees to cause its employees, representatives, agents, or subcontractors to become aware of, fully informed about, and in full compliance with all applicable University Rules, including those relative to personal health, security, environmental quality, safety, fire prevention, noise, smoking, and access restrictions.

5. Texas Family Code Child Support Certification.

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

6. Tax Certification.

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

7. Payment of Debt or Delinquency to the State.

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

8. Loss of Funding.

Performance by University under this Agreement may be dependent upon the appropriation and allotment of funds by the Texas State Legislature (Legislature) and/or allocation of funds by the Board of Regents of The University of Texas System (Board). If Legislature fails to appropriate or allot necessary funds, or Board fails to allocate necessary funds, then University will issue written notice to Contractor and University may terminate this Agreement without further duty or obligation. Contractor acknowledges that appropriation, allotment, and allocation of funds are beyond University’s control.

9. Notices.

Except as otherwise provided by this Section, notices, consents, approvals, demands, requests or other communications required or permitted under this Agreement, will be in writing and sent via certified mail, hand delivery, overnight courier, facsimile transmission (to the extent a facsimile number is provided below), or email (to the extent an email address is provided below) as indicated below, and notice will be deemed given (i) if delivered by certified mail, when deposited, postage prepaid, in the United States mail, or (ii) if delivered by hand, overnight courier, facsimile (to the extent a facsimile number is provided below) or email (to the extent an email address is provided below), when received:

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

10. State Auditor’s Office.

Contractor understands acceptance of funds under this Agreement constitutes acceptance of authority of the Texas State Auditor's Office or any successor agency (Auditor), to conduct an audit or investigation in connection with those funds (ref. §§51.9335(c), 73.115(c) and 74.008(c), Texas Education Code). Contractor agrees to cooperate with Auditor in the conduct of the audit or investigation, including providing Auditor any information Auditor considers relevant to the investigation or audit. Contractor will include this provision in all contracts with permitted subcontractors. This provision is included pursuant to Section 2262.154 of the Texas Government Code.

11. Venue; Governing Law.

Bexar County, Texas, will be the proper place of venue for suit on or in respect of this Agreement. This Agreement, all of its terms and conditions, all rights and obligations of the parties, and all claims arising out of or relating to this Agreement, will be construed, interpreted and applied in accordance with, governed by and enforced under, the laws of the State of Texas.

12. Breach of Contract Claims.

To the extent that Chapter 2260, Texas Government Code, is applicable to this Agreement and is not preempted by other applicable law, the dispute resolution process provided for in Chapter 2260 and the related rules adopted by the Texas Attorney General pursuant to Chapter 2260, will be used by University and Contractor to attempt to resolve any claim for breach of contract made by Contractor that cannot be resolved in the ordinary course of business. The chief business officer of University will examine Contractor's claim and any counterclaim and negotiate with Contractor in an effort to resolve the claims. The parties specifically agree (i) neither execution of this Agreement by University nor any other conduct, action or inaction of any representative of University relating to this Agreement constitutes or is intended to constitute a waiver of University’s or the state's sovereign immunity to suit; and (ii) University has not waived its right to seek redress in the courts.

13. Records.

Records of Contractor's costs, reimbursable expenses pertaining to the Work and payments will be available to University or its authorized representative during business hours and will be retained for seven (7) years after the expiration or termination of this Agreement or until all audit, claim, and litigation matters are resolved, whichever is later, unless University otherwise instructs Contractor in writing.

14. Insurance.

14.1 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-VIII or better, and in amounts not less than the following minimum limits for each coverage. The insurance requirements herein are minimum requirements for this Agreement and in no way limit Contractor’s obligations (including Contractor’s indemnity obligations) contained in this Agreement. Contractor is solely responsible for procuring insurance in addition to that set forth in this Section 14 as Contractor determines is necessary to protect the Contractor or its agents, representatives, employees, or subcontractors.

14.1.1 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 identification of the U.S. states where Contractor is to perform Work for University.

14.1.2 Commercial General Liability Insurance should be provided on an occurrence basis with limits of not less than:

Contractor’s Commercial General Liability Insurance policy must be on an ISO CG 00 01 or a substitute form providing equivalent coverage that includes bodily injury, property damage and liability assumed under an insured contract, including defense costs with respect to liability arising out of activities performed by or on behalf of Contractor.

14.1.3 Business Auto Liability Insurance must be on an ISO CA 00 01 or substitute form providing equivalent coverage that covers 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.

14.1.4 Umbrella/Excess Liability Insurance with limits of not less than $2,000,000 per occurrence and aggregate. The Umbrella/Excess Liability policy will be excess over and at least as broad as the underlying coverage as required under sections 14.1.1 Employer’s Liability; 14.1.2 Commercial General Liability; and 14.1.3 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.

14.1.8 Contractor will maintain Cyber Liability insurance with limits of not less than $10,000,000 for each cyber incident and that provides coverage for:

· Liability for network security failures or privacy breaches, including loss or unauthorized access, use or disclosure of University data, whether by Contractor or any subcontractor or cloud service provider used by Contractor.

· Costs associated with a privacy breach, including notification of affected individuals, customer support, forensics, crises management / public relations consulting, legal services of privacy counsel, credit monitoring and identity fraud resolution services for affected individuals.

· Expenses related to regulatory compliance, government investigations, fines, fees assessments and penalties.

· Liability for technological products and services.

· PCI fines, fees, penalties, and assessments.

· Cyber extortion payment and response costs.

· First and Third-Party Business Interruption Loss resulting from a network security failure or system failure.

· Affirmative GDPR coverage.

· Costs of restoring, updating, or replacing data; and

· Liability losses connected to network security, privacy, and media liability.

If the Cyber Liability policy is written on a claims-made basis, then (a) Contractor must ensure that the retroactive date for that policy is prior to the commencement of this Agreement, and (b) if non-renewed at any time during and up until the Work under this Agreement is completed, or the Agreement expires, is terminated or is cancelled, Contractor shall purchase an Extended Reporting Period for at least a two-year period.

14.2 Contractor will deliver to University:

14.2.1 After the execution and delivery of this Agreement and prior to the performance of any Work by Contractor, Contractor must provide evidence of insurance on a Texas Department of Insurance (“TDI”) approved certificate form (the Acord form is a TDI-approved form) verifying the existence 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, Contractor must provide a new certificate form verifying the continued existence of all required insurance policies. Certificates of Insurance shall reflect applicable limits, sub-limits, self-insured retentions, and deductibles provided by Contractor. The certificate of insurance must confirm the required coverages in the "Description of Operations” or “Additional Remarks” section or Contractor must provide a copy of the declarations page. In the event Contractor maintains broader coverage and/or higher limits than the minimums shown above, University requires and shall be entitled to the broader coverage and/or higher limits maintained by Contractor. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to University.

14.2.1.1 All insurance policies (except for workers’ compensation, employer’s liability, and professional liability) will be endorsed and name or list (1) University, (2) The University of Texas System, and (3) The University of Texas System Board of Regents as Additional Insureds for liability caused by Contractor’s acts or omissions with respect to its on-going and completed operations. A Blanket Additional Insured Certificate is also acceptable. Commercial General Liability and Business Auto Liability will be endorsed to provide primary and non-contributory coverage.

14.2.1.2 Contractor hereby waives all rights of subrogation against (1) University, (2) The University of Texas System, and (3) The University of Texas System Board of Regents. All insurance policies will be endorsed to provide a waiver of subrogation in favor of the entities identified in the preceding sentence. A Blanket Waiver of Subrogation Certificate is also acceptable. No policy will be canceled until after thirty (30) days' unconditional written notice to University. Contractor will send notice to University thirty (30) days in advance of any cancellation, material change, or non-renewal relating to any insurance policy required in this Section 14.

14.2.1.3 Contractor will pay any deductible or self-insured retention and be responsible for any applicable policy waiting periods for claims covered by policies Contractor is required to provide under this Agreement.

14.2.1.4 Certificates of Insurance: Additional Insured/Blanket Additional Insured, Waiver of Subrogation/Blanket Waiver of Subrogation Endorsements as required by this Agreement will be mailed, faxed, or emailed to the following University contact

The University of Texas Health Science Center at San Antonio Eric R. Walls, Sr. Director of Supply Chain Management 7703 Floyd Curl Drive, Mail Code 7962 San Antonio, TX. 78229-3900 BusContracts@uthscsa.edu 210-562-6200

14.3 Subject to Section 33, herein, Contractor’s insurance will be kept in force until all Work has been fully performed and accepted by University in writing or the Agreement expires, is terminated or is cancelled, whichever is later.

14.4 University reserves the right to approve the security of the insurance coverages provided by Contractor’s Insurers, as well as the terms, conditions, and Certificates of Insurance. Failure of Contractor to fully comply with the requirements of this Section 14 is a material breach of the Agreement and, notwithstanding any requirements for notice and opportunity to cure in Article 24 herein, is a basis for immediate termination of the Agreement by University, at University’s election.

14.5 Nothing in this Agreement shall be deemed to limit Contractor’s liability under this Agreement to the insurance coverages required by this Section 14. No limitation of liability provided to Contractor under this Agreement, if any, is intended nor shall run to the benefit of any insurance company or in any way prejudice, alter, diminish, abridge or reduce, in any respect, the amount of proceeds of insurance otherwise payable to University under the insurance coverages required to be carried by Contractor under this Agreement, it being the intent of the Parties that the full amount of insurance coverage bargained for be actually available notwithstanding any limitation of liability contained in this Agreement.

15. Indemnification.

15.1 TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAWS, CONTRACTOR WILL AND DOES HEREBY AGREE TO INDEMNIFY, PROTECT, DEFEND WITH COUNSEL APPROVED BY UNIVERSITY, AND HOLD HARMLESS UNIVERSITY, THE UNIVERSITY OF TEXAS 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 AND/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.

15.2 IN ADDITION, CONTRACTOR WILL AND DOES HEREBY AGREE TO 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 AGREES TO REASONABLY COOPERATE WITH CONTRACTOR. ALL PARTIES WILL BE ENTITLED TO BE REPRESENTED BY COUNSEL AT THEIR OWN EXPENSE.

16. Ethics Matters; No Financial Interest.

Contractor and its employees, agents, representatives and consultants have read and understand University’s Conflicts of Interest Policy available at ,http://www.uthscsa.edu/compliance, and http://www.uthscsa.edu/hop2000/10.1.12.pdf University’s Standards of Conduct Guide available at http://www.uthscsa.edu/compliance and http://www.uthscsa.edu/hop2000/10.1.2.pdf and applicable state ethics laws and rules available at https://www.utsystem.edu/offices/systemwide-compliance/ethics. Neither Services Provider nor its employees, agents, representatives or consultants will assist or cause University employees to violate University’s Conflicts of Interest Policy, provisions described by University’s Standards of Conduct Guide, or applicable state ethics laws or rules. Services Provider represents and warrants that no member of the Board of Regents of The University of Texas System, or Executive Officers, including component institutions has a direct or indirect financial interest in the transaction that is the subject of this Agreement.

17. Undocumented Workers.

The Immigration and Nationality Act (8 USC §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 CFR §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 Applicable Laws. 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 24. 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.

18. Force Majeure.

Neither party hereto will be liable or responsible to the other for any loss or damage or for any delays or failure to perform due to causes beyond its reasonable control including acts of God, strikes, epidemics, war, riots, flood, fire, sabotage, or any other circumstances of like character (force majeure occurrence). Provided, however, in the event of a force majeure occurrence, Contractor agrees to use its best efforts to mitigate the impact of the occurrence so that University may continue to provide healthcare, research and other mission critical services during the occurrence. Taxes, tariffs, or other charges imposed by a governmental entity do not constitute a force majeure occurrence.

19. Entire Agreement; Modifications.

This Agreement (including all exhibits, schedules, supplements and other attachments (collectively, Exhibits)) supersedes all prior agreements, written or oral, between Contractor and University and will constitute the entire agreement and understanding between the parties with respect to its subject matter. This Agreement and each of its provisions will be binding upon the parties, and may not be waived, modified, amended or altered, except by a writing signed by University and Contractor. All Exhibits are attached to this Agreement and incorporated for all purposes.

20. Captions.

The captions of sections and subsections in this Agreement are for convenience only and will not be considered or referred to in resolving questions of interpretation or construction.

21. Waivers.

No delay or omission in exercising any right accruing upon a default in performance of this Agreement will impair any right or be construed to be a waiver of any right. A waiver of any default under this Agreement will not be construed to be a waiver of any subsequent default under this Agreement.

22. Ownership and Use of Work Material.

22.1 All tools, software, programs, drawings, specifications, plans, computations, sketches, data, photographs, tapes, renderings, models, publications, statements, accounts, reports, studies, and other materials prepared by Contractor or any subcontractors in connection with Work (collectively, Work Material), whether or not accepted or rejected by University, are the sole property of University and for its exclusive use and re‑use at any time without further compensation and without any restrictions.

22.2 Contractor grants and assigns to University all rights and claims of whatever nature and whether now or hereafter arising in and to Work Material and will cooperate fully with University in any steps University may take to obtain or enforce patent, copyright, trademark or like protections with respect to Work Material.

22.3 Contractor will deliver all Work Material to University upon expiration or termination of this Agreement. University will have the right to use Work Material for the completion of Work or otherwise. University may, at all times, retain the originals of Work Material. Work Material will not be used by any person other than University on other projects unless expressly authorized by University in writing.

22.4 Work Material will not be used or published by Contractor or any other party unless expressly authorized by University in writing. Contractor will treat all Work Material as confidential.

23. Confidentiality and Safeguarding of University Records; Press Releases; Public Information.

Under this Agreement, Contractor may (1) create, (2) receive from or on behalf of University, or (3) have access to, records or record systems (collectively, University Records). Among other things, University Records may contain social security numbers, credit card numbers, or data protected or made confidential or sensitive by Applicable Laws. Additional mandatory confidentiality and security compliance requirements with respect to University Records subject to the Family Educational Rights and Privacy Act, 20 United States Code (USC) §1232g (FERPA). Additional mandatory confidentiality and security compliance requirements with respect to University Records subject to the Health Insurance Portability and Accountability Act and 45 Code of Federal Regulations (CFR) Part 160 and subparts A and E of Part 164 (collectively, HIPAA) will be addressed in separate executed Business Associates Agreement (BAA). Contractor represents, warrants, and agrees that it will: (1) hold University Records in strict confidence and will not use or disclose University Records except as (a) permitted or required by this Agreement, (b) required by Applicable Laws, or (c) otherwise authorized by University in writing; (2) safeguard University Records according to the security controls, including reasonable administrative, physical and technical standards (such as standards established by the National Institute of Standards and Technology and the Center for Internet Security that are proportionate to the University’s risk under the Agreement based on the sensitivity of University’s Records, and no less rigorous than the standards by which Contractor protects its own confidential information, and periodically provide to University evidence that Contractor meets the security controls required under the Agreement; (3) continually monitor its operations and take any action necessary to assure that University Records are safeguarded and the confidentiality of University Records is maintained in accordance with all Applicable Laws and the terms of this Agreement; and (4) comply with University Rules regarding access to and use of University’s computer systems, including UTS165 at https://www.utsystem.edu/sites/policy-library/policies/uts-165-information-resources-use-and-security-policy. At the request of University, Contractor agrees to provide University with a written summary of the procedures Contractor uses to safeguard and maintain the confidentiality of University Records.

23.1 Notice of Impermissible Use.

If an impermissible use or disclosure of any University Records occurs, Contractor will provide written notice to University within one (1) business day after Contractor’s discovery of that use or disclosure. Contractor will promptly provide University with all information requested by University regarding the impermissible use or disclosure.

23.2 Return of University Records.

Contractor agrees that within thirty (30) days after the expiration or termination of this Agreement, for any reason, all University Records created or received from or on behalf of University will be (1) returned to University, with no copies retained by Contractor; or (2) if return is not feasible, destroyed. Twenty (20) days before destruction of any University Records, Contractor will provide University with written notice of Contractor’s intent to destroy University Records. Within five (5) days after destruction, Contractor will confirm to University in writing the destruction of University Records.

23.3 Disclosure.

If Contractor discloses any University Records to a subcontractor or agent, Contractor will require the subcontractor or agent to comply with the same restrictions and obligations as are imposed on Contractor by this Section 23.3.

23.4 Press Releases.

Except when defined as part of Work, Contractor will not make any press releases, public statements, or advertisement referring to the Project or the engagement of Contractor as an independent contractor of University in connection with the Project, or release any information relative to the Project for publication, advertisement or any other purpose without the prior written approval of University.

23.5 Public Information.

University strictly adheres to all statutes, court decisions and the opinions of the Texas Attorney General with respect to disclosure of public information under the Texas Public Information Act (TPIA), Chapter 552, Texas Government Code. In accordance with §§552.002 and 2252.907, Texas Government Code, and at no additional charge to University, Contractor will make any information created or exchanged with University pursuant to this Agreement (and not otherwise exempt from disclosure under TPIA) available in a format reasonably requested by University that is accessible by the public.

23.6 Termination.

In addition to any other termination rights in this Agreement and any other rights at law or equity, if University reasonably determines that Contractor has breached any of the restrictions or obligations in this Section, University may immediately terminate this Agreement without notice or opportunity to cure.

23.7 Security Incident Notification Requirements. Notwithstanding any other provision of this Agreement, any terms and conditions in, incorporated into, or referenced by this Agreement (including, but not limited to, any contract language in a cybersecurity insurance contract) that prohibit or restrict the University or the State of Texas from complying with Section 2063.302 (formerly Section 2054.603) of the Texas Government Code or that otherwise circumvent the requirements of that Section 2063.302 are void and unenforceable. (Ref. House Bill 5331, 89th Regular Session of the Texas Legislature.)

23.8 Duration.

The restrictions and obligations under this Section will survive expiration or termination of this Agreement for any reason.

24. Default and Termination

24.1 In the event of a material failure by a party to this Agreement to perform in accordance with its terms (default), the other party may terminate this Agreement upon thirty (30) days’ written notice of termination setting forth the nature of the material failure; provided, that, the material failure is through no fault of the terminating party. The termination will not be effective if the material failure is fully cured prior to the end of the thirty-day (30-day) period.

24.2 University may, without cause, terminate this Agreement at any time upon giving thirty (30) days’ advance written notice to Contractor. Upon termination pursuant to this Section, Contractor will be entitled to payment of an amount that will compensate Contractor for Work satisfactorily performed from the time of the last payment date to the termination date in accordance with this Agreement; provided, that, Contractor has delivered all Work Material to University. Notwithstanding any provision in this Agreement to the contrary, University will not be required to pay or reimburse Contractor for any services performed or for expenses incurred by Contractor after the date of the termination notice, that could have been avoided or mitigated by Contractor.

24.3 Termination under Sections 24.1 or 24.2 will not relieve Contractor from liability for any default or breach under this Agreement or any other act or omission of Contractor.

24.4 If Contractor fails to cure any default within thirty (30) days after receiving written notice of the default, University will be entitled (but will not be obligated) to cure the default and will have the right to offset against all amounts due to Contractor under this Agreement any and all reasonable expenses incurred in connection with University’s curative actions.

25. Binding Effect.

This Agreement will be binding upon and inure to the benefit of the parties hereto and their respective permitted assigns and successors.

26. Severability.

In case any provision of this Agreement will, for any reason, be held invalid or unenforceable in any respect, the invalidity or unenforceability will not affect any other provision of this Agreement, and this Agreement will be construed as if the invalid or unenforceable provision had not been included.

27. Limitation of Liability.

EXCEPT FOR UNIVERSITY’S OBLIGATION (IF ANY) TO PAY CONTRACTOR CERTAIN FEES AND EXPENSES UNIVERSITY WILL HAVE NO LIABILITY TO CONTRACTOR OR TO ANYONE CLAIMING THROUGH OR UNDER CONTRACTOR BY REASON OF THE EXECUTION OR PERFORMANCE OF THIS AGREEMENT. NOTWITHSTANDING ANY DUTY OR OBLIGATION OF UNIVERSITY TO CONTRACTOR OR TO ANYONE CLAIMING THROUGH OR UNDER CONTRACTOR, NO PRESENT OR FUTURE AFFILIATED ENTERPRISE, SUBCONTRACTOR, AGENT, OFFICER, DIRECTOR, EMPLOYEE, REPRESENTATIVE, ATTORNEY OR REGENT OF UNIVERSITY, OR THE UNIVERSITY OF TEXAS SYSTEM, OR ANYONE CLAIMING UNDER UNIVERSITY HAS OR WILL HAVE ANY PERSONAL LIABILITY TO CONTRACTOR OR TO ANYONE CLAIMING THROUGH OR UNDER CONTRACTOR BY REASON OF THE EXECUTION OR PERFORMANCE OF THIS AGREEMENT.

28. Assignment and Subcontracting.

Except as specifically provided in Exhibit A, Historically Underutilized Business Subcontracting Plan, Contractor's interest in this Agreement (including Contractor’s duties and obligations under this Agreement, and the fees 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 breach of this Agreement for which Contractor will be subject to all remedial actions provided by Applicable Laws, 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.

29. Historically Underutilized Business Subcontracting Plan. Contractor will comply with and use good faith efforts to subcontract Work in accordance with the Historically Underutilized Business Subcontracting Plan (HSP) (ref. Exhibit A). Contractor will maintain records documenting its compliance with the HSP and will submit a progress assessment report (PAR) to University with each invoice, with such a report being in the format required by the Texas Comptroller of Public Accounts or successor entity (collectively, the Texas Comptroller). Submission of a PAR with each invoice will be required as a condition for payment 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 34 TAC §§20.285(h)(4), 20.585 and 20.586. University may also revoke this Agreement for breach and make a claim against Contractor.

29.1 Changes to the HSP.

If at any time during the Term, Contractor desires to change the HSP or to perform or subcontract any part of this Agreement in a manner that is not consistent with its existing HSP, then before doing so Contractor must submit an amended HSP to the University’s HUB Office/Department for its review and approval. Contractor will demonstrate good faith by complying with the requirements of 34 TAC §20.285(d) in the development of the amended HSP. If University’s HUB Office/Department approves the amended HSP, this Agreement must be amended in accordance with Section 19 to replace the existing HSP with the amended HSP. Failure by Contractor to comply with this Section 29.1 may be deemed a breach by Contractor of this Agreement subject to any remedies provided by Texas Government Code, Chapter 2161 and other Applicable Laws.

29.2 Expansion of Work.

If University expands the scope of Work through a change order or contract amendment, including a renewal that expands the scope of Work, University’s HUB Office/Department will determine if the expanded Work contains additional probable subcontracting opportunities. If University’s HUB Office/Department so determines additional probable subcontracting opportunities exist, Contractor will submit an amended HSP covering those opportunities to University’s HUB Office/Department for its review and approval. Contractor will demonstrate good faith by complying with the requirements of 34 TAC §20.285(d) in the development of the amended HSP. Such an amended HSP must be approved by the University’s HUB Office/Department and this Agreement must be amended in accordance with Section 19 to replace the existing HSP with the amended HSP before Contractor may perform the expanded scope of Work. If Contractor performs any such expanded scope of Work or subcontracts any of the additional probable subcontracting opportunities identified by University’s HUB Office/Department without prior authorization and without complying with 34 TAC §20.285, Contractor will be deemed to be in breach of this Agreement under Section 24 and will be subject to any remedial actions provided by Applicable Laws, including Chapter 2161, Texas Government Code, and 34 TAC §20.285. In addition, University may report Contractor’s noncompliance with this Section 29.2 to the Texas Comptroller in accordance with 34 TAC §§20.285(h)(4), 20.585 and 20.586.

30. Responsibility for Individuals Performing Work; Criminal Background Checks.

Each individual who is assigned to perform Work under this Agreement will be an employee of Contractor or an employee of a subcontractor engaged by Contractor. Contractor is responsible for the performance of all individuals performing Work under this Agreement. Prior to commencing Work, Contractor will (1) provide University with a list (List) of all individuals who may be assigned to perform Work, and (2) have an appropriate criminal background screening performed on all the individuals. Contractor will determine on a case-by-case basis whether each individual assigned to perform Work is qualified to provide the services. Contractor will not knowingly assign any individual to provide services on University’s campus who has a history of criminal conduct unacceptable for a university campus or healthcare center, including violent or sexual offenses. Contractor will update the List each time there is a change in the individuals assigned to perform Work.

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

31. Limitations.

THE PARTIES ARE AWARE THERE ARE CONSTITUTIONAL AND STATUTORY LIMITATIONS (LIMITATIONS) ON THE AUTHORITY OF UNIVERSITY (A STATE AGENCY) TO ENTER INTO CERTAIN TERMS AND CONDITIONS THAT MAY BE PART OF THIS AGREEMENT, INCLUDING TERMS AND CONDITIONS RELATING TO LIENS ON UNIVERSITY’S PROPERTY; DISCLAIMERS AND LIMITATIONS OF WARRANTIES; DISCLAIMERS AND LIMITATIONS OF LIABILITY FOR DAMAGES; WAIVERS, DISCLAIMERS AND LIMITATIONS OF LEGAL RIGHTS, REMEDIES, REQUIREMENTS AND PROCESSES; LIMITATIONS OF PERIODS TO BRING LEGAL ACTION; GRANTING CONTROL OF LITIGATION OR SETTLEMENT TO ANOTHER PARTY; LIABILITY FOR ACTS OR OMISSIONS OF THIRD PARTIES; PAYMENT OF ATTORNEYS’ FEES; DISPUTE RESOLUTION; INDEMNITIES; AND CONFIDENTIALITY, AND TERMS AND CONDITIONS RELATED TO LIMITATIONS WILL NOT BE BINDING ON UNIVERSITY EXCEPT TO THE EXTENT AUTHORIZED BY THE LAWS AND CONSTITUTION OF THE STATE OF TEXAS.

32. Prohibited Activities. Contractor represents, certifies, and warrants that Contractor and its employees, agents, representatives, and subcontractors (1) have not and will not violate Chapter 2261, Subchapter G of the Texas Government Code (“Subchapter G”), including engaging in any of the prohibited activities identified in Subchapter G and (2) will fully cooperate in any investigations conducted under Subchapter G. Contractor understands and agrees that violations of Subchapter G may result in enforcement actions, contract terminations (including, but not limited to, termination of this Agreement), liabilities, disqualifications, causes of action, lawsuits, damages, costs, and injunctive relief as provided by Subchapter G.

33. Survival of Provisions.

No expiration or termination of this Agreement will relieve either party of any obligations under this Agreement that by their nature survive expiration or termination.

34. Relationship of the 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 sort, including workers’ compensation insurance.

35. External Terms.

This Agreement completely supplants, replaces, and overrides all other terms and conditions or agreements, written or oral, concerning Contractor’s performance or provision of goods or services under this Agreement (External Terms). External Terms are null and void and will have no effect under this Agreement, even if University or its employees, contractors, or agents express assent or agreement to External Terms. External Terms include any shrinkwrap, clickwrap, browsewrap, web-based terms and conditions of use, and any other terms and conditions displayed in any format that University or its employees, contractors, or agents are required to accept or agree to before or in the course of accessing or using any goods or services provided by Contractor.

36. Certifications of Nonsegregated Facilities and Equal Employment Opportunities Compliance.

Contractor certifies that, except for restrooms and wash rooms and one (1) or more lactation rooms each of which is segregated on the basis of sex: (1) it does not maintain or provide for its employees any segregated facilities at any of its establishments and that it does not permit its employees to perform their services at any location under its control where segregated facilities are maintained; (2) it will not maintain or provide for its employees any segregated facilities at any of its establishments; and (3) it will not permit its employees to perform their services at any location under its control where segregated facilities are maintained. A breach of this certification is a violation of the Equal Opportunity clause. Segregated facilities means any waiting rooms, work areas, rest rooms and wash rooms, entertainment areas, and transportation or housing facilities provided for employees which are segregated by explicit directive or are in fact segregated on the basis of race, color, religion, sex, or national origin, because of habit, local custom, or otherwise.