Exhibit 10.22
SCOPE OF WORK AND SPECIAL TERMS AND CONDITIONS
CONTRACT FOR PORTAL MANAGER SERVICES
THIS CONTRACT is between the State of Hawaii, hereinafter referred to as
"the State", and Hawaii Information Consortium, Inc., a for-profit
corporation, hereinafter referred to a "HIC".
WHEREAS, the State has worked diligently to create an opportunity for
providing enhanced electronic access to public services and information for
Hawaii citizens in the most cost-effective, progressive, and cooperative
means possible; and
WHEREAS, Access Hawaii, hereinafter referred to as the "Portal", is
poised to become a significant public access, economic development and
educational tool for the State of Hawaii and its residents; and
WHEREAS, the Portal will significantly benefit the State through:
1. Increased public services;
2. Enhanced public access to State government;
3. Equality of access to State government regardless of geographic
locations;
4. Increased efficiency of State government agencies and offices without
budget increases through electronic commerce transactions;
5. Providing additional resources to State agencies and offices and to
assist them in information management, access, and electronic commerce
functions as project grows;
6. Providing both Standard Portal Services and Premium Services, for
which an access charge will be assessed as recommended by the Access Hawaii
Committee, hereinafter referred to as the AHC;
7. Enhancing access to services and information of political
subdivisions; and
WHEREAS, in order to effectuate electronic access and commerce for
citizens with government throughout the State, the Governor's Office issued a
Request for Proposals for an Electronic Business and Internet Portal
Provider, GOV (RFP 99-00) on September 22, 1999 and amendments on October 7,
1999, October 14, 1999, November 5, 1999, and December 9, 1999, referred to
hereinafter collectively as the "RFP", seeking proposals for a private Portal
manager; and
WHEREAS, HIC submitted an original proposal on November 19, 1999 in
response to the RFP and Best and Final Offer on December 20, 1999 in response
to Addenda D, and such proposal was determined by the proposal review
committee to be the one best suited to the goals of the State, which proposal
in hereinafter referred to as the"HIC Proposal"; and
WHEREAS, the State desires to contract with HIC to serve as the Portal
Manager and to establish, develop, operate, maintain and expand the Portal as
mutually agreed to by HIC and the State; and
WHEREAS the Portal will provide increased electronic access and commerce
among Hawaii residents, businesses, and other government entities;
NOW THEREFORE, the parties agree as follows:
1. INCORPORATION BY REFERENCE
The provisions of the RFP and the HIC Proposal are hereby incorporated
into this Contract and made a part hereof. If there is any conflict among the
provisions of the RFP, the HIC Proposal, this Contract, and the laws of the
State, then those conflicts will be resolved in the following order
precedence:
1. Hawaii law
2. Contract
3. The RFP and addenda & the HIC Proposal, equally.
This Contract may be amended only by mutual expressed written consent.
2. PURPOSE OF THE PORTAL.
The purpose of the Portal and this contract is to realize the vision of
the Governor and Access Hawaii Committee in meeting the goals set forth in the
RFP and may be summarized as follows:
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A. To create and provide a significant and diligently promoted public service
to Hawaii citizens and businesses by:
(1) Expanded business and citizen access to government services and
information;
(2) Offering an easy and convenient process for these groups to conduct
transactions with State government online;
(3) Accelerating the development and delivery of an increased volume of
quality, online government services;
(4) Improving the level of customer service from State government;
(5) Extend electronic government services to citizens of cities and
county government; and
B. To provide such public service without increasing the tax burden on the
citizens of Hawaii, through utilization of private capital and management
and appropriate payment for the same.
3. TERM OF CONTRACT AND RENEWALS
This Contract shall be for a term of three (3) years, commencing
January 3, 2000 and expiring at 12:00 a.m., January 3, 2003, unless earlier
terminated.
At the option of the State, the Contract may be renewed for a period of
two (2) additional years by written notice from the State on or before
July 1, 2002, of its decision to extend the Contract period through
January 3, 2005.
At the option of the State, the Contract may be renewed for an additional
period of two (2) additional years by written notice from the State on or
before July 1, 2004, of its decision to extend the Contract period through
January 3, 2007.
4. RELATIONSHIP OF PARTIES
Access Hawaii will be overseen by the AHC, an advisory committee to the
State. Routine contract administrative activities will be implemented
through the AHC, who is the state electronic commerce coordinator
committee, working in concert with HIC. Final statutory and decision-making
authority for this contract resides with the Governor's Special Advisor
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for Technology Development (GSATD). The duties and responsibilities of the
AHC and HIC are as follows:
A. Notwithstanding any other provisions contained herein, it is expressly
agreed that HIC is an independent contractor in the performance of each and
every part of this Contract. As such HIC is solely liable for all labor
and expenses in furtherance of such performance hereunder. It is expressly
agreed that HIC and any of its subcontractors and agents, officers and
employees in the performance of this Contract shall act in an independent
capacity and not as officers or employees of the State. It is further
expressly agreed that this Contract shall not be construed as a partnership
or joint venture between HIC or any subcontractor and the State of Hawaii.
B. HIC may become an agent of the State only by the expressed written
consent of the State.
C. HIC will not pledge any assets of the State in its care, custody or
control, or cause any type of lien to attach to such.
D. HIC will provide Portal manager services in exchange for the
opportunity to earn a reasonable profit from the Portal's premium services.
Premium Services are those services or information that are made available
in such a way that they have commercial value or add convenience to the
user. HIC will capitalize, develop and operate the Portal, which will
serve in a manner which is self-supporting and cost effective. Some of the
information access is intended to be provided standard (no cost) to Portal
users. Standard services will be funded from the proceeds of the premium
services. The development of premium or standard services will include
adequate integration with state agency systems to ensure that necessary
records are created and populated appropriately. The Portal is intended to
be self-supporting with HIC receiving its compensation from the net
proceeds of premium services. The State of Hawaii will give its full
support and effort to HIC in the effort to make the Portal self-supporting.
E. The AHC will establish priorities and policies and approve or
disapprove Service Level Agreements (agreements between the Portal and
State Agencies or political subdivisions that define circumstances and
responsibilities relating to providing on-line
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electronic access and/or transactions, which are at the agencies' or
political subdivisions' discretion). HIC will submit a revised budget plan
for the operation of the Portal within 60 days of the commencement of this
contract.
F. As a contractor for the State, HIC will deliver and disburse funds
as agreed between HIC, AHC and any entity as negotiated in separate Service
Level Agreement. The AHC and the Hawaii Director of the Department of
Budget and Finance ("B&F") shall approve all funds handling procedures. HIC
will keep, maintain and be a custodian of all Portal financial and
operation records.
G. HIC will follow relevant state and federal statutes, rules and
regulations applicable to assuring privacy and confidentiality. With
respect to state and local government information and filings, service
level agreements will specify the process for disclosure. Any disclosure
that is not specified in the service level agreement shall only be
disclosed through the express written authorization of the data custodian.
HIC company records are not considered public documents for purposes of
public disclosure.
5. HARDWARE AND SOFTWARE AGREEMENTS
A. HIC will provide hardware, and provide or develop software as
outlined in the HIC Proposal, and such other hardware and software as may
be necessary to make the Portal operational.
B. Upon completion of the initial three year term of the contract, HIC
will provide to the State at no cost, and without additional terms or
conditions, a complete copy, together with any software updates or upgrades
made by HIC, of all application and Portal software (hereinafter
collectively "The Software") developed either by HIC or by any or all of
its Affiliate Portal Companies and implemented on the Portal Corporations
who are wholly owned subsidiaries of the National Information Consortium,
Inc. that serve as the Portal Managers for state gateway service
initiatives.) HIC will also include with the Software complete
documentation and source code. The State shall be granted a perpetual
for-use-only license to The Software including rights to modify the code
and application, as the State deems appropriate. This provision does not
apply to software or documentation
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created by third parties and purchased by HIC, or one of its Affiliate
Portal Companies. The Software shall be delivered to the State no later
than the end of the term of the contract unless otherwise agreed to
mutually by the parties to this contract. This provision also remains in
effect for any additional software created by HIC or an Affiliate Portal
Company implemented on the Portal during any subsequent contract
extension, amendment or renewal period.
C. If this Agreement is terminated by the State "for cause", or by HIC
for reasons identified in section 15 and 16 prior to the end of the
initial contract term, or by HIC without cause, the State shall be
entitled to the license at the time termination is effective. If this
Agreement is terminated by the State without cause, the State reserves
the right to negotiate terms for licensure or software. The State
reserves the right to acquire equipment at fair market value at the
termination of this contract in coordination with HIC's leasing agent.
D. License shall be limited to State use for the state of Hawaii's
Portal for state and local government services and may not be sublicensed
to political subdivisions; however, if the State has a joint program
through the Portal with a political subdivision at the time the license
is granted or before the termination of the contract, the license may
continue to be used for such a program only.
E. HIC shall deposit on a quarterly basis, the most recent version of
all Portal application source code in escrow with a Hawaii-based neutral
third party (the "Escrow Agent") to be mutually chosen by HIC and the
State. Over the term of the contract HIC will have the authority to
remove superseded source code. The source code shall be delivered to the
State by the Escrow Agent in the event HIC: (i) is declared insolvent
through bankruptcy proceedings, (ii) is unable to perform its obligations
to the State under the Contract, or (iii) as otherwise provided in its
agreement with the Escrow Agent.
HIC acknowledges that the State will review, approve and subsequently
receive from HIC, an executed copy of the software escrow agreement
between HIC and the Escrow Agent to the State. HIC will notify the State
in writing of any amendments to such agreements, any change in Escrow
Agent, or of any replacement or successor escrow arrangements. The
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Escrow Agent will provide written notification to the State's GSATD or
his successor, at least semiannually, detailing all account activity
during the previous period.
F. All Portal trademarks, trade names, logos and other identifiers,
Internet uniform resource locators, Internet addresses and e-mail
addresses obtained or developed pursuant to this Contract shall be the
property of the State.
6. CONNECTIONS BETWEEN PORTAL AND STATE AGENCIES
Costs associated with and maintenance of communication links from State
facilities to HIC facilities for Portal purposes, including but not
limited to leased circuits from telephone or cable companies, shall be
paid as expenses by HIC.
7. PORTAL SERVICE
A. HIC shall negotiate with and obtain written Service Level Agreements
from each separate data-providing entity (hereinafter, "DPE") from which
electronic access or transactions are desired.
B. Subscribers (customers who apply for and receive from the Portal, a
user name and password in order to access the services they desire with
monthly billing instead of instant payment) will be required to execute a
contract for services. All contracts with subscribers and all SLA's shall
be subject to approval and continuing monitoring by the AHC.
C. HIC will enter into an SLA with each agency or political subdivision
who provides information to HIC for the Portal or which has a transaction
which furnishes information to the agency or political subdivision. These
agreements will be signed by the agencies' authorized representative(s)
and will be approved by the AHC. Only information that is legally and
ethically distributable, as determined by the state agency, in its
capacity as the legal custodian of the respective data, will be included
on the Portal. The SLA will detail what information will be accessed or
transactions performed, how it will be accessed and provided to the
public or how the transaction will generally operate with the agency, any
statutory fees or enhanced access charges, and what, if any special
requirements must be
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satisfied by the individual customers to qualify for access to the
information or to perform the transaction. The agency and HIC will agree
on a schedule for collection and payment of any statutory fee required.
Once an agreement has been reached and approved by the AHC, the public
information application will be developed according to the agency's SLA.
D. Since HIC's software developers creating the application may see
some confidential information while working with the agency
representative in determining which data fields are required, HIC's
employees must satisfy any privacy and confidentiality requirements that
the agency may require prior to beginning work.
E. All SLA's or other requests regarding the Portal from non-state
level political subdivisions must be approved by the AHC through the
service request process. The AHC shall establish the priority of such
requests.
8. DISTRIBUTION OF PORTAL REVENUES
A. The establishment of all charges to Portal users shall be reviewed
by the AHC. The AHC will review and approve any and all Portal use or
data access charges for fairness, reasonableness, and appropriateness in
furthering the goals of this Agreement. HIC may at any time recommend
changes in charges to the AHC.
B. In establishing Portal use or data access charges the AHC shall
consider the following factors:
(1) A commitment to the public policy requirement to provide
electronic access to public records at the most reasonable rate
possible and to improve government service to its citizens and
businesses by allowing transactions online.
(2) That the charges may be adjusted to permit funding of special
projects and enhancement of public service.
(3) The entrepreneurial and start-up nature of the business and
attendant risk of capital for HIC and the need to earn a reasonable
profit on Portal operations.
(4) The need to invest in the reasonable expansion, maintenance and
improvement to online Portal transactions and information services.
(5) Any other reasonable factors which in the opinion of AHC should
be considered.
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C. To the extent an audit report discloses any discrepancies in the HIC
charges, xxxxxxxx, or financial records, and following a period for
review and verification of the amount by HIC, HIC will adjust the payment
as soon as reasonable possible, but not to
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exceed 90 days. HIC shall cooperate to assure that verification is
completed in a timely manner.
D. HIC also agrees to make other changes requested by the State, which
is agreed to by HIC and the AHC, to comply with recommendations resulting
from any audit. Any such audit will be performed by a competent and
reputable Certified Public Accountant licensed in Hawaii.
E. The accounting system is to include a numbered chart of accounts,
books of original entry of all transactions, appropriate subsidiary
ledgers, a general ledger, which includes to-date postings and an audit
trail through financial statements. Such books may either be maintained
on paper or on computer with appropriate backup. HIC shall from the
beginning of this Contract adopt the calendar year ending December 31st
for reporting purposes.
F. HIC will report activities to the State as follows:
(1) Within 120 days after the close of HIC's fiscal year, HIC will
submit to the State an annual financial report and audit. These
reports must be certified by an independent certified public
accountant (selected by HIC) that may be the accountant or a member
of the firm of accountants who regularly audit the books and
accounts of HIC. The submitted audit information must include, but
is not limited to, the audited financial statements, auditor
opinions, reports on internal control, findings and recommendations
and management letters. In addition, HIC is subject to any further
audit and review determined necessary by the State after furnishing
reasonable notice to HIC.
(2) Develop and regularly update, in cooperation with the data
custodians, a draft Portal strategic plan for presentation to the
AHC on at least an annual basis.
(3) Report to the AHC on a periodic basis concerning potential new
applications, services and related issues. HIC will strive to
improve access to, and the utility of the public information and
transactions available through the Portal by exploring and
recommending ways to:
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a. Expand the amount and kind of public services and
information available;
b. Increase the utility of the public information presented,
the transactions available, and the form in which both are
provided;
c. Expand the base of users who access the public services
and information;
d. Improve individual and business access to public services
and information through implementing improvements in
technology; and,
e. Make recommendations designed to increase the effectiveness
and resources of the Portal.
f. Redesign and maintain the State of Hawaii website and the
agreed upon Portal pages.
(4) HIC will measure Customer satisfaction including Web surveys
and report results to the AHC on a schedule to be agreed to by the
AHC and HIC but no less than on an annual basis, and
(5) HIC will measure and report to the AHC on growth trends and
usage of the Portal, as well as hits, access, transactions and other
performance measures or metrics as mutually agreed upon by the AHC
and HIC. Working in cooperation with the AHC, HIC will submit the
details of the proposed service measures either as part of the
service management plan for Portal wide indicators and as part of
the Service Level Agreements for application specific indicators.
(6) If available, HIC will utilize the state's payment card
processor for payment card transactions, with the provision that
HIC will receive state rates negotiated as part of the State of
Hawaii contract with its chosen bank during the life of that
contract unless otherwise determined by the State, or unless more
favorable rates may be obtained by HIC independent of the state.
(7) HIC will have an initial opportunity to collect state statutory
fees from users before paying same to the state. HIC guarantees the
collection of such statutory fees to the state.
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11. PERSONNEL PRACTICES
A. The hiring, recruitment, management, training, and firing of HIC
employees will be the responsibility of HIC. The State's only involvement
in the personnel affairs of HIC shall be limited to disclosure of the
names and positions of officers and employees of HIC, except within
its role as auditor.
B. No officer, employee, or director of HIC shall receive a salary,
except as and for services performed by such officer, employee, or
director, or member for HIC on behalf of the Portal.
C. HIC shall be responsible for all required costs attributable to its
officers and employees, including but not limited to, worker's
compensation premiums and deductible, unemployment compensation tax
withholding contributions, tax withholding contributions, and similar
items.
12. INSURANCE AND BONDS
HIC shall provide the AHC written proof of the following insurance
provided by a qualified firm authorized/admitted to do business in Hawaii:
A. General comprehensive liability insurance policy in the amount of at
least $1,000,000.
B. Workers' compensation insurance coverage as required by State law on
all HIC employees.
C. Fidelity bond in the amount of at least $200,000 per HIC employee.
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13. CHANGES IN PORTAL
A. Portal operations and development shall be generally in accordance
with the HIC Proposal, the RFP and this contract as described in
Section 11, and Section 13.B.
B. A planned material change in Portal operations cannot be made by HIC
without the prior written consent of the AHC. A "material change" includes,
but is not limited to, a change which is substantial and which increases
response time to inquires, adds to the complexity of Portal use,
diminishes services provided to users, or results in a comparable impact
on operations noticeable by users.
C. HIC will provide to the AHC at least thirty (30) days prior written
notice of a planned material change in Portal operations.
D. HIC shall timely provide to the AHC such other management reports as
the AHC may reasonably request.
14. NOTICES
Each party may change its designation for notice following written notice
to the other party to this Contract.
AHC
Xx. Xxxxxx Xxxxxx
Chair, Access Hawaii
State Capitol
Honolulu, Hawaii
HIC
Aka X. XxXxxx
Hawaii Information Consortium, Inc.
Honolulu, Hawaii
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Notices by the parties to one another shall be given in writing to the
persons identified above or to such other persons as may be subsequently
identified in a written notice. Such notices shall be effective on the
date of receipt if sent by U.S. first-class or restricted delivery
mail, postpaid, or by any reputable overnight delivery service, prepaid.
15. TERMINATION OF CONTRACT
The State of HIC shall have the right to terminate this Contract for cause,
subject to cure, by providing written notice of termination to HIC or the
State, respectively. Such notice shall specify the time, the specific
provision of this Contract or "for cause" reason that gives rise to the
termination and shall specify reasonable appropriate action that can be
taken by HIC or the State to avoid termination of the Contract. The State
and HIC shall provide a period of up to sixty (60) days, unless otherwise
specified in this Contract, for HIC or the State to cure breaches and
deficiencies of its performance obligations under this Contract. The State
may terminate this Contract at any time, if directed to do so by statute
or court order.
16. TERMINATION FOR CAUSE
A. For purposes of this Contract, the phrase "for cause" by the State
shall include but not be limited to:
(1) Any material breach or evasion by HIC of the terms or
conditions of this Contract and its amendments, if any; or,
(2) Substantial cessation of Portal services by the Portal; or,
(3) Fraud, misappropriation, embezzlement, malfeasance, significant
misfeasance, or illegal conduct by HIC, its employees, agents,
officers, or directors; or,
(4) Dissolution of HIC or forfeiture of its company existence; or,
(5) Amendment of the State's enabling authority making the Portal
substantially impractical; or,
(6) An adverse judicial decision by a court of competent
jurisdiction, which has the effect of rendering Portal operations no
longer feasible; or,
(7) Insolvency of HIC; or,
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(8) Material breach of an SLA; or,
(9) Negligent disclosure of any confidential information; or,
(10) Legislation materially alters the ability of HIC to operate the
Portal; or,
(11) All applicable provisions of the RFP.
B. For purposes of this Contract, the phrase "for cause" by HIC shall
include, but not be limited to key premium service applications that do not
generate sufficient revenue to support the basic core functions required
to operate the Portal at a reasonable profit, provided that HIC
acknowledges that no reasonable profit is expected in the first eighteen
(18) months of the initial contract term.
17. CONTINUATION OF OPERATIONS DURING TRANSITION PERIOD
If for any reason this contract shall be terminated or upon expiration of
the Contract without extension, or at the end of any extension HIC shall,
at the option of the State, continue to operate under this Contract as
Portal Manager in accordance with all forms and conditions of this
Contract, together with any amendments or modifications in existence at
such time, for a period of up to twelve (12) months from the time of
expiration or notification of termination from the State to HIC. The intent
of this provision is to insure continuation of Portal operations while a
successor Portal manager is chosen and installed. The State shall notify
HIC at the earliest possible opportunity but in any event, no later than
the date of notification of termination, or the notifications dates set
forth in Section 2 above whichever is earlier that it shall continue
operations and the duration of time for such continuation.
18. DEFENSE OF PATENT, COPYRIGHT, TRADEMARK, TRADE SECRET
HIC warrants that its proposed operation of the Portal does not and shall
not infringe on the United States patent, copyright, trademark or trade
secret right of any person or entity. The State shall be provided with
prompt notice of any such claim of infringement and HIC shall have the
exclusive right to defend or settle such claim at HIC's option subject to
State approval which shall not be unreasonably withheld. The State shall
cooperate with HIC in its defense or settlement of such claim at no
expense and no liability to the State. HIC
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is not responsible for the content of information or links furnished by
the state or any entity thereunder to HIC.
19. MARKETING
It is recognized that HIC and its affiliated companies intend to use its
experience with the State, the AHC and DPE's as a marketing tool with
third parties. It is agreed that HIC may make references to and use the
State as a reference. If HIC intends to claim that the State "endorses"
HIC or use the State seal, AHC or Portal logo or claim representations
made by the State, all such material must be submitted to AHC to review
and approval prior to use by HIC.
20. LIABILITY
A. The State, its agents, and employees shall not be legally responsible
for errors due to problems caused by HIC's actions or intentional
omissions in operation of the Portal.
B. HIC agrees for itself, its agents, employees, and assigns to hold
harmless, indemnify and defend the State, its agents and employees from
any actions arising out of HIC's negligence or material failure to perform
under the terms of this Contract.
C. HIC agrees that it has not right of subrogation or contribution from
the State for any judgment rendered against HIC to the extent such
judgment results from HIC's negligence or material failure to perform
under the terms of this contract.
21. ASSIGNMENT
HIC may not assign any of its rights or delegate any of its duties
hereunder unless done pursuant to prior written consent of the State,
which consent shall not be unreasonably withheld.
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22. CLAIMS
This Contract shall be construed according to the laws of the State of
Hawaii. Any legal proceedings against the State regarding this
solicitation or any resultant contract shall be brought in the State's
administrative, legislative, or judicial forums.
23. ENTIRE AGREEMENT
This Contract, including any documents incorporated by reference,
constitutes the entire agreement of the parties and supersedes all other
prior written or oral contracts between the parties with respect to the
subject matter hereof. This Contract may be amended only in writing signed
by the parties thereto.
24. Disputes. In the event of any disputes or misunderstanding between the
State and HIC, in addition to any and all other remedies, the State
reserves the right to involve the National Information Consortium ("NIC")
in the resolution process.
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IN WITNESS WHEREOF, the parties have executed this Agreement, effective
the day and year first above written.
STATE OF HAWAII
By /s/ XXXXXX X. XXXXXX
----------------------
XXXXXX X. XXXXXX
Procurement Officer
HAWAII INFORMATION CONSORTIUM, INC.
By /s/ AKA X. XXXXXX
----------------------
AKA X. XXXXXX
President and CEO
APPROVED AS TO FORM:
/s/ XXXXXXX [illegible] XXXXXXX
---------------------------
Deputy Attorney General
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CONTRACTOR ACKNOWLEDGEMENT:
STATE OF HAWAII )
:SS
CITY AND COUNTY OF HONOLULU
On this 29TH day of DECEMBER, 1999, before me appeared AKA X. XXXXXX
_____ to me known to be the person(s) described in and, who, being by me duly
sworn, did say that he is PRESIDENT and CEO of HAWAII INFORMATION CONSORTIUM,
INC., the Contractor named in the foregoing instrument, and that he is
authorized to sign said instrument in behalf of the Contractor, and
acknowledges that he executed said instrument as the free act and deed of the
Contractor.
/s/ XXXXXXXXX X. XXXXXXXX
----------------------------------
Xxxxxxxxx X. Xxxxxxxx
Notary Public
State of HAWAII
My commission expires: 2/27/2000
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