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Staff Report & Attachment 1 PREPARED BY: STEPHEN CONWAY Finance Director Reviewed by: Town Manager, Assistant Town Manager, Town Attorney, and Finance Director 110 E. Main Street Los Gatos, CA 95030 ● 408-354-6832 www.losgatosca.gov TOWN OF LOS GATOS COUNCIL AGENDA REPORT MEETING DATE: 08/07/2018 ITEM NO: 8 DATE: JULY 28, 2018 TO: MAYOR AND TOWN COUNCIL FROM: LAUREL PREVETTI, TOWN MANAGER SUBJECT: AUTHORIZE THE TOWN MANAGER TO EXECUTE AN AGREEMENT WITH SUPERION LLC. TO UPGRADE, CLOUD HOST, AND PROVIDE ANNUAL MAINTENANCE SERVICES FOR THE TOWN’S FINANCIAL/HUMAN RESOURCE MANAGEMENT INFORMATION SYSTEM IN AN AMOUNT NOT TO EXCEED $95,759. RECOMMENDATION: Authorize the Town Manager to execute an agreement with Superion LLC. to upgrade, cloud host, and provide annual maintenance services for the Town’s financial/human resource management information system in an amount not to exceed $95,759. BACKGROUND: In FY 2008/09, staff completed a multi-year financial system upgrade. This project involved the conversion of General Ledgers, Payroll, Budget, and Human Resources modules, followed by the implementation of the Cashiering and Business License module. For the last ten years, the Town has managed its financial/human resource information systems through Superion’s e- Finance Plus and e-Community Plus software hosted on the Town’s own servers. The Town has not made any recent investments in this system even though Superion LLC. has offered a series of software updates and external cloud hosting. DISCUSSION: Implementing a financial/human resources system upgrade is a significant and complex undertaking requiring intense technical and cross-Departmental project coordination. Key milestones during project delivery include and are not limited to: system setup, configuration, installation, data migration, manual input of new data, implementation of modules, system testing, and user training. PAGE 2 OF 3 SUBJECT: AUTHORIZE THE TOWN MANAGER TO EXECUTE AN AGREEMENT WITH SUPERION LLC. TO UPGRADE, CLOUD HOST, AND PROVIDE ANNUAL MAINTENANCE SERVICES FOR THE TOWN’S FINANCIAL/HUMAN RESOURCE MANAGEMENT INFORMATION SYSTEM IN AN AMOUNT NOT TO EXCEED $95,759. JULY 28, 2018 S:\COUNCIL REPORTS\2018\08-07-18 Commission Interviews and Closed Session\Finance system\08 Staff Report FINAL.docx 8/2/2018 2:57 PM CGG DISCUSSION (cont’d): At the completion of the system upgrades and transition to the cloud, the Town’s finance/human resource systems will receive the following benefits: • The Town will now be on the latest version of Superion’s financial system. • Future software version upgrades will be completed by Superion at their data centers, occurring more frequently and causing less disruption to Town operations. • Server hardware at the Superion data center is redundant and easily available, eliminating the single point of failure the Town has today. • Superion has multiple data centers, so an unlikely complete collapse of one data center will not cause a prolonged outage for the Town system. • The annual licensing for the cloud option is less expensive than licensing to run th e software on-site on Town servers. • The Town does not need to purchase or maintain any servers or storage for this approach. • The Town is expecting better support for the product because there are no unknown variables of their system running on Town-owned hardware. • With this system, the Town is more prepared for emergencies and disaster recovery, since the system can be accessed remotely and access is not tied to local seismic, fire, or flooding activity. CONCLUSION: Authorize the Town Manager to execute the agreement (Attachment 1) with Superion LLC. for software upgrade, cloud hosting and annual maintenance services in an amount not to exceed $95,759. COORDINATION: The Finance Department and Information Technology Departments coordinated this report. FISCAL IMPACT: There are sufficient funds available to pay for the upgrade and the annual maintenance services and access fees. The cost of the upgrade and cloud hosting set up is $45,790. These expenditures are budgeted in the Information System Upgrade capital project (841-6101) in the recently adopted Fiscal Year 2018/19 – 2022/23 Capital Improvement Program. The cost of the PAGE 3 OF 3 SUBJECT: AUTHORIZE THE TOWN MANAGER TO EXECUTE AN AGREEMENT WITH SUPERION LLC. TO UPGRADE, CLOUD HOST, AND PROVIDE ANNUAL MAINTENANCE SERVICES FOR THE TOWN’S FINANCIAL/HUMAN RESOURCE MANAGEMENT INFORMATION SYSTEM IN AN AMOUNT NOT TO EXCEED $95,759. JULY 28, 2018 S:\COUNCIL REPORTS\2018\08-07-18 Commission Interviews and Closed Session\Finance system\08 Staff Report FINAL.docx 8/2/2018 2:57 PM CGG FISCAL IMPACT (cont’d): annual maintenance services and access fee is $49,696. These expenditures are budgeted in the Information technology (IT) Fund as part of the IT Support Program. ENVIRONMENTAL ASSESSMENT: This is not a project defined under CEQA, and no further action is required. Attachment: 1. Superion Solutions Agreement (Q-00001406)                                                                                    Superion Solutions Agreement (Q-00001406) This Superion Solutions Agreement (the "Agreement"), effective as of the latest date shown on the signature block below (the "Effective Date"), is entered into between Superion, LLC, a Delaware Limited Liability Company with its principal place of business in Lake Mary, FL ("Superion") and the Town of Los Gatos, CA ("Customer"), together with Superion, the "Parties", and each, a "Party". WHEREAS, Superion licenses and gives access to certain software applications (“Superion Solutions”) to its customers and also provides maintenance, support, migration, installation and other professional services; and WHEREAS, Customer desires to license and/or gain access to certain Superion Solutions and receive professional services described herein, and Superion desires to grant and provide Customer license and access to such offerings as well as to support them with professional services, subject to the terms and conditions set forth in this Agreement. NOW, THEREFORE, in consideration of the mutual covenants, terms, and conditions set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, by the signatures of their duly authorized representative below, the Parties intending to be legally bound, agree to all of the following provisions and exhibits of this Agreement: Superion, LLC Town of Los Gatos 1000 Business Center Dr. Lake Mary, FL 32746 110 E. Main Street Los Gatos, CA 95030 By: By: Print Name: Print Name: Print Title: Print Title: Date Signed: Date Signed: 1. Superion Solution: PLUS Term. 1.1. Initial Term. The Initial Term of this Agreement commences as of the Effective Date and will continue in effect for one (1) year from such date unless terminated earlier pursuant to any of the Agreement’s express provisions (the “Initial Term”). 1.2. Renewal Term. This Agreement will automatically renew for additional successive one (1) year terms unless earlier terminated pursuant to any of the Agreement’s provisions (a “Renewal Term” and, collectively, with the Initial Term, the “Term”) at the then prevailing rate. 1.3. Non-Renewal. Either party may elect to end renewal of the contract by issuing a notice of non-renewal, in writing, to the other party three (3) months prior to the expiration of the current contract term. 2. Fees. In consideration of the rights and services granted by Superion to Customer under this Agreement, Customer shall make payments to Superion pursuant to the amounts and payment terms outlined in Exhibit 1 (the “Project Cost Summary”). 3. Definitions. Capitalized terms not otherwise defined in this Agreement have the meanings set forth below: 3.1. "Action" means any claim, action, cause of action, demand, lawsuit, arbitration, inquiry, audit, notice of violation, proceeding, litigation, citation, summons, subpoena, or investigation of any nature, civil, criminal, administrative, regulatory or other, whether at law, in equity, or otherwise. 3.2. "Affiliate" of a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person.   2 3.3. "Authorized User" means Customer's employees, consultants, contractors, and agents who are authorized by Customer to access and use the Superion Solutions under the rights granted to Customer pursuant to this Agreement, and for whom access to the Superion Solutions has been purchased. 3.4. “Baseline” means the version of a Superion Solution updated to the particular time in question through Superion’s warranty services and maintenance, but without any other modification whatsoever. 3.5. “Component System” means any one of the Superion Solutions identified in Exhibit 1, including all copies of Source Code, Object Code and all related specifications, Documentation, technical information, and all corrections, modifications, additions, development work, improvements and enhancements to and all Intellectual Property Rights for such Component System. 3.6. "Customer Data" means information, data, and content, in any form or medium, collected, downloaded, or otherwise received, directly or indirectly from Customer, an Authorized User or end-users by or through the Superion Solutions, provided the data is not personally identifiable and not identifiable to Customer. 3.7. “Custom Modification” means a change that Superion has made at Customer’s request to any Component System in accordance with a Superion-generated specification, but without any other changes whatsoever by any Person. 3.8. "Customer Systems" means the Customer's information technology infrastructure, including computers, software, hardware, databases, electronic systems (including database management systems), and networks, whether operated by Customer or through the use of third-party services. 3.9. “Defect” means a material deviation between the Baseline Superion Solution and its Documentation, for which Defect Customer has given Superion enough information to enable Superion to replicate the deviation on a computer configuration that is both comparable to the Equipment and that is under Superion’s control. Further, with regard to each Custom Modification, Defect means a material deviation between the Custom Modification and the Superion-generated specification and documentation for such Custom Modification, and for which Defect Customer has given Superion enough information to enable Superion to replicate the deviation on a computer configuration that is both comparable to the Equipment and that is under Superion’s control. 3.10. "Documentation" means any manuals, instructions, or other documents or materials that Superion provides or makes available to Customer in any form or medium and which describe the functionality, components, features, or requirements of the Superion Solutions, including any aspect of the installation, configuration, integration, operation, use, support, or maintenance thereof. 3.11. “Enhancements” means general release (as opposed to custom) changes to a Baseline Component System or Custom Modification which increase the functionality of the Baseline Component System or Custom Modification in question. 3.12. "Harmful Code" means any software, hardware, device or other technology, including any virus, worm, malware, or other malicious computer code, the purpose or effect of which is to (a) permit unauthorized access to, or to destroy, disrupt, disable, distort, or otherwise harm or impede any (i) computer, software, firmware, hardware, system, or network; or (ii) any application or function of any of the foregoing or the security, integrity, confidentiality, or use of any data Processed thereby; or (b) prevent Customer or any Authorized User from accessing or using the Superion Solutions as intended by this Agreement. 3.13. "Intellectual Property Rights" means any and all registered and unregistered rights granted, applied for, or otherwise now or hereafter in existence under or related to any patent, copyright, trademark, trade secret, database protection, or other intellectual property rights laws, and all similar or equivalent rights or forms of protection, in any part of the world. 3.14. “Maintenance” means optimization, error correction, modifications, and updates to Superion Systems to correct any known Defects and improve performance. Maintenance will be provided for each Component System, the hours and details of which are described in Exhibit 2 (“Support Standards”). 3.15. “New Releases” means new editions of a Baseline Component System or Custom Modification. 3.16. “Person” means an individual, corporation, partnership, joint venture, limited liability entity, governmental authority, unincorporated organization, trust, association, or other entity. 3.17. "Personal Information" means any information that does or can identify a specific individual or by or from which a specific individual may be identified, contacted, or located. Personal Information includes all "nonpublic personal information" as defined under the Gramm-Leach-Bliley Act, "protected health information" as defined under the Health and Insurance Portability and Accountability Act of 1996, "Personal Data" as defined in the EU Data Protection Directive (Directive 95/46/EEC), "Personal   3 Information" as defined under the Children's Online Privacy Protection Act of 1998, and all rules and regulations issued under any of the foregoing. 3.18. “Professional Services” means installation, implementation, development work, training or consulting services including custom modification programming, support relating to custom modifications, on-site support services, assistance with data transfers, system restarts and reinstallations provided by Superion. 3.19. “Representatives" means, with respect to a party, that party's employees, officers, directors, agents, subcontractors, and legal advisors. 3.20. "Superion Personnel" means all individuals involved in the performance of Support Services and Professional Services as employees, agents, Subcontractors or independent contractors of Superion. 3.21. "Superion Solution(s)" means the Component Systems, Documentation, Custom Modifications, development work, Superion Systems and any and all other information, data, documents, materials, works, and other content, devices, methods, processes, hardware, software, technologies and inventions, including any deliverables, technical or functional descriptions, requirements, plans, or reports, provided or used by Superion or any Subcontractor in connection with Professional Services or Support Services rendered under this Agreement. 3.22. "Superion Systems" means the information technology infrastructure used by or on behalf of Superion to deliver Superion Solutions, including all computers, software, hardware, databases, electronic systems (including database management systems), and networks, whether operated directly by Superion or through the use of third-party services. 3.23. “Support Services” means Maintenance, Enhancements, implementation of New Releases, and general support efforts to respond to incidents reported by Customer in accordance with the detailed Support Standards outlined in Exhibit 2. 3.24. "Third-Party Materials" means materials and information, in any form or medium, including any software, documents, data, content, specifications, products, related services, equipment, or components of or relating to the Superion Solutions that are not proprietary to Superion. 4. License, Access & Services. 4.1. License Grant. Subject to and conditioned on the payment of Fees and compliance with all other terms and conditions of this Agreement, Superion hereby grants to Customer a non-exclusive, non- sublicensable, and non-transferable license to the current version of the Superion Solution(s) outlined in Exhibit 1 at the time of this Agreement’s execution. 4.2. Access and Scope of Use. Subject to and conditioned on Customer and their Authorized Users' compliance with the terms and conditions of this Agreement, Superion hereby grants Customer a non- exclusive, non-transferable right to access and use the Solutions, solely by Authorized Users. Such use is limited to Customer's internal use. Superion shall deliver to Customer the initial copies of the Superion Solution(s) outlined in Exhibit 1 by (a) electronic delivery, by posting it on Superion’s network for downloading, or similar suitable electronic file transfer method, or (b) physical shipment, such as on a disc or other suitable media transfer method. Physical shipment is on FOB-Superion’s shipping point, and electronic delivery is deemed effective at the time Superion provides Customer with access to download the Superion Solutions. The date of such delivery shall be referred to as the “Delivery Date.” 4.3. Documentation License. Superion hereby grants to Customer a non-exclusive, non-sublicenseable, non- transferable license to use the Documentation during the Term solely for Customer's internal business purposes in connection with its use of the Superion Solutions. 4.4. Service and System Control. Except as otherwise expressly provided in this Agreement: 4.4.1. Superion has and will retain sole control over the operation, provision, maintenance, and management of the Superion Solutions; and 4.4.2. Customer has and will retain sole control over the operation, maintenance, and management of, and all access to and use of, the Customer Systems, and sole responsibility for access to and use of the Superion Solutions by any Person by or through the Customer Systems or other means controlled by Customer or any Authorized User, including any reports or results obtained from any use of the Superion Solutions, and conclusions, decisions, or actions based on such use. 4.5. Limitations. Customer must provide Superion with such facilities, equipment and support as are reasonably necessary for Superion to perform its obligations under this Agreement, including, if required by Superion, remote access to the Equipment. Superion is not responsible or liable for any delay or failure of performance caused in whole or in part by any Customer delay or Customer’s failure to perform any   4 obligations under this Agreement. 4.6. Exceptions. Superion has no obligation to provide Support Services relating to any Defect with the Superion Solutions that, in whole or in part, arise out of or result from any of the following: 4.6.1. software, or media on which provided, that is modified or damaged by Customer or third party; 4.6.2. any operation or use of, or other activity relating to, the Superion Solutions other than as specified in the Documentation, including any incorporation, or combination, operation or use of the Superion Solutions in or with, any technology (software, hardware, firmware, system, or network) or service not specified for Customer's use in the Documentation; 4.6.3. any negligence, abuse, misapplication, or misuse of the Superion Solution other than by Superion personnel, including any Customer use of the Superion Solution other than as specified in the Documentation or expressly authorized in writing by Superion; 4.6.4. any Customer's failure to promptly install any New Releases that Superion has previously made available to Customer; 4.6.5. the operation of, or access to, Customer's or a third party's system, materials or network; 4.6.6. any relocation of the Superion Solution other than by Superion personnel; 4.6.7. any beta software, software that Superion makes available for testing or demonstration purposes, temporary software modules, or software for which Superion does not receive a fee; 4.6.8. any breach of or noncompliance with any provision of this Agreement by Customer or any of its Representatives or any Force Majeure Event (including abnormal physical or electrical stress). 4.7. Reservation of Rights. Except for the specified rights outlined in this Section, nothing in this Agreement grants any right, title, or interest in or to any Intellectual Property Rights in or relating to the Support Services, Professional Services, Superion Solutions, or Third-Party Materials, whether expressly, by implication, estoppel, or otherwise. All right, title, and interest in the Superion Solutions, and the Third- Party Materials are and will remain with Superion and the respective rights holders. 4.8. Changes. Superion reserves the right, in its sole discretion, to make any changes to the Support Services and Superion Solutions that it deems necessary or useful to: (a) maintain or enhance the quality or delivery of Superion's services to its customers, the competitive strength of or market for Superion's services, or the Support Services' cost efficiency or performance; or (b) to comply with applicable law. Without limiting the foregoing, either party may, at any time during the Term, request in writing changes to particular Support Services, Professional Services or their product suite of Superion Solutions. The parties shall evaluate and, if agreed, implement all such requested changes. No requested changes will be effective unless and until memorialized in either a Superion issued Add-On Quote signed by the Customer, or a written change order or amendment to this agreement signed by both parties. 4.9. Subcontractors. Superion may from time to time in its discretion engage third parties to perform Professional Services or Support Services (each, a "Subcontractor"). 4.10. Security Measures. The Superion Solution may contain technological measures designed to prevent unauthorized or illegal use of the Superion Solution. Customer acknowledges and agrees that: (a) Superion may use these and other lawful measures to verify compliance with the terms of this Agreement and enforce Superion’s rights, including all Intellectual Property Rights, in and to the Superion Solution; (b) Superion may deny any individual access to and/or use of the Superion Solution if Superion, in its reasonable discretion, believes that person’s use of the Superion Solution would violate any provision of this Agreement, regardless of whether Customer designated that person as an Authorized User; and (c) Superion may collect, maintain, process, use and disclose technical, diagnostic and related non- identifiable data gathered periodically which may lead to improvements in the performance and security of the Superion Solutions. 5. Use Restrictions. Customer shall not, and shall not permit any other Person to, access or use the Superion Solutions except as expressly permitted by this Agreement. For purposes of clarity and without limiting the generality of the foregoing, Customer shall not, except as this Agreement expressly permits: 5.1. copy, modify, or create derivative works or improvements of the Superion Solutions, or rent, lease, lend, sell, sublicense, assign, distribute, publish, transfer, or otherwise make available any Superion Solutions to any Person, including on or in connection with the internet or any time-sharing, service bureau, software as a service, cloud, or other technology or service;   5 5.2. reverse engineer, disassemble, decompile, decode, adapt, or otherwise attempt to derive or gain access to the source code of the Superion Solutions, in whole or in part; 5.3. bypass or breach any security device or protection used by Superion Solutions or access or use the Superion Solutions other than by an Authorized User through the use of his or her own then valid access; 5.4. input, upload, transmit, or otherwise provide to or through the Superion Systems, any information or materials that are unlawful or injurious, or contain, transmit, or activate any Harmful Code; 5.5. damage, destroy, disrupt, disable, impair, interfere with, or otherwise impede or harm in any manner the Superion Systems, or Superion's provision of services to any third party, in whole or in part; 5.6. remove, delete, alter, or obscure any trademarks, Specifications, Documentation, warranties, or disclaimers, or any copyright, trademark, patent, or other intellectual property or proprietary rights notices from any Documentation or Superion Solutions, including any copy thereof; 5.7. access or use the Superion Solutions in any manner or for any purpose that infringes, misappropriates, or otherwise violates any Intellectual Property Right or other right of any third party, or that violates any applicable law; 5.8. access or use the Superion Solutions for purposes of competitive analysis of the Superion Solutions, the development, provision, or use of a competing software service or product or any other purpose that is to Superion's detriment or commercial disadvantage or otherwise access or use the Superion Solutions beyond the scope of the authorization granted under this Section. 6. Customer Obligations. 6.1. Customer Systems and Cooperation. Customer shall at all times during the Term: (a) set up, maintain, and operate in good repair all Customer Systems on or through which the Superion Solutions are accessed or used; (b) provide Superion Personnel with such access to Customer's premises and Customer Systems as is necessary for Superion to perform the Support Services in accordance with the Support Standards and Specifications; and (c) provide all cooperation as Superion may reasonably request to enable Superion to exercise its rights and perform its obligations under and in connection with this Agreement. 6.2. Effect of Customer Failure or Delay. Superion is not responsible or liable for any delay or failure of performance caused in whole or in part by Customer's delay in performing, or failure to perform, any of its obligations under this Agreement. 6.3. Corrective Action and Notice. If Customer becomes aware of any actual or threatened activity prohibited by Section 5, Customer shall, and shall cause its Authorized Users to, immediately: (a) take all reasonable and lawful measures within their respective control that are necessary to stop the activity or threatened activity and to mitigate its effects (including, where applicable, by discontinuing and preventing any unauthorized access to the Superion Solutions and permanently erasing from their systems and destroying any data to which any of them gained unauthorized access); and (b) notify Superion of any such actual or threatened activity. 7. Professional Services. 7.1. Compliance with Customer Policies. While Superion Personnel are performing services at Customer's site, Superion will ensure that such personnel comply with Customer’s reasonable security procedures and site policies that are generally applicable to Customer’s other suppliers providing similar services and that have been provided to Superion in writing or in advance. Customer shall promptly reimburse Superion for any out-of-pocket costs incurred in complying with such procedures and policies. 7.2. Contributed Material. In the process of Superion’s performing Professional Services, Customer may, from time to time, provide Superion with designs, plans, or specifications, improvements, works or other material for inclusion in, or making modifications to, the Superion Solutions, the Documentation or any other deliverables (“Contributed Material”). Customer grants to Superion a nonexclusive, irrevocable, perpetual, transferable right, without the payment of any royalties or other compensation of any kind and without the right of attribution, for Superion, Superion’s Affiliates and Superion’s licensees to make, use, sell and create derivative works of the Contributed Material. 8. Confidentiality. 8.1. Confidential Information. "Confidential Information" means information in any form or medium (whether oral, written, electronic, or other) that the Disclosing Party considers confidential or proprietary, including information consisting of or relating to the Disclosing Party's technology, trade secrets, know-how, business operations, plans, strategies, customers, and pricing, and information with respect to which the   6 Disclosing Party has contractual or other confidentiality obligations. Without limiting the foregoing, Confidential Information of Superion includes the Superion Solutions, all software provided with the Superion Solutions, and algorithms, methods, techniques and processes revealed by the Source Code of the Superion Solutions and any software provided with the Superion Solutions. In connection with this Agreement each party (as the "Disclosing Party") may disclose or make available Confidential Information to the other party (as the "Receiving Party"). 8.2. Exclusions. Confidential Information does not include information that: (a) was rightfully known to the Receiving Party without restriction on use or disclosure prior to being disclosed or made available to the Receiving Party in connection with this Agreement; (b) was or becomes generally known by the public other than by the Receiving Party or any of its Representatives' noncompliance with this Agreement; (c) was or is received by the Receiving Party on a non-confidential basis from a third party that was or is independently developed by the Receiving Party without reference or use of any Confidential Information. 8.3. Protection of Confidential Information. As a condition to being provided with any disclosure of or access to Confidential Information, the Receiving Party shall: 8.3.1. not access or use Confidential Information other than as necessary to exercise its rights or perform its obligations under and in accordance with this Agreement; 8.3.2. not disclose or permit access to Confidential Information other than to its Representatives who: (i) need to know such Confidential Information for purposes of the Receiving Party's exercise of its rights or performance of its obligations under and in accordance with this Agreement; (ii) have been informed of the confidential nature of the Confidential Information and the Receiving Party's obligations under this Section; and (iii) are bound by written confidentiality or restricted use obligations at least as protective of the Confidential Information as the terms in this Section; 8.3.3. safeguard the Confidential Information from unauthorized use, access, or disclosure using at least the degree of care it uses to protect its sensitive information and in no event less than a reasonable degree of care; 8.3.4. ensure its Representatives' compliance with, and be responsible and liable for any of its Representatives' non-compliance with, the terms of this Section. 8.4. Compelled Disclosures. If the either Party or any of its Representatives is compelled by applicable law to disclose any Confidential Information then, to the extent permitted by law, that Party shall: (a) promptly, and prior to such disclosure, notify the other Party in writing of such requirement so that they can seek a protective order or other remedy or waive its rights under Section 8.3; and (b) provide reasonable assistance to the Disclosing Party in opposing such disclosure or seeking a protective order or other limitations on disclosure. If the Disclosing Party waives compliance or, after providing the notice and assistance required under this Section, the Receiving Party remains required by law to disclose any Confidential Information, the Receiving Party shall disclose only that portion of the Confidential Information that the Receiving Party is legally required to disclose. 8.5. Trade Secrets. Notwithstanding any other provisions of this Agreement, the Receiving Party's obligations under this Section with respect to any Confidential Information that constitutes a trade secret under any applicable law will continue until such time, if ever, as such Confidential Information ceases to qualify for trade secret protection under one or more such applicable laws other than as a result of any act or omission of the Receiving Party or any of its Representatives. 9. Security. 9.1. Superion will implement commercially reasonable administrative, technical and physical safeguards designed to ensure the security and confidentiality of Customer Data, protect against any anticipated threats or hazards to the security or integrity of Customer Data, and protect against unauthorized access or use of Customer Data. Superion will review and test such safeguards on no less than an annual basis. 9.2. Customer shall maintain, in connection with the operation or use of the Superion Solutions, adequate technical and procedural access controls and system security requirements and devices, necessary for data privacy, confidentiality, integrity, authorization, authentication and non-repudiation and virus detection and eradication. 9.3. To the extent that Authorized Users are permitted to have access to the Superion Solutions, Customer shall maintain agreements with such Authorized Users that adequately protect the confidentiality and Intellectual Property Rights of Superion in the Superion Solutions and Documentation, and disclaim any liability or responsibility of Superion with respect to such Authorized Users.   7 10. Personal Data. If Superion processes or otherwise has access to any personal data or personal information on Customer’s behalf when performing Superion’s obligations under this Agreement, then: 10.1. Customer shall be the data controller (where “data controller” means an entity which alone or jointly with others determines purposes for which and the manner in which any personal data are, or are to be, processed) and Superion shall be a data processor (where “data processor” means an entity which processes the data only on behalf of the data controller and not for any purposes of its own); 10.2. Customer shall ensure that it has obtained all necessary consents and it is entitled to transfer the relevant personal data or personal information to Superion so that Superion may lawfully use, process and transfer the personal data and personal information in accordance with this Agreement on Customer’s behalf, which may include Superion processing and transferring the relevant personal data or personal information outside the country where Customer and the Authorized Users are located in order for Superion to provide the Superion Solutions and perform its other obligations under this Agreement; and 10.3. Superion shall process the personal data and personal information only in accordance with any lawful and reasonable instructions given by Customer from time to time as set out in and in accordance with the terms of this Agreement; and 10.4. Each party shall take appropriate technical and organizational measures against unauthorized or unlawful processing of the personal data and personal information or its accidental loss, destruction or damage so that, having regard to the state of technological development and the cost of implementing any measures, the measures taken ensure a level of security appropriate to the harm that might result from such unauthorized or unlawful processing or accidental loss, destruction or damage in relation to the personal data and personal information and the nature of the personal data and personal information being protected. If necessary, the parties will cooperate to document these measures taken. 11. Representations and Warranties. 11.1. Software Warranty. Superion warrants to Customer that for a period of twelve (12) months from the Execution Date, the Superion Solutions (as delivered to Customer by Superion and when properly used for the purpose and in the manner specifically authorized by this Agreement), will perform as described in the Documentation in all material respects, including being free from any viruses or Harmful Code. 11.2. Professional Services Representation and Warranty. Superion represents, warrants, and covenants to Customer that during the Term, Superion will perform Professional Services using personnel of required skill, experience, and qualifications and in a professional and workmanlike manner in accordance with generally recognized industry standards for similar services and will devote adequate resources to meet its obligations under this Agreement. If Customer reasonably believes that any Professional Services were performed in violation of this warranty, it will notify Superion within twenty (20) days of service performance describing the issue, together with adequate supporting documentation and data. Upon receipt of such notice, Superion’s obligation will be to re-perform the particular Professional Services affected as soon as commercially reasonable at no additional charge. 11.3. Support Services Representation and Warranty. Superion represents, warrants, and covenants to Customer that during the Term, Superion will perform the Support Services using personnel of required skill, experience, and qualifications and in a professional and workmanlike manner in accordance with both generally recognized industry standards for similar services, and the specific guidance for support found in Exhibit 2, and will devote adequate resources to meet its obligations under this Agreement. If Customer reasonably believes that any Support Services failed to meet this warranty, they will follow their preferred escalation path outlined in the Support Standards below, including receipt of service credit. 11.4. DISCLAIMER OF WARRANTIES. EXCEPT FOR THE EXPRESS LIMITED WARRANTIES SET FORTH ABOVE, SUPERION MAKES NO WARRANTIES WHATSOEVER, EXPRESSED OR IMPLIED, WITH REGARD TO THE SUPERION SOLUTIONS, PROFESSIONAL SERVICES, SUPPORT SERVICES, AND/OR ANY OTHER MATTER RELATING TO THIS AGREEMENT, AND THAT SUPERION DISCLAIMS ALL WARRANTIES, WHETHER EXPRESS, IMPLIED, STATUTORY, OR OTHER, INCLUDING ALL WARRANTIES ARISING FROM COURSE OF DEALING, USAGE OR TRADE PRACTICE, AND SPECIFICALLY DISCLAIMS IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, AND NON-INFRINGEMENT. FURTHER, SUPERION EXPRESSLY DOES NOT WARRANT THAT A SUPERION SOLUTION, ANY CUSTOM MODIFICATION OR ANY IMPROVEMENTS WILL BE USABLE BY CUSTOMER IF THE SUPERION SOLUTION OR CUSTOM MODIFICATION HAS BEEN MODIFIED BY ANYONE OTHER THAN   8 SUPERION PERSONNEL, OR WILL BE ERROR FREE, WILL OPERATE WITHOUT INTERRUPTION OR WILL BE COMPATIBLE WITH ANY HARDWARE OR SOFTWARE OTHER THAN THE EQUIPMENT EXCEPT TO THE EXTENT EXPRESSLY SET FORTH IN THE DOCUMENTATION. ALL THIRD-PARTY MATERIALS ARE PROVIDED “AS-IS” AND ANY REPRESENTATION OR WARANTY OF OR CONCERNING ANY OF THEM IS STRICTLY BETWEEN CUSTOMER AND THE THIRD- PARTY OWNER. THIS AGREEMENT DOES NOT AMEND, OR MODIFY SUPERION’S WARRANTIES UNDER ANY AGREEMENT OR ANY CONDITIONS, LIMITATIONS, OR RESTRICTIONS THEREOF. 12. Notices. All notices and other communications required or permitted under this Agreement must be in writing and will be deemed given when delivered personally, sent by United States registered or certified mail, return receipt requested; transmitted by facsimile or email confirmed by United States first class mail, or sent by overnight courier. Notices must be sent to a Party at its address shown below, or to such other place as the Party may subsequently designate for its receipt of notices in writing by the other Party. If to Superion: Superion, LLC 1000 Business Center Dr. Lake Mary, FL. Phone: 407-304-3235 email: info@superion.com Attention: Senior Counsel / Contracts Department If to Customer: Town of Los Gatos Attn: Finance Department 110 E. Main Street Los Gatos, CA 95030 Phone: 408-354-6805 email: gungvari@losgatosca.gov Attention: Gitta Ungvari 13. Force Majeure. 13.1. No Breach or Default. Neither Party will be liable to the other for any failure or delay in fulfilling or performing any term of this Agreement (except for any payment obligation) when and to the extent such failure or delay is caused by any circumstances beyond such Party’s reasonable control (a “Force Majeure Event”), including Acts of God, flood, fire, earthquake, explosion, war, terrorism, invasion, national or regional emergency, riot or other civil-unrest, labor disruption, acts and omissions of third parties, governmental and judicial action (including embargoes, export or import restrictions) not the fault of the Party failing or delaying in performance. 13.2. Affected Party Obligations. In the event of any failure or delay caused by a Force Majeure Event, the affected Party shall give prompt written notice to the other Party stating the period of time the occurrence is expected to continue and use commercially reasonable efforts to end the failure or delay and minimize the effects of such Force Majeure Event. 14. Mutual Indemnification. 14.1. Superion Indemnification. Superion shall indemnify, defend, and hold harmless Customer and Customer's officers, elected officials, directors, employees, agents, successors, and assigns from and against any and all losses incurred by or resulting from any Action by a third party (other than an Affiliate of Customer) that Customer's use of the Superion Solutions in accordance with this Agreement infringes or misappropriates such third party's US Intellectual Property Rights, US patents, copyrights, or trade secrets. The foregoing obligation does not apply to the extent that the alleged infringement arises from: 14.1.1. Third-Party Materials or Customer Data; 14.1.2. access to or use of the Superion Solutions in combination with any hardware, system, software, network, or other materials or service not provided by Superion or specified for Customer's use in the Documentation; 14.1.3. modification of the Superion Solutions other than: by or on behalf of Superion or with Superion's written approval in accordance with Superion's written specification; 14.1.4. failure to timely implement any modifications, upgrades, replacements, or enhancements made available to Customer by or on behalf of Superion; or 14.1.5. act, omission, or other matter described in Section 15.2 below, whether or not the same results in any Action against or losses by any Superion Indemnitee.   9 14.2. Customer Indemnification. Customer shall indemnify, defend, and hold harmless Superion and its officers, directors, employees, agents, successors, and assigns from and against any and all losses incurred by Superion resulting from any Action by a third party (other than an Affiliate of Superion) that arise out of or result from, or are alleged to arise out of or result from: 14.2.1. Customer Data, including any Processing of Customer Data by or on behalf of Superion in accordance with this Agreement; 14.2.2. Gross negligence or more culpable act or omission (including recklessness or willful misconduct) by Customer, any Authorized User, or any third party on behalf of Customer or any Authorized User, in connection with this Agreement. 14.3. Procedure. Each party shall promptly notify the other party in writing of any Action for which such party believes it is entitled to be indemnified. The party seeking indemnification shall cooperate with the other party at that party’s sole cost and expense. The indemnitor shall promptly assume control of the defense and shall employ counsel of its choice that is reasonably acceptable to the indemnitee to handle and defend the same. 14.3.1. Superion agrees to testify in any litigation brought regarding the subject of the work to be performed under this Agreement. Superion shall be compensated for its costs and expenses in preparing for, traveling to, and testifying in such matters at its then current hourly rates of compensation, unless such litigation is brought by Superion or is based on allegations of Superion’s negligent performance or wrongdoing. 14.4. Sole Remedy. THIS SECTION SETS FORTH CUSTOMER'S SOLE REMEDIES AND SUPERION'S SOLE LIABILITY AND OBLIGATION FOR ANY ACTUAL, THREATENED, OR ALLEGED CLAIMS THAT THE SERVICES AND SUPERION SOLUTIONS OR ANY SUBJECT MATTER OF THIS AGREEMENT INFRINGES, MISAPPROPRIATES, OR OTHERWISE VIOLATES ANY INTELLECTUAL PROPERTY RIGHTS OF ANY THIRD PARTY. 15. Termination. This Agreement may be terminated: 15.1. For cause by either Party, effective on written notice to the other Party, if the other Party materially breaches this Agreement and: (i) is incapable of cure; or (ii) being capable of cure, remains uncured thirty (30) days after the non-breaching Party provides the breaching Party with written notice of such breach. 15.2. For lack of payment by written notice to Customer, if Customer’s failure to pay amounts due under this Agreement has continued more than ninety (90) days after delivery of written notice of non-payment. 15.3. By either Party, if the other Party (i) becomes insolvent, (ii) files, or has filed against it, a petition for voluntary or involuntary bankruptcy or pursuant to any other insolvency Law, (iii) makes or seeks to make a general assignment for the benefit of its creditors, or (iv) applies for, or consents to, the appointment of a trustee, receiver or custodian for a substantial part of its property or business. 15.4. For Customer’s failure to appropriate funds as provided in Section 28 below. 16. Effect of Termination or Expiration. On the expiration or earlier termination of this Agreement: 16.1. all rights, licenses, and authorizations granted to Customer hereunder will immediately terminate and Customer shall immediately cease all use of and other activities with respect to Superion’s Confidential Information relating to the Superion Solutions, and within thirty (30) days deliver to Superion, or at Superion’s request destroy and erase Superion’s Confidential Information from all systems Customer directly or indirectly controls; and 16.2. all amounts payable by Customer to Superion of any kind are immediately payable and due no later than thirty (30) days after the effective date of the termination or expiration. 16.3. The provisions set forth in the following sections, and any other right or obligation of the parties in this Agreement that, by its nature (including but not limited to: Use Restrictions, Confidential Information, Warranty Disclaimers, Mutual Indemnifications & Limitations of Liability), should survive termination or expiration of this Agreement, will survive any expiration or termination of this Agreement. 16.4. Return of Customer Data. If Customer requests in writing at least 10 days prior to the effective date of expiration or earlier termination of this Agreement, Superion shall within 60 days following such expiration or termination, deliver to Customer in Superion’s standard format the then most recent version of   10 Customer Data maintained by Superion, provided that Customer has at that time paid all Fees then outstanding and any amounts payable after or as a result of such expiration or termination. 16.5. Deconversion. In the event of (i) expiration or earlier termination of this Agreement, or (ii) Customer no longer purchasing certain Superion Solutions (including those indicated to be Third-Party Materials), if Customer requests assistance in the transfer of Customer Data to a different vendor’s applications (“Deconversion”), Superion will provide reasonable assistance. Superion and Customer will negotiate in good faith to establish the relative roles and responsibilities of Superion and Customer in effecting Deconversion, as well as the appropriate date for completion. Superion shall be entitled to receive compensation for any additional consultation, software and documentation required for Deconversion on a time and materials basis at Superion’s then standard rates. 17. Assignment. Customer shall not assign or otherwise transfer any of its rights, or delegate or otherwise transfer any of its obligations or performance, under this Agreement, in each case whether voluntarily, involuntarily, by operation of law, or otherwise, without Superion's prior written consent, which consent Superion may give or withhold in its sole discretion. For purposes of the preceding sentence, and without limiting its generality, any merger, consolidation, or reorganization involving Customer (regardless of whether Customer is a surviving or disappearing entity) will be deemed to be a transfer of rights, obligations, or performance under this Agreement for which Superion's prior written consent is required. No delegation or other transfer will relieve Customer of any of its obligations or performance under this Agreement. Any purported assignment, delegation or transfer in violation of this Section is void. This Agreement is binding upon and inures to the benefit of the Parties and their respective permitted successors and assigns. 18. No Waiver. A Party’s failure to enforce its rights with respect to any single or continuing breach of this Agreement will not act as a waiver of the right of that Party to later enforce any such rights or to enforce any other or any subsequent breach. 19. Arbitration of Disputes. Any dispute, controversy or claim arising out of or relating to this Agreement, including the breach, termination, or validity thereof, shall be resolved by final and binding arbitration. 19.1. Arbitration Procedure. The claimant shall commence the arbitration by delivering a notice of arbitration to the respondent setting out the nature of the claim(s), the relief requested, and the proposed location. Within thirty (30) days of the receipt of the notice of arbitration, the respondent shall deliver to the claimant its answer and any counterclaim(s), and the relief requested, as well as any proposed changes to location. The tribunal shall consist of three (3) arbitrators, appointed as follows: The claimant shall appoint an arbitrator in the request for arbitration and the respondent shall appoint an arbitrator in the answer. The two arbitrators so appointed shall, within thirty (30) days of delivery of the answer, appoint a third arbitrator who shall act as the chair of the tribunal. The tribunal shall decide the procedures to be followed in the arbitration after consultation with the parties. The tribunal may make its decisions by a majority. The tribunal shall have the power to grant any provisional or final remedy or relief that it deems appropriate, including conservatory measures and an award of attorneys’ fees. The parties further agree that judgment may be entered upon the award by of any court having jurisdiction. 20. Jurisdiction and Governing Law. This Agreement and any dispute or claim arising, directly or indirectly, out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) is governed by, and shall be construed and enforced in accordance with, the laws of the State of California excluding choice of law. Each party irrevocably (i) agrees that a County or Circuit Court in Santa Clara County, California, or the United States District for the Northern District of California, shall have exclusive jurisdiction to settle any dispute, controversy or claim arising, directly or indirectly, out of or in connection with this Agreement, or the breach, termination or validity thereof (including non-contractual disputes or claims) and that such court shall be the proper venue therefor; (ii) waives the right to trial by jury, (iii) consents to service of process by first class certified mail, return receipt requested, postage prepaid, to the address at which the party is to receive notice and (iv) agrees that the prevailing party shall be entitled to recover its reasonable attorney's fees, court costs and other legal expenses from the other party. 21. Severability. If any provision of this Agreement is illegal or unenforceable, it will be deemed stricken from the Agreement and the remaining provisions of the Agreement will remain in full force and effect. 22. LIMITATIONS OF LIABILITY. 22.1. LIMITED LIABILITY OF SUPERION. SUPERION’S LIABILITY IN CONNECTION WITH THE SERVICES, IMPROVEMENTS OR ANY OTHER MATTER RELATING TO THIS AGREEMENT WILL NOT EXCEED THE FEES THAT CUSTOMER ACTUALLY PAID TO SUPERION IN CONNECTION WITH THIS AGREEMENT FOR THE INITIAL TERM OR RENEWAL TERM WHEN THE RELEVANT   11 ACTIONS LEADING TO SUCH LIABILITY AROSE. IN ANY EVENT, SUPERION SHALL NOT BE LIABLE FOR ANY LOSSES RESULTING FROM THE CRIMINAL ACTS OF THIRD PARTIES. 22.2. EXCLUSION OF DAMAGES. REGARDLESS OF WHETHER ANY REMEDY SET FORTH HEREIN FAILS OF ITS ESSENTIAL PURPOSE OR OTHERWISE, IN NO EVENT WILL SUPERION, SUPERION PERSONNEL, SUBCONTRACTORS OR SUPPLIERS BE LIABLE UNDER OR IN CONNECTION WITH THIS AGREEMENT FOR ANY (I) LOSS OF DATA, BUSINESS, REVENUE, PROFIT, GOODWILL, OR REPUTATION, (II) BUSINESS INTERRUPTION, INCREASED COSTS, OR DIMINUTION IN VALUE, OR SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES, WHETHER BASED ON BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, OR OTHERWISE; AND WHETHER OR NOT SUPERION, SUPERION PERSONNEL, SUBCONTRACTORS OR SUPPLIERS HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH LOSSES OR DAMAGES OR SUCH LOSSES OR DAMAGES WERE OTHERWISE FORESEEABLE. 22.3. BASIS OF THE BARGAIN. CUSTOMER ACKNOWLEDGES THAT SUPERION HAS SET ITS FEES AND ENTERED INTO THIS AGREEMENT IN RELIANCE UPON THE LIMITATIONS OF LIABILITY AND THE DISCLAIMERS OF WARRANTIES AND DAMAGES SET FORTH IN THIS AGREEMENT, AND THAT THE SAME FORM AN ESSENTIAL BASIS OF THE BARGAIN BETWEEN THE PARTIES. 23. Third-Party Materials. Customer is hereby advised that Superion provides front-line support services for third parties, but these third parties assumes all responsibility for and liability in connection with the Third-Party Materials. Superion is not authorized to make any representations or warranties that are binding upon the third party or to engage in any other acts that are binding upon the third party, excepting specifically that Superion is authorized to represent the fees for the Third-Party Materials as the same is provided for in the Agreement and to accept payment of such amounts from Customer on behalf of the third party for as long as such third party authorizes Superion to do so. As a condition precedent to installing or accessing any Third-Party Materials, Customer may be required to execute a click-through, shrink-wrap EULA or similar agreement provided by the Third-Party Materials provider. 24. Entire Agreement; Amendment and Modification. This Agreement contains the entire understanding of the parties with respect to its subject matter, and supersedes and extinguishes all prior oral and written communications between the parties about its subject matter. Any purchase order, agreement, or other ordering document issued by Customer at any time for any reason, will not modify or affect this Agreement nor have any other legal effect notwithstanding the inclusion of any additional or different terms or conditions in any such ordering document and shall serve only the purpose of identifying the products or services ordered. No modification of this Agreement will be effective unless it is in writing, is signed by each Party, and expressly provides that it amends this Agreement. Notwithstanding any language to the contrary herein, numbered Add- On Quotes on Superion letterhead issued by authorized Superion representatives and signed by Customer shall constitute an amendment to this Agreement. 25. No Third-Party Beneficiaries. This Agreement is for the sole benefit of the Parties and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer on any other person any legal or equitable right, benefit, or remedy of any nature under or by reason of this Agreement. 26. Counterparts. This Agreement may be executed in counterparts, each of which is deemed an original, but all of which together are deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail, or other means of electronic transmission is deemed to have the same legal effect as delivery of an original signed copy of this Agreement. 27. Cooperative Purchases. This Contract may be used by other government agencies. Superion has agreed to offer similar services to other agencies under the same terms and conditions as stated herein except that the compensation may be negotiated between Superion and other agencies based on the specific revenue expectations, agency reimbursed costs, and other agency requirements. The Customer will in no way whatsoever incur any liability in relation to specifications, delivery, payment, or any other aspect of purchases by such agencies. 28. Appropriation of Funds. Customer represents and warrants to Superion that Customer has appropriated sufficient funds to pay all amounts due Superion throughout the term of this Agreement and hereby covenants and agrees that it will make appropriate requests for budget appropriations for the fiscal years in amounts as specified herein. Customer further agrees that said funds, once appropriated, will be maintained and expended for the expressed purpose of acquiring from Superion the Superion Solutions, applications and/or services set forth herein. In the event sufficient funds are not appropriated, not budgeted or not otherwise legally available, Customer shall immediately notify Superion of such occurrence and Superion will respond with a proclamation that the Agreement, or the appropriate executory portion(s)   12 thereof, is terminated. Should there be any premature termination of this Agreement, Customer shall be responsible to pay a) for any Services delivered by Superion or reimbursable expenses incurred by Superion prior to the notice and b) for all Superion Solutions or applications which have been delivered. Superion shall not be obligated to provide any Services for which payment has not been appropriated. 29. Incorporated Exhibits to this Agreement: 29.1. Exhibit 1 – Project Cost Summary 29.2. Exhibit 2 - Maintenance & Support Standards 29.3. Exhibit 3 – Travel Expense Guidelines 29.4. Exhibit 4 - Additional Terms                                                                                    EXHIBIT 1 Project Cost Summary   Applications and/or Services License Fee Professional Services ASP Startup Fee Annual Access Fee Current PLUS Products Financial Accounting (GFPFAM), PLUS Budget Preparation (GFPBUD), Personnel Budgeting (GFPPBS),Workflow (GFPWKF), Payroll/HY (GFPPAY), Employee Access Center (GFPEAC), Position Control, (GFPPOS), Salary Negotiations (GFPSAL), Fixed Assets (GFPFA), CA Regulatory Software (GFPRNC), Cash Receipting (GCPCR), Business License (GCPBL), Misc Billing (GCPMB), FPLUS Employee Timesheet (GFIETS) $ 10,000.00 $31,461.00 Terminating PLUS Products eFinancePLUS Web Browser Interface N/A N/A N/A Current Third Party Products 4J's Server Compiler (FourJS), FourJ's Concurrent User -25 (FOUR-RUN), Optio ECI (OPTIOECI)(Transfer Fee $250.00) $ 250.00 $11,188.00 New Third Party Products Cognos 11 (ANLC-NOW) $ 2,000.00 $ 7,320.00 Terminating Third Party Products Business Author - Cognos, Professional Author - Cognos, Anonymous Consumer - eFinancePLUS - Cognos, Bundle 1 Cognos Report Writer, Windows Server Phone Support - Cognos Server N/A N/A N/A Professional Services PLUS Products Plus Products Installation - $10,500 PLUS Products Training - 2 days - $2,560 PLUS Products Project Management - $6400 PLUS Products Custom Retrofitting- $1,000 Cognos 11 Project Management - $1280 $ 21,740.00 Professional Services New Third Party Cognos 11 Installation - $2,800 Cognos 11 Training - 5 days - $9,000 11,800.00 ASP Services Setup, Implementation, Disaster Recovery Plan for Superion applications Included in Access Fee Total Proposed System: $33,790.00 $12,000.00 $49,969.00 *Note: Current Custom Mods will continue to be invoiced separately. PAYMENT TERMS: a) Start-Up Fees are due: 100% on the Execution Date. Customer will be contacted by the Superion Implementation Coordinator to begin the implementation process of this project upon receipt of startup fees. b) License Fee (Transfer Third Party Product OPTIO ECI): 100% on the Execution Date. c) Installation Fees are due upon completion.      2 d) Professional Service Fees for training will be billed as incurred. e) Unless otherwise provided herein, all other Professional Service Fees are due: 100% on the Execution Date. f) Third Party Professional Services and Installation Fees are due 50% upon execution and 50% upon delivery. RECURRING FEES g) The Annual Access Fee is due: on the Execution Date, and annually thereafter on the anniversary of the Execution Date at the fees listed above. Following the initial term, Services will be provided on a year-to- year basis provided the Customer pays the then current Annual Access Fee. i. End Billing with Continued Support. Upon commencement of billing for the Annual Access Fee, Customer acknowledges the termination of the current maintenance billing structure for any products listed above. that will be effectively replaced by any of the new modules listed above. Superion shall continue to provide Customer with maintenance of these products until the transition to a new environment is complete, at which time Maintenance will be terminated. Customer shall continue to pay separately annual maintenance on product Custom Modifications. ii. Credit. A credit in the amount of the unused portion of Maintenance paid by Customer shall be applied toward Customers first Annual Access Fee. The unused portion of paid Maintenance will consist of the amount unused as of Execution Date. h) The Monthly Access Fee for any additional applications purchased will be placed on the same term as the original contract. ADDITIONAL FEES AND COSTS: i) Travel and related expenses of the trainers, installers or Implementation Coordinator is in addition to the above costs and they are billed separately. Does not apply to webex training proposed. Customer will reimburse Superion for actual travel and living expenses that Superion incurs in providing Customer with Support Services and Professional Services under this Agreement, with reimbursement to be on an as- incurred basis. Such travel and living expenses will be governed by Exhibit 3 (“Superion Travel Expense Guidelines”) attached hereto and will be invoiced on a monthly basis in arrears and due within thirty (30) days from the date of invoice. j) Customer is responsible for paying additional network hardware components which may be required at the customer site. Superion can work with your organization to identify what if any network components would be required. k) Customer is responsible for paying all taxes relating to this Agreement. Applicable tax amounts (if any) are not included in the fees set forth in this Agreement. If Customer is exempt from the payment of any such taxes, Customer must provide Superion valid proof of exemption; otherwise, Superion will invoice Customer and Customer will pay to Superion all such tax amounts.      3 EXHIBIT 2 Support Standards 1. Service Level Commitments 1.1. Overall System Availability. 1.1.1. Target. In each Service Period, the target for availability of the Superion Solutions is 99.9% (“Availability Target”). “Service Period” means 24 hours per day Monday through Sunday each calendar month that Customer receives the Superion Solutions, excluding Sundays between 12:00 AM and 12:00 PM Eastern Time for scheduled maintenance. During this time, Customers may experience intermittent interruptions. Superion will make commercially reasonable efforts to minimize the frequency and duration of these interruptions and Superion will notify the Customer if the entire maintenance window will be required. 1.1.2. Measurement. Service availability is measured as the total time that the Superion Solutions are available during each Service Period for access by Customer (“Service Availability”). Service Availability measurement shall be applied to the production environment, and the points of measurement for all monitoring shall be the servers and the Internet connections at Superion’s hosted environment. Superion has technology monitoring, measuring, and recording Service Availability. The Customer, at their discretion, may also employ monitoring tools, not to override Superion’s measurements for the purposes of calculating Service Availability. Additionally, the use must be: 1.1.2.1. mutually agreed upon by Superion and the Customer. 1.1.2.2. paid, installed and maintained by the Customer. 1.1.2.3. non-invasive and may not reside on Superion’s systems. 1.2. Calculation. Service Availability for a given month shall be calculated using the following calculation: 1.2.1. The total number of minutes which the service was NOT available in a given month shall be subtracted from the total number of minutes available in the given month. The resulting figure is divided by the total number of minutes available in the given month. 1.2.2. Service Availability Targets are subject to change due to the variance of the number of days in a month. 1.2.3. The total number of minutes which the service was NOT available in a given month shall exclude minutes associated with scheduled or emergency maintenance. 1.3. Remedy. If the Service Period target measurement is not met then the Customer shall be entitled to a credit calculated as follows: Service Availability in the relevant Service Period Percentage Reduction in Monthly Fee for the Subsequent Service Period Less than 99.9% but greater than or equal to 99.0% 5% Less than 99.0% but greater than or equal to 95.0% 10% Less than 95% 20% 1.4. If not directly reported by Superion, Credit entitlement must be requested by the Customer within sixty (60) days of the failed Target. Superion’s failure to meet the relevant service level commitment. Customer shall not be entitled to offset any monthly Superion Solutions fee payments, nor withhold fee payments, on account of a pending credit. Customer shall not be eligible for credits for any period where Customer is more than thirty (30) days past due on their account. Superion will provide reporting, showing performance and service levels. 2. Server Performance & Capacity. 2.1. Superion shall provide sufficient server capacity for the duration of this hosting Agreement to meet the reasonable performance requirements for the number of concurrent system users provided for in this Agreement. If the Customer requests, at some later date, to add additional Superion Solutions, increase user licenses, increase storage or processing requirements, and/or request additional environments, these requests will be evaluated and if additional resources are required to support modifications, additional fees may apply. 2.2. “In-network” is defined as any point between which the data packet enters the Superion environment and subsequently departs the Superion environment. Any point of communications outside of the Superion protected network environment shall be deemed as “out-of-network.” Superion is not responsible for Internet connectivity and/or performance out-of-network.      4 3. System Maintenance. 3.1. Superion Solutions maintenance and upgrades. Superion will provide all hosted systems and network maintenance as deemed appropriate and necessary by Superion. Maintenance and upgrades will be scheduled in advance with the Customer’s primary contact if they fall outside of the designated hours set aside for this function of Sundays from 12:00AM to 12:00 PM. 3.2. Hardware maintenance and upgrades. Hardware maintenance and upgrades will be performed outside of the Customer’s standard business hours of operation and the Customer will be notified prior to the upgrade. 3.3. Emergency maintenance. Emergency situations will be handled on a case-by-case basis in such a manner as to cause the least possible disruption to overall system operations and availability without negatively affecting system stability and integrity. Superion will attempt to notify the Customer promptly, however if no contact can be made, Superion management may deem it necessary to move forward with the emergency maintenance. 4. Incident Response. Incidents are defined as interruptions to existing service and can range in priority from urgent to low depending on the impact to the Customer. Superion will make commercially reasonable efforts to respond to Superion Solutions incidents for live production systems using the following guidelines: Priority Level Impact Description Performance Target Minimum Performance Goal % 1 Urgent An Incident that results in loss of Customer connectivity to all of the Superion Solutions or results in loss, corruption or damage to Customer’s Data. Superion will respond within 1 hour of the issue being reported. 95% 2 Critical An Incident that has an adverse material impact on the performance of the Superion Solutions or materially restricts Customer’s day-to-day operations. Superion will respond within 2 hours of the issue being reported. 95% 3 Non-Critical An Incident that does not result in a failure of the Superion Solutions but a fault exists that restricts the Customer’s use of the Superion Solutions. Superion will respond within 4 hours of the issue being reported. 95% 4 Minor An Incident that does not affect or which has minimal adverse impact on the use of the Superion Solutions. Superion will respond within 24 hours of the issue being reported. 95% 4.1. Measurement. Superion shall track and report on response and resolution time for application and hosting support issues identified by the Customer. 5. Disaster Recovery. Superion provides disaster recovery services for Superion Solutions. The costs for these disaster recovery services are included in the monthly fees. In the event that a disaster renders the Customer’s data center is inaccessible or rendered non-functional, Superion will provide the ability to connect to the appropriate data center using software provided by Superion. This will allow the Customer to connect to their systems from a remote site to the previously identified critical functions, however functionality may be diminished due to lack of access to hardware and/or software located in the Customer’s facilities. 6. Exceptions. Superion shall not be responsible for failure to carry out its service and maintenance obligations under this Agreement if the failure is caused by adverse impact due to: 6.1. defectiveness of the Customer’s environment, Customer’s systems, or due to Customer corrupt, incomplete, or inaccurate data reported to the Superion Solutions. 6.2. denial of reasonable access to Customer’s system or premises preventing Superion from addressing the issue. 6.3. material changes made to the usage of the Superion Solutions by Customer where Superion has not agreed to such changes in advance and in writing or the modification or alteration, in any way, by Customer or its subcontractors, of communications links necessary to the proper performance of the Superion Solutions. 6.4. a force majeure event, or the negligence, intentional acts, or omissions of Customer or its agents. 6.5. a documented Defect. 7. Incident Resolution. Actual response times and resolutions may vary due to issue complexity and priority. For critical impact level and above, Superion provides a continuous resolution effort until the issue is resolved.      5 8. Service Requests. Service requests are new requests that will take less than 8 hours to accomplish. For new requests that require additional time, Superion will prioritize these requests, and determine if extra time is needed to order equipment or software. 9. Non-Production Environments. Superion will make commercially reasonable efforts to provide non-production environment(s) during Customer business hours. Non-production environments are not included under the metrics or service credit schedules discussed in this Exhibit. 9.1. Maintenance. All forms of maintenance to be performed on non-production environments will follow the exact structure and schedules outlined above in Section 3 for regular System Maintenance. 9.2. Incidents and service requests. Non-production environment incidents are considered priority 3 or 4 as circumstances dictate. Service requests will otherwise be prioritized and scheduled similar to production service requests. 10. Responsibility Summary Matrix. Responsibility Summary Matrix Description Superion Responsibility Customer Responsibility ASP Server Hardware management X ASP Server File system management X ASP Server OS upgrades and maintenance X ASP Database product upgrades and maintenance X ASP 3rd Party product upgrades and maintenance X Application Update Installation Request to install application updates X Installation of application updates X ASP Backup Management X Data and or File restoration Request to restore data and or files X Restoration of data and or files X Network ASP Network up to and including the router at Superion’s location X ASP Router at Customer’s location X Customer’s network up to the router at Customer’s location X Customer Workstations X System Performance X X Add/Change users User add/change requests X User add/change implementation for System Access X User add/change implementation for Superion Solutions X Add/Change Printers Printer add/change requests X Printer add/change implementation on ASP network X Printer add/change implementation for Superion Solutions X Disaster Recovery X Password Management X X Application Management Application Configuration X Application Security Management X Accuracy and Control of Data X Security Intrusion and Penetration Testing X 11. Virtual Private Network (VPN) Concentrator. If Customer’s desired system configuration requires the use of a VPN concentrator, including router, this will be provided by Superion. It will reside at Customer’s location but is, and shall remain the property of Superion.      6 12. Customer Cooperation. Customer may be asked to perform problem determination activities as suggested by Superion. Problem determination activities may include capturing error messages, documenting steps taken and collecting configuration information. Customer may also be requested to perform resolution activities including, for example, modification of processes. Customer agrees to cooperate with such requests, if reasonable. 13. Training. Outside the scope of training services purchased, if any, Customer is responsible for the training and organization of its staff in the operation of the Superion Solutions. 14. Development Work. The Support Standards do not include development work either (i) on software not licensed from Superion or (ii) development work for enhancements or features that are outside the documented functionality of the Superion Solutions, except such work as may be specifically purchased and outlined in Exhibit 1. Superion retains all Intellectual Property Rights in development work performed and Customer may request consulting and development work from Superion as a separate billable service. 15. Disagreement Procedure. In case the parties are in disagreement as to whether Superion has fulfilled its support obligations, they shall use all reasonable efforts to amicably settle such dispute. If disagreement remains following a ten (10) day work period, the parties shall escalate the issue to the following representatives to resolve the dispute: Superion: Director of Operations (first level); VP of Services (escalation – 1st level); General Manager (escalation – 2nd level) Customer: _____________________ The disagreement procedure proposed herein shall not limit either party’s right to bring a claim as provided for in the Agreement. Notwithstanding any dispute the parties have a duty to continue fulfilling all their other obligations under this Agreement.   16. Telephone Support & Support Portal 16.1. Hours. Superion shall provide to Customer, Monday through Friday, 8:00 A.M. to 5:00 P.M. Customer’s Local Time within the continental United States, excluding holidays (“5x9”). Superion shall provide to Customer, during the Support Hours, commercially reasonable efforts in solving errors reported by the Customer as well as making available an online support portal. Customer shall provide to Superion reasonably detailed documentation and explanation, together with underlying data, to substantiate errors and to assist Superion in its efforts to diagnose, reproduce and correct the error. This support shall be provided by Superion at Customer location(s) if and when Superion and Customer agree that on-site services are necessary to diagnose or resolve the problem. If a reported error did not, in fact, exist or was not attributable to a defect in the Superion Solutions or an act or omission of Superion, then Customer shall pay for Superion's investigation and related services at Superion’s standard professional services rates. Customer must provide Superion with such facilities, equipment and support as are reasonably necessary for Superion to perform its obligations under this Agreement, including remote access to the Specified Configuration 16.2. Releases. Customer shall promptly install and/or use any Release provided by Superion to avoid or mitigate a performance problem or infringement claim. All modifications, revisions and updates to the Superion Solutions shall be furnished by means of new Releases of the Superion Solutions and shall be accompanied by updates to the Documentation whenever Superion determines, in its sole discretion, that such updates are necessary. 16.3. Case Number. Measured from the moment a Case number is created. As used herein a “Case number” is created when a) a Superion support representative has been directly contacted by Customer either by phone, email, in person, or through Superion’s online support portal, and b) when Superion’s support representative assigns a case number and conveys that case number to the Customer.      1 EXHIBIT 3 SUPERION TRAVEL EXPENSE GUIDELINES Superion will adhere to the following guidelines when incurring travel expenses: All arrangements for travel are to be made through the Superion Corporate Travel Agent unless other arrangements have been made with the Customer and are documented in writing. AIR TRAVEL – Superion will use the least expensive class of service available with a minimum of seven (7) day, maximum of thirty (30) day, advance purchase. Upon request, Superion shall provide the travel itinerary as the receipt for reimbursement of the airfare and any fees. Fees not listed on the itinerary will require a receipt for reimbursement. Trips fewer than 250 miles round are considered local. Unless a flight has been otherwise approved by the Customer, Customer will reimburse the current IRS approved mileage rate for all local trips. LODGING –Superion will use the most reasonable accommodations possible, dependent on the city. All food items, movies, and phone/internet charges are not reimbursable. RENTAL CAR – Compact or Intermediate cars will be required unless there are three or more Superion employees sharing the car in which case the use of a full size car is authorized. Gas is reimbursable however, pre-paid gas purchases will not be authorized and all rental cars are to be returned with a full tank of gas. Upon request, receipts for car rental and gas purchases will be submitted to Customer. Superion shall decline all rental car insurance offered by the car rental agency as staff members will be covered under the Superion auto insurance policy. Fines for traffic violations are not reimbursable expenses. OTHER TRANSPORTATION – Superion staff members are expected to use the most economical means for traveling to and from the airport (Airport bus, hotel shuttle service). Airport taxi or mileage for the employee’s personal vehicle (per IRS mileage guidelines) are reimbursable if necessary. Upon request, receipt(s) for the taxi will be submitted to Customer. Proof of mileage may be required and may be documented by a readily available electronic mapping service. The mileage rate will be the then-current IRS mileage guideline rate (subject to change with any change in IRS guidelines). OTHER BUSINESS EXPENSES – Parking at the airport is reimbursable. Tolls to and from the airport and while traveling at the Customer site are reimbursable. Tipping on cab fare exceeding 15% is not reimbursable. Porter tips are reimbursable, not exceeding $1.00 per bag. Laundry is reimbursable when travel includes a weekend day or Company Holiday and the hotel stay is four nights or more. Laundry charges must be incurred during the trip and the limit is one shirt and one pair of pants/skirt per day. With the exception of tips, receipts shall be provided to Customer upon request for all of the aforementioned items. MEALS – Standard per Diem. Subject to change due to cost of living. Page 1 of 5 Exhibit 4 ADDITIONAL TERMS TO SUPERION SOLUTIONS AGREEMENT These ADDITIONAL TERMS incorporated as Exhibit 4 to the SUPERION SOLUTIONS AGREEMENT dated __________________________________ (“SSA”) are made by and between TOWN OF LOS GATOS, a California municipal corporation, (“Town”) and SUPERION, LLC, (“Supplier”). These ADDITIONAL TERMS are made with reference to the following facts. I. RECITALS 1.1 Town sought quotations for the purchase described in this Agreement, and Supplier was found to be the lowest responsible supplier for this purchase. 1.2 Supplier represents that it is a qualified and competent supplier of the items to be purchased under this Agreement. 1.3 The Town desires to engage Supplier to provide the software applications maintenance, support, migration, installation and other professional services identified in the SSA. 1.4 The Supplier represents and affirms that it is qualified and willing to perform the desired work pursuant to the SSA. 1.5 The parties agree that the below additional terms are incorporated to the SSA. II. ADDITIONAL TERMS 2.1 Supplies and Terms. Supplier hereby agrees to deliver to Town the items and materials described in the SSA. The prices and payment terms under which Town shall pay Supplier are established in Exhibit 1 of the SSA. The terms of delivery are outlined in the SSA. 2.2 Time of the Essence. Prompt delivery of the items and materials is essential to this Agreement. 2.3 Scope of Services. Supplier shall provide services as described in the SSA. 2.4 Compliance with Laws. The Supplier shall comply with all applicable laws, codes, ordinances, and regulations of governing federal, state and local laws. Supplier represents and warrants to Town that it has all licenses, permits, qualifications and approvals of whatsoever nature which are legally required for Supplier to practice its profession. Supplier shall maintain a Town of Los Gatos business license pursuant to Chapter 14 of the Code of the Town of Los Gatos. Page 2 of 5 2.5 Sole Responsibility. Supplier shall be responsible for employing or engaging all persons necessary to perform the services under this Agreement. 2.6 Information/Report Handling. All documents furnished to Supplier by the Town and all reports and supportive data prepared by the Supplier under this Agreement are the Town’s property and shall be delivered to the Town upon the completion of Supplier's services or at the Town's written request. All reports, information, data, and exhibits prepared or assembled by Supplier in connection with the performance of its services pursuant to this Agreement are confidential until released by the Town to the public, and the Supplier shall not make any of the these documents or information available to any individual or organization not employed by the Supplier or the Town without the written consent of the Town before such release. The Town acknowledges that the reports to be prepared by the Supplier pursuant to this Agreement are for the purpose of evaluating a defined project, and Town's use of the information contained in the reports prepared by the Supplier in connection with other projects shall be solely at Town's risk, unless Supplier expressly consents to such use in writing. Town further agrees that it will not appropriate any methodology or technique of Supplier which is and has been confirmed in writing by Supplier to be a trade secret of Supplier. 2.7 Compensation. Compensation for the supplies and materials delivered and for supplier's professional services for the upgrade shall not exceed $45,790.00, inclusive of all costs. Payment shall be based upon Town approval of each task. Annual Access Fee is $49,969.00. 2.8 Billing. Billing shall be by invoice within thirty (30) days of the rendering of the services and shall be accompanied by a detailed explanation of the work performed by whom at what rate and on what date. Also, plans, specifications, documents or other pertinent materials shall be submitted for Town review, even if only in partial or draft form. Payment shall be net thirty (30) days. All invoices and statements to the Town shall be addressed as follows: Invoices: Town of Los Gatos Attn: Accounts Payable P.O. Box 655 Los Gatos, CA 95031-0655 2.9 Availability of Records. Supplier shall maintain the records supporting this billing for not less than three years following completion of the work under this Agreement. Supplier shall make these records available to authorized personnel of the Town at the Supplier's offices during business hours upon written request of the Town. Page 3 of 5 2.10 Independent Contractor. It is understood that the Supplier, in the performance of the work and services agreed to be performed, shall act as and be an independent contractor and not an agent or employee of the Town. As an independent contractor he/she shall not obtain any rights to retirement benefits or other benefits which accrue to Town employee(s). 2.11 Conflict of Interest. Supplier understands that its professional responsibilities are solely to the Town. The Supplier has and shall not obtain any holding or interest within the Town of Los Gatos. Supplier has no business holdings or agreements with any individual member of the Staff or management of the Town or its representatives nor shall it enter into any such holdings or agreements. In addition, Supplier warrants that it does not presently and shall not acquire any direct or indirect interest adverse to those of the Town in the subject of this Agreement, and it shall immediately disassociate itself from such an interest, should it discover it has done so and shall, at the Town's sole discretion, divest itself of such interest. Supplier shall not knowingly and shall take reasonable steps to ensure that it does not employ a person having such an interest in this performance of this Agreement. If after employment of a person, Supplier discovers it has employed a person with a direct or indirect interest that would conflict with its performance of this Agreement, Supplier shall promptly notify Town of this employment relationship, and shall, at the Town's sole discretion, sever any such employment relationship. 2.12 Equal Employment Opportunity. Supplier warrants that it is an equal opportunity employer and shall comply with applicable regulations governing equal employment opportunity. Neither Supplier nor its subcontractors do and neither shall discriminate against persons employed or seeking employment with them on the basis of age, sex, color, race, marital status, sexual orientation, ancestry, physical or mental disability, national origin, religion, or medical condition, unless based upon a bona fide occupational qualification pursuant to the California Fair Employment & Housing Act. III. INSURANCE AND INDEMNIFICATION 3.1 Minimum Scope of Insurance: i. Supplier agrees to have and maintain, for the duration of the contract, General Liability insurance policies insuring him/her and his/her firm to an amount not less than: one million dollars ($1,000,000) combined single limit per occurrence for bodily injury, personal injury and property damage. ii. Supplier agrees to have and maintain for the duration of the contract, an Automobile Liability insurance policy ensuring him/her and his/her staff to an amount not less than one million dollars ($1,000,000) combined single limit per accident for bodily injury and property damage. Page 4 of 5 iii. Supplier shall provide to the Town all certificates of insurance, with original endorsements effecting coverage. Supplier agrees that all certificates and endorsements are to be received and approved by the Town before work commences. iv. Supplier agrees to have and maintain, for the duration of the contract, technology professional liability insurance in amounts not less than $1,000,000 which is sufficient to insure Supplier for technology professional errors or omissions in the performance of the particular scope of work under this agreement. 3.2 General Liability: i. The Town, its officers, officials, employees and volunteers are to be covered as additional insured as respects: liability arising out of activities performed by or on behalf of the Supplier; products and completed operations of Supplier, premises owned or used by the Supplier. This requirement does not apply to the professional liability insurance required for technology professional errors and omissions. ii. The Supplier's insurance coverage shall be primary insurance as respects the Town, its officers, officials, employees and volunteers. Any insurance or self- insurances maintained by the Town, its officers, officials, employees or volunteers shall be excess of the Supplier's insurance and shall not contribute with it. iii. Any failure to comply with reporting provisions of the policies shall not affect coverage provided to the Town, its officers, officials, employees or volunteers. iv. The Supplier's insurance shall apply separately to each insured against whom a claim is made or suit is brought, except with respect to the limits of the insurer's liability. 3.3 All Coverages. Each insurance policy required in this item, with exception of the Technology Errors and Omissions, shall be endorsed to state that coverage shall not be suspended, voided, cancelled, reduced in coverage or in limits except after thirty (30) days' prior written notice by certified mail, return receipt requested, has been given to the Town. Current certification of such insurance shall be kept on file at all times during the term of this agreement with the Town Clerk Administrator. Page 5 of 5 3.4 Workers’ Compensation. In addition to these policies, Supplier shall have and maintain Workers' Compensation insurance as required by California law and shall provide evidence of such policy to the Town before beginning services under this Agreement. Further, Supplier shall ensure that all subcontractors employed by Supplier provide the required Workers' Compensation insurance for their respective employees. IN WITNESS WHEREOF, the Town and Supplier have executed this document. Town of Los Gatos by: Superion, LLC by: Laurel Prevetti, Town Manager Tom Amburgey, General Manager Recommended by: Department Head Name, Title Approved as to Form: Robert Schultz, Town Attorney Attest: Shelley Neis, CMC, Town Clerk Administrator