Master Services Agreement (Hawaii)

MASTER SERVICES AGREEMENT

STATE OF HAWAII

This Master Services Agreement (the “Agreement”) is made as of [__/__/____]
(the “Effective Date”) between:

Client and Provider are each a “Party” and together the “Parties.”

1. AGREEMENT STRUCTURE

1.1 Statements of Work

Services will be authorized only by a written statement of work (“SOW”) signed
by both Parties. Each SOW must identify the services, deliverables, schedule,
fees, acceptance criteria, dependencies, and any SOW-specific terms.

1.2 Order of Precedence

If documents conflict, the following order applies unless the SOW expressly
identifies the provision it changes:

1. A signed amendment to this Agreement;
2. The applicable SOW;
3. This Agreement; and
4. Other incorporated exhibits.

A purchase order is administrative only and does not amend this Agreement
unless both Parties sign an express amendment.

1.3 Affiliates

An affiliate may use this Agreement only through a signed SOW that identifies
the affiliate and assigns responsibility for payment and performance.

2. DEFINITIONS

Acceptance Criteria means the objective requirements stated in the SOW.

Client Data means data supplied by or collected for Client in connection
with the Services.

Client Materials means materials supplied by Client for Provider's use.

Confidential Information means nonpublic information disclosed in
connection with the Services that is marked confidential or reasonably should
be understood as confidential.

Deliverable means a work product identified for delivery in an SOW.

Documentation means manuals, specifications, and operating instructions
identified in an SOW.

Personal Information means information designated as personal information
in the applicable data-protection addendum or current governing law.

Services means the services described in an SOW.

Work Product means Deliverables created specifically for Client under an
SOW, excluding Provider Tools and third-party materials.

Provider Tools means Provider's preexisting or independently developed
methods, software, templates, know-how, and reusable materials.

3. SERVICES AND GOVERNANCE

3.1 Performance

Provider shall perform the Services professionally, according to the applicable
SOW, and using personnel with appropriate skills.

3.2 Project Contacts

Project managers may coordinate daily work but may not amend price, scope,
ownership, risk allocation, or legal terms without a signed change order.

3.3 Client Dependencies

Client shall timely provide the access, decisions, personnel, information, and
materials identified in the SOW. Provider shall promptly document any delay or
cost effect caused by an unmet dependency.

3.4 Subcontractors

Provider may use subcontractors only as stated below:

☐ Prior written Client approval required

☐ Notice to Client required

☐ No additional approval required

Provider remains responsible for subcontracted performance and shall impose
written confidentiality, security, and intellectual-property obligations
appropriate to the assigned work.

4. FEES, INVOICING, AND TAXES

4.1 Fee Model

Each SOW shall select and complete one or more models:

☐ Fixed fee

☐ Time and materials

☐ Milestone fee

☐ Subscription or recurring service fee

☐ Other: [________________________________]

4.2 Invoices

Provider shall invoice [MONTHLY / BY MILESTONE / OTHER]. Each invoice must
identify the SOW, period, services or milestone, approved expenses, taxes, and
amount due.

4.3 Payment

Undisputed amounts are due within [____] days after receipt of a conforming
invoice.

4.4 Invoice Disputes

Client shall give written notice of a good-faith dispute within [____] days
after receipt, describing the disputed amount and basis. Client shall timely
pay the undisputed portion. The Parties shall escalate unresolved disputes to
their executive contacts.

4.5 Late Charge

A late charge applies only if completed and approved by Hawaii counsel:

Rate: [____]% per [MONTH / YEAR]

Grace period: [____] days

Lawful-rate review completed by: [________________________________]

4.6 Expenses and Taxes

Client shall reimburse only pre-approved, documented expenses within the SOW
limits. Fees exclude taxes imposed on the transaction, except taxes measured
by Provider's net income. Each Party remains responsible for its own tax
reporting.

5. DELIVERABLES AND ACCEPTANCE

5.1 Delivery

Provider shall deliver each Deliverable through the method and by the milestone
date stated in the SOW.

5.2 Review Period

Client shall review a Deliverable within [____] business days after receipt and
either:

☐ Accept it in writing; or

☐ Reject it in writing with specific references to unmet Acceptance Criteria.

Silence is not acceptance unless the SOW expressly states a completed deemed-
acceptance mechanism reviewed by counsel.

5.3 Correction

Provider shall correct a properly rejected Deliverable within [____] business
days or another agreed period. If repeated correction fails, the SOW shall
state whether Client may receive a refund, terminate the affected work, obtain
replacement performance, or use another negotiated remedy.

6. CHANGES

No scope, schedule, fee, staffing, or Deliverable change is binding unless a
written change order is signed by authorized representatives of both Parties.

A change order must state:

• The requested change;
• Price effect;
• Schedule effect;
• Dependency or risk effect;
• Acceptance effect; and
• Effective date.

7. INTELLECTUAL PROPERTY

7.1 Existing Materials

Each Party retains ownership of its preexisting and independently developed
materials.

7.2 Work Product Election

Select one ownership model in each SOW:

☐ Client ownership after payment. Upon full payment, Provider assigns the
identified Work Product to Client, excluding Provider Tools and third-party
materials.

☐ Provider ownership with license. Provider retains ownership and grants
Client the license described in the SOW.

☐ Other allocation: [________________________________]

7.3 Provider Tools License

To the extent Provider Tools are embedded in a Client-owned Deliverable,
Provider grants Client a [PERPETUAL / TERM-LIMITED], worldwide, nonexclusive,
[TRANSFERABLE / NONTRANSFERABLE] license to use those tools solely as necessary
to use the Deliverable.

7.4 Third-Party Materials

Provider shall identify third-party materials and applicable license terms
before incorporating them. Client shall not receive broader rights than the
third-party licensor permits.

7.5 Client Materials License

Client grants Provider a nonexclusive, limited license to use Client Materials
only to perform the applicable SOW.

8. CONFIDENTIALITY

8.1 Use and Protection

The receiving Party shall use Confidential Information only for this Agreement,
limit access to personnel and contractors with a need to know, and protect it
with at least reasonable care.

8.2 Exclusions

Confidential Information does not include information the receiving Party can
document:

• Was lawfully known without restriction;
• Becomes public without breach;
• Is received lawfully from a third party without restriction; or
• Is independently developed without use of the disclosing Party's information.

8.3 Required Disclosure

Before a legally compelled disclosure, the receiving Party shall give prompt
notice when permitted and reasonably cooperate with protective measures.

8.4 Duration

Contract confidentiality lasts [____] years after disclosure or termination.
Information selected and confirmed by counsel as a trade secret remains
protected while it qualifies for that treatment.

8.5 Return or Destruction

On request or termination, each receiving Party shall return or destroy
Confidential Information, subject to documented backup, legal-hold, and
record-retention exceptions.

9. DATA PROTECTION AND SECURITY

This section creates contractual duties; it does not replace a law-specific
privacy or security addendum.

9.1 Security Schedule

If Provider processes Client Data, the Parties shall attach a security schedule
covering:

• Data categories and approved uses;
• Hosting and storage locations;
• Access control and authentication;
• Encryption;
• Logging and monitoring;
• Vulnerability and patch management;
• Subprocessors;
• Backup and recovery;
• Incident response;
• Retention and deletion; and
• Audit evidence.

9.2 Security Incident

Provider shall notify Client within [____] hours after confirming a Security
Incident affecting Client Data, provide available material facts, preserve
evidence, mitigate harm, and provide updates. This is a negotiated contractual
deadline and is not labeled as a statutory notification period.

9.3 Legal Notice Responsibility

The data-protection addendum shall assign responsibility for determining and
making any legally required notice. Neither Party may notify an affected person
or regulator in the other's name without authorization, except as law
requires.

10. WARRANTIES

10.1 Mutual Authority

Each Party represents that it has authority to enter into this Agreement.

10.2 Provider Warranty

Provider warrants for [____] days after acceptance that Services and
Deliverables will materially conform to the applicable SOW and Acceptance
Criteria.

10.3 Correction Remedy

Provider shall reperform or correct a verified warranty nonconformity reported
during the warranty period. If correction is not reasonably successful, the
SOW shall state the applicable refund, credit, termination, or replacement
remedy.

10.4 Disclaimers

Any disclaimer of implied warranties, any goods-related warranty language, and
any exclusive-remedy clause must be completed in conspicuous text and reviewed
for the actual transaction:

[INSERT REVIEWED DISCLAIMER OR STATE “NONE”]

11. INDEMNIFICATION

11.1 Provider Indemnity

Provider shall defend and indemnify Client against third-party claims to the
extent arising from:

☐ Bodily injury or tangible property damage caused by Provider's negligence;

☐ Alleged infringement by a Provider-created Deliverable;

☐ Provider's material breach of the completed data-protection addendum; or

☐ Other: [________________________________]

11.2 Client Indemnity

Client shall defend and indemnify Provider against third-party claims to the
extent arising from:

☐ Client Materials or Client instructions;

☐ Client's unauthorized use or modification of a Deliverable; or

☐ Other: [________________________________]

11.3 Procedure

The indemnified Party shall promptly notify the indemnifying Party, permit
control of the defense by qualified counsel, and reasonably cooperate. No
settlement may admit fault, impose nonmonetary duties, or fail to release the
indemnified Party without written consent.

12. LIMITATION OF LIABILITY

12.1 Excluded Damages

Subject to the completed exceptions, neither Party is liable for indirect,
special, incidental, exemplary, or consequential damages, or for lost profits,
revenue, goodwill, or data.

12.2 Liability Cap

Each Party's aggregate liability is limited to:

☐ Fees paid or payable under the affected SOW during the preceding [____] months

☐ $[________________________________]

☐ Other: [________________________________]

12.3 Exceptions

Select exceptions only after counsel review:

☐ Payment obligations

☐ Indemnification obligations

☐ Confidentiality breach

☐ Data-security breach

☐ Intellectual-property infringement or misappropriation

☐ Fraud, willful misconduct, or gross negligence

☐ Bodily injury or tangible property damage

☐ Liability that cannot lawfully be limited

13. INSURANCE

Provider shall maintain only the coverages selected in the SOW:

14. TERM AND TERMINATION

14.1 Term

The Agreement begins on the Effective Date and continues until [DATE / ALL SOWS
END / OTHER], unless terminated earlier.

14.2 Cause

Either Party may terminate the Agreement or an affected SOW for material breach
not cured within [____] days after detailed written notice. A shorter or
immediate route may be selected for an incurable breach:

[________________________________]

14.3 Insolvency or Cessation

A Party may terminate upon the other Party's insolvency event or cessation of
business only to the extent permitted by applicable law and the completed
clause below:

[________________________________]

14.4 Convenience

☐ Client may terminate an SOW on [____] days' notice.

☐ Either Party may terminate this Agreement when no SOW is active on [____]
days' notice.

14.5 Effect

On termination:

• Client shall pay undisputed fees for accepted work and approved commitments;
• Provider shall deliver paid-for work in its then-current state;
• Each Party shall return or destroy protected information as required;
• Transition assistance, if any, is provided under a signed SOW; and
• Provisions intended by their nature to survive remain effective.

15. DISPUTE RESOLUTION AND HAWAII TERMS

15.1 Executive Escalation

Before filing a claim, the project managers and then executive contacts shall
attempt in good faith to resolve the dispute for [____] days, except where
urgent relief is reasonably sought.

15.2 Mediation

☐ Required before arbitration or litigation

☐ Optional

If selected, mediation will occur in [HONOLULU / OTHER], Hawaii, unless the
Parties agree otherwise.

15.3 Final Forum

Select one:

☐ State or federal courts with subject-matter jurisdiction in Hawaii, with
venue selected and confirmed by Hawaii counsel: [________________________________]

☐ Binding arbitration under the completed arbitration exhibit

15.4 Governing Law

Hawaii law governs this Agreement, without using a choice-of-law rule that
would select another jurisdiction's law.

15.5 Attorneys' Fees

Any request for attorneys' fees in a court action is subject to HRS § 607-14
and other applicable authority. Section 607-14 directs the court, in actions in
the nature of assumpsit and written-contract actions providing for fees, to tax
a reasonable fee against the losing party and generally limits the award to
twenty-five percent of the judgment, with the statutory calculation differing
when the defendant obtains judgment.

15.6 Limitations Period

This Agreement does not create a universal shortened claim period. Hawaii
counsel shall calendar the limitations period applicable to the actual claim
and transaction.

16. GENERAL TERMS

16.1 Notices

Notices must be in writing and delivered by the methods selected below:

☐ Personal delivery

☐ Nationally recognized overnight service

☐ Certified mail

☐ Email with agreed receipt evidence

Notice addresses appear in the opening table and may be changed by notice.

16.2 Assignment

Neither Party may assign this Agreement without consent, except as completed
below for a merger, reorganization, or transfer of substantially all relevant
assets:

[________________________________]

16.3 Independent Contractors

The Parties are independent contractors. This Agreement does not create a
partnership, joint venture, employment, fiduciary, or agency relationship.

16.4 Publicity

Neither Party may use the other's name or marks in publicity without written
consent, except as stated in an SOW.

16.5 Force Majeure

Neither Party is liable for delay caused by an event beyond reasonable control,
excluding payment obligations. The affected Party shall promptly notify the
other, mitigate effects, and resume performance. An affected SOW may be
terminated after [____] consecutive days of material delay.

16.6 Entire Agreement; Amendment

This Agreement and signed SOWs are the entire agreement on their subject.
Amendments must be signed by authorized representatives of both Parties.

16.7 Severability and Waiver

An unenforceable provision shall be addressed by the court or arbitrator as
permitted by law without invalidating the remainder. A waiver must be in
writing and applies only to the identified instance.

16.8 Electronic Transactions

The Parties agree to conduct execution of this Agreement and its SOWs by
electronic means. Under HRS § 489E-5, chapter 489E applies only when each Party
has agreed to transact electronically, and a Party may refuse to conduct other
transactions electronically. Under HRS § 489E-7, a record, signature, or
contract is not denied legal effect solely because it is electronic, and an
electronic record or signature may satisfy a writing or signature requirement.

☐ Client consents to electronic execution of this Agreement and its SOWs.

☐ Provider consents to electronic execution of this Agreement and its SOWs.

Future notices and transactions will use electronic means only as separately
agreed or as this Agreement expressly provides.

16.9 Counterparts

The Parties may sign counterparts, which together form one agreement.

17. SIGNATURES

Client

By: ______________________________________

Name: [________________________________]

Title: [________________________________]

Date: [__/__/____]

Provider

By: ______________________________________

Name: [________________________________]

Title: [________________________________]

Date: [__/__/____]

EXHIBIT A — STATEMENT OF WORK

A. Parties and Project

SOW number: [________________________________]

Effective date: [__/__/____]

Project name: [________________________________]

Client affiliate, if any: [________________________________]

B. Services and Deliverables

C. Acceptance Criteria

[________________________________]

D. Schedule and Dependencies

E. Fees

Invoice schedule: [________________________________]

Payment terms: [________________________________]

Expense cap: $[________________________________]

F. SOW-Specific Terms

[________________________________]

G. SOW Signatures

Client: ______________________________________ Date: [__/__/____]

Provider: ______________________________________ Date: [__/__/____]

CURRENT OFFICIAL SOURCES

• HRS § 489E-5:
  https://capitol.hawaii.gov/hrscurrent/Vol11_Ch0476-0490/HRS0489E/HRS_0489E-0005.htm

• HRS § 489E-7:
  https://capitol.hawaii.gov/hrscurrent/Vol11_Ch0476-0490/HRS0489E/HRS_0489E-0007.htm

• HRS § 607-14:
  https://capitol.hawaii.gov/hrscurrent/Vol13_Ch0601-0676/HRS0607/HRS_0607-0014.htm