PrePass+Contract+Signed+3-31-2023.pdf

TECHNOLOGY CONTRACT: Commercial Vehicle Screening

1. PARTIES

The parties to this contract (Contract) are the state of North Dakota, acting through its Office of Management & Budget, State Procurement Office (STATE), and PrePass Safety Alliance, formerly known as Heavy-vehicle Electronic License Plate, Inc., having its principal place of business at 2929 N. Central Avenue, Suite 1500, Phoenix, AZ 85012 (CONTRACTOR).

2. COOPERATIVE PURCHASING

This contract is a cooperative purchasing contract established pursuant to N.D.C.C § 54-44.4-13.

This contract is made available to state entities, institutions under the jurisdiction of the State Board of Higher Education, other government entities (including counties, cities, townships, public primary and secondary educational entities, governmental boards and commissions), nonprofit entities established on behalf of public entities, tribal agencies, transportation providers under N.D.C.C § 39-04.2, and the International Peace Garden (hereafter known as “Ordering Agencies”).

Participation in this open-ended contract is not mandated; therefore, the estimated volume of this contract is not known. CONTRACTOR may contact the Procurement Officer for assistance in determining whether an entity is eligible to purchase under this contract.

3. 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 State system. Data includes user identification information and metadata which may contain Data or from which the STATE’s Data may be ascertainable. Notwithstanding the foregoing, information and data obtained independently by Contractor through its own systems or Third- Party systems or services (“Contractor Data”) shall not be owned by the State or considered State Data or Works.

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 – means contractors, subcontractors, outsourcing vendors, consultants and others who have a need to use the software for the benefit of STATE.

4. SCOPE OF WORK

CONTRACTOR, in exchange for the compensation paid by STATE under this Contract, shall provide electronic screening services available at fixed and mobile weigh/inspections stations along major highways throughout the state according to STATE’s Request for Proposal #110.7-16-067 dated December 21, 2016, and CONTRACTOR’s Proposal dated January 24, 2017, which are made a part of the Contract by reference.

CONTRACTOR, shall comply with the 2014 Standard Specifications adopted by the North Dakota Department of Transportation and the Supplemental Specifications effective on the date the project is advertised.

5. COMPENSATION-PAYMENTS

The compensation of the CONTRACTOR shall be derived solely from the fees which the CONTRACTOR is permitted to charge participating carriers.

CONTRACTOR acknowledges travel expenses are not paid by STATE shall not invoice STATE for travel expenses.

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

a. On site means any ND office or fixed and mobile weigh/inspections station location.

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.

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.

7. TERM OF CONTRACT

This Contract term (Term or Initial Term) begins on its effective date and ends on March 31, 2025.

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 three (3) options to renew this Contract under the same terms and conditions for a period of twenty-four (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.

8. TIME IS OF THE ESSENCE

CONTRACTOR hereby acknowledges that time is of the essence for performance under this Contract unless otherwise agreed to in writing by the Parties.

9. TERMINATION

a. Termination by Mutual Agreement

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

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. 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.

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.

10. SUSPENSION FOR 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. Notwithstanding the foregoing, in the event that a suspension for convenience by STATE extends for more than thirty (30) consecutive days or for more than sixty (60) days in the aggregate during the Term of this Contract, CONTRACTOR shall have the right to terminate this Contract upon ten (10) days prior written notice to STATE.

11. FORCE MAJEURE

Neither Party shall be held responsible for delay or default caused by 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.

12. 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 injunctive relief or any other remedies to which it is entitled under law or equity without requiring a cure period. 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. 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.

13. 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.

14. 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.

15. 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, but not against claims based on the State’s contributory negligence, comparative and/or contributory negligence or fault, sole negligence, or intentional misconduct. This obligation to defend, indemnify, and hold harmless does not extend to professional liability claims arising from professional errors and omissions. The legal defense provided by CONTRACTOR to the State under this provision 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.

16. 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.

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.

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, less a reasonable offset for use and obsolescence.

17. 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.

18. INSURANCE

a. 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) 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

3) Employer’s liability or “stop gap” insurance of not less than $1,000,000 as an endorsement on the workers compensation or commercial general liability insurance

4) CONTRACTOR may satisfy any coverage amount required above through its Excess Liability/Umbrella policy coverage.

b. 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 Contract.

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 Contract 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 prior to commencement of this Contract. All endorsements shall be provided as soon as practicable.

7) Failure to provide insurance as required in this Contract is a material breach of contract entitling STATE to terminate this Contract immediately.

8) CONTRACTOR shall provide at least 30-day notice of any cancellation or material change to the policies or endorsements. CONTRACTOR shall provide on an ongoing basis, current certificates of insurance during the term of the Contract. A renewal certificate will be provided 10 days prior to coverage expiration.

19. 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.

20. WORK PRODUCT

1. All data and reports ('Work Product') created for STATE under this Contract belong to STATE and must be promptly delivered to STATE upon termination of this Contract.

2. STATE shall retain all right, title, and Interest in any property that it provides under this Contract.

3. CONTRACTOR shall retain all right, title, and Interest In any property that it provides under this Contract.

4. CONTRACTOR will be allowed to remove all of its provided equipment, hardware, and property upon cancellation or termination of this Contract. Removal shall occur during regular business hours or at a time mutually agreed upon by the parties.

5. Each party shall maintain its own property during the Term of this Contract.

21. OWNERSHIP OF INTELLECTUAL PROPERTY

CONTRACTOR (or its subcontractor) shall retain all right, title and interest in and to all of its pre-existing intellectual property used, provided or delivered by CONTRACTOR to STATE in connection with the performance of this Contract, including but not limited to know-how, software, associated documentation, software upgrades, modifications and customizations. For purposes of this Contract, "pre-existing intellectual property” shall mean any intellectual property developed prior to this Contract, or if developed after execution of this Contract, then developed independently of this Contract in the normal course of CONTRACTOR’s operations for the general use by clients.

Furthermore, all software, services and related materials and documentation provided in the performance of this Contract are protected by various trademarks, copyrights, and patents. Title to the service, software, materials, and documentation used to provide the services (including all copies thereof), and all patent, copyright, trade secret, and other proprietary rights therein will at all times reside exclusively with CONTRACTOR and/or its licensors. STATE agrees that CONTRACTOR grants no intellectual property ownership rights to STATE under this Contract.

To the extent required, CONTRACTOR extends to STATE a limited, non-transferable, non-exclusive license to use CONTRACTOR's software solely for purposes of this Contract and for the Term. No license rights shall extend beyond the Term of this Contract.

22. LICENSE GRANT AND SCOPE OF USE

a. Licensing CONTRACTOR grants to STATE a limited, non-transferable, nonexclusive license to use the software and associated documentation, plus any additional software which shall be added by mutual agreement of the parties during the term of this Contract only.

b. Software Functionality andReplacement This software licensed by CONTRACTOR to STATE provides the following functionality: PrePass "NextGen,· delivers a user friendly in-station software that gives users a single gateway to access multiple Federal, State, and Provincial Data Sources, manual search capabilities delivering specific carrier and vehicle data for PrePass and Non-PrePass vehicles, expanded credential information, ISS Score, Access to Driver & vehicle inspection reports, carrier BASICs, recent vehicle & driver out of service (00S} Notifications, improved site administrator management, configure weight, credential and safety settings, and to allow users to easily and quickly set and review credentials, set alarms, set and adjust random pull-in rates, set pull-In requirements, and view real-time by-pass transactions.

Regarding the aforementioned ‘software functionality' licensed by CONTRACTOR to STATE, CONTRACTOR agrees that:

If CONTRACTOR reduces or replaces the functionality contained in the licensed product, and provides this functionality as a separate or renamed product, then STATE shall be entitled to license such software product at no additional license or maintenance fee for the Term of this Contract, including the Term of any Renewal or Extension exercised under the terms of this Contract.

23. TECHNOLOGY STANDARDS

CONTRACTOR shall comply with applicable STATE enterprise architecture technology standards.

These standards can be found on STATE’s website at https://www.ndit.nd.gov/standards. If CONTRACTOR is unable to comply with any applicable standard, 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.

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.

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.

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.

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.

3) No replacement, reassignment or substitution of any assigned individuals and personnel qualifications shall be made without the prior written approval of 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.

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.

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.

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.

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

CONTRACTOR shall conduct background investigations on all contracted staff and subcontractors assigned by CONTRACTOR to perform work under this Contract and shall advise State of the results of such background investigations unless prohibited by law. STATE shall have the right to reject any individual assigned to perform work under this Contract if, in its sole discretion, it determines that the results of the background investigation make the individual unacceptable.

25. PROJECT MANAGEMENT

a. Reporting

1) CONTRACTOR’s Project Manager shall deliver to STATE’s Project Manager, weekly 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. 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, STATE will have five (5) working days or a different period of time as is agreed to by the Parties, 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 best 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 Agency Head, or terminating this Contract upon written notice to CONTRACTOR.

c. Final Acceptance

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 fully implemented in STATE’s live production environment AND

3) STATE has sixty (60) calendar days thereafter in which to accept or reject it in writing. If STATE rejects it, STATE shall specify in writing its grounds for rejection and CONTRACTOR shall use its best efforts to make the product conform to the requirements of this Contract as soon as possible and at no additional cost to STATE. CONTRACTOR shall continue to use its best efforts to make the product conform to the requirements of this Contract until STATE accepts the product or terminates this Contract upon written notice to CONTRACTOR.

26. WARRANTY

Contractor shall maintain all Contractor supplied equipment, at its cost, for the Term of this Contract, including the Term of any Renewal or Extension exercised under the terms of this Contract.

27. SOFTWARE MAINTENANCE

CONTRACTOR shall provide, and STATE may subscribe to, Maintenance Services, including software/hardware updates and technical support services as defined in the Scope of Work, for the product(s) delivered pursuant to this Contract commencing at the end of the warranty period.

CONTRACTOR and STATE shall negotiate the terms and price of such Maintenance Services.

CONTRACTOR warrants that it will continue to offer Maintenance Services for the product(s) for as long as they are allowed to operate in the State under this Contract, including the Term of any Renewal or Extension exercised under the terms of this Contract.

28.A. SOFTWARE SUPPORT – SERVICE LEVEL REQUIREMENT

CONTRACTOR will respond to STATE requests for software support services regarding the licensed software in accordance with the procedures identified below. In each case, STATE may describe and submit the problem by telephone, email, or online helpdesk/service desk tool.

Incident Severity Response

Time Resolution

Time Escalation Procedure

High Impact – software unusable

1 hour

Final Resolution within:

1 business day

See Exhibit 1 – Incident Escalation Procedure

Medium Impact – software useable with severely restricted functionality or performance

4 hours

Final Resolution within:

1 business day

See Exhibit 1 – Incident Escalation Procedure

Low Impact – software useable with minor impact on functionality or performance

8 hours

Final Resolution within:

3 business days

See Exhibit 1 – Incident Escalation Procedure

CONTRACTOR’S failure to meet the above defined Response Times or Resolution Times in any given month during the term and any renewal term shall be deemed a service level default (“Service Level Default”) and STATE may obtain the non-exclusive remedies set forth below. Notwithstanding the above, CONTRACTOR shall not be held responsible for delay or a service level default, if the event is beyond its reasonable control and it gives notice to STATE promptly upon occurrence of the event causing the delay or default or that is reasonably expected to cause a delay or default.

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

CONTRACTOR shall provide subscription services, including software/hardware updates and technical support services for the subscription services pursuant to this Contract commencing at the end of the warranty period

29. HOSTING SERVICES

a. Service Level

CONTRACTOR’s failure to make the hosting services available at least 99% of the time in any given month during the term and any renewal term, (excluding scheduled maintenance, non-operating hours of any State facility or site supporting this Contract, or other matters beyond the reasonable control of CONTRACTOR) shall be deemed a service level default (“Service Level Default”). For purposes of this Contract, “Available” means that STATE users are able to access all features and functions of the licensed product and services including, but not limited to the licensed software and licensed content.

b. Scheduled Maintenance and Notifications The PrePass NextGen in-station software solution is hosted and maintained by the CONTRACTOR team and will require no STATE resources to maintain the software. If maintenance or a patch is needed, the CONTRACTOR team will communicate to STATE information about the issue and the timeframe in which it expects the issue will be resolved. All software releases that include patches will be completed after hours or when the site is closed in order to avoid disruption of daily operations.

c. Hosting Service Exit Plan CONTRACTOR and STATE shall develop an Exit Plan (“Exit Plan”) detailing each party’s respective tasks in connection with the orderly transfer of STATE’s data back to STATE upon termination of this Contract. CONTRACTOR agrees that there shall be no additional fees to execute the Exit Plan. STATE agrees to take delivery of transferred STATE data no later than sixty (60) calendar days following termination of this Contract.

The Exit Plan must include:

1) The format and delivery method mutually agreed upon by CONTRACTOR and STATE to transfer STATE data securely

2) The deletion criteria of STATE data from CONTRACTOR’s location as determined by STATE

30. 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

Name Gabriel Hoggarth Name Mark Doughty Title State Procurement Officer Title President & CEO Address 600 E Blvd Ave Address 2929 N. Central Ave., Suite 1500 City, State, Zip Bismarck, ND 58505 City, State, Zip Phoenix, AZ 85012 Email gjhoggarth@nd.gov Email mark@prepassalliance.org

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.

31. CONFIDENTIALITY

CONTRACTOR shall not use or disclose any information it receives from STATE under this Contract that STATE has previously identified as confidential or exempt from mandatory public disclosure except as necessary to carry out the purposes of this Contract or as authorized in advance by STATE. STATE shall not disclose any information it receives from CONTRACTOR that CONTRACTOR has previously identified as confidential and that STATE determines in its sole discretion is protected from mandatory public disclosure under a specific exception to the North Dakota public records law, N.D.C.C. ch. 44-04. The duty of STATE and CONTRACTOR to maintain confidentiality of information under this section continues beyond the Term of this Contract.

32. COMPLIANCE WITH PUBLIC RECORDS LAWS

Under the North Dakota public records law and subject to the Confidentiality clause of this Contract, certain records may be open to the public upon request.

Public records may include: (a) records STATE receives from CONTRACTOR under this Contract,

(b) records obtained by either Party under this Contract, and (c) records generated by either Party under this Contract.

CONTRACTOR agrees to contact STATE immediately upon receiving a request for information under the public records law and to comply with STATE’s instructions on how to respond to such request.

33. INDEPENDENT ENTITY

CONTRACTOR is an independent entity under this Contract and is not a STATE employee for any purpose, including the application of the Social Security Act, the Fair Labor Standards Act, the Federal Insurance Contribution Act, the North Dakota Unemployment Compensation Law and the North Dakota Workforce Safety and Insurance Act. CONTRACTOR retains sole and absolute discretion in the manner and means of carrying out CONTRACTOR’s activities and responsibilities under this Contract, except to the extent specified in this Contract.

34. ASSIGNMENT AND SUBCONTRACTS

CONTRACTOR may not assign or otherwise transfer or delegate any right or duty without STATE’s express written consent, provided, however, that CONTRACTOR may assign its rights and obligations under this Contract in the event of a change of control or sale of all or substantially all of its assets related to this Contract, whether by merger, reorganization, operation of law, or otherwise.

Should Assignee be a business or entity with whom STATE is prohibited from conducting business, STATE shall have the right to terminate in accordance with the Termination for Cause section of this Contract.

CONTRACTOR may enter subcontracts provided that any subcontract acknowledges the binding nature of this Contract and incorporates this Contract, including any attachments. CONTRACTOR is solely responsible for the performance of any subcontractor with whom CONTRACTOR contracts.

CONTRACTOR does not have authority to contract for or incur obligations on behalf of STATE.

35. SPOLIATION – NOTICE OF POTENTIAL CLAIMS

CONTRACTOR shall promptly notify STATE of all potential claims that arise or result from this Contract. CONTRACTOR shall also take all reasonable steps to preserve all physical evidence and information that may be relevant to the circumstances surrounding a potential claim, while maintaining public safety, and grants to STATE the opportunity to review and inspect such evidence, including the scene of an accident.

36. MERGER AND MODIFICATION, CONFLICT IN DOCUMENTS

This Contract, including the following documents, constitutes the entire agreement between the Parties. There are no understandings, agreements, or representations, oral or written, not specified within this Contract. This Contract may not be modified, supplemented, or amended, in any manner, except by written agreement signed by both Parties.

Notwithstanding anything herein to the contrary, in the event of any inconsistency or conflict among the documents making up this Contract, the documents must control in this order of precedence:

a. The terms of this Contract as may be amended;

b. STATE’s Solicitation Amendment #1 to Request for Proposal (“RFP”) number 110.7-16-080 dated December 21, 2016;

c. STATE’s Request for Proposal (“RFP”) number 110.7-16-080, dated December 21, 2016;

d. CONTRACTOR’s proposal dated January 24, 2017 in response to RFP number 110.7-16-080.

e. All automated end-user agreements (e.g., click-through, shrink-wrap, or browse-wrap) are specifically excluded and null and void. Clicking shall not represent acknowledgement or agreement to any terms and conditions contained in those agreements.

37. UNANTICIPATED AMENDMENTS

If additional work is required within the scope of this Contract due to a legitimate unforeseen circumstance, STATE shall provide CONTRACTOR a written description of the additional work and request CONTRACTOR to submit a proposal for accomplishing the scope of work. CONTRACTOR will not commence additional work until all Parties agree in writing.

38. SEVERABILITY

If any term of this Contract is declared to be illegal or unenforceable by a court having competent jurisdiction, the validity of the remaining terms is unaffected and, if possible, the rights and obligations of the Parties are to be construed and enforced as if this Contract did not contain that term.

39. APPLICABLE LAW AND VENUE

This Contract is governed by and construed in accordance with the laws of the State of North Dakota. Any action to enforce this Contract must be adjudicated exclusively in the state District Court of Burleigh County, North Dakota. Each Party consents to the exclusive jurisdiction of such court and waives any claim of lack of jurisdiction or forum non conveniens.

40. ALTERNATIVE DISPUTE RESOLUTION – JURY TRIAL

By entering this Contract, STATE does not agree to binding arbitration, mediation, or any other form of mandatory Alternative Dispute Resolution. The Parties may enforce the rights and remedies in judicial proceedings. STATE does not waive any right to a jury trial.

41. ATTORNEY FEES AND COSTS

In the event a lawsuit is instituted by STATE to obtain performance under this Contract, and STATE is the prevailing Party, CONTRACTOR shall, except when prohibited by N.D.C.C. § 28-26-04, pay STATE’s reasonable attorney fees and costs in connection with the lawsuit.

42. NONDISCRIMINATION - COMPLIANCE WITH LAWS

CONTRACTOR agrees to comply with all applicable federal and state laws, rules, and policies, including those relating to nondiscrimination, accessibility, and civil rights. (See N.D.C.C. Title 34 – Labor and Employment, specifically N.D.C.C. ch. 34-06.1 Equal Pay for Men and Women.)

CONTRACTOR agrees to timely file all required reports, make required payroll deductions, and timely pay all taxes and premiums owed, including sales and use taxes, unemployment compensation and workers' compensation premiums. CONTRACTOR shall have and keep current all licenses and permits required by law during the Term of this Contract all licenses and permits required by law.

CONTRACTOR’s failure to comply with this section may be deemed a material breach by CONTRACTOR entitling STATE to terminate in accordance with the Termination for Cause section of this Contract.

43. STATE AUDIT

Pursuant to N.D.C.C. § 54-10-19, all records, regardless of physical form, and the accounting practices and procedures of CONTRACTOR relevant to this Contract are subject to examination by the North Dakota State Auditor, the Auditor’s designee, or Federal auditors, if required.

CONTRACTOR shall maintain these records for at least three (3) years following completion of this Contract and be able to provide them upon reasonable notice. STATE, State Auditor, or Auditor’s designee shall provide reasonable notice to CONTRACTOR prior to conducting examination.

44. EFFECTIVENESS OF CONTRACT

This Contract is not effective until fully executed by both Parties. If no start date is specified in the Term of Contract, the most recent date of the signatures of the Parties shall be the Effective Date.

CONTRACTOR STATE OF NORTH DAKOTA

PrePass Safety Alliance Acting through its State Procurement Office

BY: BY:

Printed Name: Mark Doughty Printed Name: Gabriel Hoggarth

Title: President & CEO Title: State Procurement Officer

Date: Date:

3/31/2023

EXHIBIT 1

INCIDENT ESCALATION PROCEDURE

A. Operations and Support

1. Initial Analysis Upon receiving a critical and essential alert, an email will be sent to the State Notification list within the applicable time frames set forth in B.5 below, advising that Contractor is aware of the issue and is looking into the issue. An initial analysis will be completed and will consist of validating that the event condition still exists. This analysis will determine if the event condition can be corrected via a remote desktop session or whether the event requires escalation to either a PrePass Site Technician or a third party vendor service. At the completion of this analysis, a corrective action plan will be started. If escalation to either a PrePass Site Technician or vendor is required they will be contacted and availability for response and resolution will be determined. The support team will remain the central point of communication until the event is resolved.

2. Corrective Action Corrective action implementation will be completed and will consist of validating that the event condition still exists and after completion of corrective action that the event condition has been resolved. If a PrePass Site Technician or vendor is performing the corrective action then the support team will validate that the event condition has been resolved and notify via email the State Notification list of the resolution.

3. Long Term Corrective Action Some event conditions will require further root-cause analysis. Corrective action expected completion will be based on the effort required and if needed will require enhancement or change to be placed on the product backlog. Based on the criticality and urgency of the issue, a hot fix deployment may be required to correct the problem at the earliest possible time.

4. Escalation to PrePass Site Technician One of the support team’s managers will notify the PrePass Site Technician and obtain a schedule for when the PrePass Site Technician will be on the Site. The scheduled site visit and estimated time for the repairs will be sent to the State Notification list.

5. Escalation to Third Party Vendors One of the support team’s managers will notify the third party vendors and obtain an estimate for when repairs will be completed. The estimate for the repair will be sent to the State Notification list.

B. Reactive Support

1. Dispatching CONTRACTOR has established a toll-free non-automated answering service to receive maintenance requests and dispatch appropriate technical staff for problem resolution during coverage hours. The toll free number to call for maintenance issues is 800-562-4718. The dispatch center has been instructed to escalate calls until they speak to live individuals, and not simply leave a message on voice mail. The dispatch center personnel are trained in dispatching procedures that are unique to this program, and have been provided with escalation procedures to ensure no calls will go unattended.

2. Escalation The escalation procedures below provide multiple contact names and telephone numbers so that in the event a primary (during normal business and weekend standby hours) contact cannot be reached; secondary (backup) and higher-level contacts will be called. As a typical example of the escalation process that occurs:

The primary site technician is the first person to receive the call. If the primary site technician does not answer his cell phone, a message is left on voice mail and the backup technician is contacted.

If the backup technician does not answer a message is left and the call is escalated to the service manager.

3. Support Team – High Level Issue Lifecycle

4. Response and Repair Times The maintenance plan has established program response times based on the priority of the site. The priority of the site is determined by the potential bypass volume. We have established the shortest response to correspond to the highest priority, Priority 1. When the technician receives notification of a failure from any of the methods described above, the technician is required to respond within the timeframes listed below for the priority of the site. The table below indicates the priority assignment and response time allowed.

5. Priority Mean Time to Respond/Resolution

Incident Severity Response Time Resolution Time

Priority 1

High Impact [software unusable] 1 hour

Final Resolution within:

1 business day

Priority 2

Medium Impact –

[software useable with severely restricted functionality or performance]

4 hours Final Resolution within:

1 business day

Priority 3 or 4

Low Impact

[software useable with minor impact on functionality or performance]

8 hours Final Resolution within:

3 business days

Response to a failure event is defined as the mean time between receipt of notification and a technician responds in either of the following fashions, remotely accesses the site and starts the troubleshooting process, or if unable to remotely diagnose the problem, response time is define as the time between notification and the time the technician is physically onsite.

As with the response times, the maintenance plan has established program repair times based on the priority of the site. The repair times will be measured from the end of the response time to when the site is fully operational and averaged over all maintenance activities to determine a mean repair time.