Data Processing Addendum

This Data Processing Addendum (the "DPA") is part of the agreement under which a Partner uses the ProctoredAI Service: the Master Services Agreement (the "MSA") once the Partner has signed or accepted it, and before then the ProctoredAI Terms of Use (either one, the "Agreement"). It is between ProctoredAI, Inc., a North Carolina corporation ("ProctoredAI"), and the Partner.

This DPA applies when ProctoredAI processes Personal Data in Client Data that is protected by European Data Protection Law. It takes effect when the Partner accepts the Agreement, with no separate signature needed. ProctoredAI will countersign a copy on request. If this DPA conflicts with the Agreement, this DPA controls for that Personal Data. If it conflicts with the Standard Contractual Clauses, the Standard Contractual Clauses control.

1. Definitions

"European Data Protection Law" means Regulation (EU) 2016/679 (the "GDPR"), the GDPR as it forms part of UK law, as amended, with the UK Data Protection Act 2018 (the "UK GDPR"), the Swiss Federal Act on Data Protection (the "FADP"), and the national laws that implement or supplement them.

"Personal Data," "Controller," "Processor," "Data Subject," "Processing," "Personal Data Breach" and "Supervisory Authority" mean what they mean in the GDPR.

"Standard Contractual Clauses" or "SCCs" means the standard contractual clauses approved by the European Commission in Implementing Decision (EU) 2021/914.

"UK Addendum" means the International Data Transfer Addendum to the SCCs issued by the UK Information Commissioner, version B1.0, as laid before Parliament on 2 February 2022, including its Mandatory Clauses.

"Subprocessor" means a third party that ProctoredAI engages to process Personal Data in Client Data.

Words such as "Client," "Client Data," "Device," "Agent" and "Service" mean what they mean in the Agreement.

2. Roles

2.1 Who Is the Controller

Each Client is the Controller of its Client Data. The Partner processes Client Data as the Client's Processor, and ProctoredAI is the Partner's Subprocessor. Where the Partner is itself the Controller, such as for its own internal-use organization and its staff's console accounts, ProctoredAI is the Partner's Processor.

2.2 The Partner Speaks for Its Clients

The Partner confirms that each Client has authorized it to engage ProctoredAI on the terms of this DPA. Unless the law requires otherwise, ProctoredAI takes instructions from the Partner and gives notices to the Partner, and the Partner passes them on to its Clients. If ProctoredAI cannot reach the Partner, it may take instructions from the Client directly.

2.3 Details of the Processing

Annex I describes the Data Subjects, the categories of Personal Data, and the nature, purpose and duration of the processing.

2.4 Data ProctoredAI Controls

ProctoredAI is a controller, not a processor, of account, billing, Device-Day and Terms of Use acceptance records, and of data it needs to secure the Service. It keeps these as the Agreement describes, and section 10 does not apply to them.

3. Instructions

3.1 Documented Instructions

ProctoredAI processes Personal Data only on the Partner's documented instructions. Those instructions are the Agreement, this DPA, the settings chosen for each Client in the console (including prompt capture and retention), and any other written instruction the Partner gives that is consistent with the Agreement. If the law of the EU, a Member State, the UK or Switzerland requires ProctoredAI to process Personal Data otherwise, ProctoredAI will tell the Partner first, unless the law forbids that.

3.2 Unlawful Instructions

ProctoredAI will tell the Partner promptly if it believes an instruction infringes European Data Protection Law.

3.3 Improving the Service

The Partner instructs ProctoredAI, and confirms that each Client has authorized it, to use Client Data to improve the Service, for example to improve detection accuracy, fix defects and measure performance. This use is part of providing the Service to the Partner and its Clients, and ProctoredAI does not do it for any independent purpose of its own. ProctoredAI will de-identify or aggregate data before using it for this purpose wherever that serves the purpose. It will use prompt excerpts and file names only to fix specific defects or detection errors, will limit access to the personnel doing that work, and will apply this DPA to all of it. ProctoredAI will not use Client Data to train AI models, to profile individuals for its own purposes, or for marketing. A Client may opt out of this use by writing to its Partner, and the Partner will pass the request to [email protected]. ProctoredAI will stop using that Client's Personal Data for this purpose within 30 days.

3.4 What ProctoredAI Will Not Do

ProctoredAI will not sell Personal Data, will not share it except with Subprocessors under section 6 or as the law requires, and will not combine it with data from other sources except as needed to provide the Service or as section 3.3 allows.

4. Confidentiality

ProctoredAI will give access to Personal Data only to personnel who need it to provide, support, secure or improve the Service and who are bound to keep it confidential.

5. Security

ProctoredAI will keep the technical and organizational measures in Annex II, which are designed to protect Personal Data against accidental or unlawful destruction, loss, alteration, unauthorized disclosure and access. ProctoredAI may update these measures as technology and risks change, but will not reduce the overall level of protection.

6. Subprocessors

6.1 Authorized Subprocessors

The Partner gives ProctoredAI general authorization to engage Subprocessors. The Subprocessors in Annex III are approved.

6.2 Obligations

ProctoredAI will have a written contract with each Subprocessor that protects Personal Data at least as much as this DPA, and remains responsible to the Partner for each Subprocessor's performance.

6.3 New Subprocessors

ProctoredAI will give the Partner at least 30 days' notice by email before a new Subprocessor processes Personal Data. The Partner may object on reasonable data protection grounds within that period. The parties will discuss the objection in good faith. If they cannot resolve it, the Partner may archive the affected Clients, or end the Agreement, on written notice before the new Subprocessor starts, without penalty. Either takes effect on the date the Partner chooses. Fees for those Clients stop on that date, use through that date is billed on the next Billing Date, and credits already earned are applied to that final charge. During the export period, ProctoredAI will not let the new Subprocessor process that Partner's Client Data.

6.4 Integrations

Integrations that the Partner or a Client turns on, such as a PSA, a chat tool, a directory or a SIEM, send data to services the Partner or Client chooses. Those services are not ProctoredAI's Subprocessors.

7. International Transfers

7.1 Where Data Is Processed

ProctoredAI is based in the United States and hosts Client Data in the United States. Cloudflare's network, which terminates TLS connections, operates worldwide. Using the Service therefore transfers Personal Data from the European Economic Area, the United Kingdom and Switzerland to the United States.

7.2 Standard Contractual Clauses

ProctoredAI is not certified under the EU-U.S. Data Privacy Framework. Transfers to ProctoredAI rely on the SCCs, which are incorporated into this DPA by reference, with the Partner as data exporter and ProctoredAI as data importer:

• Module Two (controller to processor) applies where the Partner is the Controller, and Module Three (processor to processor) applies where the Partner processes Client Data for a Client.
• Clause 7 (the docking clause) applies.
• Under Clause 9, Option 2 (general written authorization) applies, with the notice period in section 6.3.
• The optional language in Clause 11 does not apply.
• Under Clause 13, the competent Supervisory Authority is the one for the EU Member State where the Partner is established. If the Partner is not established in the EU, it is the one for the Member State where its Article 27 representative is established. If it has none, it is the Data Protection Commission of Ireland.
• Under Clauses 17 and 18, the SCCs are governed by the law of Ireland, and disputes under them are resolved by the courts of Ireland.
• Annexes I, II and III of this DPA complete the Annexes to the SCCs.

7.3 United Kingdom

For Personal Data protected by the UK GDPR, the UK Addendum is incorporated into this DPA. Tables 1 to 3 of the UK Addendum are completed with the information in this DPA and its Annexes. For Table 4, either party may end the UK Addendum as its Section 19 allows.

7.4 Switzerland

For Personal Data protected by the FADP, the SCCs apply with these changes: the Swiss Federal Data Protection and Information Commissioner is the competent Supervisory Authority for transfers governed by the FADP; references to the GDPR are read as references to the FADP for those transfers; and the term "Member State" does not prevent Data Subjects in Switzerland from bringing claims where they habitually reside, as Clause 18(c) provides.

7.5 Requests From Public Authorities

If a public authority asks ProctoredAI for Personal Data, ProctoredAI will handle the request as Clause 15 of the SCCs requires. It will tell the Partner unless the law forbids that, challenge requests it reasonably believes are unlawful, and disclose only the minimum the request lawfully requires. ProctoredAI will give the Partner the information it reasonably needs for its own transfer impact assessment.

8. Assistance

8.1 Data Subject Requests

If ProctoredAI receives a request from a Data Subject about Client Data, it will pass the request to the Partner without undue delay and will not answer it except to direct the Data Subject to the Partner or Client. Taking into account the nature of the processing, ProctoredAI will help the Partner respond, including through the console's search and export tools and by deleting specified Personal Data on the Partner's written request.

8.2 Impact Assessments

Monitoring employees' use of AI services may require the Client to carry out a data protection impact assessment, consult employee representatives, or both. These duties belong to the Client, as section 2.2 of the MSA and section 1.6 of the Terms of Use describe. ProctoredAI will give the Partner the information it reasonably needs for an impact assessment or a prior consultation with a Supervisory Authority, including how the Agent works, what it sends to the console, and the measures in Annex II.

9. Personal Data Breaches

ProctoredAI will notify the Partner without undue delay, and in any event within 48 hours, after becoming aware of a Personal Data Breach affecting Client Data. The notice will describe, as far as then known, the nature of the breach, the categories and approximate number of Data Subjects and records concerned, the likely consequences, and the steps taken or proposed. ProctoredAI will update the Partner as it learns more, and will take reasonable steps to contain the breach and reduce its effects. Notice of a breach is not an admission of fault.

10. Deletion and Return

Client Data is deleted automatically after the retention period set for each Client. When the Agreement ends, the Partner can export Client Data for 30 days, after which ProctoredAI deletes it, or sooner on the Partner's written request. Deleted data leaves backups within 30 days. ProctoredAI may keep Personal Data that the law requires it to keep, and will protect it under this DPA for as long as it does. ProctoredAI will confirm deletion in writing on request.

11. Audits

ProctoredAI will make available the information reasonably needed to show that it meets Article 28 of the GDPR. It will do so by answering a reasonable security questionnaire once a year and by sharing its security documentation and, once available, independent audit reports. If that information is not enough, a Supervisory Authority requires it, or there has been a Personal Data Breach, the Partner may audit, itself or through an auditor that it or its Client mandates. Audits happen no more than once every 12 months, except after a breach or when a Supervisory Authority requires one. The Partner gives 30 days' written notice, the audit takes place during business hours, and it is at the Partner's cost. Auditors must be bound by confidentiality and may not see other partners' or clients' data.

12. Liability

Each party's liability under this DPA is subject to the limits in the Agreement, except where European Data Protection Law or the SCCs do not allow it, including liability to Data Subjects under the SCCs.

13. Sensitive Data

The Service is not designed to process special categories of Personal Data. Prompt excerpts and file names can include them incidentally, depending on what users send to AI services. Each Client chooses its prompt capture setting: None keeps no excerpts, Redacted, the default, replaces each finding with its detector name, and Full keeps the text as sent. A Client that chooses Full is responsible for having a lawful basis for it. Health information is also covered by section 2.5 of the MSA and section 1.8 of the Terms of Use.

14. Representative

Where Article 27 of the GDPR or of the UK GDPR requires one, ProctoredAI will appoint a representative in the European Union or the United Kingdom and publish its contact details on this page.

15. Term and Contact

This DPA lasts as long as ProctoredAI processes Personal Data in Client Data for the Partner. Questions and notices about this DPA go to [email protected].

Annex I. Description of the Processing

A. Parties

Data exporter: the Partner identified in the Agreement, as Controller or as the Processor of its Clients. Address: as recorded in the Partner's account or the Agreement. Contact: the Partner's notice email or account email. Activities: using the Service to discover and govern the use of AI services on its Clients' Devices. The exporter accepts these Annexes by accepting the Agreement.

Data importer: ProctoredAI, Inc., a North Carolina corporation, as Processor or Subprocessor. Address: as recorded with the North Carolina Secretary of State. Contact: [email protected]. Activities: providing the Service under the Agreement. The importer accepts these Annexes by publishing this DPA and providing the Service.

B. Description of the Transfer

Data Subjects: employees, contractors and other users of Clients' Devices; Partner and Client console users; and people whose details appear in prompts or files that users try to send to AI services.

Categories of Personal Data: account identities (device user names, AI service account emails, console user names and emails); device data (host name, operating system, Agent version, hardware identifier, and the IP address seen at check-in); event data (the AI app and host, channel, action, rule, types and counts of sensitive data found, and timestamps); prompt excerpts as the Client's capture setting allows; file metadata (name, size, type and SHA-256 fingerprint, not contents); AI agent and MCP tool call metadata (server, method and tool name); exception requests (reason, duration and decision); hourly usage counts; and audit log entries.

Sensitive data: not intended. Prompt excerpts and file names can include it incidentally. Safeguards: Redacted capture by default, an option to keep no excerpts, access limited to the Client's tenant and its Partner, per-Client retention, and the measures in Annex II.

Frequency: continuous while the Agent is installed on a Device.

Nature of the processing: inspection in memory on the Device; collection of the event data above; transfer to the console; storage, display, alerting, reporting, export and deletion.

Purposes: providing the Service to each Client through its Partner, including discovering AI use, enforcing the Client's policy, alerting and reporting; supporting and securing the Service; and improving the Service as section 3.3 allows.

Retention: the retention period set for each Client (365 days by default, configurable from 7 days to 10 years), then as section 10 describes.

Transfers to Subprocessors: as Annex III lists, for the duration of the Agreement.

C. Competent Supervisory Authority

The Supervisory Authority identified in section 7.2 for Clause 13 of the SCCs. For Swiss data, the Federal Data Protection and Information Commissioner. For UK data, the Information Commissioner.

Annex II. Technical and Organizational Measures

• Inspection on the Device. AI traffic is inspected in memory on the Device. Each Device generates its own certificate authority, and its private key never leaves that Device.
• Data minimization. Only AI services in the Client's policy, web channels the Client opts in, and remote MCP servers the Client approves are inspected. Prompt capture is Redacted by default. Cookies, tokens, API keys and request headers are never sent. Exact-match list values are hashed with a per-list salt before upload.
• Encryption. All traffic between the Agent, browsers and the console uses TLS. Data and backups are encrypted at rest by the hosting provider.
• Access control. Three-tier tenancy (platform, Partner, Client) scopes every query to the caller's tier, with roles and read-only viewers. Console users can turn on two-factor authentication or sign in with single sign-on, which can be made the only way to sign in. Passwords and API keys are stored only as hashes.
• Audit logging. Console and Agent actions are recorded in a hash-chained, tamper-evident audit log that can be verified in the console. Exports are logged.
• Software integrity. Agent releases are cryptographically signed. Devices verify the signature before installing an update and never accept a downgrade. macOS builds are notarized by Apple.
• Resilience. The database is replicated continuously with point-in-time recovery, backed up nightly with 30 days of retention, and the server disk is snapshotted daily. Enforcement runs on each Device and continues if the console is unavailable.
• Administrative access. Production access is limited to authorized personnel and restricted at the network level.
• Incident response. Security incidents are handled and notified as section 9 describes.

Annex III. Subprocessors