Terms of Service — Audit Logic
Effective Date: May 1, 2026
Last Updated: August 3, 2026
ARTICLE 1: GENERAL
1.1 These terms and conditions apply to and form part of all offers, agreements, and service deliveries by Audit Logic, located in San Antonio, TX 78251 (hereinafter: "Audit Logic"), regarding the provision of local AI engineering, custom RAG (Retrieval-Augmented Generation) architectures, specialized data chunking solutions, and consulting services to the customer.
1.2 Any deviations from these terms are only valid if explicitly approved in writing by Audit Logic.
1.3 The customer's general terms and conditions do not apply unless expressly accepted in writing by Audit Logic.
ARTICLE 2: DEFINITIONS
2.1 "Offer" refers to any written or verbal proposal made by Audit Logic regarding the delivery of AI consulting, local RAG pipeline engineering, script development, or database configuration services.
2.2 "Customer" refers to the party to whom Audit Logic provides services under an agreement.
2.3 "Services" refer to specialized AI and data engineering activities, including but not limited to local offline RAG deployment, local LLM execution framework configuration (e.g., Ollama setups), custom document chunking algorithm development, backend local database deployment, and technical consulting.
2.4 "Agreement" refers to the written contract between Audit Logic and the customer detailing the scope of engineering and consulting services to be provided, as further described in Article 4.
2.5 "Product" refers to any custom Python scripts, data chunking routines, local model execution environments, vector store configurations, or offline RAG documentation delivered as part of the agreement.
ARTICLE 3: OFFERS
3.1 All offers from Audit Logic are non-binding until confirmed in writing and shall include a clear validity period not to exceed 30 days from issuance.
3.2 Acceptance must be provided in writing—via email or the designated acceptance form—and becomes binding only when received and confirmed in writing by Audit Logic as described in Article 4.
3.3 Once accepted, the offer is irrevocable; any changes or cancellations thereafter require mutual written consent.
3.4 Audit Logic reserves the right to revoke an offer prior to written acceptance if material technical or legal circumstances change.
ARTICLE 4: AGREEMENTS
4.1 A signed offer, order form, or Statement of Work submitted by the customer constitutes the customer's offer to enter into an agreement with Audit Logic on these terms.
4.2 The agreement between Audit Logic and the customer is established only when Audit Logic confirms its acceptance of the customer's offer in writing, including by email, unless Audit Logic has revoked the underlying offer as described in Article 3.4.
4.3 Where a separate Statement of Work, order form, or similar document is used, that document together with these General Terms & Conditions constitutes the agreement. In the event of any conflict, the Statement of Work controls solely as to project-specific scope, deliverables, and pricing; these General Terms & Conditions control as to all other matters.
ARTICLE 5: ADDITIONAL WORK
5.1 Should Audit Logic determine that extra or altered tasks are necessary—such as custom model adjustments, additional data parsing requirements, or expanded local vector store deployments—it will issue a written proposal detailing the work scope, revised timelines, and associated costs.
5.2 No additional work shall commence without the customer's explicit written approval.
5.3 Approved additional work costs will be added to the project total, and any revised delivery schedules will be confirmed in writing.
5.4 Audit Logic shall not be liable for delays caused by the customer's failure to timely review or approve the additional work proposal.
ARTICLE 6: PRICE
6.1 All prices for Audit Logic's services and products are exclusive of applicable taxes and are stated in U.S. Dollars.
6.2 Prices apply as stated in the agreement between Audit Logic and the customer.
6.3 If cost increases occur during the term of the agreement due to major scope expansions or regulatory compliance updates, Audit Logic may propose a price adjustment in writing. Any such adjustment requires the customer's written consent before it takes effect. If the parties are unable to agree on an adjustment necessitated by a scope expansion, the additional scope shall be treated as additional work under Article 5 and excluded from the agreement until agreed.
ARTICLE 7: INVOICING
7.1 Unless explicitly agreed otherwise in writing, Audit Logic will invoice the customer within 7 days of the execution of the agreement (i.e., the date the agreement is established under Article 4), with an advance payment of 50% of the total project cost due before project commencement.
7.2 Invoicing for ongoing maintenance, support, or iterative script optimizations will follow a monthly billing cycle unless otherwise specified in the agreement.
ARTICLE 8: PAYMENT
8.1 Payment of Audit Logic's invoices must be made within 14 days of the invoice date.
8.2 If the customer fails to pay on time, a 12% annual interest will be applied to the outstanding balance.
8.3 In the event of non-payment, extrajudicial collection costs of 10% of the unpaid amount will be charged.
8.4 The customer is responsible for Audit Logic's reasonable attorneys' fees and court costs actually incurred in collecting a delinquent payment.
ARTICLE 9: COOPERATION
9.1 The customer agrees to provide necessary cooperation, including:
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Access to on-premise hardware, local test environments, or dedicated hardware (e.g., local host machines, client hardware endpoints).
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Timely delivery of sample datasets, document corpuses, and technical requirements.
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Prompt feedback, code testing verification, and administrative approvals.
9.2 Audit Logic is not liable for delays or implementation failures caused by customer inaction or failure to provide timely hardware/data access.
ARTICLE 10: DELIVERY
10.1 Audit Logic will deliver services in the manner agreed upon in the contract, including local on-site environment setup, local hardware configuration, or secure repository transfers.
10.2 Any delay in delivery caused by customer hardware limitations, delayed sample data delivery, or third-party hardware component delays will not be the responsibility of Audit Logic.
ARTICLE 11: RISK OF SHIPMENT
11.1 If Audit Logic transfers software components, hardware pre-configurations, or digital deliverables to the customer by post, courier, or electronic transfer, this delivery is at the expense and risk of the customer.
ARTICLE 12: COMPLAINTS & ACCEPTANCE
12.1 Upon delivery of custom scripts, local execution environments, or RAG configurations, the customer must inspect and test them and notify Audit Logic in writing within 14 calendar days of any functional defects or non-conformities.
12.2 Once a written complaint is received, Audit Logic will acknowledge it within 2 working days and, within a reasonable period, evaluate and resolve the issue by refining scripts, adjusting chunking parameters, or correcting local environment configurations.
12.3 In the absence of a written complaint within 14 calendar days, the deliverables shall be deemed accepted.
ARTICLE 13: INTELLECTUAL & INDUSTRIAL PROPERTY
13.1 Audit Logic retains ownership of all "Core IP" — its underlying code frameworks, proprietary chunking logic, reusable utility tools, and core system architectures developed or used in performing the agreement — including improvements and generalized components that are not specific to the customer's proprietary data.
13.2 The customer retains exclusive ownership of all input data, source documents, proprietary business knowledge, and vector embeddings generated strictly from customer data.
13.3 Subject to full payment of the agreed fees, the customer is granted a perpetual, non-exclusive, internal-use license to execute the specific configuration of the Product delivered to it under the agreement (the "Deployment") on its own local hardware, including any customer-specific parameters or configurations developed for that Deployment. This license does not transfer ownership of the underlying Core IP.
13.4 The customer is not permitted to resell, redistribute, or reverse-engineer Audit Logic's Core IP, or redistribute the Deployment outside its own organization, without Audit Logic's prior written consent.
ARTICLE 14: RIGHT TO USE PRODUCTS
14.1 The license described in Article 13.3 is perpetual, subject to full payment of the agreed fees for the applicable Deployment.
14.2 Where Audit Logic procures or resells specialized host hardware to the customer as part of a Deployment, Audit Logic retains title to that hardware until the customer has made full payment for it, at which point ownership transfers to the customer. This Article does not apply to hardware the customer purchases directly from a third party.
14.3 Unauthorized modification of the underlying system software or Core IP by the customer, without Audit Logic's prior written consent, may void ongoing maintenance support and the warranties described in Articles 15 and 16 with respect to the affected component.
14.4 Audit Logic retains the right to use non-confidential technical methodologies, generalized workflow architecture patterns, and anonymized benchmark data for internal development, standard code improvement, or portfolio presentation, provided no confidential customer data or proprietary documents are disclosed.
ARTICLE 15: WARRANTY FOR SERVICES
15.1 Audit Logic warrants that all software engineering and consulting services will be performed with professional skill, care, and in accordance with current AI/RAG industry practices.
15.2 The warranty period for delivered services and custom scripts shall be 30 calendar days from formal delivery unless otherwise specified. During this period, Audit Logic will use reasonable efforts to fix reported execution errors or script bugs.
15.3 This warranty excludes issues arising from local hardware failures, third-party OS/dependency updates, user modifications to source code, or corrupted customer input data.
ARTICLE 16: WARRANTY FOR PRODUCTS & EXECUTION PIPELINES
16.1 Audit Logic warrants that custom Python scripts, data chunking routines, and local pipeline integration setups will function substantially in accordance with agreed technical specifications when executed on verified target local environments.
16.2 Upon written notice of a technical defect during the warranty period, Audit Logic will, at its discretion, patch the code, re-configure the local execution setup, or otherwise remedy the bug.
16.3 Open-source underlying frameworks (such as local model runtimes, vector storage engines, or base language models) are subject to their respective open-source licenses and carry no separate warranty from Audit Logic.
16.4 Audit Logic provides no further implied or explicit warranty regarding third-party underlying models or hardware performance.
ARTICLE 17: LIABILITY
17.1 Audit Logic's aggregate liability for direct damages arising from negligence or failure to deliver as agreed shall be strictly limited to the total fees actually paid by the customer under the applicable agreement or Statement of Work giving rise to the claim.
17.2 In no event shall Audit Logic be liable for any indirect, consequential, incidental, or special damages—including lost profits, lost operational business data, system downtime, or accuracy variances inherent in AI model output inference.
17.3 The customer agrees to maintain appropriate system backups and hardware insurance coverage to protect against data loss or local equipment failure.
17.4 Nothing in this Article 17 limits either party's liability for gross negligence, willful misconduct, or fraud, to the extent such limitation is not permitted by applicable law.
ARTICLE 18: FORCE MAJEURE
18.1 In the event of force majeure, Audit Logic has the right to suspend its performance or terminate the agreement in whole or part without liability for compensation.
18.2 Force majeure includes, but is not limited to: severe local power outages, hardware component destruction outside Audit Logic's control, open-source model repository unexpected deprecations, or changes in regional AI regulatory laws.
18.3 If force majeure occurs, Audit Logic will notify the customer as soon as practical.
18.4 If the force majeure event exceeds sixty (60) days, either party may terminate the agreement via written notice. Payment remains due for all work rendered prior to the event.
ARTICLE 19: EARLY TERMINATION
19.1 The customer may not terminate the agreement prior to completion without Audit Logic's prior written consent.
19.2 In the event of agreed early termination, the customer shall pay for all engineering hours, code development, and non-recoverable expenses incurred up to the termination date.
19.3 Audit Logic shall be compensated for documented damages resulting from premature termination.
ARTICLE 20: TERMINATION AND CONSEQUENCES
20.1 Audit Logic may terminate the agreement immediately upon written notice if the customer fails to remedy a material breach (including non-payment) within 15 days of notice.
20.2 Upon termination, all unpaid fees for rendered engineering and consulting become immediately due.
20.3 The customer must return or delete all non-licensed proprietary materials, system documentation, and preliminary code delivered by Audit Logic within 7 days.
ARTICLE 21: INDEMNIFICATION
21.1 The customer shall indemnify, defend, and hold harmless Audit Logic and its contractors from any third-party claims, losses, or legal expenses arising out of:
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Any breach of this agreement by the customer;
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Unauthorized modification or redistribution of delivered scripts/models;
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Customer's inclusion of illegal, infringing, or un-consented sensitive data within its local data corpuses processed by the system.
21.2 Audit Logic shall indemnify, defend, and hold harmless the customer from any third-party claim alleging that the Core IP, as delivered and used in accordance with the agreement, infringes that third party's U.S. intellectual property rights, excluding any claim arising from (a) the customer's modification of the Deployment, (b) combination of the Deployment with software or hardware not supplied by Audit Logic, or (c) the customer's continued use after Audit Logic has provided a non-infringing alternative at no additional cost. Audit Logic's obligations under this Article 21.2 are subject to the liability cap in Article 17.1.
ARTICLE 22: CONFIDENTIALITY & ON-PREMISE DATA ISOLATION
22.1 Audit Logic and the customer agree to maintain strict confidentiality regarding all proprietary algorithms, client business data, and technical architecture details.
22.2 Local Execution Guarantee: Audit Logic acknowledges that its core deployment paradigm relies on fully offline, locally hosted execution environments. Audit Logic agrees that customer datasets, document indexes, and query outputs will not be transmitted to external public cloud LLM services or unauthorized remote third parties without express written client authorization.
22.3 The confidentiality obligations in this Article 22 survive termination of the agreement for five (5) years, except with respect to information that constitutes a trade secret under applicable law, for which the obligations survive for as long as the information remains a trade secret.
22.4 The obligations in this Article 22 do not apply to information that: (a) is or becomes publicly available through no fault of the receiving party; (b) was already known to the receiving party without an obligation of confidentiality prior to disclosure; (c) is independently developed without use of the disclosing party's confidential information; or (d) is required to be disclosed by law or court order, provided the receiving party gives the disclosing party prompt notice where legally permitted.
ARTICLE 23: LIQUIDATED DAMAGES
23.1 The parties acknowledge that a breach of the confidentiality obligations under Article 22, or unauthorized commercial redistribution, resale, or reverse-engineering of Audit Logic's Core IP under Article 13, would cause Audit Logic harm — including loss of trade secret value, competitive harm, and diminished value of proprietary work product — that is difficult to calculate with precision at the time such a breach occurs.
23.2 In recognition of that difficulty, for a discrete, one-time violation (e.g., a single unauthorized disclosure or act of redistribution), the customer shall pay Audit Logic liquidated damages of $1,000 per occurrence, representing the parties' reasonable, good-faith estimate of the resulting harm.
23.3 For a continuing violation (e.g., ongoing unauthorized use, or failure to cure a breach within 5 business days of written notice), liquidated damages shall accrue at $500 per day the violation continues, subject to the cap in Article 23.4.
23.4 Total liquidated damages under this Article shall not exceed $10,000 per incident.
23.5 Payment of liquidated damages under this Article shall be the customer's sole monetary liability to Audit Logic for the specific breach giving rise to such damages. This Article does not limit Audit Logic's right to seek injunctive or other equitable relief to prevent or stop an ongoing or threatened breach of Article 13 or Article 22.
ARTICLE 24: APPLICABLE LAW
24.1 These terms and conditions are governed by the laws of the State of Texas and applicable U.S. federal laws.
24.2 The UN Convention on Contracts for the International Sale of Goods (CISG) is explicitly excluded.
ARTICLE 25: JURISDICTION
25.1 All disputes arising out of or related to these terms and conditions or services provided by Audit Logic shall be subject to the exclusive jurisdiction of the state or federal courts located in Bexar County, Texas.
ARTICLE 26: SEVERABILITY & FINAL PROVISIONS
26.1 If any portion of a provision in these terms is held invalid or unenforceable, that part shall be severed, and the remaining provisions shall remain in full force and effect.
ARTICLE 27: DATA PRIVACY & ON-PREMISE EXECUTION COMPLIANCE
27.1 Audit Logic's service architecture is designed around locally hosted, offline execution environments. Where required by the customer, Audit Logic can configure the deployed system to operate fully air-gapped, with no network connection to the internet or any external system.
27.2 Because services are designed around locally hosted, offline execution environments, no customer data is transmitted to or stored on external cloud infrastructure managed by Audit Logic or any third party, unless explicitly specified in a written addendum signed by both parties.
27.3 Audit Logic does not hold, and does not represent that it holds, any third-party data privacy, security, or industry compliance certifications (including but not limited to HIPAA, SOC 2, ISO 27001, or PCI-DSS). Audit Logic's local-execution and air-gapping capabilities are technical measures that may assist the customer in meeting its own regulatory or compliance obligations, but do not themselves constitute, guarantee, or substitute for compliance with any specific law, regulation, or industry standard.
27.4 The customer is solely responsible for determining whether Audit Logic's services meet the customer's own legal, regulatory, and compliance requirements, and for implementing any additional administrative, technical, or physical safeguards required by applicable law.
27.5 The customer is solely responsible for verifying that all document corpuses, data files, and text ingested into local vector systems have been lawfully collected and obtained with all necessary legal consents.
ARTICLE 28: ENTIRE AGREEMENT
28.1 These General Terms & Conditions, together with any Statement of Work, order form, or written addendum signed or confirmed in writing by both parties, constitute the entire agreement between Audit Logic and the customer regarding the subject matter herein, and supersede all prior or contemporaneous proposals, negotiations, and agreements, whether written or oral, relating to that subject matter.
ARTICLE 29: NOTICES
29.1 Any written notice required or permitted under the agreement shall be sent by email to the address the receiving party has designated for project communications, or by certified mail to the address stated in the agreement. Notice shall be deemed received the next business day for email, or three business days after mailing for certified mail.
ARTICLE 30: ASSIGNMENT
30.1 Neither party may assign the agreement, in whole or in part, without the prior written consent of the other party, except that either party may assign the agreement without consent in connection with a merger, acquisition, or sale of substantially all of its assets, provided the assignee agrees in writing to be bound by these terms.