2-Appendix Two - Agreement.docx

NON-EXCLUSIVE AGREEMENT BETWEEN UNIVERSITY AND CONTRACTOR

This Agreement between University and Contractor (Agreement) is made and entered into effective as of _________________, 20____ (Effective Date), by and between The University of Texas System, an agency and institution of higher education established under the laws of the State of Texas (University), and , a (Contractor), Federal Tax Identification Number _______________________.

University and Contractor hereby agree as follows:

1. Scope of Work.

1.1 Contractor acknowledges that this Agreement is a non-exclusive agreement. Neither University nor any Institution (defined below) is obligated to request Work (defined below) from Contractor under this Agreement. CONTRACTOR UNDERSTANDS AND AGREES THAT UNIVERSITY HAS MADE NO REPRESENTATION, ASSURANCE, WARRANTY OR GUARANTY THAT UNIVERSITY OR AN INSTITUTION WILL REQUEST CONTRACTOR TO PERFORM ANY SERVICE AND THAT UNIVERSITY HAS AND DOES SPECIFICALLY DISCLAIM ANY SUCH REPRESENTATIONS, WARRANTIES, ASSURANCES OR GUARANTIES.

1.2 Contractor will perform services within the scope of the work (Work) set forth in Exhibit A, Scope of Work, attached and incorporated for all purposes, only on request of an Institution (the Requesting Institution) and in accordance with a fully executed Project Addendum, as described in Section 2 below. The Institutions include, but are not limited to, the following: The University of Texas System, The University of Texas at Arlington, The University of Texas at Austin, The University of Texas at Dallas, The University of Texas at El Paso, The University of Texas at San Antonio, The University of Texas at Tyler, The University of Texas Health Science Center at Houston, The University of Texas MD Anderson Cancer Center, The University of Texas Medical Branch at Galveston, The University of Texas of the Permian Basin, The University of Texas Rio Grande Valley, The University of Texas Southwestern Medical Center, and Stephen F. Austin State University. Contractor will perform the Work to the satisfaction of the Requesting Institution and in accordance with the schedule (Schedule) for the Work set out in the executed Project Addendum. Time is of the essence in connection with this Agreement and each Project Addendum. Neither University nor any Requesting Institution will have any obligation to accept late performance or waive timely performance by Contractor.

1.3 Contractor will obtain, at its own cost, any and all approvals, licenses, filings, registrations and permits required by federal, state or local, laws, statutes, regulations and ordinances (collectively, Applicable Laws), for the performance of Work.

2. Project Addendum.

1.

2.

2.1 Prior to Contractor’s commencement of any Work for a Requesting Institution, the Contractor and the Requesting Institution must complete and enter into a Project Addendum using the form attached hereto as Exhibit D. Such a Project Addendum must contain a description of the Work to be performed by Contractor and a schedule for Contractor’s performance of that Work. All of terms and conditions contained in this Agreement are incorporated into each Project Addendum for all purposes. Once a Project Addendum is executed by both parties, Contractor will have the exclusive right to represent Requesting Institution with respect to the Work set forth in that Project Addendum only until that Work is complete or this Agreement or the relevant Project Addendum is otherwise terminated.

2.2 In the event of a conflict between a Project Addendum and this Agreement, this Agreement will control. Provided however a Requesting Institution and Contractor may agree to language in a Project Addendum that specify or clarify the Work to be provided or provide the Requesting Institution with more beneficial pricing and related financial terms than that set forth in this Agreement. Specifically, a Requesting Institution and Contractor may document in a Project Addendum for the Contractor’s performance of any subset of the Work identified in this Agreement, with Contractor’s pricing for that subset of the Work correspondingly reduced from the pricing set forth in this Agreement. Contractor and Requesting Institution can enter into a Project Addendum at any time during the Term. A Project Addendum will specify the term during which Contractor will provide any Work. To the extent that this Agreement expires or terminates prior to the end of a Project Addendum, such Project Addendum will survive any such termination or expiration of the Agreement and the terms and conditions of this Agreement will continue to be incorporated for all purposes into the Project Addendum. Contractor understands and agrees that it will not receive any payment or other compensation under this Agreement unless it enters into a Project Addendum and provides Services in accordance with the terms and conditions of that Project Addendum and this Agreement.

2.3 To enable an Institution to make a determination whether to proceed with engaging Contractor to perform Work under a particular Project Addendum, Contractor, at the request of that Institution and at a mutually convenient time and place, may be requested to make an oral presentation of no more than two (2) hours to that Institution’s personnel. The purpose of the presentation will be to summarize Contractor’s proposal for and approach to the specific Work that the Institution is considering engaging Contractor to perform under a Project Addendum.

3. Time for Commencement and Completion.

The term (Initial Term) of this Agreement will begin on the Effective Date and expire on ______________________, 20___. University will have the option to renew this Agreement for one (1) additional one (1) year term (Renewal Term). The Initial Term and each Renewal Term are collectively referred to as the Term.

The University or Requesting Institution and Contractor may enter into Project Addenda as set forth in Section 2 of this Agreement at any time during the Term. Each Project Addenda will specify the period of time that Project Addenda will be in effect (a Project Addenda Term). Except as otherwise specified in a specific Project Addenda, each Project Addenda will survive any expiration or termination of this Agreement to the extent that its Project Addenda Term extends past the date of such expiration or termination. All of the terms and conditions of this Agreement will continue to be incorporated into and applicable to such a surviving Project Addenda until the expiration or termination of that Project Addenda. Provided, however, the University or Requesting Institution and Contractor cannot enter into a Project Addenda with a Project Addenda Term that extends more than one (1) year past expiration of Agreement.

4. Contractor's Obligations.

4.1 Prior to Contractor’s commencement of any work, the Contractor will notify the following person at University’s Office of Risk Management (ORM):

Phone Number: (512) 499-4401 Email Address: syoungdale@utsystem.edu

Upon receipt of authorization to proceed from ORM, Contractor and the Requesting Institution must complete and enter into a Project Addendum, which shall contain a description of the Project, and a schedule for performance of all work to be provided for the Project.

Contractor represents, warrants and agrees that the Work to be performed by Contractor pursuant to any Addendum will be of the highest standard and quality as an “expert” under the Daubert standards, and shall be tailored to the laws and procedures applicable to the State of Texas which govern institutions of higher education.

In addition, ORM will identify those instances when the fact investigation or factual reports of Contractor shall be performed under the express direction of The University of Texas System Office of General Counsel (OGC) in order to preserve the attorney-client and attorney work product privileges.

4.2 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 and each Requesting Institution (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.

4.5 University and the Requesting Institutions are at all times 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 or any Requesting Institution. Contractor will not be released from any liability by reason of any approval by University or any Requesting Institution.

4.6 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 or any Requesting Institution 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 or any Requesting Institution may have at law or in equity.

4.7 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. Contractor will furnish efficient business administration and coordination and perform Work in an expeditious and economical manner consistent with the interests of University and the Requesting Institutions.

4.8 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.

4.9 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.

4.10 Contractor represents and warrants that all of Contractor’s Personnel contributing to Work Material (ref. Section 7) under this Agreement will be required to (i) acknowledge in writing the ownership of Contractor (for the benefit of University and the Requesting Institutions) of Work Material produced by Personnel while performing Work pursuant to this Agreement, and (ii) make all assignments necessary to effectuate such ownership. Personnel means any and all persons associated with Contractor who provide any work or work product pursuant to this Agreement, including officers, managers, supervisors, full-time employees, part-time employees, and independent contractors.

4.11 Contractor represents and warrants that: (i) Work will be performed solely by Contractor, its full-time or part-time employees during the course of their employment, or independent contractors who have assigned in writing all right, title and interest in their work to Contractor (for the benefit of Requesting Institution); (ii) Requesting Institution will receive free, good and clear title to all Work Material developed under this Agreement; (iii) Work Material and the intellectual property rights protecting Work Material are free and clear of all encumbrances, including security interests, licenses, liens, charges and other restrictions; (iv) Work Material will not infringe upon or violate any patent, copyright, trade secret, trademark, service mark or other property right of any former employer, independent contractor, client or other third party; and (v) the use, reproduction, distribution, or modification of Work Material will not violate the rights of any third parties in Work Material, including trade secret, publicity, privacy, copyright, trademark, service mark and patent rights.

4.12 If this Agreement requires Contractor’s presence on University’s or a Requesting Institution's premises or in University’s or a Requesting Institution’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.

4.13 Within ten (10) days after execution of a Project Addendum with a Requesting Institution, Contractor will provide a copy of the Project Addendum to The University of Texas System Office of Risk Management.

5. The Contract Amount.

5.1 So long as Contractor has provided a Requesting Institution with its current and accurate Federal Tax Identification Number in writing and is in good standing with the State of Texas, a Requesting Institution will pay Contractor for the performance of Work in accordance with Exhibit C, Payment for Work, attached and incorporated for all purposes and the Project Addendum entered into between Contractor and that Requesting Institution.

5.2 The Contract Amount includes all applicable federal, state or local sales or use taxes payable as a result of the execution or performance of this Agreement or any Project Addendum.

5.3 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.

5.4 The total cumulative amount paid to Contractor under this Agreement and all Project Addenda will not exceed $2,000,000 until approved by the Board of Regents of The University of Texas System.

6. Payment Terms.

6.1 At least ten (10) days before the end of each month during the Term, Contractor will submit to each Requesting Institution an invoice covering Work performed for that Requesting Institution to that date, in compliance with Exhibit C, Payment for Work, and the Project Addendum entered into between Contractor and that Requesting Institution. Each invoice will be accompanied by documentation that the Requesting Institution may reasonably request to support the invoice amount. A Requesting Institution will, within twenty-one (21) days from the date it receives an invoice and supporting documentation, approve or disapprove the amount reflected in the invoice. If Requesting Institution approves the amount or any portion of the amount of an invoice submitted by Contractor, that Requesting Institution will promptly pay (each a Progress Payment) to Contractor the amount approved so long as Contractor is not in default under this Agreement. If a Requesting Institution disapproves any invoice amount, that Requesting Institution will give Contractor specific reasons for its disapproval in writing.

6.2 Within ten (10) days after final completion and acceptance by a Requesting Institution of the Work performed by Contractor under the Project Addendum entered into between Contractor and that Requesting Institution or as soon thereafter as possible, Contractor will submit a final invoice to that Requesting Institution (Final Invoice) setting forth all amounts due and remaining unpaid to Contractor under that Project Addendum. Upon approval of a Final Invoice by a Requesting Institution, that Requesting Institution will pay (Final Payment) to Contractor the amount due under the Final Invoice.

6.3 Notwithstanding any provision of this Agreement to the contrary, neither University nor any Requesting Institution will be obligated to make any payment (whether a Progress Payment or Final Payment) to Contractor if Contractor is in default under this Agreement.

6.4 The cumulative amount of all Progress Payments and Final Payments made under all Project Addenda entered into under this Agreement will not exceed the Contract Amount in Exhibit C, Payment for Work.

6.7 University and the Requesting Institutions will have the right to verify the details 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 this Agreement and the Project Addenda; and (c) other reasonable action.

6.8 Section 51.012, Texas Education Code, authorizes University and the Requesting Institutions to make payments through electronic funds transfer methods. Contractor agrees to accept payments from University and the Requesting Institutions through those methods, including the automated clearing house system (ACH). Contractor agrees to provide Contractor’s banking information to University and each Requesting Institution in writing on Contractor letterhead signed by an authorized representative of Contractor. Prior to the first payment made by University or a Requesting Institution, University and that Requesting Institution will confirm Contractor’s banking information. Changes to Contractor’s bank information must be communicated to University and the Requesting Institutions in accordance with Section 12.14 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.

6.9 Included only if University is entitled to a 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.

6.10 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 12.29).

7. Ownership and Use of Work Material.

7.1 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 for a Requesting Institution in connection with Work (collectively, Work Material), whether or not accepted or rejected by that Requesting Institution, are the sole property of that Requesting Institution and for its exclusive use and re‑use at any time without further compensation and without any restrictions.

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

7.3 Contractor will deliver all Work Material to a Requesting Institution upon expiration or termination of this Agreement or of the Project Addendum between Contractor and that Requesting Institution. A Requesting Institution will have the right to use Work Material for the completion of Work or otherwise. A Requesting Institution may, at all times, retain the originals of Work Material. Work Material prepared for a Requesting Institution will not be used by any person other than that Requesting Institution on other projects unless expressly authorized by that Requesting Institution in writing.

7.4 Work Material will not be used or published by Contractor or any other party unless expressly authorized by the applicable Requesting Institution in writing. Contractor will treat all Work Material as confidential.

7.5 All title and interest in Work Material prepared for a Requesting Institution will vest in that Requesting Institution and will be deemed to be work made for hire and made in the course of Work rendered under this Agreement and the applicable Project Addendum. To the extent that title to any Work Material prepared for a Requesting Institution may not, by operation of law, vest in a Requesting Institution or such Work Material may not be considered works made for hire, Contractor irrevocably assigns, conveys and transfers to that Requesting Institution and its successors, licensees and assigns, all rights, title and interest worldwide in and to Work Material and all proprietary rights therein, including all copyrights, trademarks, service marks, patents, trade secrets, moral rights, all contract and licensing rights and all claims and causes of action with respect to any of the foregoing, whether now known or hereafter to become known. In the event Contractor has any rights in Work Material prepared for a Requesting Institution which cannot be assigned, Contractor agrees to waive enforcement worldwide of the rights against that Requesting Institution, its successors, licensees, assigns, distributors and customers or, if necessary, to exclusively license the rights, worldwide to that Requesting Institution with the right to sublicense. These rights are assignable by Requesting Institution

8. Default and Termination. The following termination provisions shall apply regardless of any conflicting terms and conditions in this Agreement or any Project Addendum.

8.1 In the event Contractor breaches the terms and conditions of a Project Addendum (including any Contractor breach of the terms and conditions of this Agreement as incorporated into that Project Addendum), the Requesting Institution under that Project Addendum may terminate that Project Addendum (a “Contractor-Breached Project Addendum”) upon thirty (30) days’ written notice to Contractor. However, a Contractor-Breached Project Addendum shall not terminate at the end of the thirty-day notice period in the event that Contractor completely cures its breach of that Project Addendum before the end of that thirty-day period. The termination of a Contractor-Breached Project Addendum by a Requesting Institution under this Section 8.1 shall not terminate or otherwise affect any other Project Addenda entered into with Contractor under this Agreement by the terminating Requesting Institution or by any of the other Requesting Institutions.

8.1.1 Contractor’s failure to maintain staff identified to University or a Requesting Institution for the performance of or completion of Work or to provide reasonable substitute or replacement staff, in the reasonable discretion of University or a Requesting Institution, may be deemed a material failure by Contractor.

8.2 In the event a Requesting Institution breaches the terms and conditions of a Project Addendum (including the Requesting Institution’s breach of the terms and conditions of the Agreement as incorporated into that Project Addendum), Contractor may terminate that Project Addendum (a “Requesting Institution-Breached Project Addendum”) upon thirty (30) days’ written notice to that Requesting Institution. However, a Requesting Institution-Breached Project Addendum shall not terminate at the end of the thirty-day notice period in the event that the Requesting Institution completely cures its breach of that Project Addendum before the end of that thirty-day period. The termination of a Requesting Institution-Breached Project Addendum by Contractor under this Section 8.2 shall not terminate or otherwise affect any other Project Addenda entered into with Contractor under the Agreement by the breaching Requesting Institution or by any of the other Requesting Institutions.

8.3. University may, without cause, terminate this Agreement or any and all executed Project Addenda at any time upon giving seven (7) days’ advance written notice to Contractor. Furthermore, a Requesting Institution may terminate a Project Addendum to which it is a party at any time by giving fifteen (15)-days’ notice to Contractor. Upon termination of a Project Addendum pursuant to this Section 8.3, Contractor will be entitled to payment by the Requesting Institution that is a party to that Project Addendum for the Work performed by Contractor under that Project Addendum prior to such termination, so long as such Work conforms to the terms and conditions of that Project Addendum and the Agreement and Contractor has delivered all Work Material under that Project Addendum to the Requesting Institution. However, in no event will a Requesting Institution be obligated to pay Contractor any amounts for anticipatory profits associated with the terminated Project Addendum, any services that are not rendered by Contractor, any ordered products, goods, or materials that are not delivered by Contractor, or any costs that could reasonably have been avoided by Contractor once it receives notice of the terminated Project Addendum. The termination of a single Project Addendum without cause by University or a Requesting Institution under this Section 8.3 shall not terminate or otherwise affect any other Project Addenda entered into with Contractor under this Agreement by that Requesting Institution or by any of the other Requesting Institutions.

8.4 Within thirty (30) days after the termination of a Project Addendum, Contractor will reimburse the Requesting Institution under that Project Addendum for all fees paid by or to Contractor under that Project Addendum that were (a) not earned by Contractor prior to termination, or (b) for Work that the Requesting institution did not receive from Contractor prior to termination.

8.5 Termination under Sections 8.1, 8.3, or 8.4 will not relieve Contractor from liability for any default or breach under this Agreement or any other act or omission of Contractor.

8.6 If Contractor fails to cure any default within fifteen (15) days after receiving written notice of the default, University or the applicable Requesting Institution 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 or the applicable Requesting Institution’s curative actions.

8.7 In the event that this Agreement is terminated, then within thirty (30) days after termination, Contractor will reimburse each Requesting Institution for all fees paid by the Requesting Institution to Contractor that were (a) not earned by Contractor prior to termination, or (b) for goods or services that the Requesting Institution did not receive from Contractor prior to termination.

9. Indemnification.

9.1 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 THE UNIVERSITY OF TEXAS SYSTEM, THE REQUESTING INSTITUTIONS, 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.

9.2 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 AND THE REQUESTING INSTITUTIONS AGREE TO REASONABLY COOPERATE WITH CONTRACTOR. ALL PARTIES WILL BE ENTITLED TO BE REPRESENTED BY COUNSEL AT THEIR OWN EXPENSE.

10. 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 or Requesting Institution. Contractor will not bind nor attempt to bind University or any Requesting Institution 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.

11. Insurance.

11.1 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 11 as Contractor determines is necessary to protect the Contractor or its agents, representatives, employees, or subcontractors.

11.1.1 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.

11.1.2 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.

11.1.3 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.

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.

11.1.4 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 11.1.1 Employer’s Liability; 11.1.2 Commercial General Liability; and 11.1.3 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.

11.1.5 Professional Liability (Errors & Omissions) Insurance with limits of not less than $1,000,000 each claim, $3,000,000 aggregate. Such insurance will cover all Work performed by or on behalf of Contractor under this Agreement. Contractor warrants that any retroactive date under that policy shall precede the Effective Date of this Agreement; and that Contractor will either maintain continuous coverage under such a policy or Contractor will procure and maintain an extended reporting period under the policy that can be exercised for a period of two (2) years starting on the later of the time Work under this Agreement is completed, or the time the policy expires or is cancelled. 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.

11.1.6 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.

11.2 Contractor will deliver to University:

11.2.1 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.

11.2.1.1 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.

11.2.1.2 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 11.

Name:

Address:

Facsimile Number:

Email Address:

11.3 Subject to Section 12.18, 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.

11.4 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 11 is a material breach of the Agreement and, notwithstanding any requirements for notice and opportunity to cure in Article 8 herein, is a basis for immediate termination of the Agreement by University, at University’s election.

11.5 Nothing in this Agreement shall be deemed to limit Contractor’s liability under this Agreement to the insurance coverages required by this Section 11. 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.

12. Miscellaneous.

12.1 Assignment and Subcontracting. Except as specifically provided in Exhibit F, Historically Underutilized Business Subcontracting Plan, Contractor's interest in this Agreement and all Project Addenda (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.

12.2 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 the Project Addenda, and acknowledges this Agreement and all Project Addenda may be terminated and payment withheld if this certification is inaccurate.

12.3 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.

12.4 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 or under any Project Addendum 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.

12.5 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.

Performance by University and the Requesting Institutions under the Project Addenda that are entered into with Contractor under this Agreement may be dependent upon the appropriation and allotment of funds by the Legislature) and/or allocation of funds by the Board. If the Legislature fails to appropriate or allot the necessary funds for a Project Addendum, or if the Board fails to allocate the necessary funds for a Project Addendum (a “Non-Funded Project Addendum”) then University or the Requesting Institution that is a party to that Non-Funded Project Addendum shall issue written notice to Contractor and University or the Requesting Institution may terminate their further participation under the Non-Funded Project Addendum without further duty or obligation under that Project Addendum. Provided, however, that such termination of a Non-Funded Project Addendum shall not terminate or otherwise affect any other Project Addendum entered into under this Agreement. Contractor acknowledges that appropriation, allotment, and allocation of funds are beyond the control of University and the Requesting Institutions.

12.6 Entire Agreement; Modifications. This Agreement (including the Project Addenda and 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, the Project Addenda, and all of their 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 into this Agreement and all Project Addenda for all purposes.

12.7 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 and the Requesting Institutions 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.

12.8 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.

12.9 Venue; Governing Law. Travis County, Texas, will be the proper place of venue for suit on or in respect of this Agreement and all Project Addenda. This Agreement the Project Addenda, and all of their terms and conditions, all rights and obligations of the parties, and all claims arising out of or relating to this Agreement or the Project Addenda, will be construed, interpreted and applied in accordance with, governed by, and enforced under the laws of the State of Texas.

12.10 Waivers.

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

12.11 Confidentiality and Safeguarding of University Records; Press Releases; Public Information. Under this Agreement and the Project Addenda Contractor may (1) create, (2) receive from or on behalf of University, or (3) have access to, records or record systems (collectively, University Records). However, it is expressly agreed that University will not provide to Contractor, and Contractor will never seek to access, any University Records that contain personally identifiable information regarding any individual that is not available to any requestor under the Texas Public Information Act, Chapter 552, Texas Government Code, including “directory information” of any student who has opted to prohibit the release of their “directory information” as that term is defined under the Family Educational Rights and Privacy Act, 20 USC §1232g (FERPA) and its implementing regulations. Additional mandatory confidentiality and security compliance requirements with respect to University Records subject to the Health Insurance Portability and Accountability Act and 45 CFR Part 160 and subparts A and E of Part 164 (collectively HIPAA) are addressed in Section 12.28.