JT+Contract+Final+with+Exhibits+-+signed.pdf

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TECHNOLOGY CONTRACT: LEGAL CASE MANAGEMENT SYSTEM

1. PARTIES

The parties to this contract (Contract) are the state of North Dakota, acting through its Office of Attorney General (STATE), and Journal Technologies, Inc., a Utah Corporation having its principal place of business at 915 E. 1st

Street, Los Angeles, CA 90012 (CONTRACTOR).

2. DEFINITIONS

a) Control Environment - is the set of standards, processes, and structures that provide the basis for carrying out internal control across the organization.

b) Data - means any information provided to, or collected, generated, stored, or processed by the system. Data includes user identification information and metadata which may contain Data or from which the STATE’s Data may be ascertainable.

c) Data Breach - means any access, destruction, loss, theft, use, modification or disclosure of Data by an unauthorized party or that is in violation of Contract terms and/or applicable state or federal law.

d) Data Classification - means the process of defining data into relevant categories so the information has the appropriate controls in place to protect confidentiality, integrity, and availability based on the type of information.

e) Personally Identifiable Information (PII) - information about an individual maintained by an agency, including that 1) can be used to distinguish or trace an individual’s identity, such as name, social security number, date and place of birth, mother’s maiden name, or biometric records; or (2) is linked or linkable to an individual, such as medical, educational, financial, and employment information.

f) Recovery Point Objective (RPO) - means the point in time to which Data can be recovered and/or systems restored when service is restored after an interruption. The Recovery Point Objective is expressed as a length of time between the interruption and the most proximate backup of Data immediately preceding the interruption. The RPO is detailed in the SLA.

g) Recovery Time Objective (RTO) - means the period within which information technology services, systems, applications and functions must be recovered following an unplanned interruption. The RTO is detailed in the

SLA.

h) Software as a Service (SaaS). Any software or infrastructure hosted outside the State of North Dakota’s environment.

i) Users – shall have the meaning set forth in Section 1 (“Definitions”) of Exhibit D.

3. SCOPE OF WORK

CONTRACTOR, in exchange for the compensation paid by STATE under this Contract, shall work cooperatively with STATE to provide a legal case management system as described in the Statement of Work (Exhibit A) and in the documents listed in the Merger and Modification, Conflict in Documents Section.

CONTRACTOR agrees that STATE may continue use of its licenses for the state-hosted version of JustWare currently in use by STATE (the “Legacy System”) pursuant to the terms of a separate contract, which CONTRACTOR agrees may be extended as necessary until all current agencies are on the new solution under this Contract’s Scope of Work, provided STATE is not in breach thereof and has paid associated fees prescribed thereunder, and provided STATE is actively continuing efforts with CONTRACTOR on the new solution implementation. Given the Legacy System is in an end-of-life state, support and maintenance for it during any extension period will be reasonably circumscribed in a manner to be set forth in the extension of the Legacy

System contract, but which shall include support and troubleshooting to address critical issues, as well as maintenance to address critical issues; provided that for such maintenance to be provisioned STATE must be using the most recently available Legacy System version. No new versions of the Legacy System are being developed or released given that the system is in an end-of-life state.

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4. COMPENSATION-PAYMENTS

a. Contractual Amount

STATE shall pay for the accepted services provided by CONTRACTOR under this Contract an amount not to exceed those listed in Exhibit B (Contractual Amount). The Contractual Amount shall be paid according to the Compensation Details document attached as Exhibit B.

Subject to the dependencies in Exhibit B, the Contractual Amount is firm for the duration of this Contract and constitutes the entire compensation due CONTRACTOR for performance of its obligations under this Contract regardless of the difficulty, materials or equipment required, including fees, licenses, overhead, profit and all other direct and indirect costs or expenses incurred by CONTRACTOR except as provided by an amendment to this Contract.

b. Retainage

All deliverable payments shall be subject to 20% retainage. Retained amounts due to CONTRACTOR shall be paid upon the conclusion of the 90-day Stabilization Phase.

c. Invoicing

The final cost set forth on each invoice shall be equivalent to the cost for each deliverable or service as specified in the Scope of Work. CONTRACTOR shall not submit an invoice for any deliverable or service specified in the Scope of Work that STATE has not fully accepted.

d. Payment

Payment made in accordance with this Compensation section shall constitute payment in full for the services and work performed and the deliverables provided under this Contract and CONTRACTOR shall not receive any additional compensation hereunder.

STATE shall make payment under this Contract within forty-five (45) calendar days after receipt of an approved invoice.

Payment of an invoice by STATE will not prejudice STATE’s right to object to or question that or any other invoice or matter in relation thereto. CONTRACTOR's invoice will be subject to reduction for amounts included in any invoice or payment made which are determined by STATE not to constitute allowable costs, on the basis of audits conducted in accordance with the terms of this Contract. At STATE’s sole discretion, all payments shall be subject to reduction for amounts equal to prior overpayments to CONTRACTOR.

For any amounts that are or will become due and payable to STATE by CONTRACTOR, STATE reserves the right to deduct the amount owed from payments that are or will become due and payable to

CONTRACTOR under this Contract.

e. Travel

CONTRACTOR acknowledges travel expenses are covered by the Contractual Amount and shall not invoice

STATE for travel expenses.

f. Prepayment

STATE will not make any advance payments before performance or delivery by CONTRACTOR under this

Contract.

g. Payment of Taxes by State

STATE is not responsible for and will not pay local, state, or federal taxes. STATE sales tax exemption number is E-2001. STATE has furnished certificates of exemption, which are set forth as Exhibit H.

h. Taxpayer ID

CONTRACTOR’s federal employer ID number is: 87-0626854.

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i. Purchasing Card

STATE may make payment using a government credit card. CONTRACTOR will accept a government credit card without passing the processing fees for the government credit card back to STATE.

5. EQUIPMENT, MATERIALS, AND WORKSPACE – RESOURCES PROVIDED BY PARTIES

For periods during which the Parties mutually agree that CONTRACTOR’s assigned staff is on site:

a. On site means Office of Attorney General – IT/CJIS Division, 1720 Burlington Dr, Suite B, Bismarck, ND

58504.

b. STATE agrees to provide an adequate working space, when required.

c. Equipment and software for on-site CONTRACTOR personnel is to be provided by CONTRACTOR.

d. When STATE and CONTRACTOR agree that remote access to systems is required, STATE shall provide the necessary supervised remote access security to enable CONTRACTOR access to the appropriate

STATE systems.

6. TERM OF CONTRACT

This Contract term (Term or Initial Term) begins on its Effective Date and ends 60 months after Deployment (as such term is defined in the License, Maintenance and Support Agreement attached hereto as Exhibit D).

a. No Automatic Renewal

This Contract will not automatically renew.

b. Renewal Option

STATE may renew this Contract upon satisfactory completion of the Initial Term. STATE reserves the right to execute up to five (5) options to renew this Contract under the same terms and conditions for a period of

24 months each (Renewal Term).

c. Extension Option

STATE reserves the right to extend this Contract for an additional period, not to exceed 12 months, beyond the current termination date of this Contract.

d. Renegotiation Option

Because it is unknown how long the solution and services will be used by STATE and ongoing maintenance and support are required for as long as the system is operational STATE and CONTRACTOR may renegotiate this Contract. After completion of the Initial Term, renewals, and extensions, STATE and CONTRACTOR may renegotiate the pricing and Term of this Contract. New pricing and Term shall be mutually agreed upon by the Parties and executed in writing.

If, during the Initial Term, any renewal, or extension STATE determines a realignment of the Term is needed (e.g., to align with STATE’s fiscal biennium, SaaS period), the Parties may mutually agree, in writing, to a new Term with a termination date not to exceed the total available length of Contract including its Initial

Term, renewals, and extensions.

7. TERMINATION

a. Termination for Convenience or by Mutual Agreement

This Contract may be terminated by STATE upon thirty (30) days’ written notice to CONTRACTOR. This

Contract may be terminated by mutual consent of both Parties executed in writing.

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b. Early Termination in the Public Interest

STATE is entering this Contract for the purpose of carrying out the public policy of the State of North Dakota, as determined by its Governor, Legislative Assembly, Agencies, and Courts. After a thirty-day notice, if this Contract ceases to further the public policy of the State of North Dakota, STATE, in its sole discretion, by written notice to CONTRACTOR, may terminate this Contract in whole or in part.

c. Termination for Lack of Funding or Authority

STATE, by written notice to CONTRACTOR, may terminate the whole or any part of this Contract under any of the following conditions:

1) If funding from federal, state, or other sources is not obtained or continued at levels sufficient to allow for purchase of the services or goods in the indicated quantities or term.

2) If federal or state laws or rules are modified or interpreted in a way that the services or good are no longer allowable or appropriate for purchase under this Contract or are no longer eligible for the funding proposed for payments authorized by this Contract.

3) If any license, permit, or certificate required by law or rule, or by the terms of this Contract, is for any reason denied, revoked, suspended, or not renewed.

Termination of this Contract under this subsection is without prejudice to any obligations or liabilities of either

Party already accrued prior to termination.

d. Termination for Cause.

After a thirty-day cure period, which would have been commenced by written notice to CONTRACTOR, STATE may terminate this Contract effective upon delivery of written notice to CONTRACTOR, or any later date stated in the notice:

1) If CONTRACTOR fails to provide services or goods required by this Contract within the time specified or any extension agreed to in writing by STATE; or

2) If CONTRACTOR fails to perform any of the other provisions of this Contract, or so fails to pursue the work as to endanger performance of this Contract in accordance with its terms.

The rights and remedies of STATE provided in this subsection are not exclusive and are in addition to any other rights and remedies provided by law or under this Contract.

e. Termination for Cause by CONTRACTOR

CONTRACTOR may terminate the license granted in Section 2.2 of Exhibit D, and this Contract (but reserving cumulatively all other rights and remedies under this Contract, in law and/or in equity):

1) if STATE fails to make payments of moneys due when the same are due, and such failure continues for a period of thirty (30) days after written notice thereof by CONTRACTOR to STATE.

2) for any other material breach by STATE which breach continues for a period of thirty (30) days after written notice thereof by CONTRACTOR to STATE.

The rights and remedies of STATE provided in this subsection are not exclusive and are in addition to any other rights and remedies provided by law, in equity and/or under this Contract.

f. Actions Upon and Following Termination.

Termination of this Contract or the Statement of Work shall not affect any rights and/or obligations of the parties which arose prior to any such termination and such rights and/or obligations shall survive any such termination. Within thirty (30) days after the effective date of a termination made pursuant to Sections 7(a), 7(b), 7(c) or 7(e), STATE must pay CONTRACTOR fees and expenses at the Contract rates for all undisputed Services rendered under the applicable Statement of Work or this Contract up to the effective date of termination, including, without limitation, all work in process. Within thirty (30) days after the effective

- 5 -date of a termination made pursuant to Section 7(d), STATE must pay CONTRACTOR fees and expenses at the Contract rates for all undisputed Services rendered and accepted under the applicable Statement of

Work or this Contract up to the effective date of termination. In the context of any termination described in this Section 7, within thirty (30) days of the effective date of the termination, STATE must (i) cease use of the Licensed Software and any work product of CONTRACTOR produced pursuant to this Contract or any Statement of Work, and (ii) return all work product of CONTRACTOR produced pursuant to this Contract or any Statement of Work. If not removed and returned within such thirty (30) day period, STATE hereby grants CONTRACTOR the right to remove the Licensed Software and work product. Within thirty (30) days after the effective date of any such termination, CONTRACTOR must return the confidential property of the STATE obtained under the terminated Statement of Work or this Agreement, as applicable. In addition, the confidentiality obligations of the parties in Section 35 ("Confidentiality") shall survive the termination of this

Agreement.

8. SUSPENSION FOR CONVENIENCE

Upon a thirty day prior written notice or at its earliest convenience, STATE shall have the right at any time to order the services of CONTRACTOR fully or partially stopped for STATE’s own convenience. STATE shall provide CONTRACTOR written notice of the reason for and duration of the suspension. The schedule shall be delayed on a day-for-day basis to the extent STATE has issued a stop work order to CONTRACTOR and such stop work order is causing delays in completing services in accordance with the schedule. CONTRACTOR shall have the right to submit claims in accordance with the terms of this Contract as a result of stop work orders issued under this section.

9. FORCE MAJEURE

Neither Party shall be held responsible for delay or default caused by labor disputes or other industrial disturbances, electrical or power outages, utilities or other telecommunications failures, internet service provider failures or delays, denial of service attacks, earthquake, storms or other elements of nature, blockages, embargoes, acts or orders of government affecting the industry as a whole, epidemics, fire, riot, terrorism, pandemic (excluding COVID-19), acts of God, or war if the event was not foreseeable through the exercise of reasonable diligence by the affected Party, the event is beyond the Party’s reasonable control, and the affected Party gives notice to the other Party promptly upon occurrence of the event causing the delay or default or that is reasonably expected to cause a delay or default. If CONTRACTOR is the affected Party and does not resume performance within fifteen (15) days or another period agreed between the Parties, then STATE may seek all available remedies, up to and including termination of this Contract pursuant to its Termination Section, and

STATE shall be entitled to a pro-rata refund of any amounts paid for which the full value has not been realized, including amounts paid toward software subscriptions, maintenance, or licenses.

10. LIQUIDATED DAMAGES

INTENTIONALLY RESERVED

11. INJUNCTIVE RELIEF

CONTRACTOR shall immediately report to STATE any and all unauthorized disclosures or uses of STATE’s confidential information or proprietary information of which CONTRACTOR or its staff is aware or has knowledge. CONTRACTOR acknowledges that any unauthorized publication or disclosure of STATE’s confidential information or proprietary information to others may cause immediate and irreparable harm to

STATE. If CONTRACTOR should publish or disclose such confidential information or proprietary information without authorization, STATE shall immediately be entitled to seek injunctive relief or any other remedies to which it is entitled under law or equity without requiring a cure period. Subject to Section 18 (“Limitations on Liability”) of this Contract CONTRACTOR shall indemnify, defend, and hold harmless STATE from all damages, costs, liabilities, and expenses (including without limitation reasonable attorneys’ fees) caused by or arising from CONTRACTOR’s unauthorized use or disclosure of STATE’s confidential information or proprietary information

- 6 -arising from, caused by or resulting from the negligence or willful misconduct of CONTRACTOR and any of CONTRACTOR’s subcontractors in the performance of this Contract, except to the extent any such loss, expense, claim or suit arose or resulted from, or was caused by or contributed to by, the negligence of STATE or its officers, officials, agents or employees. As a condition to these indemnity obligations, STATE will provide CONTRACTOR with prompt notice of any claim of which STATE is aware and for which indemnification shall be sought under this Contract and shall cooperate in all reasonable respects with CONTRACTOR in connection with any such claim.

12. RESERVED

13. RIGHT TO WITHHOLD AMOUNTS OTHERWISE DUE IF THE CONTRACTOR IS IN BREACH

If CONTRACTOR fails to deliver Deliverables or to provide Services which satisfy CONTRACTOR’s obligations under this Contract, and STATE has notified CONTRACTOR of such alleged failure and described to CONTRACTOR the basis for STATE’S claim of such failure, STATE shall have the right to withhold any and all payments due under this Contract. STATE may withhold any and all such payments due under this Contract to

CONTRACTOR without penalty or work stoppage by CONTRACTOR, until such failure to perform is cured.

14. RIGHT TO REMEDIES AND CUMULATION OF RIGHTS

No remedy conferred by any of the specific provisions of this Contract is intended to be exclusive of any other remedy, and each and every remedy shall be cumulative and shall be in addition to every other remedy given under this Contract, now or in the future existing at law or in equity or by statute or otherwise.

15. NON-WAIVER

Either party’s failure to exercise any of its rights under this Contract, its delay in enforcing any right, or its waiver of its rights on any occasion, shall not constitute a waiver of such rights on any other occasion. No course of dealing by either party in exercising any of its rights shall constitute a waiver thereof. No waiver of any provision of this Contract shall be effective unless it is in writing and signed by the party against whom the waiver is sought to be enforced.

16. INDEMNIFICATION

CONTRACTOR agrees to defend, indemnify, and hold harmless the state of North Dakota, its agencies, officers and employees (State), from and against claims based on the vicarious liability of the State or its agents arising from, caused by or resulting from the negligence or willful misconduct of CONTRACTOR and any of CONTRACTOR’s subcontractors in the performance of this Contract, except to the extent any such loss, expense, claim or suit arose or resulted from, or was caused by or contributed to by, the negligence of the STATE or its officers, officials, agents or employees. This obligation to defend, indemnify, and hold harmless does not extend to professional liability claims arising from professional errors and omissions. CONTRACTOR shall control the legal defense provided to the State under this provision, provided CONTRACTOR shall not enter any settlement that admits fault or liability of State without State’s express approval. The legal defense must be free of any conflicts of interest, even if retention of separate legal counsel for the State is necessary.

Any attorney appointed to represent the State must first qualify as and be appointed by the North Dakota

Attorney General as a Special Assistant Attorney General as required under N.D.C.C. § 54-12-08.

CONTRACTOR also agrees to reimburse the State for all costs, expenses and attorneys’ fees incurred if the State prevails in an action against CONTRACTOR in establishing and litigating the indemnification coverage provided herein. This obligation shall continue after the termination of this Contract.

17. INTELLECTUAL PROPERTY INFRINGEMENT INDEMNIFICATION

a. CONTRACTOR, at its own expense, shall defend and indemnify STATE against claims that products furnished under this Contract infringe a United States patent or copyright or misappropriate trade secrets protected under United States law.

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CONTRACTOR’S obligation shall not extend to a claim based on any alleged infringement arising from any:

(a) additions, changes, or modifications to the services by or on behalf of STATE; (b) incorporation of the services or any component thereof into any other product or process; or (c) use of the services other than as permitted by this Contract.

b. As to any product which is subject to a claim of infringement or misappropriation, CONTRACTOR may (a) obtain the right of continued use of the product for STATE or (b) replace or modify the product to avoid the claim. If neither alternative is available on commercially reasonable terms then, at the request of CONTRACTOR, any applicable Software license and its charges will end, STATE will stop using the product, and will return the product to CONTRACTOR. Upon return of the product, CONTRACTOR will give

STATE a credit for the price paid to CONTRACTOR for the period during which the STATE could no longer use the Software due to infringement or misappropriation.

18. LIMITATIONS ON LIABILITY

NOTWITHSTANDING ANY OTHER PROVISION OF THIS CONTRACT, NEITHER PARTIES SHALL BE

LIABLE TO THE OTHER FOR ANY INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OR LOSS OF

ANTICIPATED REVENUES IN CONNECTION WITH OR ARISING OUT OF THE SUBJECT MATTER OF

THIS CONTRACT. FURTHERMORE, (I) FOR LOSSES ARISING PRIOR TO GO LIVE: STATE’S TOTAL

LIABILITY WITH RESPECT TO CLAIMS ARISING OUT OF THE SUBJECT MATTER OF THIS CONTRACT

SHALL NOT EXCEED, IN THE AGGREGATE, TWICE THE TOTAL AMOUNT OF PROFESSIONAL

SERVICES FEES LISTED IN EXHIBIT B PAYABLE HEREUNDER TO CONTRACTOR; AND IN NO EVENT

SHALL CONTRACTOR’S TOTAL LIABILITY WITH RESPECT TO CLAIMS ARISING OUT OF THE SUBJECT

MATTER OF THIS CONTRACT EXCEED, IN THE AGGREGATE, TWICE THE TOTAL AMOUNT OF

PROFESSIONAL SERVICES FEES PAID HEREUNDER TO CONTRACTOR. FOR (II) LOSSES ARISING

SUBSEQUENT TO GO LIVE: STATE’S TOTAL LIABILITY WITH RESPECT TO CLAIMS ARISING OUT OF THE SUBJECT MATTER OF THIS CONTRACT SHALL NOT EXCEED, IN THE AGGREGATE, TWICE THE

TOTAL AMOUNT OF LICENSE, MAINTENANCE AND SUPPORT FEES PAYABLE HEREUNDER TO

CONTRACTOR FOR THE FIRST THREE (3) YEARS OF THE LICENSE TERM; AND IN NO EVENT SHALL

CONTRACTOR’S TOTAL LIABILITY WITH RESPECT TO CLAIMS ARISING OUT OF THE SUBJECT

MATTER OF THIS CONTRACT EXCEED, IN THE AGGREGATE,TWICE THE TOTAL AMOUNT OF

LICENSE, MAINTENANCE AND SUPPORT FEES PAID HEREUNDER TO CONTRACTOR FOR THE FIRST

THREE YEARS OF THE LICENSE TERM, PROVIDED THAT WITH RESPECT TO CLAIMS ARISING OUT OF

THE SUBJECT MATTER OF EXHIBIT E OR THE HOSTED SERVICE PROVIDED BY CONTRACTOR

HEREUNDER, CONTRACTOR’S TOTAL LIABILITY SHALL NOT EXCEED, IN THE AGGREGATE, TWICE

THE TOTAL AMOUNT OF HOSTING FEES PAID HEREUNDER TO CONTRACTOR FOR THE PRIOR

TWELVE (12) MONTHS OF THE HOSTING TERM

THE FOREGOING LIMITATIONS DO NOT LIMIT LOSS TO STATE RESULTING FROM FRAUD OR OTHER

INTENTIONAL OR WILLFUL MISCONDUCT, CONTRACTOR'S BREACH OF ITS CONFIDENTIALITY

OBLIGATIONS UNDER SECTION 35(b) (“CONTRACTOR’S Responsibilities”) OF THE AGREEMENT OR

LOSS RESULTING FROM TANGIBLE PROPERTY DAMAGE OR PERSONAL INJURY THAT CANNOT BE

LIMITED UNDER N.D.C.C. § 32-12.2-15(4)

19. REPRESENTATIONS AND WARRANTIES

CONTRACTOR represents and warrants to STATE that neither CONTRACTOR, in connection with performing the services in performance of this Contract, nor the completed product delivered by CONTRACTOR, will infringe any patent, copyright, trademark, trade secret or other proprietary right of any person. CONTRACTOR further represents and warrants to STATE that it will not use any trade secrets or confidential or proprietary information owned by any third party in performing the services related to this Contract or in delivery of the completed product unless CONTRACTOR has the authority to license, use or provide those trade secrets or confidential or proprietary information to STATE. CONTRACTOR further represents and warrants to STATE that neither CONTRACTOR nor any other company or individual performing services pursuant to this Contract is under any obligation to assign or give any work done under this Contract to any third party.

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20. INSURANCE

a. CONTRACTOR shall provide certificate of insurance and any endorsements to STATE electronically via to:

Name: Lita Lehde

Email Address: llehde@nd.gov

Email Subject Line: Certificate of Insurance – Legal Case Management System

b. CONTRACTOR shall secure and keep in force during the term of this Contract and CONTRACTOR shall require all subcontractors, prior to commencement of an agreement between CONTRACTOR and the subcontractor, to secure and keep in force during the term of this CONTRACT, from insurance companies, government self-insurance pools or government self-retention funds, authorized to do business in North

Dakota, the following insurance coverages:

1) Commercial general liability, including premises or operations, contractual, and products or completed operations coverages (if applicable), with minimum liability limits of $2,000,000 per occurrence.

2) Automobile liability, including Owned (if any), Hired, and Non-Owned automobiles, with minimum liability limits of $500,000 per person and $2,000,000 per occurrence.

3) Workers compensation coverage meeting all statutory requirements. The policy shall provide coverage for all states of operation that apply to the performance of this Contract.

4) Professional errors and omissions with minimum limits of $1,000,000 per claim and in the aggregate, CONTRACTOR shall continuously maintain such coverage during the Contract period and for three years thereafter. In the event of a change or cancellation of coverage, CONTRACTOR shall purchase an extended reporting period to meet the time periods required in this section.

c. The insurance coverages listed above must meet the following additional requirements:

1) Any deductible or self-insured retention amount or other similar obligation under the policies shall be the sole responsibility of the CONTRACTOR.

2) This insurance may be in policy or policies of insurance, primary and excess, including the so-called umbrella or catastrophe form and must be placed with insurers rated “A-” or better by A.M. Best Company, Inc., provided any excess policy follows form for coverage. Less than an “A-” rating must be approved by the State. The policies shall be in form and terms approved by the State.

3) The duty to defend, indemnify, and hold harmless the State under this agreement shall not be limited by the insurance required in this agreement.

4) The state of North Dakota and its agencies, officers, and employees (State) shall be endorsed on the commercial general liability policy, including any excess policies (to the extent applicable), as additional insured. The State shall have all the benefits, rights and coverages of an additional insured under these policies that shall not be limited to the minimum limits of insurance required by this agreement or by the contractual indemnity obligations of the CONTRACTOR.

5) A Waiver of Subrogation” waiving any right to recovery the insurance company may have against the

State.

6) CONTRACTOR shall furnish a certificate of insurance to the undersigned STATE representative electronically prior to commencement of this agreement. All endorsements shall be provided as soon as practicable.

7) Failure to provide insurance as required in this agreement is a material breach of contract entitling

STATE to terminate this agreement immediately.

8) CONTRACTOR shall provide at least 30-day notice of any cancellation or material change to the policies or endorsements; except that the notice period for cancellation due to non-payment or premiums shall be 10 days. CONTRACTOR shall provide on an ongoing basis, current certificates of insurance during the

- 9 -term of the Contract. A renewal certificate will be provided electronically 10 days prior to coverage expiration. An updated, current certificate of insurance shall be provided in the event of any change to a policy.

21. CYBER LIABILITY AND SECURITY INSURANCE

In the event CONTRACTOR will host data, or provide for the hosting of data through a third-party entity, CONTRACTOR shall secure and maintain Cyber Liability and Security Insurance or equivalent insurance product(s), with minimum liability limits of not less than $5,000,000 and first party limits of not less than $1,000,000, that will provide, without cost to the CONTRACTOR or STATE, an immediate response in the event of a data breach, including meeting all notification obligations of CONTRACTOR and STATE and in the event the data breach involves personal information as defined by N.D.C.C. § 51-30-1(4), the insurance policy shall also make available free credit monitoring for any affected individual for a minimum period of one year.

CONTRACTOR shall defend, indemnify, save and hold harmless, the STATE, its officers, agents and employees from liability of any nature or kind, including costs and expenses, on account of a data breach arising from CONTRACTOR hosting, transmission, or control of data, any and all suits, claims, or damages of any character whatsoever, resulting from injuries or damages sustained by any person or persons or property by virtue of performance of this Contract.

22. WORK PRODUCT

All custom work product, equipment or materials created specifically for STATE or purchased by STATE under this Contract, to the extent such custom work product does not incorporate or include any intellectual property of

CONTRACTOR, belong to STATE and must be immediately delivered to STATE at STATE's request upon termination of this Contract.

23. TECHNOLOGY STANDARDS

Prior to the Contract Execution, CONTRACTOR does comply with the applicable STATE enterprise architecture technology standards cited below, except as noted:

Electronic Signature Standard* Identity and Access Management Service, State Entity Standard

Identity Provider, State Entity Standard Authentication, State Entity Standard Authentication, Public Standard*

Auditing Standard Access Control Standard Encryption Standard

Remote User Access Standard

*Pursuant to discussion held on May 22, 2024, STATE agreed to submit exceptions for these two standards as CONTRACTOR currently does not fully meet these standards.

After Contract Execution, STATE will notify CONTRACTOR of any changes to or new applicable STATE IT

Standards. For any gaps, CONTRACTOR will make commercially reasonable efforts to coordinate updates into a product roadmap and incorporate those releases into the project schedule. If CONTRACTOR is unable to comply with any applicable standard, STATE will submit a Request for Exemption from Information Technology

Standards or Statutory Policies (SFN 51687) in coordination with CONTRACTOR for the North Dakota Information Technology Department’s review and approval or disapproval.

These standards can be found on STATE’s website at https://www.ndit.nd.gov/standards.

https://www.ndit.nd.gov/standards

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24. PERSONNEL

a. STATE will designate a Project Manager to serve as the primary project manager for this Contract. If, during the course of this Contract, it becomes necessary for STATE to change the person assigned as STATE’s

Project Manager, STATE will notify CONTRACTOR in writing, pursuant to Notice section of this Contract.

b. Unless STATE otherwise notifies CONTRACTOR, STATE’s Project Manager shall carry out STATE’s administrative and management functions under this Contract, shall be responsible for acceptance of the

Contract deliverables, and shall provide support and overall direction to CONTRACTOR.

c. CONTRACTOR will designate a Project Manager and provide individuals to meet the requirements and accomplish the work as stated in this Contract including any mutually agreed upon Scope of Work.

d. CONTRACTOR agrees and understands that STATE’s execution of this Contract is predicated, in part and among other considerations, on the utilization of the specific individuals and personnel qualifications as identified; primary being the Project Manager. Therefore, CONTRACTOR agrees that:

1) The personnel assigned must have the knowledge necessary to complete requirements as defined in this Contract.

2) CONTRACTOR shall warrant that all personnel assigned to perform tasks in response to this Contract will remain assigned for the agreed-upon length of time to the best of CONTRACTOR’s ability.

3) No replacement, reassignment or substitution of any assigned individuals and personnel qualifications shall be made without the prior notification to STATE and that such replacement, reassignment or substitution shall be made at no additional cost to STATE.

4) Any substitution made pursuant to this paragraph must be of equal or higher skills, knowledge, and abilities than those personnel originally proposed, and that STATE’s approval of a substitution is not construed as an acceptance of the substitution’s performance potential. STATE agrees that an approval of a substitution will not be unreasonably withheld.

e. Upon request by STATE, CONTRACTOR shall replace any CONTRACTOR personnel that STATE determines, in its sole discretion, to be unable to perform the responsibilities of this Contract acceptably, e.g., inappropriate or unprofessional personal conduct, professional inabilities, etc.

f. STATE's working hours are Monday through Friday from 8:00 AM until 5:00 PM (CST or CDT) with one hour for lunch. STATE Project Manager may approve alternate work schedules.

g. According to STATE policy, STATE personnel are only obligated to work a forty-hour workweek, Monday through Friday, and are allowed reasonable vacation, sick and educational absences.

h. CONTRACTOR’s personnel are not expected to work on State holidays or other mandatory leave days.

25. CRIMINAL JUSTICE INFORMATION

a. CONTRACTOR shall comply with the FBI CJIS Security Policy and the FBI CJIS Security Addendum. This policy and addendum can be found on the FBI website at https://www.fbi.gov/about-us/cjis/cjis-security-policy-resource-center/view.

b. For all personnel who have unescorted access to a location where STATE systems are accessed or criminal background checks are performed by the STATE:

1) Personnel Screening – Prior to access, CONTRACTOR shall provide to STATE fingerprints of personnel and a consent form provided by STATE and signed by said personnel for a fingerprint-based background check to be performed by STATE.

2) Security Awareness Training – Within six (6) months of obtaining access and every two (2) years thereafter, CONTRACTOR shall ensure personnel receive security awareness training provided by STATE that is appropriate for the level of access, as defined in the CJIS Security Policy. CONTRACTOR shall maintain and annually submit a list of all personnel with access and the date the required training https://www.fbi.gov/about-us/cjis/cjis-security-policy-resource-center/view https://www.fbi.gov/about-us/cjis/cjis-security-policy-resource-center/view

- 11 -was completed. At any time, CONTRACTOR shall provide that list to STATE within seven (7) days of request by STATE.

c. CJIS Security Addendums – In addition to the personnel screening and security awareness training, for personnel with access to perform contracted services on state systems or information: CONTRACTOR shall provide personnel with a copy of the FBI CJIS Security Policy and the FBI CJIS Security Addendum.

CONTRACTOR shall require personnel to sign the FBI CJIS Security Addendum Certification and provide the signed certification to the STATE.

d. Security Incident Notification – CONTRACTOR shall report all security incidents to the STATE within twenty-four hours, but no longer than forty-eight (24-48) hours, in accordance with the CJIS Security Policy. The report shall substantially conform to the Security Incident Response Form in Appendix F in the CJIS Security

Policy.

e. Upon request by STATE, CONTRACTOR shall replace any CONTRACTOR personnel that STATE determines, in its sole discretion, to be unable to perform the responsibilities of the Contract acceptably, e.g., inappropriate, or unprofessional personal conduct, professional inabilities, etc.

26. PROJECT MANAGEMENT

a. Reporting

1) CONTRACTOR’s Project Manager shall deliver to STATE’s Project Manager, bi-weekly (i.e. once every two weeks) reports of CONTRACTOR’s progress on the project and meeting the objective/deliverables as stated in the Scope of Work. Each report must contain a description of the current status of the project, the tasks on which time was spent, the estimated progress to be made in the next reporting period, and the problems encountered the proposed solutions to them and their effect, if any, on the project budget/schedule.

2) Project Variance Reporting – CONTRACTOR must provide data to allow STATE’s project manager to calculate cost and schedule variance in accordance with N.D.C.C. § 54-59-23 as determined by STATE. If STATE’s analysis shows a negative cost or schedule variance exceeding 20%, a subsequent report must also provide proposed corrective measures to address the issues.

b. Integrated Change Control Process

CONTRACTOR and STATE will utilize an integrated change control process to manage changes during the life of a project.

1) A change request must be in writing to document the potential change. The write-up for the proposed change must be submitted to CONTRACTOR and STATE’s project managers who will in turn provide it to relevant Parties for assessment.

2) All change requests will be logged and tracked. STATE’s project manager will record the request in the project repository and will update the repository throughout the process.

3) The change will be reviewed and, if acceptable to STATE, CONTRACTOR will submit to STATE an estimate of the impact to cost, schedule, scope, and quality.

4) CONTRACTOR will continue performing the services in accordance with the original Contract unless otherwise agreed upon by STATE’s project manager. Work shall not commence on any new activities related to the change request until all Parties agree in writing.

5) CONTRACTOR’s project manager and STATE’s project manager will adapt the Project Management Plan to incorporate approved changes.

6) Each change request duly authorized in writing by the Parties shall be incorporated into and considered part of this Contract.

7) During the course of this Contract, if CONTRACTOR determines or could reasonably determine any STATE actions or directions constitute a requirement to perform additional work, CONTRACTOR shall notify STATE within thirty (30) calendar days that STATE has requested CONTRACTOR to perform additional work in the http://www.legis.nd.gov/cencode/t54c59.pdf

- 12 -form of a change request utilizing the process above. CONTRACTOR understands that it waives the right to request additional time and reimbursable costs if CONTRACTOR fails to notify STATE within thirty (30) calendar days of determining or reasonably being able to determine that any STATE actions or directions constitute a requirement to perform additional work under this Contract.

c. Deliverable Acceptance

1) Upon completion of a deliverable, CONTRACTOR will furnish STATE with the deliverable and associated documentation, the expected performance, and agreed upon Acceptance Criteria.

2) After receipt of items in Paragraph 26(c)(1), STATE will have five (5) working days or a different period of time as is agreed to by the Parties or as set forth in the Project Schedule, in which to accept or reject each item in writing. STATE will accept by signature. If STATE rejects it, STATE will specify in writing its grounds for rejection and CONTRACTOR shall use its commercially reasonable efforts to revise any issues for the deliverables to be acceptable to STATE within the following five (5) working days. If STATE rejects it a second time, STATE will have the option of repeating the procedure as described in this acceptance statement above, escalating the issue to the Executive Steering Committee, or terminating this Contract upon written notice to CONTRACTOR.

d. Project Completion

1) The successful completion of all deliverables as stated in the Scope of Work in accordance with the deliverable acceptance process AND

2) The final delivered product is accepted by State prior to or not later than Deployment

3) The ninety (90) calendar days following Deployment is the 90-day Stabilization Phase as defined in the SOW. During the Stabilization Phase, CONTRACTOR shall provide the support described in Section 3.2.1 of Exhibit D (“Stabilization Phase Support”). As part of this support, CONTRACTOR will address issues that arise, monitor system performance, and make adjustments as necessary. After 90 days a support hand-off meeting will take place between the CONTRACTOR implementation team, CONTRACTOR’S general support team, and STATE. Introductions will take place and information passed along to ensure a smooth hand-off and understanding of how the STATE will interact with CONTRACTOR support thereafter. At the conclusion of the 90-day Stabilization Phase, STATE will pay the retainage set forth in Exhibit B.

27. WARRANTY

CONTRACTOR shall provide a software warranty upon Final Acceptance for the entirety of the License Term as further detailed in Section 4 (“Warranty”) of the Exhibit D.

28. SOFTWARE LICENSE

All ownership rights to CONTRACTOR’s software being licensed to STATE under this Contract (intellectual property owned by CONTRACTOR prior to performance of this Contract) shall remain with CONTRACTOR.

29. SOFTWARE AS A SERVICE (SAAS) AND SERVICE LEVEL AGREEMENT (SLA)

The terms and service level obligations are set forth in Exhibit C Software as a Service (SaaS) Service Level Agreement (SLA) are made a part of this Contract through its reference here. CONTRACTOR shall provide a

Software as a Service (“SaaS”), including software/hardware updates and technical support services for the Software as a Service pursuant to this Contract as specifically set forth in Exhibit E (“Hosted Services”) commencing at Deployment, or prior to Deployment if requested by STATE, subject to STATE’s payment of the required fees set forth in Exhibit B. CONTRACTOR warrants that it will continue to offer Subscription Services for the product(s) for a minimum of five (5) years from the date of Go Live of any software/product update.

a. Subscription Services:

1) CONTRACTOR provides a SaaS to fully manage STATE’s Licensed Software in secure, industry-leading cloud infrastructure such as AWS GovCloud.

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2) Service shall be extended to any Users who have a need to use the SaaS for the benefit of STATE, provided

STATE has paid the required fees for such Users as defined in Exhibit B.

3) While there shall be no specific limit on the number of machines, number of locations, or size of processors on which STATE can operate the service, CONTRACTOR is committed to using appropriate resources to provide the Hosted Services and service levels set forth in this SLA, and our infrastructure is designed to scale efficiently and securely within commercially reasonable parameters, ensuring that all customer needs are met while maintaining the overall integrity and performance of the Hosted Services; and therefore STATE agrees there may be certain commercially-consistent limitations in order that CONTRACTOR can provide the above service levels.

4) CONTRACTOR shall provide software/hardware updates as defined in Section 3 (“Maintenance and

Support”) of Exhibit D at no additional cost to the STATE, including any professional services needed.

5) If CONTRACTOR reduces or replaces the functionality contained in the Licensed Software and provides this functionality as a separate or renamed product, then STATE shall be entitled to license such software product at no additional License and Maintenance fees for the remainder of the then-current term of the STATE’s license to use the Licensed Software. If CONTRACTOR releases an optional, future product or other release that has substantially the same functionality as the Licensed Software, and CONTRACTOR ceases to provide maintenance services for the older software product, then STATE shall have the option to exchange licenses for such replacement product or function at no additional License and Maintenance charge for the remainder of the then-current term of STATE’s license to use the Licensed Software.

a. Purchase of Additional Users

STATE may purchase additional Users during the term of this Contract at the same price offered by

CONTRACTOR under the terms of this Contract.

b. Subscription Fee Cap

CONTRACTOR agrees that any change to the annual Services fee may increase by not more than the lower of 5% or Consumer Price Index (CPI). The rates shall be adjusted in accordance with the index titled “All Urban Consumers (CPI-U). for the U.S. City Average. All Items 1982-84=100”, prepared by the U.S. Bureau of Labor Statistics.

c. Right to Modify or Cancel SaaS Services

STATE may choose to no longer receive SaaS Services from CONTRACTOR at any time upon reasonable notice to CONTRACTOR, and pursuant to a statement of work entered into between the STATE and CONTRACTOR under which CONTRACTOR would move STATE’s Licensed Software from the cloud to

STATE’s on-premise servers.

STATE may choose to cancel SaaS Services from CONTRACTOR at Contract’s next renewal date upon thirty (30) calendar days.

30. SAAS AND DATA SECURITY

Remote access to Data from outside the continental United States, including remote access to Data by authorized support staff in identified support centers, is prohibited. If CONTRACTOR is unable to comply, a Request for Exemption from Information Technology Standards or Statutory Policies (SFN 51687) must be submitted in coordination with STATE and CONTRACTOR for the North Dakota Information Technology

Department’s review and approval or disapproval.

31. DATA PROCESSING AND LOCATION:

a) CONTRACTOR shall transmit, process, and store STATE Data within the continental United States.

b) CONTRACTOR shall make commercially reasonable efforts to notify STATE at least 90 days prior to any relocation of STATE’s Data to a different hosting facility; provided such notification has been made to CONTRACTOR by the cloud infrastructure provider. STATE reserves the right to terminate the Contract without penalty if STATE does not approve of the new hosting facility.

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32. RESERVED

33. SOFTWARE AUDIT

CONTRACTOR may, upon sixty (60) calendar days’ notice to STATE, but not more frequently than once per year, either request a signed certification by an officer of STATE verifying that the software is being used in accordance with the terms of this Contract or audit STATE’s use of the software to ensure compliance with the terms and conditions of this Contract. Any such audit shall be conducted at CONTRACTOR’s expense during regular business hours at STATE’s offices and shall not unreasonably interfere with STATE’s business activities.

CONTRACTOR shall provide documentation to STATE defining the scope of the audit not less than thirty (30) calendar days prior to the audit. STATE shall have sixty (60) calendar days to review CONTRACTOR’s audit findings. If an audit reveals that STATE’s use of the Software exceeds the use permitted hereunder, then CONTRACTOR may invoice STATE for the applicable additional amounts based on the price agreement between the Parties as of the date of completion of the audit.

34. NOTICE

All notices or other communications required under this Contract must be given by email, registered or certified mail and are complete on the date postmarked when addressed to the Parties at the following addresses:

STATE CONTRACTOR

Heidi Smith Danny Hemnani

IT/CJIS Director CEO

1720 Burlington Dr, Suite B 915 E 1st Street

Bismarck, ND 58504 Los Angeles, CA 90012 hsmith@nd.gov dhemnani@journaltech.com

Notice provided under this provision does not meet the notice requirements for monetary claims against STATE found at N.D.C.C § 32-12.2-04.

35. CONFIDENTIALITY

a) STATE's Responsibilities. STATE hereby agrees that (a) the Licensed Software and other materials received from CONTRACTOR under this Agreement are the confidential and proprietary information of CONTRACTOR, (b) STATE shall take all necessary steps to protect and ensure the confidentiality of the Licensed Software and other materials, and (c) except as permitted by the terms of Section 2.1 of Exhibit D

("Grant of License") or in accordance with N.D.C.C. chap. 44-04, the pertinent provisions of which are set forth in Exhibit E, neither the Licensed Software nor any of the other materials shall be in any way disclosed by STATE to any third party, in whole or in part, without the prior written consent of CONTRACTOR, which may be granted or withheld in its sole discretion.