Contract analysis

Section 1.1 — Defined Terms As used in this Agreement, the following capitalized terms shall have the meanings set forth below. Other capitalized terms used but not defined in this Section 1.1 shall have the meanings ascribed to them elsewhere in this Agreement. "Affiliate" means, with respect to any Party, any entity that directly or indirectly controls, is controlled by, or is under common control with such Party.

Section 1.2 — Interpretation The following rules of construction and interpretation shall apply to this Agreement: (a) The headings and captions contained in this Agreement are inserted for convenience of reference only and shall not affect the meaning or interpretation of any provision of this Agreement. (b) References to "Sections," "Articles," "Exhibits," and "Schedules" are to the sections, articles, exhibits, an

Section 2.1 — Services Generally During the Term, Service Provider shall provide to Customer the Services described in this Agreement and in Exhibit A (Scope of Services) attached hereto and incorporated herein by reference. Service Provider shall perform the Services in a professional, workmanlike manner, consistent with industry standards, best practices, and the degree of care, skill, and diligence that would be e

Section 2.2 — Cloud Infrastructure Management Service Provider shall provide cloud infrastructure management services as more particularly described in Exhibit A, Section A-1. The annual fee for cloud infrastructure management services shall be One Million Two Hundred Thousand Dollars ($1,200,000). Cloud infrastructure management services shall include, without limitation, the following: (a) Provisioning, configurati

Section 2.3 — Managed IT Services Service Provider shall provide managed IT services as more particularly described in Exhibit A, Section A-2. The annual fee for managed IT services shall be Eight Hundred Twenty-Five Thousand Dollars ($825,000). Managed IT services shall include, without limitation, the following: (a) Help desk support at Tier 1, Tier 2, and Tier 3 levels, including first-call resolution for routine

Section 2.4 — Enterprise Application Support Service Provider shall provide enterprise application support services as more particularly described in Exhibit A, Section A-3. The annual fee for enterprise application support services shall be Five Hundred Seventy-Five Thousand Dollars ($575,000). Enterprise application support services shall include, without limitation, the following: (a) Support for Customer's Harbor

Section 2.5 — Cybersecurity Monitoring and Incident Response Service Provider shall provide cybersecurity monitoring and incident response services as more particularly described in Exhibit A, Section A-4. The annual fee for cybersecurity monitoring and incident response services shall be Three Hundred Fifty Thousand Dollars ($350,000). Cybersecurity monitoring and incident response services shall include, without li

Section 2.6 — Statements of Work From time to time during the Term, the Parties may execute additional Statements of Work for supplemental services not covered by Exhibit A. Each Statement of Work shall be executed in writing by authorized representatives of both Parties, shall reference this Agreement, and shall be substantially in the form attached hereto as Exhibit E (Form of Statement of Work). Each duly executed

Section 2.7 — Service Provider Personnel Service Provider shall assign to the performance of the Services qualified personnel who possess the appropriate skills, experience, training, and certifications necessary to perform the Services in accordance with the standards required by this Agreement. Service Provider shall ensure that all personnel assigned to the Services are properly supervised and managed, and that ad

Section 2.8 — Subcontracting Service Provider shall not subcontract, delegate, or otherwise transfer any portion of the Services or any of its obligations under this Agreement to any third party without the prior written consent of Customer, which consent shall not be unreasonably withheld, conditioned, or delayed. Any request for consent to subcontract shall be made in writing and shall identify the proposed subcont

Section 3.1 — Initial Term The initial term of this Agreement shall commence on November 1, 2023 and shall expire on October 31, 2028, unless earlier terminated in accordance with Article 4 (the "Initial Term"). The Initial Term is a period of five (5) years.

Section 3.2 — Renewal Following the expiration of the Initial Term, this Agreement shall automatically renew for successive one-year periods (each, a "Renewal Term"), unless either Party provides written notice of non-renewal to the other Party at least one hundred eighty (180) days prior to the expiration of the then-current Initial Term or Renewal Term, as applicable. Each Renewal Term shall be subject to the same

Section 3.3 — Effect of Expiration or Termination Upon the expiration or termination of this Agreement for any reason, Service Provider shall cooperate fully in the orderly transition of the Services back to Customer or to a successor service provider designated by Customer, as further described in Article 13 (Transition Assistance). All provisions of this Agreement that by their nature should survive expiration or t

Section 4.1 — Termination for Cause Either Party may terminate this Agreement upon thirty (30) days' prior written notice to the other Party if the other Party materially breaches any provision of this Agreement and fails to cure such material breach within such thirty (30)-day notice period. The written notice of termination for cause shall describe in reasonable detail the nature of the alleged material breach and

Section 4.2 — Termination for Convenience Customer may terminate this Agreement at any time, with or without cause, upon one hundred eighty (180) days' prior written notice to Service Provider. Upon any termination by Customer for convenience pursuant to this Section 4.2, Customer shall pay to Service Provider an early termination fee equal to fifty percent (50%) of the remaining Annual Contract Value for the balance

Section 4.3 — Termination for Insolvency Either Party may terminate this Agreement immediately upon written notice to the other Party if the other Party: (a) becomes insolvent or admits its inability to pay its debts as they become due; (b) files a voluntary petition in bankruptcy or for reorganization under any applicable bankruptcy or insolvency law; (c) has an involuntary petition in bankruptcy filed against it th

Section 4.4 — Change of Control Either Party may terminate this Agreement within thirty (30) days following receipt of notice of a Change of Control event affecting the other Party by providing written notice of termination to the affected Party. For purposes of this Section 4.4, "Change of Control" shall have the meaning set forth in Section 1.1. Each Party shall provide written notice to the other Party of any Chan

Section 4.5 — Effect of Termination Termination or expiration of this Agreement shall not relieve either Party of any obligations or liabilities that have accrued prior to the effective date of such termination or expiration, including without limitation any payment obligations for Services rendered prior to the effective date of termination. The following provisions shall survive the expiration or termination of thi

ARTICLE 5: SERVICE LEVELS AND REMEDIES

Section 5.1 — Service Level Agreement Service Provider shall perform the Services in accordance with the Service Level Agreements set forth in Exhibit B attached hereto and incorporated herein by reference. The Service Level Agreements establish minimum performance standards for availability, response time, resolution time, and other metrics applicable to each service component. Service Provider acknowledges that Cus

Section 5.2 — SLA Measurement Methodology Revised per negotiation call of September 8, 2023: SLA measurement windows shall be aligned to Customer's fiscal calendar (four-week reporting periods aligned to MCB's 4-4-5 fiscal calendar), rather than standard calendar months, to facilitate Customer's internal performance reporting and financial reconciliation processes. The specific measurement period dates for each fisca

Section 5.3 — Service Level Credits In the event that Service Provider fails to meet the SLA targets set forth in Exhibit B, Customer shall be entitled to Service Level Credits as follows: (a) Severity 1 Outages: For any Severity 1 Outage that exceeds four (4) hours in duration, Customer shall be entitled to a credit of up to fifteen percent (15%) of the monthly fees attributable to the affected service component for

Section 5.4 — Chronic Failure [Note: The definition of "chronic failure" or "repeated SLA failure" and the remedies available to Customer in the event of chronic failure remain open for further negotiation. This was among the 18 remaining open issues identified following the September 8, 2023 negotiation call. MCB's position is that if Service Provider fails to meet the SLA targets for any service component for three

Section 6.1 — Fees In consideration of Service Provider's performance of the Services during the Term, Customer shall pay to Service Provider fees in the amount of Two Million Nine Hundred Fifty Thousand Dollars ($2,950,000) per year (the "Annual Contract Value" or "ACV"). The Annual Contract Value is allocated among the service components as follows: The Total Contract Value over the five-year Initial Term is Fourte

Section 6.2 — Payment Terms Fees shall be payable quarterly in advance. Service Provider shall submit invoices to Customer on or before the first business day of each calendar quarter for the fees due for such quarter. All invoices shall include a reasonably detailed description of the Services provided or to be provided during the applicable quarter, a breakdown of fees by service component, and such other informati

Section 6.3 — Fee Escalation [Note: The annual fee escalation mechanism remains open for negotiation and is one of the 18 remaining open issues. MCB's position is that fees should remain fixed during the Initial Term, with any escalation limited to a maximum of the lesser of (a) three percent (3%) per year or (b) the annual increase in the Consumer Price Index for All Urban Consumers (CPI-U), U.S. City Average, as pu

Section 6.4 — Taxes All fees set forth in this Agreement are exclusive of any and all applicable sales, use, value-added, goods and services, excise, and other similar taxes, duties, levies, and assessments imposed by any governmental authority (collectively, "Taxes"), other than taxes based on Service Provider's net income, gross receipts (to the extent measured by Service Provider's income), capital, franchise, or

Section 6.5 — Disputed Invoices Customer may dispute any invoice or any portion thereof in good faith by providing written notice to Service Provider within thirty (30) days of receipt of the disputed invoice. Such written notice shall identify the invoice in question, the amount disputed, and the basis for the dispute in reasonable detail. Customer shall pay all undisputed amounts in accordance with Section 6.2, not

Section 6.6 — Late Payment Any undisputed amount that is not paid when due shall accrue interest from the date due until the date paid at a rate equal to the lesser of (a) one and one-half percent (1.5%) per month, compounded monthly, or (b) the maximum rate permitted by applicable law. The assessment of late payment interest shall not limit or waive any other rights or remedies available to Service Provider under th

ARTICLE 7: DATA SECURITY AND PRIVACY

Section 7.1 — Data Security Obligations Service Provider shall implement and maintain comprehensive administrative, technical, and physical safeguards designed to protect Customer Data against unauthorized access, use, disclosure, alteration, destruction, or loss, in accordance with industry standards, best practices, and all applicable laws and regulations. Such safeguards shall be no less protective than the measur

Section 7.2 — Data Isolation Service Provider shall maintain logical separation of Customer Data from the data of Service Provider's other customers at all times. Where commercially reasonable and technically feasible, Service Provider shall also maintain physical separation of Customer Data from the data of other customers. In no event shall Customer Data be commingled with data belonging to third parties in a manne

Section 7.3 — Breach Notification Service Provider shall notify Customer of any actual or reasonably suspected security breach, unauthorized access, unauthorized use, or unauthorized disclosure affecting Customer Data (a "Security Incident") within seventy-two (72) hours of Service Provider's discovery of such Security Incident. The initial notification may be made by telephone or email to Customer's designated secur

Section 7.4 — Data Privacy Compliance Service Provider shall comply with all applicable data protection and privacy laws, regulations, and standards in connection with its receipt, processing, storage, and transmission of Customer Data, including without limitation applicable state privacy laws (including the California Consumer Privacy Act (CCPA), as amended by the California Privacy Rights Act (CPRA), and other sta

Section 7.5 — Return and Destruction of Customer Data Upon the expiration or termination of this Agreement for any reason, Service Provider shall, at Customer's election (which election shall be communicated in writing), either: (a) return all Customer Data to Customer in a commercially standard format reasonably requested by Customer; or (b) securely destroy all Customer Data, including all copies, backups, and arch

Section 8.1 — Confidentiality Obligations Each Party (in its capacity as a "Receiving Party") shall hold in strict confidence and shall not disclose, publish, release, or otherwise make available to any third party the Confidential Information of the other Party (in its capacity as a "Disclosing Party"), except as expressly permitted by this Agreement. Each Party shall use at least the same degree of care to protect

Section 8.2 — Permitted Disclosures Notwithstanding Section 8.1, the Receiving Party may disclose Confidential Information of the Disclosing Party: (a) To the Receiving Party's employees, contractors, Affiliates, and professional advisors (including attorneys, accountants, and financial advisors) who have a need to access such Confidential Information for purposes related to this Agreement and who are bound by writte

Section 8.3 — Duration The obligations set forth in this Article 8 shall survive the expiration or termination of this Agreement for a period of five (5) years from the date of such expiration or termination, except that the Receiving Party's obligations with respect to information that constitutes a trade secret under applicable law (including the Defend Trade Secrets Act of 2016 and applicable state trade secret la

Section 8.4 — Equitable Remedies Each Party acknowledges and agrees that a breach or threatened breach of this Article 8 would cause the Disclosing Party irreparable harm for which monetary damages alone would be an inadequate remedy. Accordingly, each Party agrees that, in addition to any other remedies available at law or in equity, the Disclosing Party shall be entitled to seek equitable relief, including temporar

ARTICLE 9: INTELLECTUAL PROPERTY

Section 9.1 — Customer Data Ownership All Customer Data is and shall remain the sole and exclusive property of Customer. Nothing in this Agreement shall be construed to transfer, assign, or convey to Service Provider any right, title, or interest in or to any Customer Data. Service Provider acquires no right, title, or interest in or to Customer Data except the limited, non-exclusive, non-transferable, revocable lice

Section 9.2 — Pre-Existing IP Each Party retains all right, title, and interest in and to its respective Pre-Existing IP. Neither Party acquires any right, title, or interest in the other Party's Pre-Existing IP by virtue of this Agreement, except as expressly set forth in this Section 9.2. Service Provider hereby grants to Customer a non-exclusive, royalty-free, fully paid-up, perpetual, irrevocable, worldwide licen

Section 9.3 — Work Product and Custom Deliverables All Deliverables and work product created, developed, or produced by Service Provider or its personnel specifically for Customer pursuant to this Agreement or any Statement of Work shall be the sole and exclusive property of Customer. Service Provider hereby irrevocably assigns, and shall assign, to Customer all right, title, and interest in and to all such Deliverab

Section 9.4 — Third-Party IP Service Provider shall obtain, at its own expense, all necessary licenses, permissions, and authorizations for any third-party intellectual Property that is incorporated into or required for the use of the Deliverables. Service Provider shall ensure that Customer's use of the Deliverables, including any third-party IP components embedded therein, is properly licensed and authorized and d