CTR073894_Contract_Documents.pdf

Docusign Envelope ID: 6DEA6F44-77CE-4177-8441-F33867AA3BB0

CTR073894

8/27/2025

August27 25

Rev. 05/2023

STATE OF ARIZONA

ARIZONA DEPARTMENT OF TRANSPORTATION

1655 W. Jackson St., MD 100P Phoenix, AZ 85007

CONTRACT

CONTRACT NUMBER: CTR073894

DESCRIPTION: CoStar Subscription

Matthew Martinez Procurement Officer Phone: 602-712-4398 Email: mmartinez12@azdot.gov

This contract is established in accordance with A.R.S. §41-2537 and A.A.C. R2-7-E303, Competition Impracticable Procurements.

“An Equal Opportunity Agency”

The Arizona Department of Transportation, in accordance with the provisions of Title VI of the Civil Rights Act of 1964 (78 Stat. 252.42 U.S.C. §§ 2000d-4) and the Americans with Disabilities Act (ADA), hereby notifies all bidders that it will affirmatively ensure that any contract entered into pursuant to this advertisement, disadvantaged business enterprises will be afforded full and fair opportunity to submit bids in response to this invitation and will not be discriminated against on the grounds of race, color, national origin in consideration for an award.

Persons that require a reasonable accommodation based on language or disability should contact ADOT’s Procurement Office by phone (602) 712-2089. Requests should be made as early as possible to ensure the State has an opportunity to address the accommodation.

Las personas que requieran asistencia (dentro de lo razonable) ya sea por el idioma o discapacidad deben ponerse en contacto con ADOT (602) 712-2089.

mailto:SAlberts@azdot.gov

TABLE OF CONTENTS

CONTRACT NO: CTR073894 Available online at https://app.az.gov/

SECTION PAGE

Cover Page 1

Table of Contents 2

Specifications 3

Special Terms and Conditions 7

Uniform Terms and Conditions 18

CoStar License Agreement Terms and Conditions 34

Exhibits

1 - Title VI/Non-Discrimination Assurances Appendix A 46

2 - Title VI/Non-Discrimination Assurances Appendix E 47

SPECIFICATIONS

1. Statement of Need

1.1. Pursuant to the Arizona Procurement Code, A.R.S. §41-2501 et seq., the State of Arizona Department of Transportation, has a requirement for online real estate data providing real-time commercial real estate information regarding property and market values for existing and new development of all land and building types statewide, current availability, market data comparisons of sales and listings statewide, along with other relevant real estate data.

2. Introduction and Background

2.1. Real-time real estate data needed to complete appraisals, relocation benefit determinations, prepare for excess land sales and listings, and create customizable reports for review.

2.1.1 This service is used frequently, often daily, by Right of Way Appraisers and Right of Way Agents for current availability, market data comparisons of sales and listings statewide, along with other relevant real estate data.

2.1.2 This service is annually renewable with Co-Star

3. General Requirements

3.1. Co-Star shall provide data for the following property types, but not limited to:

Laboratory / R&D Retail and Community Shopping Centers

Gas Station / Convenience Store Apartment Property & Condo Conversion

Industrial Distribution, Flex & Office Warehouse

Commercial Restaurants

Bank Branch Residential and Commercial Condominiums

Residential Subdivision Analysis Veterinary Hospital / Kennel

Congregate Care / Senior Housing Automotive Service / Dealership

Day Care Facility Hospitality: Hotel / Motel / Resort Campus

Mini Storage & RV/Boat Storage RV / Mobile Home Park

Funeral Home Car Wash: Full and Self-Serve

Special Use (USA/BIA/Forest Service) Office and Medical Buildings

Bed & Breakfast Outdoor Advertising Signage

Vacant Land/Acreage, Mixed Use, Ranch Use

Net-Lease/Leased Fee and Leasehold Interests

Religious and School Facilities

3.1.1 Real-time commercial real estate information regarding property and market values for existing and new development of all land and building types statewide, current availability, market data comparisons of sales and listings statewide, along with other relevant real estate data including all of Arizona and nationwide coverage (for comparable research).

4. Specific Requirements

4.1. Online access to current, up to date data to be provided by Contractor. Data will be accessed by

ADOT via the Internet. This service is not specific to an individual project and will be used for any/all projects, excess land disposals, land donations, relocation benefits determinations, and ad hoc reporting.

Feature Attribute Benefit Analytics Markets& Submarkets

Timely data and insightful narrative on all the key metrics for 16,000 markets and submarkets.

Save time preparing for presentations and demonstrate market knowledge to clients and prospects to gain an edge against the competition.

Sale Comps Search our database of 4.2M sales comps and set alerts to be notified when a property sells or goes under contract.

Contact tenants in properties that have recently sold to discuss opportunities to renegotiate their lease or search for new space.

Lease Comps Search database of 9.3M lease transactions, enter private lease comps which you can share with other users.

Demonstrate knowledge of lease comparables and the market to clients.

Tenant (Locations)

Quickly search over 7M records based on space (e.g., location, space use, size, expiration), tenant (e.g., name, industry, territory, revenue), building attributes (e.g., star rating, property type and size) and contacts (e.g. tenant rep, landlord). Also search for tenants with potential real

Find tenant locations that meet criteria for targeted prospecting.Find tenants that have a high probability of needing to find new space or negotiate a renewal. Save considerable time with pre-vetted prospected to contact to win their business. Express your knowledge of tenants in the market to estate needs using new Tenant Insights filter. View results in Map, List or Gallery views.

prospective and existing clients.

Tenant (Companies)

Search by tenant name to see a company’s portfolio of leased space.

Quickly search over 5M records by various criteria. View information on number of locations, size occupied, employees, credit rating, industry, annual revenue, etc.

Better prepare for a pitch by researching all a tenant’s locations or leases. Find companies that meet users’ criteria.

Feature Attribute Benefit CMBS Loan Data Search CMBS loan information on

130K properties, including loan maturities, loan-to-value, loan performance, and building income statements.

Find properties where a tenant could have more leverage in a lease negotiation. Use loan information to prospect for tenants and assist with lease negotiations.

Expanded Geography

Expanded geographic access for Property, Comps, Tenant, and Market Analytics.

An expanded geography allows you to leverage all the benefits of CoStar Suite modules to better serve and meet the demands of the tenants you represent to win more business across all markets.

Work with existing clients in new markets.

Protect against losing existing clients to national firms.

Grow assignments outside your local market.

Locate local brokers outside your market to co-broker your deals with.

Connect out-of-town brokers with assignments in your market so you can be their local co-broker.

Prospect for clients expanding into your market (or whose decision makers are outside of your market).

Underwriting Reports

Comprehensive push button reports with all the data you need to about a property.

Reduce the time it takes to assess a potential deal.

Public Record Search

Search over 38M commercial parcels based on criteria such as land size, zoning, and use.

Identify off-market land for potential development sites.

5. Contractor’s Responsibilities

5.1. The Contractor shall be required to provide annual CoStar subscriptions as specified within. These activities shall be coordinated and managed by the Arizona Department of Transportation Right of Way group. The Contractor shall provide in an online format accessible via the Internet, accurate real-time data regarding real estate information regarding property and market values for existing and new development of all land and building types statewide, current availability, market data comparisons of sales and listings statewide, along with other relevant real estate data including all of Arizona and nationwide coverage (for comparable research).

6. Department’s Responsibilities

6.1. The Department will pay the Contractor’s invoice for the service provided.

SPECIAL TERMS AND CONDITIONS

1. CONTRACT TERM

The term of any resultant contract shall commence on the effective date of award and shall continue for a period of twelve (12) months thereafter, unless terminated, cancelled or extended as otherwise provided herein.

2. CONTRACT EXTENSION

By mutual written contract amendment, any resultant contract may be extended for supplemental periods of up to a maximum of forty-eight (48) months.

3. ELIGIBLE AGENCIES

This contract shall be for the exclusive use of the Arizona Department of Transportation.

4. NON-EXCLUSIVE CONTRACT

This contract shall be for the sole convenience of the Department. The Department reserves the right to obtain like goods or services from another source when necessary. The Off- Contract Purchase Authorization and subsequent procurement shall be consistent with the Arizona Procurement Code.

5. ORDERING PROCESS

The Department shall issue a purchase order to the Contractor. Each purchase order must cite the contract number. This purchase order shall be the only document required for the Department to order and the Contractor to deliver the material and/or service.

Any attempts to represent any material and/or service not specifically awarded as being under contract is a breach of the contract and a violation of the Arizona Procurement Code.

Any such action is subject to the legal and contractual remedies available to the State inclusive of but not limited to contract cancellation, suspension and/or debarment of the Contractor.

Any attempts to represent any material and/ or service not specifically awarded as being under contract is a breach of the contract and violation of the Arizona Procurement Code.

Any such action is subject to the legal and contractual remedies available to the State Inclusive of but not limited to contract cancellation, suspension and/ or debarment of the Contractor.

6. SHIPPING TERMS- N/A

7. DELIVERY- N/A

8. INSPECTION AND ACCEPTANCE- N/A

9. INVOICING REQUIREMENTS

Separate invoices are required for each delivery of service and shall include at a minimum:

• Department Location’s Name and Address

• Vendor Name, Remit to Address and Contact Information

• Contract Number

• Purchase Order Number

• Invoice Number and Date

• Date the items were shipped to the Department

• Contract Line Item Number

• Line Item Description or Item or Service

• Quantity Purchased

• Line Item Unit of Measure

• Price per Unit and Total per Unit

• Catalog or Other Discount (if applicable)

• Net Unit Price and Total per Unit (if applicable)

• Applicable taxes

• Applicable Shipping/Freight Charges

• Total Invoice Amount Due

Invoices not sent to the proper address, or not containing the necessary and required information may delay payment. A Contractor whose payments are delayed due to improper invoicing shall make no claim against the Department or the State for late or finance charges.

The Department will make every effort to process payment within thirty (30) calendar days after acceptance of services. Delivery of the service to the Department does not constitute acceptance.

The date the Department accepts delivery of services shall be the valid date for starting the thirty (30) calendar day payment period.

Payment due dates, including discount periods, will be computed from the date of acceptance or date of correct invoice (whichever is later) to the date the Department’s warrant is mailed.

10. ESTIMATED USAGE

The Department anticipates considerable usage under this contract. The Department reserves the right to increase or decrease actual quantities ordered as circumstances may require. No guarantees are made concerning actual purchases under this contract.

11. PRICE REDUCTION

A price reduction adjustment may be offered at any time during the term of the contract and shall become effective upon notice through a written contract amendment.

12. PRICE INCREASE

The Department will review fully documented requests for price increases for any contract which will or has been in effect for twelve (12) months. The request shall be submitted no less than 60 days prior to the contract renewal date. The Contractor shall provide fully documented information which supports the price increase request. Fully documented means that the request shall present detailed information and calculations that make it clear how the claimed increase has an impact on the contract unit prices. All assumptions regarding cost factors that have an impact on the requested increase shall also be clearly identified and justified. The requested price increase must be based upon a cost increase that was clearly unpredictable at the time of the offer and can be shown to directly affect the price of the item concerned. Any price increase adjustment request prior to the time of contract extension will be a factor in the extension review process. The Department will determine whether the requested price increase or an alternate option, is in the best interest of the State.

13. SAFETY STANDARDS- N/A

14. CURENT PRODUCTS- N/A

15. PRODUCT DISCONTINUANCE – N/A

16. CONTRACT ADMINISTRATION

The contractor shall contact the Procurement Officer for guidance or direction in matters of contract interpretation or questions regarding the terms, conditions or scope of the contract.

17. NOTICES

All notices, requests, demands, consents, approvals, and other communications which may or are required to be served or given hereunder (for the purposes of this provisions collectively called “Notices”), shall be in writing and shall be sent by certified United States mail, return receipt requested, or by any other method that provides evidence of receipt, addressed to the party or parties to receive such notice as follows:

Arizona Department of Transportation, Procurement Group 1739 W. Jackson Street, MD 100P

Phoenix, Arizona 85007-3276

Or to such other address as either party may from time to time furnish in writing to the other by notice hereunder. Any notice so mailed shall be deemed to have been given as of the date such notice is received as shown on the return receipt. Furthermore, such notice may be given by delivering personally such notice, if intended for the State, to the Arizona Department of Transportation, Procurement Officer and, if intended for the Contractor, to the person named on the Offer & Contract Award of this contract, or to such other person as either party may from time to time furnish in writing to the other by notice hereunder.

Any notice so delivered shall be deemed to have been given as of the date such notice is personally delivered to the other party.

18. CANCELLATION FOR POSSESSION OF WEAPONS ON ADOT PROPERTY

The Contractor or any subcontractors are prohibited from having weapons in their possession or on their person within the building. Weapons shall be stored securely, consistent with A.R.S.

§ 13-3118, in the Contractor’s or any subcontractor’s vehicle if there are no storage amenities available at the ADOT facility. This contract may be cancelled if Contractor or any subcontractors or others in the employ or under the supervision of the Contractor or subcontractors is found to be in possession of weapons.

Possession of weapons (firearms, explosive device, knife or blade of more than three inches, or any other instrument designed for lethal or disabling use) is prohibited on ADOT property except in the manner stated above.

Further, if the Contractor or any subcontractors or others in the employ or under the supervision of the Contractors or subcontractors are asked by an ADOT official to leave the ADOT property, they are advised that failure to comply with such a request shall result in cancellation of the contract and anyone who refuses, whether armed or not, is subject to prosecution under A.R.S. § 13-1502, "Criminal trespass in the third degree; classification."

19. INDEMNIFICATION CLAUSE

To the fullest extent permitted by law, Contractor shall defend, indemnify, and hold harmless the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees (hereinafter referred to as “Indemnitee”) from and against any and all claims, actions, liabilities, damages, losses, or expenses (including death), or loss or damage to tangible or intangible property caused, or alleged to be caused, in whole or in part, by the negligent or willful acts or omissions of Contactor or any of its owners, officers, directors, agents, employees or subcontractors. This Indemnity includes any claim or amount arising out of, or recovered under, the Workers’ Compensation Law or arising out of the failure of such Contactor to conform to any federal, state, or local law, statute, ordinance, rule, regulation, or court decree. It is the specific intention of the parties that the Indemnitee shall, in all instances, except for Claims arising solely from the negligent or willful acts or omissions of the Indemnitee, be indemnified by Contractor from and against any and all claims. It is agreed that Contactor will be responsible for primary loss investigation, defense, and judgement costs where this indemnification is applicable. In consideration of the award of this contract, the Contactor agrees to waive all rights of subrogation against the State of Arizona, its officers, officials, agents, and employees for losses arising from the work performed by the Contactor for the State of Arizona. This indemnity shall not apply if the contactor or sub-contactor(s) is/are an agency, board, commission or university of the State of Arizona.

20. INSURANCE

The Contractor shall furnish Certificate(s) of Insurance inclusive of the following requirements to the Department. Certificate(s) shall be received within 5 calendar days of notification of contract award by the Procurement Officer.

a. Insurance Requirements

i. Contractor and subcontractors shall procure and maintain, until all of their obligations have been discharged, including any warranty periods under this Contract, insurance against claims for injury to persons or damage to property arising from, or in connection with, the performance of the work hereunder by the Contractor, its agents, representatives, employees or subcontractors.

ii. The Insurance Requirements herein are minimum requirements for this

Contract and in no way limit the indemnity covenants contained in this Contract.

The State of Arizona in no way warrants that the minimum limits contained herein are sufficient to protect the Contractor from liabilities that arise out of the performance of the work under this Contract by the Contractor, its agents, representatives, employees or subcontractors, and the Contractor is free to purchase additional insurance.

b. Minimum Scope and Limits of Insurance

i. Commercial General Liability (CGL) – Occurrence Form

Policy shall include bodily injury, property damage, and broad form contractual liability coverage.

• General Aggregate $2,000,000

• Products – Completed Operations Aggregate $1,000,000

• Personal and Advertising Injury $1,000,000

• Damage to Rented Premises $50,000

• Each Occurrence $1,000,000

a. The policy shall be endorsed, as required by this written agreement, to include the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees as additional insureds with respect to liability arising out of the activities performed by or on behalf of the Contractor.

b. Policy shall contain a waiver of subrogation endorsement, as required by this written agreement, in favor of the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees for losses arising from work performed by or on behalf of the Contractor.

ii. Business Automobile Liability

Bodily Injury and Property Damage for any owned, hired, and/or non- owned automobiles used in the performance of this Contract.

• Combined Single Limit (CSL) $1,000,000

a. Policy shall be endorsed, as required by this written agreement, to include the

State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees as additional insureds with respect to liability arising out of the activities performed by, or on behalf of, the Contractor involving automobiles owned, hired and/or non-owned by the Contractor.

b. Policy shall contain a waiver of subrogation endorsement as required by this written agreement in favor of the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees for losses arising from work performed by or on behalf of the Contractor.

iii. Workers’ Compensation and Employers' Liability

• Workers' Compensation Statutory

• Employers' Liability o Each Accident $1,000,000 o Disease – Each Employee $1,000,000 o Disease – Policy Limit $1,000,000

a. Policy shall contain a waiver of subrogation endorsement, as required by this written agreement, in favor of the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees for losses arising from work performed by or on behalf of the Contractor.

b. This requirement shall not apply to each Contractor or subcontractor that is exempt under A.R.S. § 23-901, and when such Contractor or subcontractor executes the appropriate waiver form (Sole Proprietor or Independent Contractor).

iv. Professional Liability (Errors and Omissions Liability)

• Each Claim $2,000,000

• Annual Aggregate $2,000,000

a. In the event that the Professional Liability insurance required by this Contract is written on a claims-made basis, Contractor warrants that any retroactive date under the policy shall precede the effective date of this Contract and, either continuous coverage will be maintained, or an extended discovery period will be exercised, for a period of two (2) years beginning at the time work under this Contract is completed.

b. The policy shall cover professional misconduct or negligent acts for those positions defined in the Scope of Work of this contract.

c. Additional Insurance Requirements

i. The Contractor's policies, as applicable, shall stipulate that the insurance afforded the Contractor shall be primary and that any insurance carried by the Department, its agents, officials, employees or the State of Arizona shall be excess and not contributory insurance, as provided by A.R.S. § 41-621 (E).

ii. Insurance provided by the Contractor shall not limit the Contractor’s liability assumed under the indemnification provisions of this Contract.

d. Notice of Cancellation Applicable to all insurance policies required within the Insurance Requirements of this Contract, Contractor’s insurance shall not be permitted to expire, be suspended, be canceled, or be materially changed for any reason without thirty (30) days prior written notice to the State of Arizona. Within two (2) business days of receipt, Contractor must provide notice to the State of Arizona if they receive notice of a policy that has been or will be suspended, canceled, materially changed for any reason, has expired, or will be expiring. Such notice shall be sent directly to the Department sand shall be mailed, emailed, hand delivered or sent by facsimile transmission to (State Representative’s Name, Address & Fax Number).

e. Acceptability of Insurers Contractor’s insurance shall be placed with companies licenses in the State of Arizona or hold approved non-admitted status on the Arizona Department of Insurance List of Qualifies Unauthorized Insurers. Insurers shall have an “A.M. Best” rating of not less than A-VII. The State of Arizona in no way warrants that the above- required minimum insurer rating is sufficient to protect the Contractor from Potential insurer insolvency.

f. Verification of Coverage

i. All such certificates of insurance and policy endorsements must be received by the State before work commences. The State’s receipt of any certificates of insurance or policy endorsements that do not comply with this written agreement shall not waive or otherwise affect the requirements of this agreement.

ii. Each insurance policy required by this Contract must be in effect at, or prior to, commencement of work under this Contract. Failure to maintain the insurance policies as required by this Contract, or to provide evidence of renewal, is a material breach of contract.

iii. All certificates required by this Contract shall be sent directly to the Department. The State of Arizona project/contract number and project description shall be noted on the certificate of insurance. The State of Arizona reserves the right to require complete copies of all insurance policies required by this Contract at any time.

g. Subcontractors Contractor’s certificate(s) shall include all subcontractors as insureds under its polices or Contactor shall be responsible for ensuring and/or verifying that all subcontractors have valid and collectable insurance as evidenced by the certificates of insurance and endorsements for each subcontractor. All coverages for subcontractors shall be subject to the minimum Insurance Requirements identified above. The Department reserves the right to require, at any time throughout the life of this contract, proof from the Contractor that its subcontractors have the required coverage.

h. Approval and Modifications The Contracting Agency, in consultation with State Risk, reserves the right to review or make modifications to the insurance limits, required coverages, or endorsements throughout the life of this contract, as deemed necessary. Such action will not require a formal Contract amendment but may be made by administrative action.

i. Exceptions In the event the Contractor or Subcontractor(s) is/are a public entity, the the Insurance Requirements shall not apply. Such public entity shall provide a certificate of self-insurance. If the Contractor or Subcontractor(s) is/are a State of Arizona agency board, commission, or university, none of the above shall apply.

21. POST AWARD MEETING

At the discretion of the Department, the Contractor, at their expense, shall attend and participate in post award meetings as scheduled by the Procurement Officer.

22. CONFIDENTIALITY OF RECORDS

The contractor shall establish and maintain procedures and controls acceptable to the Department for the purpose of assuring that information or data in its possession is not mishandled, misused, released, disclosed, or used in an inappropriate manner by it, its agents, officers, or employees. This includes information contained in its records obtained from the Department or others, necessary for contract performance. The contractor shall take all reasonable steps and precautions to safeguard this information and data and shall not divulge the information or data to parties other than those needed for the performance of duties under the contract.

23. CONFIDENTIALITY (END-USERS)

Notwithstanding aggregate usage statistics used for reporting purposes, Contractor shall keep confidential all information concerning individual end-users. Contractor shall not, under any conditions, resell, transfer or convey information about end-users to any third party. Contractor shall not retain or reuse information about the end-users in their own operations.

24. INCIDENT NOTIFICATION

The Contractor agrees to notify the Department immediately when the Contractor system that may access, process, or store Department data is subject to unintended access. Unintended access includes compromise (e.g., computer malware, unauthorized access to agency data, password compromise) or access by an individual or automated program due to a failure to secure a system or adhere to established security procedures.

The Contractor agrees to notify the Department promptly if there is a threat to the Contractor’s program or product as it pertains to the use, disclosure, and security of Department data. If an unauthorized use or disclosure of any personal information occurs, the Contractor shall provide written notice within seventy-two (72) hours after Contractor's confirmed discovery of such use or disclosure. The Contractor written notice shall be sent via email and US mail to:

security@azdot.gov

AZ Department of Transportation Attn: Chief Information Officer Information Technology Group 206 S 17th Avenue Phoenix, AZ 85007

25. ENCRYPTION

The Contractor shall implement encryption technologies to protect Department data. Data encrypted at rest shall use, at a minimum, Advanced Encryption Standard, 256-bit key encryption.

Data transmissions shall use Transport Layer Security (TLS) and/or IP Security (IPsec) encryption.

Backups for storage on-site and/or off-site shall be encrypted to protect against accidental or intentional disclosure. Encryption keys shall be kept separate from backups they encrypt. The Contractor shall apply full disk encryption to devices that store Department information.

26. CONTRACTOR HOSTED SOLUTION

Under this option, the Contractor would house hardware and/or software/application off-site and would be responsible for timely maintenance and security requirements.

A. Maintenance

The Contractor shall be responsible for all repairs and updates to ensure systems (i.e, hardware, software and/or applications) are current and secure. During the term of the contract, the Contractor shall be responsible for implementation, installation and maintenance of software.

This includes but is not limited to updates to new versions, system enhancements / upgrades, service packs, hotfixes and patches; and shall be provided at no additional cost to the Department.

Security updates, software and hardware patches and/or fixes for the Contractor’s solution shall be completed by the Contractor. Distribution of those patches and/or fixes shall not interrupt the Department’s operations during normal business hours.

B. Offshore Performance of Work

Offshore Performance of work involving data is prohibited. Any services that are described in the specifications or scope of work that directly serve the State of Arizona or its clients and involve access to data shall be performed within the defined territories of the United States.

mailto:security@azdot.gov

The following Special Terms and Conditions modify the Uniform Terms and Conditions. It can modify them by replacing, deleting, appending to, or revising the text of an existing provision or by inserting a new paragraph into an existing article. No other document modifies or adds to the Uniform Terms and Conditions, except as may subsequently be otherwise and expressly agreed and incorporated by Contract Amendment. The following provisions have been revised.

27. UNIFORM TERMS AND CONDITIONS SECTION 3.9 – Ownership of Intellectual Property

The following provisions have been removed in their entirety.

27.1 Uniform Term and Condition Subsection 3.9.1- Rights in Work Product

27.2 Uniform Term and Condition Subsection 3.9.2 - “Government Purpose Rights” are

27.3 Uniform Term and Condition Subsection 3.9.3 - “Movement Purpose Right” do

27.4 Uniform Term and Condition Subsection 3.9.4 - Joint Development’s

27.5 Uniform Term and Condition Subsection 3.9.5 - Pre-Existing Material

27.6 Uniform Term and Condition Subsection 3.9.6 - Development’s Outside of Contract

28. UNIFORM TERMS AND CONDITIONS SECTION 3.10 – Property of the State

29. UNIFORM TERMS AND CONDITIONS SECTION 6.1 – Risk and Liability

30. UNIFORM TERMS AND CONDITIONS SECTION 7 - WARRANTIES

30.1. Uniform Term and Condition Subsection 7.1 - Liens.

30.2. Uniform Term and Condition Subsection 7.2 - Quality.

30.3. Uniform Term and Condition Subsection 7.3 - Conformity to Requirements.

30.4. Uniform Term and Condition Subsection 7.4 - Inspection/Testing.

30.5. Uniform Term and Condition Subsection 7.5 - Contractor Personnel

30.6. Uniform Term and Condition Subsection 7.15.1 - Survival of Warranty

30.7. Uniform Term and Condition Subsection 7.15.2 – Contractor’s Representations and Warranties

UNIFORM TERMS AND CONDITIONS

1. Definition of Terms. As used in this Solicitation and any resulting Contract, the terms listed below are defined as follows:

1.1. “AI” means the science and engineering of making machines capable of performing tasks that are typically associated with human intelligence, such as learning and problem-solving, and includes without limitation: AI systems, classic AI, external AI, generative AI, and large language model (LLM)

AI.

1.2. “Attachment” means any item the Solicitation which requires the Offeror to submit as part of the Offer.

1.3. “Contract” means the combination of the Solicitation, including the Instructions to Offerors, the Uniform and Special Terms and Conditions, and the Specifications and Statement or Scope of Work;

the Offer and any Best and Final Offers; and any Solicitation Amendments or Contract Amendments.

1.4. "Contract Amendment" means a written document signed by the Procurement Officer that is issued for the purpose of making changes in the Contract.

1.5. “Contractor” means any person who has a Contract with the State.

1.6. “Data” means recorded information, regardless of form or the media on which it may be recorded.

The term may include technical data and computer software. The term does not include information incidental to contract administration, such as financial, administrative, cost or pricing, or management information.

1.7. “Days” means calendar days unless otherwise specified.

1.8. “Exhibit” means any item labeled as an Exhibit in the Solicitation or placed in the Exhibits section of the Solicitation generally containing maps, schematics, examples of reports, or other documents that will be used to perform the requirements of the Scope of Work after contract award.

1.9. “Gratuity” means a payment, loan, subscription, advance, deposit of money, services, or anything of more than nominal value, present or promised, unless consideration of substantially equal or greater value is received.

1.10. “Materials” means all property, including equipment, supplies, printing, insurance and leases of property but does not include land, a permanent interest in land or real property or leasing space.

1.11. “Procurement Officer” means the person, or his or her designee, duly authorized by the State to enter into and administer Contracts and make written determinations with respect to the Contract.

1.12. “Services” means the furnishing of labor, time or effort by a Contractor or Subcontractor which does not involve the delivery of a specific end product other than required reports and performance, but does not include employment agreements or collective bargaining agreements.

1.13. “State” means any department, commission, council, board, bureau, committee, institution, agency, government corporation or other establishment or official of the executive branch or corporation commission of the State of Arizona that executes the Contract.

1.14. “State Fiscal Year” means the period beginning with July 1 and ending June 30.

1.15. “Subcontract” means any Contract, express or implied, between the Contractor and another party or between a Subcontractor and another party delegating or assigning, in whole or in part, the making or furnishing of any Materials or any Services required for the performance of the Contract.

1.16. “Subcontractor” means a person who contracts to perform work or render Services to a Contractor or to another Subcontractor as a part of a Contract with the State.

2. Contract Interpretation

2.1. Arizona Law. The Arizona law applies to this Contract including, where applicable, the Uniform Commercial Code as adopted by the State of Arizona and the Arizona Procurement Code, Arizona Revised Statutes (A.R.S.) Title 41, Chapter 23, and its implementing rules, Arizona Administrative Code (A.A.C.) Title 2, Chapter 7.

2.2. Implied Contract Terms. Each provision of law and any terms required by law to be in this Contract are a part of this Contract as if fully stated in it.

2.3. Contract Order of Precedence. In the event of a conflict in the provisions of the Contract, as accepted by the State and as they may be amended, the following shall prevail in the order set forth below:

2.3.1. Special Terms and Conditions;

2.3.2. Uniform Terms and Conditions;

2.3.3. Statement or Scope of Work;

2.3.4. Specifications;

2.3.5. Attachments;

2.3.6. Exhibits; then

2.3.7. Any other documents referenced or included in the Solicitation including, but not limited to, any Bid or Offer documents provided by the Contractor that do not fall into one of the above categories.

2.4. Relationship of Parties. The Contractor under this Contract is an independent Contractor. Neither party to this Contract shall be deemed to be the employee or agent of the other party to the Contract.

2.5. Severability. The provisions of this Contract are severable. Any term or condition deemed illegal or invalid shall not affect any other term or condition of the Contract.

2.6. No Parol Evidence. This Contract is intended by the parties as a final and complete expression of their agreement. No course of prior dealings between the parties and no usage of the trade shall supplement or explain any terms used in this document and no other understanding either oral or in writing shall be binding.

2.7. No Waiver. Either party’s failure to insist on strict performance of any term or condition of the Contract shall not be deemed a waiver of that term or condition even if the party accepting or acquiescing in the nonconforming performance knows of the nature of the performance and fails to object to it.

3. Contract Administration and Operation

3.1. Records. Under A.R.S. § 35-214 and § 35-215, the Contractor shall retain and shall contractually require each Subcontractor to retain any and all Data and other “records” relating to the acquisition and performance of the Contract for a period of five (5) years after the completion of the Contract. All records shall be subject to inspection and audit by the State at reasonable times. Upon request, the Contractor shall produce a legible copy of any or all such records.

3.2. Non-Discrimination. The Contractor shall comply with State Executive Orders Nos. 2023-10, 2023-01, 2009-09, and any and all other applicable Federal and State laws, rules and regulations, including the Americans with Disabilities Act. Contractor shall include these provisions in contracts with Subcontractors when required by Federal or State law.

3.3. Audit. Pursuant to A.R.S. § 35-214, at any time during the term of this Contract and five (5) years thereafter, the Contractor’s or any Subcontractor’s books and records shall be subject to audit by the State and, where applicable, the Federal Government, to the extent that the books and records relate to the performance of the Contract or Subcontract.

3.4. Facilities Inspection and Materials Testing. The Contractor agrees to permit access to its facilities, Subcontractor facilities, and the Contractor’s processes or services, at reasonable times for inspection of the facilities or Materials covered under this Contract as required under A.R.S. § 41-2547. The State shall also have the right to test, at its own cost, the Materials to be supplied under this Contract.

Neither inspection of the Contractor’s facilities nor Materials testing shall constitute final acceptance of the Materials or Services. If the State determines non-compliance of the Materials, the Contractor shall be responsible for the payment of all costs incurred by the State for testing and inspection. “If applicable, the Contractor agrees to permit access to its.”

3.5. Notices. Notices to the Contractor required by this Contract shall be made by the State to the person indicated on the Offer and Acceptance form submitted by the Contractor unless otherwise stated in the Contract. Notices to the State required by the Contract shall be made by the Contractor to the Solicitation Contact Person indicated on the Solicitation, stated in the Contract, or listed on the State’s eProcurement system. An authorized Procurement Officer and an authorized Contractor representative may change their respective person to whom notice shall be given by written notice to the other and an amendment to the Contract shall not be necessary.

3.6. Advertising, Publishing and Promotion of Contract. The Contractor shall not use, advertise or promote information for commercial benefit concerning this Contract without the prior written approval of the Procurement Officer.

3.7. Continuous Improvement. Contractor shall recommend continuous improvements on an on-going basis in relation to any Materials and Services offered under the Contract, with a view to reducing State costs and improving the quality and efficiency of the provision of Materials or Services. State may require Contractor to engage in continuous improvements throughout the term of the Contract.

3.8. Other Contractors. State may undertake on its own or award other contracts to the same or other suppliers for additional or related work. In such cases, the Contractor shall cooperate fully with State employees and such other suppliers and carefully coordinate, fit, connect, accommodate, adjust, or sequence its work to the related work by others. Where the Contract requires handing-off Contractor’s work to others, Contractor shall cooperate as State instructs regarding the necessary transfer of its work product, Materials, Services, or records to State or the other suppliers. Contractor shall not commit or permit any act that interferes with the State’s or other suppliers’ performance of their work, provided that, State shall enforce the foregoing section equitably among all its suppliers so as not impose an unreasonable burden on any one of them.

3.9. Ownership of Intellectual Property

3.9.1. Rights In Work Product. All intellectual property originated or prepared by Contractor pursuant to the Contract, including but not limited to, inventions, discoveries, intellectual copyrights, trademarks, trade names, trade secrets, technical communications, records reports, computer programs and other documentation or improvements thereto, including Contractor’s administrative communications and records relating to the Contract, are considered work product and Contractor’s property, provided that, State has Government Purpose Rights to that work product as and when it was delivered to State.

3.9.2. “Government Purpose Rights” are:

3.9.2.1. the unlimited, perpetual, irrevocable, royalty free, non-exclusive, worldwide right to use, modify, reproduce, release, perform, display, sublicense, disclose and create derivatives from that work product without restriction for any activity in which State is a party;

3.9.2.2. the right to release or disclose that work product to third parties for any State government purpose; and

3.9.2.3. the right to authorize those to whom it rightfully releases or discloses that work product to use, modify, release, create derivative works from the work product for any State government purpose; such recipients being understood to include the federal government, the governments of other states, and various local governments.

3.9.3. “Government Purpose Rights” do not include any right to use, modify, reproduce, perform, release, display, create derivative works from or disclose that work product for any commercial purpose, or to authorize others to do so.

3.9.4. Joint Developments. The Contractor and State may each use equally any ideas, concepts, know-how, or techniques developed jointly during the course of the Contract, and may do so at their respective discretion, without obligation of notice or accounting to the other party.

3.9.5. Pre-existing Material. All pre-existing software and other Materials developed or otherwise obtained by or for Contractor or its affiliates independently of the Contract or applicable Purchase Orders are not part of the work product to which rights are granted State under subparagraph 3.9.1 above, and will remain the exclusive property of Contractor, provided that:

3.9.5.1. any derivative works of such pre-existing Materials or elements thereof that are created pursuant to the Contract are part of that work product;

3.9.5.2. any elements of derivative work of such pre-existing Materials that was not created pursuant to the Contract are not part of that work product; and

3.9.5.3. except as expressly stated otherwise, nothing in the Contract is to be construed to interfere or diminish Contractor’s or its affiliates’ ownership of such pre-existing Materials.

3.9.6. Developments Outside Of Contract. Unless expressly stated otherwise in the Contract, this Section does not preclude Contractor from developing competing Materials outside the Contract, irrespective of any similarity to Materials delivered or to be delivered to State hereunder.

3.10. Property of the State. If there are any materials that are not covered by Section 3.9 above created under this Contract, including but not limited to, reports and other deliverables, these materials are the sole property of the State. The Contractor is not entitled to a patent or copyright on those materials and may not transfer the patent or copyright to anyone else. The Contractor shall not use or release these materials without the prior written consent of the State.

3.11. Federal Immigration and Nationality Act. Contractor shall comply with all federal, state and local immigration laws and regulations relating to the immigration status of their employees during the term of the contract. Further, Contractor shall flow down this requirement to all Subcontractors utilized during the term of the contract. The State shall retain the right to perform random audits of Contractor and Subcontractor records or to inspect papers of any employee thereof to ensure compliance. Should the State determine that the Contractor or any Subcontractors be found noncompliant, the State may pursue all remedies allowed by law, including, but not limited to:

suspension of work, termination of the contract for default and suspension or debarment of the contractor.

3.12. E-Verify Requirements. In accordance with A.R.S. § 41-4401, Contractor warrants compliance with all Federal immigration laws and regulations relating to employees and warrants its compliance with Section A.R.S. § 23- 214, Subsection A.

3.13. Offshore Performance of Work involving Data is Prohibited. Any Services that are described in the specifications or scope of work that directly serve the State of Arizona or its clients and involve access to Data shall be performed within the defined territories of the United States.

3.14. Protection of State Cybersecurity Interests. The Contractor shall comply with State Executive Order No. 2023-10, which includes, but is not limited to, a prohibition against (a) downloading and installing of TikTok on all State-owned and State-leased information technology; and (b) accessing TikTok through State information technology.

3.15. Artificial Intelligence (AI) Prohibitions. Consistent with State policy, if Contractor supplies AI Services or Materials (either directly or through Subcontractors or the sale of licenses), such as research, development, training, implementation, deployment, maintenance, provision, or sale of AI systems, then Contractor is prohibited from using State of Arizona Materials or Data in generative AI queries or for building or training proprietary generative AI programs unless explicitly approved in advance by the State in writing.

3.15.1. Contractor shall also disclose the utilization of generative AI before producing works owned by the State and/or integrating generative AI into Materials or Services used by the State.

3.15.2. Contractor shall perform due diligence to ensure proper licensure of model training data for all generative AI services throughout the life of the Contract.

3.16. Certifications Required by State Law.

3.16.1. If Contractor is a Company as defined in A.R.S. § 35-393, Contractor certifies that it is not currently engaged in a boycott of Israel as described in A.R.S. §§ 35-393 et seq.

and will refrain from any such boycott for the duration of this Contract.

3.16.2. Contractor further certifies that it shall comply with A.R.S. § 35-394, regarding use of the forced labor of ethnic Uyghurs, as applicable.

4. Costs and Payments

4.1. Payments. Payments shall comply with the requirements of A.R.S. Titles 35 and 41, Net 30 days. Upon receipt and acceptance of Materials or Services, the Contractor shall submit a complete and accurate invoice for payment from the State within thirty (30) days.

4.2. Delivery. Unless stated otherwise in the Contract, per A.R.S. § 47-2319, all prices shall be F.O.B. (“free on board”) Destination and shall include all freight delivery and unloading at the destination.

4.3. Firm, Fixed Price. Unless stated otherwise in the Special Terms and Conditions of the Contract, all prices shall be firm-fixed-prices.

4.4. Applicable Taxes

4.4.1. Payment of Taxes. The Contractor shall be responsible for paying all applicable taxes.

4.4.2. State and Local Transaction Privilege Taxes. The State of Arizona is subject to all applicable state and local transaction privilege taxes. Transaction privilege taxes apply to the sale and are the responsibility of the seller to remit. Failure to collect such taxes from the buyer does not relieve the seller from its obligation to remit taxes.

4.4.3. Tax Indemnification. Contractor and all Subcontractors shall pay all Federal, state and local taxes applicable to its operation and any persons employed by the Contractor.