1025-00009 · Calderwood & Harkness LLP · Transaction Documents

technology-escrow-agreement.docx DOCUMENT M&A / Corporate

12 / 12 ← ✕

Contract analysis Extract to table

TECHNOLOGY ESCROW AGREEMENT

Dated as of May 3, 2024

among

QUORUM INSURANCE HOLDINGS CORP. (Beneficiary)

CLEARPOINT ANALYTICS, INC. (Depositor)

and

GRANITE TRUST COMPANY, N.A. (Escrow Agent)

Right-click to update Table of Contents

TECHNOLOGY ESCROW AGREEMENT

This Technology Escrow Agreement (this "Agreement") is entered into as of May 3, 2024 (the "Effective Date"), by and among:

Quorum Insurance Holdings Corp., a Delaware corporation, with its principal offices at 280 Constitution Plaza, Suite 1400, Hartford, CT 06103 ("Beneficiary");

Clearpoint Analytics, Inc., a Delaware corporation, with its principal offices at 200 South Wacker Drive, Suite 3100, Chicago, IL 60606 ("Depositor"); and

Granite Trust Company, N.A., a national banking association organized under the laws of the United States, with offices at 300 Main Street, Suite 100, Stamford, CT 06901 ("Escrow Agent").

Beneficiary, Depositor, and Escrow Agent are sometimes referred to herein collectively as the "Parties" and each individually as a "Party."

RECITALS

WHEREAS, Depositor and Beneficiary are parties to that certain Enterprise SaaS Subscription Agreement dated April 26, 2024 (the "SaaS Agreement"), pursuant to which Depositor licenses to Beneficiary its proprietary ClaimsIQ™ cloud-hosted, AI-driven claims triage, fraud detection, and analytics platform (the "ClaimsIQ™ Platform" or the "Platform");

WHEREAS, the SaaS Agreement has a total contract value of Seven Million Dollars ($7,000,000) over a five-year initial subscription term, and Beneficiary's business operations depend on the continued availability and functionality of the ClaimsIQ™ Platform across its claims-processing operations in Hartford, Connecticut; Dallas, Texas; and Jacksonville, Florida;

WHEREAS, Beneficiary desires assurance of access to the source code and related materials for the ClaimsIQ™ Platform upon the occurrence of certain specified release conditions, in order to protect its ability to continue operating, maintaining, and supporting the Platform in the event that Depositor is unable or unwilling to perform its obligations under the SaaS Agreement;

WHEREAS, Depositor is willing to deposit such materials with the Escrow Agent under the terms and conditions set forth herein, subject to the protections afforded to Depositor's proprietary rights and confidential information as provided in this Agreement;

WHEREAS, Escrow Agent is willing to accept, hold, and release the Deposit Materials (as defined below) in accordance with the terms and conditions of this Agreement; and

WHEREAS, the Parties desire to set forth their respective rights and obligations with respect to the deposit, verification, storage, and potential release of the Deposit Materials;

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE 1 — DEFINITIONS

As used in this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the SaaS Agreement.

1.1 "Deposit Materials" means the ClaimsIQ™ Platform source code (in all programming languages used, including but not limited to Python, Java, JavaScript, and SQL), build scripts, compilation instructions, deployment configurations, technical documentation (including architecture diagrams, API specifications, and developer guides), database schemas, data dictionaries, and all related materials reasonably necessary to enable a reasonably skilled software engineer to build, deploy, maintain, and operate the ClaimsIQ™ Platform, as more particularly described in Exhibit A (Deposit Description) attached hereto and incorporated herein by reference. For the avoidance of doubt, "Deposit Materials" includes all updates, supplements, and replacements delivered to Escrow Agent pursuant to Sections 3.3 and 3.5 of this Agreement.

1.2 "SaaS Agreement" means the Enterprise SaaS Subscription Agreement dated April 26, 2024, between Beneficiary and Depositor, including all exhibits thereto (Exhibit A — Statement of Work / Service Description; Exhibit B — Service Level Agreement; Exhibit C — Data Processing Addendum; Exhibit D — Security Requirements), as may be amended, supplemented, restated, or otherwise modified from time to time in accordance with its terms.

1.3 "Release Conditions" means those conditions and events described in Section 5.1 of this Agreement, the occurrence of any one of which shall entitle Beneficiary to request a release of the Deposit Materials pursuant to Section 5.2.

1.4 "Verification" means the process of inspection and testing of the Deposit Materials described in Article 4 of this Agreement, undertaken by an independent technical expert to confirm the completeness, accuracy, and usability of the Deposit Materials.

1.5 "Escrow Account" means the secure account established and maintained by Escrow Agent for the storage and safekeeping of the Deposit Materials, which account shall be segregated from Escrow Agent's own assets and from the assets of its other clients.

1.6 "Update Deposit" means each quarterly update to the Deposit Materials required under Section 3.3 of this Agreement, as well as any supplemental deposit required under Section 3.5.

1.7 "Beneficiary" means Quorum Insurance Holdings Corp. and its subsidiaries, including Quorum Property & Casualty Insurance Company, a Connecticut-domiciled insurance company; Quorum Specialty Underwriters, Inc., a Delaware corporation; and Quorum Digital Solutions LLC, a Delaware limited liability company. References to Beneficiary herein shall include all such entities collectively, and Quorum Insurance Holdings Corp. shall be solely responsible for the obligations of Beneficiary under this Agreement.

1.8 "Confidential Information" has the meaning set forth in Section 9.1 of this Agreement.

ARTICLE 2 — APPOINTMENT OF ESCROW AGENT

2.1 Appointment. Depositor and Beneficiary hereby appoint Granite Trust Company, N.A. as Escrow Agent under this Agreement, and Escrow Agent hereby accepts such appointment, subject to the terms and conditions set forth herein. Escrow Agent agrees to perform all duties and obligations expressly set forth in this Agreement with respect to the receipt, storage, safekeeping, and release of the Deposit Materials.

2.2 Escrow Agent's Role. The Parties acknowledge and agree that Escrow Agent acts solely as a custodian and stakeholder with respect to the Deposit Materials. Escrow Agent has no responsibility for, and makes no representations or warranties regarding, the content, completeness, accuracy, functionality, or fitness for any particular purpose of the Deposit Materials. Escrow Agent shall not be deemed a party to, or bound by any of the terms of, the SaaS Agreement, and Escrow Agent shall have no obligation to monitor or enforce the performance of either Depositor or Beneficiary under the SaaS Agreement. Escrow Agent's sole obligations are those expressly set forth in this Agreement.

2.3 Standard of Care. Escrow Agent shall hold and safeguard the Deposit Materials with the same degree of care that it uses for its own confidential materials of similar nature and importance, but in no event less than a commercially reasonable standard of care. Without limiting the generality of the foregoing, Escrow Agent shall store the Deposit Materials in a secure, environmentally controlled facility with appropriate physical access controls, fire suppression systems, and disaster recovery measures. Escrow Agent shall maintain appropriate administrative, technical, and physical safeguards designed to protect the confidentiality, integrity, and availability of the Deposit Materials.

ARTICLE 3 — DEPOSIT OF MATERIALS

3.1 Initial Deposit. Within thirty (30) calendar days following the Effective Date of this Agreement (i.e., by no later than June 2, 2024), Depositor shall deliver to Escrow Agent a complete copy of the Deposit Materials, in a format and on media mutually acceptable to the Parties, together with a written description and manifest of the materials delivered, using the form and format set forth in Exhibit A attached hereto. The initial deposit shall constitute the baseline deposit against which all subsequent Update Deposits and supplemental deposits shall be measured.

3.2 Format and Media. Deposit Materials shall be delivered on encrypted removable media (such as encrypted USB drives or encrypted optical media) or via encrypted electronic transfer using protocols approved in advance by Escrow Agent (including, without limitation, SFTP or other industry-standard secure file transfer methods). Each delivery of Deposit Materials shall include:

(a) all source code files, organized in the same directory structure as maintained in Depositor's version control system, together with a complete export of all branches and tags from Depositor's version control repository;

(b) all build scripts, makefiles, configuration files, container definitions (e.g., Dockerfiles), and compilation instructions necessary to build, package, and deploy the ClaimsIQ™ Platform from source code;

(c) all technical documentation, delivered in both PDF format and native editable format (e.g., Microsoft Word, Markdown, or Ashbury Data Systems export);

(d) complete database schemas in SQL-export format, together with data dictionaries and entity-relationship diagrams; and

(e) any passwords, encryption keys, access tokens, or other credentials necessary to access, decrypt, read, compile, or deploy the Deposit Materials.

Depositor shall ensure that all encryption keys and passwords are delivered separately from the encrypted media to which they relate, in a sealed envelope or via a separate secure electronic transmission, as directed by Escrow Agent.

3.3 Quarterly Updates. Depositor shall deliver updated Deposit Materials to Escrow Agent on a quarterly basis, no later than thirty (30) calendar days following the end of each calendar quarter (i.e., by April 30, July 31, October 31, and January 31 of each year during the term of this Agreement). Each Update Deposit shall reflect the then-current version of the ClaimsIQ™ Platform in production and shall include a revised manifest identifying all changes from the prior deposit, including:

(a) updated version numbers for all source code modules and components;

(b) date stamps indicating the date of the most recent modification to each file or module;

(d) any new or updated third-party dependencies, together with updated license information.

Each Update Deposit shall supersede and replace the immediately preceding deposit; provided, however, that Escrow Agent shall retain the two (2) most recent prior deposits in addition to the current deposit, unless otherwise instructed in writing by both Depositor and Beneficiary.

3.4 Acknowledgment of Receipt. Within five (5) business days of receipt of any Deposit Materials, Update Deposit, or supplemental deposit, Escrow Agent shall provide written acknowledgment of receipt to both Depositor and Beneficiary, specifying: (a) the date of receipt; (b) the media and format received (e.g., "one encrypted USB drive" or "SFTP transfer, 14.7 GB"); and (c) the manifest as described by Depositor, including the total number of files and aggregate file size. Escrow Agent's acknowledgment of receipt shall not constitute a verification or confirmation of the completeness, accuracy, or usability of the Deposit Materials.

3.5 Supplemental Deposits. In addition to the regularly scheduled quarterly Update Deposits, Depositor shall deliver supplemental deposits to Escrow Agent within ten (10) business days following any of the following events:

(a) any material modification to the architecture, core algorithms, or data model of the ClaimsIQ™ Platform;

(b) any new major release or version upgrade of the ClaimsIQ™ Platform (e.g., a release designated as a new major version number);

(c) any change to the technology stack, programming languages, or database systems used by the ClaimsIQ™ Platform that would materially affect the build or deployment process; or

(d) any change to third-party dependencies or open-source components that would be necessary to compile, build, or deploy the Platform.

Each supplemental deposit shall be treated as an Update Deposit for all purposes under this Agreement and shall be accompanied by an updated manifest identifying the changes from the most recent prior deposit.

ARTICLE 4 — VERIFICATION

4.1 Right to Verify. Beneficiary shall have the right, at its own expense, to cause a Verification of the Deposit Materials to be performed by an independent technical expert mutually acceptable to both Depositor and Beneficiary (the "Verification Agent"). Such Verification may be conducted no more than once per calendar year during the term of this Agreement; provided, however, that Beneficiary may request an additional Verification upon reasonable cause, including but not limited to: (a) receipt of a Verification report identifying material deficiencies that have not been cured; (b) a material change in Depositor's financial condition or business operations; or (c) a material change in the ClaimsIQ™ Platform architecture or technology stack. If Depositor and Beneficiary are unable to agree on a Verification Agent within fifteen (15) business days of Beneficiary's written request for Verification, the Verification Agent shall be selected by Pinnacle Dispute Resolution Services, Hartford, CT, from a panel of qualified independent software engineering consultants.

4.2 Scope of Verification. Each Verification shall consist of confirming that:

(a) the Deposit Materials are complete and correspond in all material respects to the manifest accompanying the most recent deposit;

(b) the source code can be compiled and built using the provided build scripts, compilation instructions, and deployment configurations, in a clean build environment, without reference to any materials or systems not included in the Deposit Materials;

(c) the resulting compiled software corresponds in material respects to the version of the ClaimsIQ™ Platform then in production use by Beneficiary, including confirmation that core features (claims triage, fraud detection, and analytics dashboards) operate substantially as described in the documentation; and

(d) the technical documentation is sufficient in scope and detail to enable a reasonably skilled software engineer, who is not previously familiar with the ClaimsIQ™ Platform, to build, deploy, operate, and maintain the Platform without the assistance of Depositor's personnel.

The scope of Verification may be expanded by mutual written agreement of Depositor and Beneficiary, at Beneficiary's expense.

4.3 Verification Report. The Verification Agent shall prepare a written report (the "Verification Report") setting forth in reasonable detail the results of the Verification, including a description of any deficiencies or discrepancies identified. The Verification Report shall be provided simultaneously to Depositor and Beneficiary within thirty (30) calendar days of the commencement of the Verification. If the Verification Report identifies deficiencies, Depositor shall cure such deficiencies within thirty (30) calendar days of receipt of the Verification Report by delivering corrected or supplemental Deposit Materials to Escrow Agent. Upon request by Beneficiary, a follow-up Verification limited in scope to the identified deficiencies may be conducted at Depositor's expense to confirm that such deficiencies have been cured.

4.4 Depositor's Cooperation. Depositor shall cooperate reasonably with any Verification conducted pursuant to this Article 4, including:

(a) providing the Verification Agent with reasonable access to Depositor's engineering personnel, including Samuel Otieno, VP of Product & Engineering, or his designee, for interviews and technical inquiries;

(b) responding to written technical inquiries from the Verification Agent within five (5) business days of receipt;

(c) providing the Verification Agent with access to a non-production instance of the ClaimsIQ™ Platform for comparison purposes, to the extent reasonably necessary to complete the Verification; and

(d) making available any development tools, compilers, or build environments required to compile the source code, to the extent such tools are not included in the Deposit Materials and are not commercially available.

Depositor's cooperation obligations under this Section 4.4 shall not require Depositor to disclose any confidential information of Depositor's other customers or to provide access to Depositor's production systems or live customer data.

4.5 Non-Disclosure. Any independent Verification Agent conducting a Verification under this Article 4 shall, prior to commencing the Verification, execute a non-disclosure agreement in a form reasonably acceptable to Depositor (the "Verification NDA"). The Verification NDA shall, at a minimum, require the Verification Agent to: (a) maintain the confidentiality of all Deposit Materials and Depositor Confidential Information to which the Verification Agent has access; (b) use such information solely for the purpose of conducting the Verification; (c) return or destroy all copies of such information upon completion of the Verification; and (d) not disclose the specific content of the source code or proprietary algorithms to Beneficiary, except to the extent necessary to describe the findings in the Verification Report.

ARTICLE 5 — RELEASE CONDITIONS AND PROCEDURES

5.1 Release Conditions. Escrow Agent shall release the Deposit Materials to Beneficiary upon the occurrence of any of the following events (each, a "Release Condition"):

(a) Bankruptcy or Insolvency of Depositor. Depositor (i) files a voluntary petition in bankruptcy under Title 11 of the United States Code or any similar federal or state insolvency law; (ii) makes a general assignment for the benefit of its creditors; (iii) has an involuntary petition in bankruptcy filed against it under Title 11 of the United States Code or any similar federal or state insolvency law that is not dismissed within sixty (60) calendar days after the date of filing; or (iv) has a receiver, trustee, custodian, liquidator, or similar official appointed for all or a substantial part of its assets, whether by court order or by operation of law, and such appointment is not vacated or stayed within sixty (60) calendar days.

(b) Cessation of Business. Depositor ceases to conduct business in the ordinary course, including, without limitation, ceasing to provide maintenance, support, hosting, or update services for the ClaimsIQ™ Platform to its customers generally (as distinguished from a termination of services solely to Beneficiary, which shall be governed by clause (c) below). For purposes of this Section 5.1(b), a temporary suspension of operations due to a force majeure event (as described in Section 13.9) lasting fewer than sixty (60) consecutive calendar days shall not constitute a cessation of business.

(c) Material Breach of SaaS Agreement. Depositor materially breaches the SaaS Agreement and fails to cure such breach within sixty (60) calendar days after receipt of written notice from Beneficiary specifying the breach in reasonable detail. For purposes of this Section 5.1(c), a "material breach" shall include, without limitation: (i) a failure by Depositor to meet the service availability commitments set forth in Exhibit B (Service Level Agreement) to the SaaS Agreement for three (3) or more consecutive calendar months; (ii) a breach of Depositor's data security obligations under Exhibit D (Security Requirements) to the SaaS Agreement that results in unauthorized access to or disclosure of Beneficiary's confidential data; or (iii) Depositor's failure to provide the support and maintenance services described in the SaaS Agreement for a period of thirty (30) or more consecutive calendar days.

5.2 Release Request Procedure. In the event that Beneficiary believes a Release Condition has occurred, the following procedure shall apply:

(a) Release Request. Beneficiary shall deliver a written release request (a "Release Request") to Escrow Agent and simultaneously deliver a copy of the Release Request to Depositor. The Release Request shall: (i) identify the specific Release Condition(s) that Beneficiary asserts have occurred, by reference to the applicable subsection of Section 5.1; (ii) provide a reasonably detailed description of the facts and circumstances supporting Beneficiary's assertion; and (iii) include reasonable supporting documentation or a certification by an officer of Beneficiary attesting to the occurrence of the Release Condition.

(b) Notification to Depositor. Upon receipt of a Release Request, Escrow Agent shall promptly, and in any event within two (2) business days of receipt, deliver a copy of the Release Request to Depositor by the notice method specified in Section 12, together with a cover letter from Escrow Agent advising Depositor of the objection period described in Section 5.2(c).

(c) Objection Period. Depositor shall have ten (10) business days from the date of receipt of the Release Request (as determined by the notice provisions of Section 12) to deliver to Escrow Agent a written objection (an "Objection Notice") disputing the occurrence of the Release Condition identified in the Release Request. The Objection Notice shall set forth in reasonable detail the basis for Depositor's objection and shall include any supporting documentation or evidence available to Depositor.

(d) Release Without Objection. If Escrow Agent does not receive a timely Objection Notice from Depositor within the ten (10) business day objection period, Escrow Agent shall release the Deposit Materials to Beneficiary within five (5) business days after the expiration of the objection period, in the manner specified in Section 5.4.

5.3 Dispute Resolution Upon Objection. In the event that Escrow Agent receives a timely Objection Notice from Depositor, the following shall apply:

(a) Continued Custody. Escrow Agent shall continue to hold the Deposit Materials in the Escrow Account and shall not release them to any Party until: (i) Escrow Agent receives joint written instructions signed by both Depositor and Beneficiary directing the disposition of the Deposit Materials; or (ii) Escrow Agent receives a final, non-appealable order from a court of competent jurisdiction or a final arbitration award directing the release of the Deposit Materials.

(b) Dispute Resolution Process. Any dispute between Depositor and Beneficiary regarding the occurrence of a Release Condition shall be resolved in accordance with the dispute resolution provisions set forth in the SaaS Agreement, which provide for: (i) mandatory mediation administered by Pinnacle Dispute Resolution Services, Hartford, CT, with the mediation to be completed within forty-five (45) calendar days of the submission of the dispute; followed by (ii) binding arbitration under the Commercial Arbitration Rules of the American Arbitration Association ("AAA"), with the seat of arbitration in Hartford, CT, before a panel of one (1) arbitrator selected in accordance with the AAA rules. Notwithstanding the foregoing, either Party may seek temporary restraining orders, preliminary injunctions, or other injunctive or equitable relief from state or federal courts of competent jurisdiction located in Hartford, CT, at any time, without first submitting to mediation or arbitration.

(c) Escrow Agent's Neutral Role. Escrow Agent shall not be required to determine the validity, sufficiency, or merits of any Release Request, Objection Notice, or the underlying facts and circumstances. Escrow Agent shall have no liability to any Party for acting or refraining from acting in accordance with the provisions of this Section 5.3, provided that Escrow Agent acts in good faith and in accordance with the express terms of this Agreement.

5.4 Manner of Release. Upon determination that a release is warranted (whether due to the absence of a timely Objection Notice, receipt of joint written instructions, or receipt of a final court order or arbitration award), Escrow Agent shall deliver a complete copy of the most recent Deposit Materials to Beneficiary at the address specified in Section 12 or at such other address as Beneficiary may designate in writing. The Deposit Materials shall be delivered in the same format and on the same type of media on which such materials were deposited with Escrow Agent (or on such other format or media as Beneficiary may reasonably request). Escrow Agent shall use commercially reasonable efforts to complete the delivery within ten (10) business days of the determination that release is warranted. Escrow Agent shall retain a copy of the released Deposit Materials in the Escrow Account until this Agreement is terminated in accordance with Article 11.

ARTICLE 6 — LICENSE UPON RELEASE

6.1 Grant of License. Depositor hereby grants to Beneficiary a non-exclusive, irrevocable, fully paid-up, royalty-free, perpetual license to use, copy, modify, and create derivative works of the Deposit Materials, solely for the purpose of continuing to operate, maintain, support, and enhance the ClaimsIQ™ Platform for Beneficiary's internal business purposes, upon and following a release of the Deposit Materials pursuant to Article 5 of this Agreement. For the avoidance of doubt, Beneficiary's internal business purposes include, without limitation, claims triage, fraud detection, and analytics across Beneficiary's property and casualty insurance and specialty lines operations, as well as any other internal business use consistent with the scope of the license granted to Beneficiary under the SaaS Agreement. This license shall become effective automatically upon delivery of the Deposit Materials to Beneficiary pursuant to Section 5.4 and shall require no further action or documentation by Depositor.

6.2 Scope Limitation. The license granted under Section 6.1 does not include any right to:

(a) sublicense, distribute, sell, lease, or otherwise transfer the Deposit Materials or any derivative works thereof to any third party;

(b) use the Deposit Materials to provide services to any third party, whether on a hosted, managed, or any other basis;

(c) reverse-engineer any portions of the Deposit Materials for the purpose of developing or assisting in the development of a competing product or service; or

(d) use the Deposit Materials or any derivative works in any manner that would constitute a violation of Depositor's intellectual property rights or any applicable law.

Notwithstanding the foregoing limitations, Beneficiary may engage third-party contractors and consultants to assist Beneficiary in operating, maintaining, and supporting the ClaimsIQ™ Platform using the Deposit Materials, provided that such contractors and consultants: (i) are bound by written confidentiality obligations no less protective than those set forth in Article 9 of this Agreement; and (ii) use the Deposit Materials solely on behalf of and for the benefit of Beneficiary.

6.3 Survival. The license granted under this Article 6 shall survive any termination or expiration of this Agreement or the SaaS Agreement, to the extent that a release of the Deposit Materials has occurred pursuant to Article 5 prior to such termination or expiration. The license shall also survive any bankruptcy or insolvency of Depositor, and Depositor hereby acknowledges that this Agreement constitutes a license of intellectual property within the meaning of Section 365(n) of Title 11 of the United States Code (the Bankruptcy Code), and Beneficiary shall be entitled to exercise all rights afforded to licensees under Section 365(n) in the event of Depositor's bankruptcy.

ARTICLE 7 — FEES

7.1 Annual Escrow Fee. The annual fee for Escrow Agent's services under this Agreement shall be Four Thousand Five Hundred Dollars ($4,500.00) per year (the "Annual Fee"). The initial Annual Fee shall be payable within thirty (30) calendar days following the Effective Date and shall cover the first year of the term. Thereafter, the Annual Fee shall be payable in advance on each anniversary of the Effective Date.

7.2 Fee Allocation. The Annual Fee shall be split equally between Depositor and Beneficiary, with each Party responsible for Two Thousand Two Hundred Fifty Dollars ($2,250.00) per year. The obligation to pay the Annual Fee is a joint obligation, such that if either Party fails to pay its share, the other Party may (but is not obligated to) pay the delinquent amount to prevent a lapse in escrow services, without waiving any right to seek reimbursement from the delinquent Party.

7.3 Payment. Each Party shall remit its share of the Annual Fee directly to Escrow Agent within thirty (30) calendar days of the date of Escrow Agent's invoice. Escrow Agent shall invoice both Depositor and Beneficiary simultaneously. Payments shall be made by wire transfer or check to the account or address designated by Escrow Agent. Late payments shall bear interest at the lesser of (a) one and one-half percent (1.5%) per month or (b) the maximum rate permitted by applicable law.

7.4 Fee Adjustments. Escrow Agent may increase the Annual Fee upon sixty (60) calendar days' prior written notice to both Depositor and Beneficiary, provided that any such increase shall not exceed five percent (5%) of the then-current Annual Fee per year. If either Depositor or Beneficiary objects to a proposed fee increase, such Party may provide written notice of objection to Escrow Agent within thirty (30) calendar days of receipt of the fee increase notice, and the Parties shall negotiate in good faith to resolve the objection. If the objection is not resolved within sixty (60) calendar days, any Party may terminate this Agreement upon ninety (90) calendar days' prior written notice, subject to the transition provisions of Section 11.3.

7.5 Additional Fees. Any extraordinary services requested by either Party that are outside the scope of Escrow Agent's standard obligations under this Agreement shall be charged at Escrow Agent's then-current hourly rates, which as of the Effective Date are Three Hundred Fifty Dollars ($350.00) per hour. Extraordinary services include, without limitation: (a) expedited release processing (release within twenty-four (24) hours); (b) provision of special storage media or formats not included in Escrow Agent's standard offerings; (c) additional Verifications beyond one (1) per calendar year initiated by Beneficiary; (d) conversion of Deposit Materials from one format to another; and (e) travel, testimony, or similar services in connection with any dispute. All additional fees shall be borne by the requesting Party unless the Parties agree otherwise in writing.

ARTICLE 8 — REPRESENTATIONS AND WARRANTIES

8.1 Depositor's Representations and Warranties. Depositor represents and warrants to Beneficiary and Escrow Agent as of the Effective Date and as of each date on which Deposit Materials are delivered to Escrow Agent, as follows:

(a) Ownership and Rights. Depositor is the sole and exclusive owner of, or has all necessary rights, licenses, and permissions in and to, the Deposit Materials, free and clear of any liens, security interests, encumbrances, or adverse third-party claims, except as expressly set forth in the SaaS Agreement. Without limiting the foregoing, the Deposit Materials do not infringe, misappropriate, or otherwise violate any intellectual property right of any third party.

(b) Completeness and Accuracy. The Deposit Materials, when deposited, constitute a complete and accurate copy of the source code, build scripts, technical documentation, and database schemas for the version of the ClaimsIQ™ Platform then in production use by Beneficiary. The Deposit Materials, together with commercially available third-party tools and libraries identified in the manifest, are sufficient to enable a reasonably skilled software engineer to build, deploy, and operate the ClaimsIQ™ Platform.

(c) Authority. Depositor has full corporate power and authority to enter into this Agreement, to perform its obligations hereunder, and to grant the license set forth in Article 6. The execution, delivery, and performance of this Agreement by Depositor have been duly authorized by all necessary corporate action.

(d) No Conflicts. The deposit and potential release of the Deposit Materials pursuant to this Agreement does not violate, conflict with, or result in a breach of any agreement, contract, or obligation to which Depositor is a party or by which Depositor or its assets are bound, including without limitation any agreements with Ridgeway Capital Partners, LP (Depositor's majority equity holder) or any other equity holder, investor, lender, or licensor.

8.2 Beneficiary's Representations and Warranties. Beneficiary represents and warrants to Depositor and Escrow Agent as of the Effective Date as follows:

(a) Authority. Beneficiary has full corporate power and authority to enter into this Agreement and to perform its obligations hereunder. The execution, delivery, and performance of this Agreement by Beneficiary have been duly authorized by all necessary corporate action.

(b) Use of Materials. Beneficiary shall use the Deposit Materials, if released, solely in accordance with the license granted in Article 6 and shall not use, disclose, or exploit the Deposit Materials for any purpose not expressly permitted by this Agreement.

8.3 Escrow Agent's Representations and Warranties. Escrow Agent represents and warrants to Depositor and Beneficiary as of the Effective Date as follows:

(a) Authority. Escrow Agent has full corporate power and authority to enter into this Agreement and to perform its obligations hereunder. The execution, delivery, and performance of this Agreement by Escrow Agent have been duly authorized by all necessary corporate action.

(b) Safeguards. Escrow Agent maintains commercially reasonable physical, electronic, and procedural safeguards for the protection of deposited materials, including without limitation secure vault storage for physical media, encrypted electronic storage systems with access logging and monitoring, multi-factor authentication for personnel access, and disaster recovery and business continuity plans tested at least annually.

8.4 Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS ARTICLE 8, NO PARTY MAKES ANY WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, TITLE, OR ACCURACY. WITHOUT LIMITING THE FOREGOING, ESCROW AGENT MAKES NO WARRANTY REGARDING THE COMPLETENESS, ACCURACY, OR FUNCTIONALITY OF THE DEPOSIT MATERIALS, AND DEPOSITOR MAKES NO WARRANTY THAT THE DEPOSIT MATERIALS WILL OPERATE WITHOUT ERROR OR INTERRUPTION.

ARTICLE 9 — CONFIDENTIALITY

9.1 Confidential Information. For purposes of this Agreement, "Confidential Information" means: (a) the Deposit Materials, which shall constitute Confidential Information of Depositor; and (b) the terms and conditions of this Agreement, including all Exhibits, which shall constitute Confidential Information of all Parties. Confidential Information also includes any information of a Party that is designated as "confidential" or "proprietary" at the time of disclosure, or that, by its nature or the circumstances of its disclosure, would reasonably be understood to be confidential.

9.2 Escrow Agent Obligations. Escrow Agent shall maintain the Deposit Materials in strict confidence and shall not disclose, use, copy, reproduce, or permit access to the Deposit Materials except as expressly permitted by this Agreement. Escrow Agent shall restrict access to the Deposit Materials to those of its employees, officers, and agents who have a need to know such materials for purposes of performing Escrow Agent's obligations under this Agreement and who are bound by written confidentiality obligations no less protective than those set forth in this Article 9. Escrow Agent shall maintain a log of all personnel who access the Deposit Materials and shall make such log available to Depositor and Beneficiary upon reasonable request.

9.3 Beneficiary Obligations. Prior to a release of the Deposit Materials pursuant to Article 5, Beneficiary shall have no access to the Deposit Materials, except through the Verification process described in Article 4. Following a release, Beneficiary shall maintain the confidentiality of the Deposit Materials and shall restrict access to the Deposit Materials to those employees, officers, and authorized contractors of Beneficiary who need access for the purpose of operating, maintaining, and supporting the ClaimsIQ™ Platform for Beneficiary's internal business purposes. All such employees, officers, and contractors shall be bound by written confidentiality obligations no less protective than those set forth in this Article 9.

9.4 Exceptions. The confidentiality obligations set forth in this Article 9 shall not apply to any information that:

(a) is or becomes publicly available through no fault or breach of the receiving Party;

(b) is independently developed by the receiving Party without reference to or use of the Confidential Information, as demonstrated by contemporaneous written records;

(c) is rightfully received by the receiving Party from a third party that is not subject to any obligation of confidentiality with respect to such information; or

(d) is required to be disclosed by applicable law, rule, regulation, court order, or governmental order or request, provided that the Party required to make such disclosure gives prompt written notice to the owning Party (to the extent legally permitted) and cooperates with the owning Party's reasonable efforts to obtain a protective order or other appropriate remedy to preserve the confidentiality of the information.

9.5 Survival. The confidentiality obligations set forth in this Article 9 shall survive the termination or expiration of this Agreement for a period of five (5) years from the date of such termination or expiration; provided, however, that the confidentiality obligations with respect to trade secrets contained in the Deposit Materials shall survive for so long as such information remains a trade secret under applicable law.

ARTICLE 10 — LIMITATION OF LIABILITY; INDEMNIFICATION OF ESCROW AGENT

10.1 Limitation of Escrow Agent Liability. Escrow Agent's aggregate liability to all Parties under this Agreement, whether in contract, tort, strict liability, or otherwise, shall not exceed the total Annual Fees actually received by Escrow Agent during the twelve (12) month period immediately preceding the event or series of related events giving rise to such liability. In no event shall Escrow Agent be liable to any Party for any indirect, incidental, consequential, special, exemplary, or punitive damages, including without limitation lost profits, lost revenue, loss of data, or business interruption, regardless of the cause of action or the theory of liability, even if Escrow Agent has been advised of the possibility of such damages.

10.2 Escrow Agent Standard of Conduct. Escrow Agent shall not be liable for any act or omission taken or suffered in good faith in accordance with the terms of this Agreement, or in reliance upon any document, notice, certification, instruction, request, or other communication believed by Escrow Agent in good faith to be genuine and to have been signed, sent, or presented by the appropriate Party or its authorized representative. Escrow Agent may rely upon, and shall be protected in acting upon, any written notice, instruction, or other document delivered to it in accordance with Section 12, and shall have no obligation to independently investigate or verify the accuracy or authenticity of any such communication.

10.3 Indemnification of Escrow Agent. Depositor and Beneficiary, jointly and severally, shall indemnify, defend, and hold harmless Escrow Agent and its directors, officers, employees, and agents (each, an "Indemnified Party") from and against any and all losses, damages, liabilities, claims, costs, and expenses (including reasonable attorneys' fees and court costs) arising out of or in connection with Escrow Agent's acceptance of appointment as Escrow Agent or the performance of its obligations under this Agreement, except to the extent that such losses, damages, liabilities, claims, costs, or expenses are directly caused by the Indemnified Party's gross negligence, willful misconduct, or material breach of this Agreement. As between Depositor and Beneficiary, the indemnification obligations under this Section 10.3 shall be borne equally, unless the underlying claim arises solely from the act or omission of one such Party, in which case that Party shall bear the full indemnification obligation.

10.4 Interpleader. In the event of any dispute, disagreement, or adverse claim between Depositor and Beneficiary with respect to the Deposit Materials or the obligations of Escrow Agent hereunder, Escrow Agent shall have the right (but not the obligation) to interplead the Deposit Materials into any court of competent jurisdiction in the State of Connecticut. Upon filing of such interpleader action and the deposit of the Deposit Materials with the court, Escrow Agent shall be relieved and discharged of all further obligations under this Agreement with respect to the interpleaded materials. Depositor and Beneficiary shall jointly and severally reimburse Escrow Agent for all costs and expenses (including reasonable attorneys' fees) incurred by Escrow Agent in connection with any such interpleader action.

ARTICLE 11 — TERM AND TERMINATION

11.1 Term. This Agreement shall commence on the Effective Date (May 3, 2024) and shall continue in full force and effect for so long as the SaaS Agreement remains in effect, and thereafter until the later of: (a) completion of all data export, transition, and destruction obligations of the Parties under the SaaS Agreement; or (b) termination of this Agreement in accordance with this Article 11. If the SaaS Agreement is renewed for any additional term (subject to the one hundred eighty (180) day non-renewal notice period specified in the SaaS Agreement), this Agreement shall automatically continue for the duration of such renewal term without the need for any further action by the Parties.

11.2 Termination by Mutual Consent. This Agreement may be terminated at any time by the mutual written consent of all three Parties. Any such termination shall be effective on the date specified in the written consent or, if no date is specified, on the date on which the last Party signs the written consent.

11.3 Termination by Escrow Agent. Escrow Agent may terminate this Agreement upon ninety (90) calendar days' prior written notice to both Depositor and Beneficiary, provided that Escrow Agent shall continue to hold and safeguard the Deposit Materials until: (a) a successor escrow agent has been appointed by mutual written agreement of Depositor and Beneficiary; and (b) all Deposit Materials, together with all copies thereof, have been transferred to such successor escrow agent in accordance with reasonable transfer procedures agreed upon by the Parties. Depositor and Beneficiary shall use commercially reasonable efforts to appoint a successor escrow agent within sixty (60) calendar days of receipt of Escrow Agent's termination notice.

11.4 Termination Upon Expiration of SaaS Agreement. Unless a Release Condition has occurred or a Release Request is pending at the time of such expiration or termination, this Agreement shall terminate automatically upon the expiration or termination of the SaaS Agreement (including any renewal terms thereof, subject to the one hundred eighty (180) day non-renewal notice period under the SaaS Agreement); provided, however, that such automatic termination shall not take effect until Depositor has requested the return of the Deposit Materials in writing within thirty (30) calendar days of such termination, and Escrow Agent has returned the Deposit Materials to Depositor in accordance with Section 11.5. If Depositor fails to request return of the Deposit Materials within such thirty (30) day period, Escrow Agent may destroy the Deposit Materials and provide written certification of such destruction to both Depositor and Beneficiary.

11.5 Effect of Termination. Upon termination of this Agreement for any reason (absent a release that has occurred or is pending pursuant to Article 5), Escrow Agent shall return the Deposit Materials to Depositor, in the same format and on the same type of media on which such materials were deposited, and shall certify in writing to both Depositor and Beneficiary the destruction of all copies of the Deposit Materials retained by Escrow Agent. The following provisions shall survive any termination or expiration of this Agreement: Article 6 (to the extent a release has occurred prior to termination), Article 9 (Confidentiality), Article 10 (Limitation of Liability; Indemnification of Escrow Agent), and Article 13 (General Provisions). All accrued payment obligations shall also survive termination.

ARTICLE 12 — NOTICES

12.1 Form of Notice. All notices, requests, demands, consents, Release Requests, Objection Notices, and other communications required or permitted under this Agreement shall be in writing and shall be deemed duly given and effective: (a) upon delivery, if delivered personally to the recipient; (b) on the next business day following deposit with a nationally recognized overnight courier service (such as Sundial Data Systems, Halcyon Partners LLC, or Tarrant & Co.), with tracking confirmation, charges prepaid; or (c) on the third (3rd) business day following deposit in the United States mail, if sent by certified mail, return receipt requested, postage prepaid.

12.2 Addresses for Notice. All notices shall be addressed as follows:

If to Beneficiary:

Quorum Insurance Holdings Corp.

Attn: Patricia Okonkwo, General Counsel

280 Constitution Plaza, Suite 1400 Hartford, CT 06103

With a copy (which shall not constitute notice) to:

Calderwood & Harkness LLP

Attn: Renata Vasquez

100 Pearl Street, Suite 800 Hartford, CT 06103

If to Depositor:

Clearpoint Analytics, Inc.

Attn: Anita Rajan, CEO

200 South Wacker Drive, Suite 3100 Chicago, IL 60606

With a copy (which shall not constitute notice) to:

Whitfield Greer & Associates LLP

Attn: Damian Cho

71 South Dearborn Street, Suite 4400 Chicago, IL 60603

If to Escrow Agent:

Granite Trust Company, N.A.

Attn: Technology Escrow Services

300 Main Street, Suite 100 Stamford, CT 06901

12.3 Change of Address. Any Party may change its address for notices by providing written notice of such change to the other Parties in accordance with this Section 12. Such change of address shall be effective upon receipt by the other Parties.

ARTICLE 13 — GENERAL PROVISIONS

13.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Connecticut, without giving effect to any choice-of-law or conflicts-of-law rules or provisions that would cause the application of the laws of any jurisdiction other than the State of Connecticut.

13.2 Dispute Resolution. Any dispute, claim, or controversy arising out of or relating to this Agreement, or the breach, termination, enforcement, interpretation, or validity thereof (other than disputes relating to the occurrence of a Release Condition, which shall be resolved in accordance with Section 5.3), shall be resolved as follows:

(a) Mediation. The disputing Parties shall first attempt to resolve the dispute through mandatory mediation administered by Pinnacle Dispute Resolution Services, Hartford, CT. The mediation shall be conducted in Hartford, CT, and shall be completed within forty-five (45) calendar days of the date on which a Party submits a written request for mediation. The costs of the mediator shall be shared equally by the disputing Parties.

(b) Arbitration. If the dispute is not resolved through mediation, the dispute shall be finally resolved by binding arbitration conducted under the Commercial Arbitration Rules of the American Arbitration Association, with the seat of arbitration in Hartford, CT, before a single arbitrator selected in accordance with the AAA rules. The arbitrator's award shall be final and binding, and judgment upon the award may be entered in any court of competent jurisdiction.

(c) Injunctive Relief. Notwithstanding the foregoing, any Party may seek temporary restraining orders, preliminary injunctions, or other injunctive or equitable relief from state or federal courts of competent jurisdiction located in Hartford, CT, at any time, without first submitting to mediation or arbitration, to the extent necessary to prevent irreparable harm.

13.3 Entire Agreement. This Agreement, together with all Exhibits attached hereto, constitutes the entire agreement among the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous negotiations, discussions, representations, understandings, and agreements, whether written or oral, relating to the subject matter hereof. This Agreement is supplemental to, and does not modify, amend, or supersede, the SaaS Agreement, except to the extent that this Agreement expressly addresses matters relating to the escrow of the Deposit Materials that are not addressed in the SaaS Agreement.

13.4 Amendments. No amendment, modification, supplement, or waiver of any provision of this Agreement shall be effective unless it is in writing and signed by all three Parties. No waiver of any provision of this Agreement shall constitute a waiver of any other provision, and no waiver shall constitute a continuing waiver unless expressly so stated.

13.5 Assignment. Neither Depositor nor Beneficiary may assign, transfer, or delegate any of its rights or obligations under this Agreement without the prior written consent of the other Parties, which consent shall not be unreasonably withheld, conditioned, or delayed; provided, however, that:

(a) Beneficiary may assign its rights (but not its obligations) under this Agreement, without the consent of Depositor or Escrow Agent, to a successor to all or substantially all of Beneficiary's business or assets, whether by merger, consolidation, reorganization, acquisition, sale of assets, or otherwise, provided that such successor assumes in writing all of Beneficiary's obligations under this Agreement; and

(b) any change-of-control of Depositor (including, without limitation, a sale of all or substantially all of Depositor's assets or equity interests, a merger or consolidation of Depositor with or into another entity, or a change in the majority equity holder of Depositor, including a transfer of Ridgeway Capital Partners, LP's equity interest) shall not relieve Depositor of its obligations under this Agreement, and Depositor shall ensure that any successor or acquiring entity assumes all of Depositor's obligations hereunder.

Any purported assignment in violation of this Section 13.5 shall be null and void.

13.6 Severability. If any provision of this Agreement is found by a court of competent jurisdiction or arbitrator to be invalid, illegal, or unenforceable, the remaining provisions of this Agreement shall remain in full force and effect. The Parties shall negotiate in good faith to replace any invalid, illegal, or unenforceable provision with a valid, legal, and enforceable provision that, to the extent possible, achieves the original intent and economic effect of the replaced provision.

13.7 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Execution of this Agreement may be accomplished by means of electronic signatures (including DocuSign, Ashford Health IT, or similar platforms), and such electronic signatures shall be deemed original signatures for all purposes under this Agreement and applicable law, including the Electronic Signatures in Global and National Commerce Act (15 U.S.C. § 7001 et seq.) and the Uniform Electronic Transactions Act as adopted in the relevant jurisdictions.

13.8 No Third-Party Beneficiaries. Except for the indemnification rights of Escrow Agent and its directors, officers, employees, and agents under Section 10.3, this Agreement is entered into solely for the benefit of the Parties hereto and does not create, and shall not be construed to create, any rights, claims, or causes of action in favor of any person or entity that is not a Party to this Agreement.

13.9 Force Majeure. No Party shall be liable for any delay in or failure of performance of its obligations under this Agreement (other than payment obligations) resulting from causes beyond such Party's reasonable control, including without limitation acts of God, natural disasters (earthquakes, floods, hurricanes), epidemics or pandemics, fires, explosions, war, terrorism, civil unrest, government actions or orders, embargoes, sanctions, internet or telecommunications failures, power outages, or cyberattacks (to the extent not caused by the affected Party's failure to maintain commercially reasonable security measures); provided, however, that: (a) the affected Party shall give prompt written notice to the other Parties of the force majeure event and its expected duration; and (b) the affected Party shall use commercially reasonable efforts to mitigate the effect of the force majeure event and to resume performance as promptly as practicable. If a force majeure event prevents performance for more than ninety (90) consecutive calendar days, the non-affected Parties may terminate this Agreement upon written notice, subject to the transition provisions of Section 11.3.

13.10 Relationship to SaaS Agreement. This Agreement is entered into in connection with, and is referenced in, the SaaS Agreement dated April 26, 2024, between Depositor and Beneficiary. The Parties acknowledge that this Agreement is intended to provide Beneficiary with continuity assurance with respect to the ClaimsIQ™ Platform in the event of certain specified Release Conditions. In the event of a conflict between the provisions of this Agreement and the provisions of the SaaS Agreement with respect to escrow-related matters (including the deposit, storage, verification, and release of the Deposit Materials), the provisions of this Agreement shall control. In all other respects, this Agreement and the SaaS Agreement shall be construed as complementary agreements, and the provisions of each shall be given full force and effect.

EXHIBIT A — DESCRIPTION OF DEPOSIT MATERIALS

The Deposit Materials to be delivered to Escrow Agent pursuant to Article 3 of this Agreement shall consist of the following categories of materials, each of which shall be included in every initial deposit, Update Deposit, and supplemental deposit:

A.1 Source Code. Complete source code for the ClaimsIQ™ Platform, including all modules and components, organized by functional area, including without limitation:

• Claims Triage Module (automated intake, severity classification, routing algorithms)

• Fraud Detection Module (pattern recognition, anomaly detection, ML/AI models and training data pipelines)

• Analytics Dashboards Module (reporting, visualization, business intelligence components)

• API Gateway and Integration Layer (RESTful APIs, webhook handlers, third-party integrations)

• Authentication and Authorization Module (user management, role-based access controls, SSO integration)

• Core Platform Infrastructure (Microservices framework, message queuing, caching, logging)

All source code shall be provided in all programming languages used (including, without limitation, Python, Java, JavaScript/TypeScript, SQL, and any other languages employed), together with a complete export of the version control repository (including all branches, tags, and commit history) in a standard format (e.g., Git bundle or archive).

A.2 Build Scripts. All build scripts, makefiles, configuration files, container definitions (e.g., Dockerfiles, Docker Compose files, Kubernetes manifests), continuous integration/continuous deployment (CI/CD) pipeline configurations, and compilation instructions necessary to build, package, and deploy the ClaimsIQ™ Platform from source code in a clean build environment. This shall include environment variable specifications, infrastructure-as-code templates (e.g., Terraform, CloudFormation), and any other automation scripts required for deployment.

A.3 Documentation. Technical documentation sufficient to enable a reasonably skilled software engineer to understand, build, deploy, operate, and maintain the ClaimsIQ™ Platform, including without limitation:

• System architecture diagrams and descriptions

• API specifications (e.g., OpenAPI/Swagger definitions)

• Developer guides and onboarding documentation

• System administrator guides, including installation, configuration, and operational procedures

• Database design documentation, including schema descriptions and data flow diagrams

• Deployment instructions for all supported environments

• Security architecture documentation

• Performance tuning and optimization guides

• Troubleshooting and known-issues documentation

TECHNOLOGY ESCROW AGREEMENT
Dated as of May 3, 2024
among
QUORUM INSURANCE HOLDINGS CORP. (Beneficiary)
CLEARPOINT ANALYTICS, INC. (Depositor)
and
GRANITE TRUST COMPANY, N.A. (Escrow Agent)
Right-click to update Table of Contents
TECHNOLOGY ESCROW AGREEMENT
This Technology Escrow Agreement (this "Agreement") is entered into as of May 3, 2024 (the "Effective Date"), by and among:
Quorum Insurance Holdings Corp., a Delaware corporation, with its principal offices at 280 Constitution Plaza, Suite 1400, Hartford, CT 06103 ("Beneficiary");
Clearpoint Analytics, Inc., a Delaware corporation, with its principal offices at 200 South Wacker Drive, Suite 3100, Chicago, IL 60606 ("Depositor"); and
Granite Trust Company, N.A., a national banking association organized under the laws of the United States, with offices at 300 Main Street, Suite 100, Stamford, CT 06901 ("Escrow Agent").
Beneficiary, Depositor, and Escrow Agent are sometimes referred to herein collectively as the "Parties" and each individually as a "Party."
RECITALS
WHEREAS, Depositor and Beneficiary are parties to that certain Enterprise SaaS Subscription Agreement dated April 26, 2024 (the "SaaS Agreement"), pursuant to which Depositor licenses to Beneficiary its proprietary ClaimsIQ™ cloud-hosted, AI-driven claims triage, fraud detection, and analytics platform (the "ClaimsIQ™ Platform" or the "Platform");
WHEREAS, the SaaS Agreement has a total contract value of Seven Million Dollars ($7,000,000) over a five-year initial subscription term, and Beneficiary's business operations depend on the continued availability and functionality of the ClaimsIQ™ Platform across its claims-processing operations in Hartford, Connecticut; Dallas, Texas; and Jacksonville, Florida;
WHEREAS, Beneficiary desires assurance of access to the source code and related materials for the ClaimsIQ™ Platform upon the occurrence of certain specified release conditions, in order to protect its ability to continue operating, maintaining, and supporting the Platform in the event that Depositor is unable or unwilling to perform its obligations under the SaaS Agreement;
WHEREAS, Depositor is willing to deposit such materials with the Escrow Agent under the terms and conditions set forth herein, subject to the protections afforded to Depositor's proprietary rights and confidential information as provided in this Agreement;
WHEREAS, Escrow Agent is willing to accept, hold, and release the Deposit Materials (as defined below) in accordance with the terms and conditions of this Agreement; and
WHEREAS, the Parties desire to set forth their respective rights and obligations with respect to the deposit, verification, storage, and potential release of the Deposit Materials;
NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE 1 — DEFINITIONS
As used in this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the SaaS Agreement.
1.1 "Deposit Materials" means the ClaimsIQ™ Platform source code (in all programming languages used, including but not limited to Python, Java, JavaScript, and SQL), build scripts, compilation instructions, deployment configurations, technical documentation (including architecture diagrams, API specifications, and developer guides), database schemas, data dictionaries, and all related materials reasonably necessary to enable a reasonably skilled software engineer to build, deploy, maintain, and operate the ClaimsIQ™ Platform, as more particularly described in Exhibit A (Deposit Description) attached hereto and incorporated herein by reference. For the avoidance of doubt, "Deposit Materials" includes all updates, supplements, and replacements delivered to Escrow Agent pursuant to Sections 3.3 and 3.5 of this Agreement.
1.2 "SaaS Agreement" means the Enterprise SaaS Subscription Agreement dated April 26, 2024, between Beneficiary and Depositor, including all exhibits thereto (Exhibit A — Statement of Work / Service Description; Exhibit B — Service Level Agreement; Exhibit C — Data Processing Addendum; Exhibit D — Security Requirements), as may be amended, supplemented, restated, or otherwise modified from time to time in accordance with its terms.
1.3 "Release Conditions" means those conditions and events described in Section 5.1 of this Agreement, the occurrence of any one of which shall entitle Beneficiary to request a release of the Deposit Materials pursuant to Section 5.2.
1.4 "Verification" means the process of inspection and testing of the Deposit Materials described in Article 4 of this Agreement, undertaken by an independent technical expert to confirm the completeness, accuracy, and usability of the Deposit Materials.
1.5 "Escrow Account" means the secure account established and maintained by Escrow Agent for the storage and safekeeping of the Deposit Materials, which account shall be segregated from Escrow Agent's own assets and from the assets of its other clients.
1.6 "Update Deposit" means each quarterly update to the Deposit Materials required under Section 3.3 of this Agreement, as well as any supplemental deposit required under Section 3.5.
1.7 "Beneficiary" means Quorum Insurance Holdings Corp. and its subsidiaries, including Quorum Property & Casualty Insurance Company, a Connecticut-domiciled insurance company; Quorum Specialty Underwriters, Inc., a Delaware corporation; and Quorum Digital Solutions LLC, a Delaware limited liability company. References to Beneficiary herein shall include all such entities collectively, and Quorum Insurance Holdings Corp. shall be solely responsible for the obligations of Beneficiary under this Agreement.
1.8 "Confidential Information" has the meaning set forth in Section 9.1 of this Agreement.
ARTICLE 2 — APPOINTMENT OF ESCROW AGENT
2.1 Appointment. Depositor and Beneficiary hereby appoint Granite Trust Company, N.A. as Escrow Agent under this Agreement, and Escrow Agent hereby accepts such appointment, subject to the terms and conditions set forth herein. Escrow Agent agrees to perform all duties and obligations expressly set forth in this Agreement with respect to the receipt, storage, safekeeping, and release of the Deposit Materials.
2.2 Escrow Agent's Role. The Parties acknowledge and agree that Escrow Agent acts solely as a custodian and stakeholder with respect to the Deposit Materials. Escrow Agent has no responsibility for, and makes no representations or warranties regarding, the content, completeness, accuracy, functionality, or fitness for any particular purpose of the Deposit Materials. Escrow Agent shall not be deemed a party to, or bound by any of the terms of, the SaaS Agreement, and Escrow Agent shall have no obligation to monitor or enforce the performance of either Depositor or Beneficiary under the SaaS Agreement. Escrow Agent's sole obligations are those expressly set forth in this Agreement.
2.3 Standard of Care. Escrow Agent shall hold and safeguard the Deposit Materials with the same degree of care that it uses for its own confidential materials of similar nature and importance, but in no event less than a commercially reasonable standard of care. Without limiting the generality of the foregoing, Escrow Agent shall store the Deposit Materials in a secure, environmentally controlled facility with appropriate physical access controls, fire suppression systems, and disaster recovery measures. Escrow Agent shall maintain appropriate administrative, technical, and physical safeguards designed to protect the confidentiality, integrity, and availability of the Deposit Materials.
ARTICLE 3 — DEPOSIT OF MATERIALS
3.1 Initial Deposit. Within thirty (30) calendar days following the Effective Date of this Agreement (i.e., by no later than June 2, 2024), Depositor shall deliver to Escrow Agent a complete copy of the Deposit Materials, in a format and on media mutually acceptable to the Parties, together with a written description and manifest of the materials delivered, using the form and format set forth in Exhibit A attached hereto. The initial deposit shall constitute the baseline deposit against which all subsequent Update Deposits and supplemental deposits shall be measured.
3.2 Format and Media. Deposit Materials shall be delivered on encrypted removable media (such as encrypted USB drives or encrypted optical media) or via encrypted electronic transfer using protocols approved in advance by Escrow Agent (including, without limitation, SFTP or other industry-standard secure file transfer methods). Each delivery of Deposit Materials shall include:
(a) all source code files, organized in the same directory structure as maintained in Depositor's version control system, together with a complete export of all branches and tags from Depositor's version control repository;
(b) all build scripts, makefiles, configuration files, container definitions (e.g., Dockerfiles), and compilation instructions necessary to build, package, and deploy the ClaimsIQ™ Platform from source code;
(c) all technical documentation, delivered in both PDF format and native editable format (e.g., Microsoft Word, Markdown, or Ashbury Data Systems export);
(d) complete database schemas in SQL-export format, together with data dictionaries and entity-relationship diagrams; and
(e) any passwords, encryption keys, access tokens, or other credentials necessary to access, decrypt, read, compile, or deploy the Deposit Materials.
Depositor shall ensure that all encryption keys and passwords are delivered separately from the encrypted media to which they relate, in a sealed envelope or via a separate secure electronic transmission, as directed by Escrow Agent.
3.3 Quarterly Updates. Depositor shall deliver updated Deposit Materials to Escrow Agent on a quarterly basis, no later than thirty (30) calendar days following the end of each calendar quarter (i.e., by April 30, July 31, October 31, and January 31 of each year during the term of this Agreement). Each Update Deposit shall reflect the then-current version of the ClaimsIQ™ Platform in production and shall include a revised manifest identifying all changes from the prior deposit, including:
(a) updated version numbers for all source code modules and components;
(b) date stamps indicating the date of the most recent modification to each file or module;
(c) a summary of material modifications, new features, bug fixes, and architectural changes since the prior deposit; and
(d) any new or updated third-party dependencies, together with updated license information.
Each Update Deposit shall supersede and replace the immediately preceding deposit; provided, however, that Escrow Agent shall retain the two (2) most recent prior deposits in addition to the current deposit, unless otherwise instructed in writing by both Depositor and Beneficiary.
3.4 Acknowledgment of Receipt. Within five (5) business days of receipt of any Deposit Materials, Update Deposit, or supplemental deposit, Escrow Agent shall provide written acknowledgment of receipt to both Depositor and Beneficiary, specifying: (a) the date of receipt; (b) the media and format received (e.g., "one encrypted USB drive" or "SFTP transfer, 14.7 GB"); and (c) the manifest as described by Depositor, including the total number of files and aggregate file size. Escrow Agent's acknowledgment of receipt shall not constitute a verification or confirmation of the completeness, accuracy, or usability of the Deposit Materials.
3.5 Supplemental Deposits. In addition to the regularly scheduled quarterly Update Deposits, Depositor shall deliver supplemental deposits to Escrow Agent within ten (10) business days following any of the following events:
(a) any material modification to the architecture, core algorithms, or data model of the ClaimsIQ™ Platform;
(b) any new major release or version upgrade of the ClaimsIQ™ Platform (e.g., a release designated as a new major version number);
(c) any change to the technology stack, programming languages, or database systems used by the ClaimsIQ™ Platform that would materially affect the build or deployment process; or
(d) any change to third-party dependencies or open-source components that would be necessary to compile, build, or deploy the Platform.
Each supplemental deposit shall be treated as an Update Deposit for all purposes under this Agreement and shall be accompanied by an updated manifest identifying the changes from the most recent prior deposit.
ARTICLE 4 — VERIFICATION
4.1 Right to Verify. Beneficiary shall have the right, at its own expense, to cause a Verification of the Deposit Materials to be performed by an independent technical expert mutually acceptable to both Depositor and Beneficiary (the "Verification Agent"). Such Verification may be conducted no more than once per calendar year during the term of this Agreement; provided, however, that Beneficiary may request an additional Verification upon reasonable cause, including but not limited to: (a) receipt of a Verification report identifying material deficiencies that have not been cured; (b) a material change in Depositor's financial condition or business operations; or (c) a material change in the ClaimsIQ™ Platform architecture or technology stack. If Depositor and Beneficiary are unable to agree on a Verification Agent within fifteen (15) business days of Beneficiary's written request for Verification, the Verification Agent shall be selected by Pinnacle Dispute Resolution Services, Hartford, CT, from a panel of qualified independent software engineering consultants.
4.2 Scope of Verification. Each Verification shall consist of confirming that:
(a) the Deposit Materials are complete and correspond in all material respects to the manifest accompanying the most recent deposit;
(b) the source code can be compiled and built using the provided build scripts, compilation instructions, and deployment configurations, in a clean build environment, without reference to any materials or systems not included in the Deposit Materials;
(c) the resulting compiled software corresponds in material respects to the version of the ClaimsIQ™ Platform then in production use by Beneficiary, including confirmation that core features (claims triage, fraud detection, and analytics dashboards) operate substantially as described in the documentation; and
(d) the technical documentation is sufficient in scope and detail to enable a reasonably skilled software engineer, who is not previously familiar with the ClaimsIQ™ Platform, to build, deploy, operate, and maintain the Platform without the assistance of Depositor's personnel.
The scope of Verification may be expanded by mutual written agreement of Depositor and Beneficiary, at Beneficiary's expense.
4.3 Verification Report. The Verification Agent shall prepare a written report (the "Verification Report") setting forth in reasonable detail the results of the Verification, including a description of any deficiencies or discrepancies identified. The Verification Report shall be provided simultaneously to Depositor and Beneficiary within thirty (30) calendar days of the commencement of the Verification. If the Verification Report identifies deficiencies, Depositor shall cure such deficiencies within thirty (30) calendar days of receipt of the Verification Report by delivering corrected or supplemental Deposit Materials to Escrow Agent. Upon request by Beneficiary, a follow-up Verification limited in scope to the identified deficiencies may be conducted at Depositor's expense to confirm that such deficiencies have been cured.
4.4 Depositor's Cooperation. Depositor shall cooperate reasonably with any Verification conducted pursuant to this Article 4, including:
(a) providing the Verification Agent with reasonable access to Depositor's engineering personnel, including Samuel Otieno, VP of Product & Engineering, or his designee, for interviews and technical inquiries;
(b) responding to written technical inquiries from the Verification Agent within five (5) business days of receipt;
(c) providing the Verification Agent with access to a non-production instance of the ClaimsIQ™ Platform for comparison purposes, to the extent reasonably necessary to complete the Verification; and
(d) making available any development tools, compilers, or build environments required to compile the source code, to the extent such tools are not included in the Deposit Materials and are not commercially available.
Depositor's cooperation obligations under this Section 4.4 shall not require Depositor to disclose any confidential information of Depositor's other customers or to provide access to Depositor's production systems or live customer data.
4.5 Non-Disclosure. Any independent Verification Agent conducting a Verification under this Article 4 shall, prior to commencing the Verification, execute a non-disclosure agreement in a form reasonably acceptable to Depositor (the "Verification NDA"). The Verification NDA shall, at a minimum, require the Verification Agent to: (a) maintain the confidentiality of all Deposit Materials and Depositor Confidential Information to which the Verification Agent has access; (b) use such information solely for the purpose of conducting the Verification; (c) return or destroy all copies of such information upon completion of the Verification; and (d) not disclose the specific content of the source code or proprietary algorithms to Beneficiary, except to the extent necessary to describe the findings in the Verification Report.
ARTICLE 5 — RELEASE CONDITIONS AND PROCEDURES
5.1 Release Conditions. Escrow Agent shall release the Deposit Materials to Beneficiary upon the occurrence of any of the following events (each, a "Release Condition"):
(a) Bankruptcy or Insolvency of Depositor. Depositor (i) files a voluntary petition in bankruptcy under Title 11 of the United States Code or any similar federal or state insolvency law; (ii) makes a general assignment for the benefit of its creditors; (iii) has an involuntary petition in bankruptcy filed against it under Title 11 of the United States Code or any similar federal or state insolvency law that is not dismissed within sixty (60) calendar days after the date of filing; or (iv) has a receiver, trustee, custodian, liquidator, or similar official appointed for all or a substantial part of its assets, whether by court order or by operation of law, and such appointment is not vacated or stayed within sixty (60) calendar days.
(b) Cessation of Business. Depositor ceases to conduct business in the ordinary course, including, without limitation, ceasing to provide maintenance, support, hosting, or update services for the ClaimsIQ™ Platform to its customers generally (as distinguished from a termination of services solely to Beneficiary, which shall be governed by clause (c) below). For purposes of this Section 5.1(b), a temporary suspension of operations due to a force majeure event (as described in Section 13.9) lasting fewer than sixty (60) consecutive calendar days shall not constitute a cessation of business.
(c) Material Breach of SaaS Agreement. Depositor materially breaches the SaaS Agreement and fails to cure such breach within sixty (60) calendar days after receipt of written notice from Beneficiary specifying the breach in reasonable detail. For purposes of this Section 5.1(c), a "material breach" shall include, without limitation: (i) a failure by Depositor to meet the service availability commitments set forth in Exhibit B (Service Level Agreement) to the SaaS Agreement for three (3) or more consecutive calendar months; (ii) a breach of Depositor's data security obligations under Exhibit D (Security Requirements) to the SaaS Agreement that results in unauthorized access to or disclosure of Beneficiary's confidential data; or (iii) Depositor's failure to provide the support and maintenance services described in the SaaS Agreement for a period of thirty (30) or more consecutive calendar days.
5.2 Release Request Procedure. In the event that Beneficiary believes a Release Condition has occurred, the following procedure shall apply:
(a) Release Request. Beneficiary shall deliver a written release request (a "Release Request") to Escrow Agent and simultaneously deliver a copy of the Release Request to Depositor. The Release Request shall: (i) identify the specific Release Condition(s) that Beneficiary asserts have occurred, by reference to the applicable subsection of Section 5.1; (ii) provide a reasonably detailed description of the facts and circumstances supporting Beneficiary's assertion; and (iii) include reasonable supporting documentation or a certification by an officer of Beneficiary attesting to the occurrence of the Release Condition.
(b) Notification to Depositor. Upon receipt of a Release Request, Escrow Agent shall promptly, and in any event within two (2) business days of receipt, deliver a copy of the Release Request to Depositor by the notice method specified in Section 12, together with a cover letter from Escrow Agent advising Depositor of the objection period described in Section 5.2(c).
(c) Objection Period. Depositor shall have ten (10) business days from the date of receipt of the Release Request (as determined by the notice provisions of Section 12) to deliver to Escrow Agent a written objection (an "Objection Notice") disputing the occurrence of the Release Condition identified in the Release Request. The Objection Notice shall set forth in reasonable detail the basis for Depositor's objection and shall include any supporting documentation or evidence available to Depositor.
(d) Release Without Objection. If Escrow Agent does not receive a timely Objection Notice from Depositor within the ten (10) business day objection period, Escrow Agent shall release the Deposit Materials to Beneficiary within five (5) business days after the expiration of the objection period, in the manner specified in Section 5.4.
5.3 Dispute Resolution Upon Objection. In the event that Escrow Agent receives a timely Objection Notice from Depositor, the following shall apply:
(a) Continued Custody. Escrow Agent shall continue to hold the Deposit Materials in the Escrow Account and shall not release them to any Party until: (i) Escrow Agent receives joint written instructions signed by both Depositor and Beneficiary directing the disposition of the Deposit Materials; or (ii) Escrow Agent receives a final, non-appealable order from a court of competent jurisdiction or a final arbitration award directing the release of the Deposit Materials.
(b) Dispute Resolution Process. Any dispute between Depositor and Beneficiary regarding the occurrence of a Release Condition shall be resolved in accordance with the dispute resolution provisions set forth in the SaaS Agreement, which provide for: (i) mandatory mediation administered by Pinnacle Dispute Resolution Services, Hartford, CT, with the mediation to be completed within forty-five (45) calendar days of the submission of the dispute; followed by (ii) binding arbitration under the Commercial Arbitration Rules of the American Arbitration Association ("AAA"), with the seat of arbitration in Hartford, CT, before a panel of one (1) arbitrator selected in accordance with the AAA rules. Notwithstanding the foregoing, either Party may seek temporary restraining orders, preliminary injunctions, or other injunctive or equitable relief from state or federal courts of competent jurisdiction located in Hartford, CT, at any time, without first submitting to mediation or arbitration.
(c) Escrow Agent's Neutral Role. Escrow Agent shall not be required to determine the validity, sufficiency, or merits of any Release Request, Objection Notice, or the underlying facts and circumstances. Escrow Agent shall have no liability to any Party for acting or refraining from acting in accordance with the provisions of this Section 5.3, provided that Escrow Agent acts in good faith and in accordance with the express terms of this Agreement.
5.4 Manner of Release. Upon determination that a release is warranted (whether due to the absence of a timely Objection Notice, receipt of joint written instructions, or receipt of a final court order or arbitration award), Escrow Agent shall deliver a complete copy of the most recent Deposit Materials to Beneficiary at the address specified in Section 12 or at such other address as Beneficiary may designate in writing. The Deposit Materials shall be delivered in the same format and on the same type of media on which such materials were deposited with Escrow Agent (or on such other format or media as Beneficiary may reasonably request). Escrow Agent shall use commercially reasonable efforts to complete the delivery within ten (10) business days of the determination that release is warranted. Escrow Agent shall retain a copy of the released Deposit Materials in the Escrow Account until this Agreement is terminated in accordance with Article 11.
ARTICLE 6 — LICENSE UPON RELEASE
6.1 Grant of License. Depositor hereby grants to Beneficiary a non-exclusive, irrevocable, fully paid-up, royalty-free, perpetual license to use, copy, modify, and create derivative works of the Deposit Materials, solely for the purpose of continuing to operate, maintain, support, and enhance the ClaimsIQ™ Platform for Beneficiary's internal business purposes, upon and following a release of the Deposit Materials pursuant to Article 5 of this Agreement. For the avoidance of doubt, Beneficiary's internal business purposes include, without limitation, claims triage, fraud detection, and analytics across Beneficiary's property and casualty insurance and specialty lines operations, as well as any other internal business use consistent with the scope of the license granted to Beneficiary under the SaaS Agreement. This license shall become effective automatically upon delivery of the Deposit Materials to Beneficiary pursuant to Section 5.4 and shall require no further action or documentation by Depositor.
6.2 Scope Limitation. The license granted under Section 6.1 does not include any right to:
(a) sublicense, distribute, sell, lease, or otherwise transfer the Deposit Materials or any derivative works thereof to any third party;
(b) use the Deposit Materials to provide services to any third party, whether on a hosted, managed, or any other basis;
(c) reverse-engineer any portions of the Deposit Materials for the purpose of developing or assisting in the development of a competing product or service; or
(d) use the Deposit Materials or any derivative works in any manner that would constitute a violation of Depositor's intellectual property rights or any applicable law.
Notwithstanding the foregoing limitations, Beneficiary may engage third-party contractors and consultants to assist Beneficiary in operating, maintaining, and supporting the ClaimsIQ™ Platform using the Deposit Materials, provided that such contractors and consultants: (i) are bound by written confidentiality obligations no less protective than those set forth in Article 9 of this Agreement; and (ii) use the Deposit Materials solely on behalf of and for the benefit of Beneficiary.
6.3 Survival. The license granted under this Article 6 shall survive any termination or expiration of this Agreement or the SaaS Agreement, to the extent that a release of the Deposit Materials has occurred pursuant to Article 5 prior to such termination or expiration. The license shall also survive any bankruptcy or insolvency of Depositor, and Depositor hereby acknowledges that this Agreement constitutes a license of intellectual property within the meaning of Section 365(n) of Title 11 of the United States Code (the Bankruptcy Code), and Beneficiary shall be entitled to exercise all rights afforded to licensees under Section 365(n) in the event of Depositor's bankruptcy.
ARTICLE 7 — FEES
7.1 Annual Escrow Fee. The annual fee for Escrow Agent's services under this Agreement shall be Four Thousand Five Hundred Dollars ($4,500.00) per year (the "Annual Fee"). The initial Annual Fee shall be payable within thirty (30) calendar days following the Effective Date and shall cover the first year of the term. Thereafter, the Annual Fee shall be payable in advance on each anniversary of the Effective Date.
7.2 Fee Allocation. The Annual Fee shall be split equally between Depositor and Beneficiary, with each Party responsible for Two Thousand Two Hundred Fifty Dollars ($2,250.00) per year. The obligation to pay the Annual Fee is a joint obligation, such that if either Party fails to pay its share, the other Party may (but is not obligated to) pay the delinquent amount to prevent a lapse in escrow services, without waiving any right to seek reimbursement from the delinquent Party.
7.3 Payment. Each Party shall remit its share of the Annual Fee directly to Escrow Agent within thirty (30) calendar days of the date of Escrow Agent's invoice. Escrow Agent shall invoice both Depositor and Beneficiary simultaneously. Payments shall be made by wire transfer or check to the account or address designated by Escrow Agent. Late payments shall bear interest at the lesser of (a) one and one-half percent (1.5%) per month or (b) the maximum rate permitted by applicable law.
7.4 Fee Adjustments. Escrow Agent may increase the Annual Fee upon sixty (60) calendar days' prior written notice to both Depositor and Beneficiary, provided that any such increase shall not exceed five percent (5%) of the then-current Annual Fee per year. If either Depositor or Beneficiary objects to a proposed fee increase, such Party may provide written notice of objection to Escrow Agent within thirty (30) calendar days of receipt of the fee increase notice, and the Parties shall negotiate in good faith to resolve the objection. If the objection is not resolved within sixty (60) calendar days, any Party may terminate this Agreement upon ninety (90) calendar days' prior written notice, subject to the transition provisions of Section 11.3.
7.5 Additional Fees. Any extraordinary services requested by either Party that are outside the scope of Escrow Agent's standard obligations under this Agreement shall be charged at Escrow Agent's then-current hourly rates, which as of the Effective Date are Three Hundred Fifty Dollars ($350.00) per hour. Extraordinary services include, without limitation: (a) expedited release processing (release within twenty-four (24) hours); (b) provision of special storage media or formats not included in Escrow Agent's standard offerings; (c) additional Verifications beyond one (1) per calendar year initiated by Beneficiary; (d) conversion of Deposit Materials from one format to another; and (e) travel, testimony, or similar services in connection with any dispute. All additional fees shall be borne by the requesting Party unless the Parties agree otherwise in writing.
ARTICLE 8 — REPRESENTATIONS AND WARRANTIES
8.1 Depositor's Representations and Warranties. Depositor represents and warrants to Beneficiary and Escrow Agent as of the Effective Date and as of each date on which Deposit Materials are delivered to Escrow Agent, as follows:
(a) Ownership and Rights. Depositor is the sole and exclusive owner of, or has all necessary rights, licenses, and permissions in and to, the Deposit Materials, free and clear of any liens, security interests, encumbrances, or adverse third-party claims, except as expressly set forth in the SaaS Agreement. Without limiting the foregoing, the Deposit Materials do not infringe, misappropriate, or otherwise violate any intellectual property right of any third party.
(b) Completeness and Accuracy. The Deposit Materials, when deposited, constitute a complete and accurate copy of the source code, build scripts, technical documentation, and database schemas for the version of the ClaimsIQ™ Platform then in production use by Beneficiary. The Deposit Materials, together with commercially available third-party tools and libraries identified in the manifest, are sufficient to enable a reasonably skilled software engineer to build, deploy, and operate the ClaimsIQ™ Platform.
(c) Authority. Depositor has full corporate power and authority to enter into this Agreement, to perform its obligations hereunder, and to grant the license set forth in Article 6. The execution, delivery, and performance of this Agreement by Depositor have been duly authorized by all necessary corporate action.
(d) No Conflicts. The deposit and potential release of the Deposit Materials pursuant to this Agreement does not violate, conflict with, or result in a breach of any agreement, contract, or obligation to which Depositor is a party or by which Depositor or its assets are bound, including without limitation any agreements with Ridgeway Capital Partners, LP (Depositor's majority equity holder) or any other equity holder, investor, lender, or licensor.
8.2 Beneficiary's Representations and Warranties. Beneficiary represents and warrants to Depositor and Escrow Agent as of the Effective Date as follows:
(a) Authority. Beneficiary has full corporate power and authority to enter into this Agreement and to perform its obligations hereunder. The execution, delivery, and performance of this Agreement by Beneficiary have been duly authorized by all necessary corporate action.
(b) Use of Materials. Beneficiary shall use the Deposit Materials, if released, solely in accordance with the license granted in Article 6 and shall not use, disclose, or exploit the Deposit Materials for any purpose not expressly permitted by this Agreement.
8.3 Escrow Agent's Representations and Warranties. Escrow Agent represents and warrants to Depositor and Beneficiary as of the Effective Date as follows:
(a) Authority. Escrow Agent has full corporate power and authority to enter into this Agreement and to perform its obligations hereunder. The execution, delivery, and performance of this Agreement by Escrow Agent have been duly authorized by all necessary corporate action.
(b) Safeguards. Escrow Agent maintains commercially reasonable physical, electronic, and procedural safeguards for the protection of deposited materials, including without limitation secure vault storage for physical media, encrypted electronic storage systems with access logging and monitoring, multi-factor authentication for personnel access, and disaster recovery and business continuity plans tested at least annually.
8.4 Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS ARTICLE 8, NO PARTY MAKES ANY WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, TITLE, OR ACCURACY. WITHOUT LIMITING THE FOREGOING, ESCROW AGENT MAKES NO WARRANTY REGARDING THE COMPLETENESS, ACCURACY, OR FUNCTIONALITY OF THE DEPOSIT MATERIALS, AND DEPOSITOR MAKES NO WARRANTY THAT THE DEPOSIT MATERIALS WILL OPERATE WITHOUT ERROR OR INTERRUPTION.
ARTICLE 9 — CONFIDENTIALITY
9.1 Confidential Information. For purposes of this Agreement, "Confidential Information" means: (a) the Deposit Materials, which shall constitute Confidential Information of Depositor; and (b) the terms and conditions of this Agreement, including all Exhibits, which shall constitute Confidential Information of all Parties. Confidential Information also includes any information of a Party that is designated as "confidential" or "proprietary" at the time of disclosure, or that, by its nature or the circumstances of its disclosure, would reasonably be understood to be confidential.
9.2 Escrow Agent Obligations. Escrow Agent shall maintain the Deposit Materials in strict confidence and shall not disclose, use, copy, reproduce, or permit access to the Deposit Materials except as expressly permitted by this Agreement. Escrow Agent shall restrict access to the Deposit Materials to those of its employees, officers, and agents who have a need to know such materials for purposes of performing Escrow Agent's obligations under this Agreement and who are bound by written confidentiality obligations no less protective than those set forth in this Article 9. Escrow Agent shall maintain a log of all personnel who access the Deposit Materials and shall make such log available to Depositor and Beneficiary upon reasonable request.
9.3 Beneficiary Obligations. Prior to a release of the Deposit Materials pursuant to Article 5, Beneficiary shall have no access to the Deposit Materials, except through the Verification process described in Article 4. Following a release, Beneficiary shall maintain the confidentiality of the Deposit Materials and shall restrict access to the Deposit Materials to those employees, officers, and authorized contractors of Beneficiary who need access for the purpose of operating, maintaining, and supporting the ClaimsIQ™ Platform for Beneficiary's internal business purposes. All such employees, officers, and contractors shall be bound by written confidentiality obligations no less protective than those set forth in this Article 9.
9.4 Exceptions. The confidentiality obligations set forth in this Article 9 shall not apply to any information that:
(a) is or becomes publicly available through no fault or breach of the receiving Party;
(b) is independently developed by the receiving Party without reference to or use of the Confidential Information, as demonstrated by contemporaneous written records;
(c) is rightfully received by the receiving Party from a third party that is not subject to any obligation of confidentiality with respect to such information; or
(d) is required to be disclosed by applicable law, rule, regulation, court order, or governmental order or request, provided that the Party required to make such disclosure gives prompt written notice to the owning Party (to the extent legally permitted) and cooperates with the owning Party's reasonable efforts to obtain a protective order or other appropriate remedy to preserve the confidentiality of the information.
9.5 Survival. The confidentiality obligations set forth in this Article 9 shall survive the termination or expiration of this Agreement for a period of five (5) years from the date of such termination or expiration; provided, however, that the confidentiality obligations with respect to trade secrets contained in the Deposit Materials shall survive for so long as such information remains a trade secret under applicable law.
ARTICLE 10 — LIMITATION OF LIABILITY; INDEMNIFICATION OF ESCROW AGENT
10.1 Limitation of Escrow Agent Liability. Escrow Agent's aggregate liability to all Parties under this Agreement, whether in contract, tort, strict liability, or otherwise, shall not exceed the total Annual Fees actually received by Escrow Agent during the twelve (12) month period immediately preceding the event or series of related events giving rise to such liability. In no event shall Escrow Agent be liable to any Party for any indirect, incidental, consequential, special, exemplary, or punitive damages, including without limitation lost profits, lost revenue, loss of data, or business interruption, regardless of the cause of action or the theory of liability, even if Escrow Agent has been advised of the possibility of such damages.
10.2 Escrow Agent Standard of Conduct. Escrow Agent shall not be liable for any act or omission taken or suffered in good faith in accordance with the terms of this Agreement, or in reliance upon any document, notice, certification, instruction, request, or other communication believed by Escrow Agent in good faith to be genuine and to have been signed, sent, or presented by the appropriate Party or its authorized representative. Escrow Agent may rely upon, and shall be protected in acting upon, any written notice, instruction, or other document delivered to it in accordance with Section 12, and shall have no obligation to independently investigate or verify the accuracy or authenticity of any such communication.
10.3 Indemnification of Escrow Agent. Depositor and Beneficiary, jointly and severally, shall indemnify, defend, and hold harmless Escrow Agent and its directors, officers, employees, and agents (each, an "Indemnified Party") from and against any and all losses, damages, liabilities, claims, costs, and expenses (including reasonable attorneys' fees and court costs) arising out of or in connection with Escrow Agent's acceptance of appointment as Escrow Agent or the performance of its obligations under this Agreement, except to the extent that such losses, damages, liabilities, claims, costs, or expenses are directly caused by the Indemnified Party's gross negligence, willful misconduct, or material breach of this Agreement. As between Depositor and Beneficiary, the indemnification obligations under this Section 10.3 shall be borne equally, unless the underlying claim arises solely from the act or omission of one such Party, in which case that Party shall bear the full indemnification obligation.
10.4 Interpleader. In the event of any dispute, disagreement, or adverse claim between Depositor and Beneficiary with respect to the Deposit Materials or the obligations of Escrow Agent hereunder, Escrow Agent shall have the right (but not the obligation) to interplead the Deposit Materials into any court of competent jurisdiction in the State of Connecticut. Upon filing of such interpleader action and the deposit of the Deposit Materials with the court, Escrow Agent shall be relieved and discharged of all further obligations under this Agreement with respect to the interpleaded materials. Depositor and Beneficiary shall jointly and severally reimburse Escrow Agent for all costs and expenses (including reasonable attorneys' fees) incurred by Escrow Agent in connection with any such interpleader action.
ARTICLE 11 — TERM AND TERMINATION
11.1 Term. This Agreement shall commence on the Effective Date (May 3, 2024) and shall continue in full force and effect for so long as the SaaS Agreement remains in effect, and thereafter until the later of: (a) completion of all data export, transition, and destruction obligations of the Parties under the SaaS Agreement; or (b) termination of this Agreement in accordance with this Article 11. If the SaaS Agreement is renewed for any additional term (subject to the one hundred eighty (180) day non-renewal notice period specified in the SaaS Agreement), this Agreement shall automatically continue for the duration of such renewal term without the need for any further action by the Parties.
11.2 Termination by Mutual Consent. This Agreement may be terminated at any time by the mutual written consent of all three Parties. Any such termination shall be effective on the date specified in the written consent or, if no date is specified, on the date on which the last Party signs the written consent.
11.3 Termination by Escrow Agent. Escrow Agent may terminate this Agreement upon ninety (90) calendar days' prior written notice to both Depositor and Beneficiary, provided that Escrow Agent shall continue to hold and safeguard the Deposit Materials until: (a) a successor escrow agent has been appointed by mutual written agreement of Depositor and Beneficiary; and (b) all Deposit Materials, together with all copies thereof, have been transferred to such successor escrow agent in accordance with reasonable transfer procedures agreed upon by the Parties. Depositor and Beneficiary shall use commercially reasonable efforts to appoint a successor escrow agent within sixty (60) calendar days of receipt of Escrow Agent's termination notice.
11.4 Termination Upon Expiration of SaaS Agreement. Unless a Release Condition has occurred or a Release Request is pending at the time of such expiration or termination, this Agreement shall terminate automatically upon the expiration or termination of the SaaS Agreement (including any renewal terms thereof, subject to the one hundred eighty (180) day non-renewal notice period under the SaaS Agreement); provided, however, that such automatic termination shall not take effect until Depositor has requested the return of the Deposit Materials in writing within thirty (30) calendar days of such termination, and Escrow Agent has returned the Deposit Materials to Depositor in accordance with Section 11.5. If Depositor fails to request return of the Deposit Materials within such thirty (30) day period, Escrow Agent may destroy the Deposit Materials and provide written certification of such destruction to both Depositor and Beneficiary.
11.5 Effect of Termination. Upon termination of this Agreement for any reason (absent a release that has occurred or is pending pursuant to Article 5), Escrow Agent shall return the Deposit Materials to Depositor, in the same format and on the same type of media on which such materials were deposited, and shall certify in writing to both Depositor and Beneficiary the destruction of all copies of the Deposit Materials retained by Escrow Agent. The following provisions shall survive any termination or expiration of this Agreement: Article 6 (to the extent a release has occurred prior to termination), Article 9 (Confidentiality), Article 10 (Limitation of Liability; Indemnification of Escrow Agent), and Article 13 (General Provisions). All accrued payment obligations shall also survive termination.
ARTICLE 12 — NOTICES
12.1 Form of Notice. All notices, requests, demands, consents, Release Requests, Objection Notices, and other communications required or permitted under this Agreement shall be in writing and shall be deemed duly given and effective: (a) upon delivery, if delivered personally to the recipient; (b) on the next business day following deposit with a nationally recognized overnight courier service (such as Sundial Data Systems, Halcyon Partners LLC, or Tarrant & Co.), with tracking confirmation, charges prepaid; or (c) on the third (3rd) business day following deposit in the United States mail, if sent by certified mail, return receipt requested, postage prepaid.
12.2 Addresses for Notice. All notices shall be addressed as follows:
If to Beneficiary:
Quorum Insurance Holdings Corp.
Attn: Patricia Okonkwo, General Counsel
280 Constitution Plaza, Suite 1400 Hartford, CT 06103
With a copy (which shall not constitute notice) to:
Calderwood & Harkness LLP
Attn: Renata Vasquez
100 Pearl Street, Suite 800 Hartford, CT 06103
If to Depositor:
Clearpoint Analytics, Inc.
Attn: Anita Rajan, CEO
200 South Wacker Drive, Suite 3100 Chicago, IL 60606
With a copy (which shall not constitute notice) to:
Whitfield Greer & Associates LLP
Attn: Damian Cho
71 South Dearborn Street, Suite 4400 Chicago, IL 60603
If to Escrow Agent:
Granite Trust Company, N.A.
Attn: Technology Escrow Services
300 Main Street, Suite 100 Stamford, CT 06901
12.3 Change of Address. Any Party may change its address for notices by providing written notice of such change to the other Parties in accordance with this Section 12. Such change of address shall be effective upon receipt by the other Parties.
ARTICLE 13 — GENERAL PROVISIONS
13.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Connecticut, without giving effect to any choice-of-law or conflicts-of-law rules or provisions that would cause the application of the laws of any jurisdiction other than the State of Connecticut.
13.2 Dispute Resolution. Any dispute, claim, or controversy arising out of or relating to this Agreement, or the breach, termination, enforcement, interpretation, or validity thereof (other than disputes relating to the occurrence of a Release Condition, which shall be resolved in accordance with Section 5.3), shall be resolved as follows:
(a) Mediation. The disputing Parties shall first attempt to resolve the dispute through mandatory mediation administered by Pinnacle Dispute Resolution Services, Hartford, CT. The mediation shall be conducted in Hartford, CT, and shall be completed within forty-five (45) calendar days of the date on which a Party submits a written request for mediation. The costs of the mediator shall be shared equally by the disputing Parties.
(b) Arbitration. If the dispute is not resolved through mediation, the dispute shall be finally resolved by binding arbitration conducted under the Commercial Arbitration Rules of the American Arbitration Association, with the seat of arbitration in Hartford, CT, before a single arbitrator selected in accordance with the AAA rules. The arbitrator's award shall be final and binding, and judgment upon the award may be entered in any court of competent jurisdiction.
(c) Injunctive Relief. Notwithstanding the foregoing, any Party may seek temporary restraining orders, preliminary injunctions, or other injunctive or equitable relief from state or federal courts of competent jurisdiction located in Hartford, CT, at any time, without first submitting to mediation or arbitration, to the extent necessary to prevent irreparable harm.
13.3 Entire Agreement. This Agreement, together with all Exhibits attached hereto, constitutes the entire agreement among the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous negotiations, discussions, representations, understandings, and agreements, whether written or oral, relating to the subject matter hereof. This Agreement is supplemental to, and does not modify, amend, or supersede, the SaaS Agreement, except to the extent that this Agreement expressly addresses matters relating to the escrow of the Deposit Materials that are not addressed in the SaaS Agreement.
13.4 Amendments. No amendment, modification, supplement, or waiver of any provision of this Agreement shall be effective unless it is in writing and signed by all three Parties. No waiver of any provision of this Agreement shall constitute a waiver of any other provision, and no waiver shall constitute a continuing waiver unless expressly so stated.
13.5 Assignment. Neither Depositor nor Beneficiary may assign, transfer, or delegate any of its rights or obligations under this Agreement without the prior written consent of the other Parties, which consent shall not be unreasonably withheld, conditioned, or delayed; provided, however, that:
(a) Beneficiary may assign its rights (but not its obligations) under this Agreement, without the consent of Depositor or Escrow Agent, to a successor to all or substantially all of Beneficiary's business or assets, whether by merger, consolidation, reorganization, acquisition, sale of assets, or otherwise, provided that such successor assumes in writing all of Beneficiary's obligations under this Agreement; and
(b) any change-of-control of Depositor (including, without limitation, a sale of all or substantially all of Depositor's assets or equity interests, a merger or consolidation of Depositor with or into another entity, or a change in the majority equity holder of Depositor, including a transfer of Ridgeway Capital Partners, LP's equity interest) shall not relieve Depositor of its obligations under this Agreement, and Depositor shall ensure that any successor or acquiring entity assumes all of Depositor's obligations hereunder.
Any purported assignment in violation of this Section 13.5 shall be null and void.
13.6 Severability. If any provision of this Agreement is found by a court of competent jurisdiction or arbitrator to be invalid, illegal, or unenforceable, the remaining provisions of this Agreement shall remain in full force and effect. The Parties shall negotiate in good faith to replace any invalid, illegal, or unenforceable provision with a valid, legal, and enforceable provision that, to the extent possible, achieves the original intent and economic effect of the replaced provision.
13.7 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Execution of this Agreement may be accomplished by means of electronic signatures (including DocuSign, Ashford Health IT, or similar platforms), and such electronic signatures shall be deemed original signatures for all purposes under this Agreement and applicable law, including the Electronic Signatures in Global and National Commerce Act (15 U.S.C. § 7001 et seq.) and the Uniform Electronic Transactions Act as adopted in the relevant jurisdictions.
13.8 No Third-Party Beneficiaries. Except for the indemnification rights of Escrow Agent and its directors, officers, employees, and agents under Section 10.3, this Agreement is entered into solely for the benefit of the Parties hereto and does not create, and shall not be construed to create, any rights, claims, or causes of action in favor of any person or entity that is not a Party to this Agreement.
13.9 Force Majeure. No Party shall be liable for any delay in or failure of performance of its obligations under this Agreement (other than payment obligations) resulting from causes beyond such Party's reasonable control, including without limitation acts of God, natural disasters (earthquakes, floods, hurricanes), epidemics or pandemics, fires, explosions, war, terrorism, civil unrest, government actions or orders, embargoes, sanctions, internet or telecommunications failures, power outages, or cyberattacks (to the extent not caused by the affected Party's failure to maintain commercially reasonable security measures); provided, however, that: (a) the affected Party shall give prompt written notice to the other Parties of the force majeure event and its expected duration; and (b) the affected Party shall use commercially reasonable efforts to mitigate the effect of the force majeure event and to resume performance as promptly as practicable. If a force majeure event prevents performance for more than ninety (90) consecutive calendar days, the non-affected Parties may terminate this Agreement upon written notice, subject to the transition provisions of Section 11.3.
13.10 Relationship to SaaS Agreement. This Agreement is entered into in connection with, and is referenced in, the SaaS Agreement dated April 26, 2024, between Depositor and Beneficiary. The Parties acknowledge that this Agreement is intended to provide Beneficiary with continuity assurance with respect to the ClaimsIQ™ Platform in the event of certain specified Release Conditions. In the event of a conflict between the provisions of this Agreement and the provisions of the SaaS Agreement with respect to escrow-related matters (including the deposit, storage, verification, and release of the Deposit Materials), the provisions of this Agreement shall control. In all other respects, this Agreement and the SaaS Agreement shall be construed as complementary agreements, and the provisions of each shall be given full force and effect.
EXHIBIT A — DESCRIPTION OF DEPOSIT MATERIALS
The Deposit Materials to be delivered to Escrow Agent pursuant to Article 3 of this Agreement shall consist of the following categories of materials, each of which shall be included in every initial deposit, Update Deposit, and supplemental deposit:
A.1 Source Code. Complete source code for the ClaimsIQ™ Platform, including all modules and components, organized by functional area, including without limitation:
•  Claims Triage Module (automated intake, severity classification, routing algorithms)
•  Fraud Detection Module (pattern recognition, anomaly detection, ML/AI models and training data pipelines)
•  Analytics Dashboards Module (reporting, visualization, business intelligence components)
•  API Gateway and Integration Layer (RESTful APIs, webhook handlers, third-party integrations)
•  Authentication and Authorization Module (user management, role-based access controls, SSO integration)
•  Core Platform Infrastructure (Microservices framework, message queuing, caching, logging)
All source code shall be provided in all programming languages used (including, without limitation, Python, Java, JavaScript/TypeScript, SQL, and any other languages employed), together with a complete export of the version control repository (including all branches, tags, and commit history) in a standard format (e.g., Git bundle or archive).
A.2 Build Scripts. All build scripts, makefiles, configuration files, container definitions (e.g., Dockerfiles, Docker Compose files, Kubernetes manifests), continuous integration/continuous deployment (CI/CD) pipeline configurations, and compilation instructions necessary to build, package, and deploy the ClaimsIQ™ Platform from source code in a clean build environment. This shall include environment variable specifications, infrastructure-as-code templates (e.g., Terraform, CloudFormation), and any other automation scripts required for deployment.
A.3 Documentation. Technical documentation sufficient to enable a reasonably skilled software engineer to understand, build, deploy, operate, and maintain the ClaimsIQ™ Platform, including without limitation:
•  System architecture diagrams and descriptions
•  API specifications (e.g., OpenAPI/Swagger definitions)
•  Developer guides and onboarding documentation
•  System administrator guides, including installation, configuration, and operational procedures
•  Database design documentation, including schema descriptions and data flow diagrams
•  Deployment instructions for all supported environments
•  Security architecture documentation
•  Performance tuning and optimization guides
•  Troubleshooting and known-issues documentation
A.4 Database Schemas. Complete database schemas for all databases used by the ClaimsIQ™ Platform (including relational databases, NoSQL databases, data warehouses, and any other data stores), together with:
•  Data dictionaries describing all tables, columns, data types, constraints, and relationships
•  Entity-relationship diagrams
•  SQL export scripts sufficient to recreate all database structures
•  Stored procedures, triggers, views, and functions
•  Data migration scripts and seed data (to the extent necessary for initial deployment)
A.5 Dependencies. A complete and current list of all third-party libraries, frameworks, tools, and dependencies (with version numbers and license types) required to build, test, and deploy the ClaimsIQ™ Platform, including:
•  Open-source libraries and frameworks (with license identification, e.g., MIT, Apache 2.0, GPL)
•  Commercial or proprietary third-party components (with license terms and any applicable license keys or activation codes, to the extent transferable)
•  Development tools and compilers required for the build process
•  Runtime dependencies and system requirements (operating system, runtime environments, database servers)
•  Machine learning model files, pre-trained weights, and training data pipelines
A.6 Manifest. Each deposit (initial deposit, quarterly Update Deposit, and supplemental deposit) shall be accompanied by a written manifest, signed by an authorized representative of Depositor, listing all files and materials deposited, including:
•  File names and directory paths
•  File sizes (in bytes)
•  Version numbers (corresponding to the version control system)
•  Date stamps (date of last modification)
•  Cryptographic hash values (SHA-256) for each file, to enable verification of integrity
•  A summary description of material changes from the prior deposit (for Update Deposits and supplemental deposits)
[Signature Page Follows]
SIGNATURE PAGE TO TECHNOLOGY ESCROW AGREEMENT
IN WITNESS WHEREOF, the Parties have executed this Technology Escrow Agreement as of the date first written above.
QUORUM INSURANCE HOLDINGS CORP.
By: ________
Name: Patricia Okonkwo
Title: General Counsel
Date: May 3, 2024
CLEARPOINT ANALYTICS, INC.

TECHNOLOGY ESCROW AGREEMENT

TECHNOLOGY ESCROW AGREEMENT

RECITALS

Record

Parties

Dates

Amounts