250000000256.pdf

STATE OF MICHIGAN

ENTERPRISE PROCUREMENT

Department of Technology, Management, and Budget 320 S. Walnut Street 2nd Floor Lansing, MI 48933

P.O. BOX 30026 LANSING, MICHIGAN 48909

CONTRACT CHANGE NOTICE

CONTRACT SUMMARY

Bridges Maintenance and Operations and Minor Enhancements

INITIAL EFFECTIVE DATE INITIAL EXPIRATION DATE INITIAL AVAILABLE OPTIONS EXPIRATION DATE

BEFORE

February 11, 2025 February 10, 2030 3 - 12 Months February 10, 2030

PAYMENT TERMS DELIVERY TIMEFRAME

ALTERNATE PAYMENT OPTIONS EXTENDED PURCHASING

MINIMUM DELIVERY REQUIREMENTS

N/A

P-Card Direct Voucher (PRC) Other Yes No

106 W. Allegan Street, Suite 400

Lansing MI 48933

Hari Murthy

646-300-4550 hamurthy@deloitte.com

CV0001354

Deloitte Consulting LLP

C O

N

TR

A C

TO

R

Brandon Samuel

517-249-0439

DTMB

Various Various samuelb@michigan.gov

C ontract

A dm inistrator Program M anagerSTA

TE

N/A0.5 Net 25; Net 45

Change Notice Number 1

Contract Number MA250000000256 to

DESCRIPTION OF CHANGE NOTICE

OPTION EXTENSIONLENGTH OF OPTION LENGTH OF EXTENSION REVISED EXP. DATE

CURRENT VALUE VALUE OF CHANGE NOTICE ESTIMATED AGGREGATE CONTRACT VALUE

$187,708,075.00 $1,852,620.00 $189,560,694.64

DESCRIPTION

Effective February 26, 2025, this contract is hereby amended for the following attached SOW that will increase the Contractors resource capacity for ITEG approved services in support of , but not limited to, the Design, Development, and Implementation of a case management solution Module for MDHHS Overpayment Establishment Section (OES) that will replace the current Bridges legacy Module referenced as Local Office Accounting (LOA2), and include additional funding of $1,852,620.00. Lastly, an Estimated Contract Value correction of $0.36 is being made. At contract execution, the Estimated Contract Value indicated $187,708,075.00 opposed to $187,708,074.64. Schedule B within the attached SOW includes this correction as well.

All other terms, conditions, specifications and pricing remain the same. Per contractor and agency agreement, DTMB Central Procurement Services approval, and State Administrative Board approval on February 25, 2025.

AGENCY NAME PHONE EMAIL

DTMB Sanjay Srivastava 517-898-0503 SrivastavaS1@michigan.gov

MDHHS Amy Hundley 517-241-7797 HundleyA@michigan.gov

Program Managers for

Multi-Agency and Statewide Contracts

CHANGE NOTICE NO. 1 TO CONTRACT NO. MA250000000256

Michigan.gov/MiProcurement

Version 2021-1 1 of 4

STATEMENT OF WORK -

IT CHANGE NOTICE

Project Title:

OVER PAYMENT CALCULATION AND CASE MANAGEMENT

Period of Coverage:

March 11, 2025 – Feb 10, 2026

Requesting Department:

Michigan Department of Technology, Management and Budget (DTMB) in support of MDHHS ESA

Date:

February 5, 2025

Agency Project Manager:

Amy Hundley

Phone:

(517)-241-9879

DTMB Project Manager:

Sanjay Srivastava

Phone:

(517) 335-1226

Brief description of services to be provided: Increase Contractor resource capacity to support MDHHS directives.

BACKGROUND:

This Amendment is entered into between The State of Michigan, Department of Technology, Management, and Budget (the “State” or “DTMB”) and Deloitte Consulting LLP, (“Contractor”) relating to a certain Contract # 250000000256, and Statement of Work (“SOW”) for Bridges Maintenance and Operations and Minor Enhancements, dated February 11, 2025. This Amendment is effective March 11, 2025. Capitalized terms, if not otherwise defined in this Amendment, shall have the same meaning as set forth in the Contract. Unless otherwise identified within this SOW, all Contract Terms and Conditions remain in full effect.

WHEREAS the parties desire to increase the Contractor’s resource capacity for services in support of, but not limited to, the Design, Development, and implementation of a case management solution for MDHHS Overpayment Establishment Section (OES) that will replace the current Bridges legacy Module referenced as Local Office Accounting (LOA2).

NOW THEREFORE, in consideration of the mutual covenants contained herein, the parties hereby agree as follows:

PROJECT OBJECTIVE:

The parties agree that the Contract Schedule A SOW shall be amended for Contract Year 1, Month 2 (March 11, 2025) to Contract Year 1, Month 12 (February 10, 2026) to add Contractor staff resource capacity as described below.

SCOPE OF WORK:

Contractor resources must support State objectives based on the priorities established by the MDHHS IT Executive Governance (ITEG) for Eligibility and as directed by the DTMB and MDHHS Project Managers.

The additional resources will have skill sets as defined within the Contract and will be made available for State capacity planning over the eleven-month duration as indicated.

• This SOW increases Contract Year 1, Months 2-12 Capacity from 20,800 to 22,013 hours and Cost from $2,888,000 to $3,056,420 per month: recognizing a cumulative increase of 13,343 hours in Capacity and $1,852,620 in Cost.

Version 2021-1 2 of 4 o This SOW also replaces the Payment Schedule for payments to include cents (previous had rounded numbers) and splits the Contract Month 8 to pro-rate cost for alignment with the State Fiscal Year term.

• Contractor must add 7 full time staff to the existing full-time staff as set forth in Section 14 of Schedule A who will operate out of the of the Contractor’s Lansing location, from Deloitte offices, or remotely within the United States.

• The 7 full time staff roles outlined below must provide an additional estimated (EST) 13,343 Support Hours for State planning over the eleven-month period.

*Cost calculated by a blended rate of $138.85 per hour in alignment with the Contract Year 1 scheduled cost.

• The DTMB Project Manager retains the ability to direct Contractor work as required and directed by MDHHS ITEG. The additional Contractor resources may be leveraged across multiple MDHHS ITEG initiatives.

• Each resource must record time worked against specific work efforts in the State Project and Portfolio Management (PPM) tool, Clarity. Clarity data will be utilized to reconcile actual cost for specific work efforts.

• Shared resource support for roles such as Program Manager, Database Administrator, Build and Deployment engineer and Test Manager will be leveraged from the existing Contract.

TASKS:

Technical support required to assist as outlined in the Contract.

DELIVERABLES:

Deliverables as outlined in the Contract.

ACCEPTANCE CRITERIA:

Acceptance Criteria as outlined in the Contract.

PROJECT CONTROL AND REPORTS:

Project Control and Reports as outlined in the Contract.

SPECIFIC DEPARTMENT STANDARDS:

Agency standards as outlined in the Contract.

Contract Role Project Role EST Hrs EST resource

Count Technical Support Manager Application Architect 1907 1 Senior Systems/Business Analyst Business Analyst 1907 1 Java Programmer Analyst UI/UX developer 3812 2 Java Programmer Analyst Java Developer 3812 2 Quality Assurance Test Analyst Tester 1906 1

13,343 7Additional FTE Resource Hrs/Count

Version 2021-1 3 of 4

PAYMENT SCHEDULE: To accommodate this SOWs increased resources capacity and cost, and to address rounding discrepancies that caused the base Estimated Contract Value at Time of Execution to be over by $0.36 (executed at $187,708,075.00 opposed to $187,708,074.64) the following tables replace in its entirety the SCHEDULE B - PRICING tables:

Base Contract Years 1-5 table:

Version 2021-1 4 of 4

Option Contract Years 6 – 8:

EXPENSES:

The State will NOT pay for any travel expenses, including hotel, mileage, meals, parking, etc.

PROJECT CONTACTS:

The designated Agency Project Manager and DTMB Project Manager as outlined in the Contract.

AGENCY RESPONSIBILITIES:

Agency Responsibilities as outlined in the Contract.

LOCATION OF WHERE THE WORK IS TO BE PERFORMED:

Consultants will work at as outlined in the Contract.

EXPECTED CONTRACTOR WORK HOURS AND CONDITIONS:

Work hours as outlined in the Contract.

STATE OF MICHIGAN PROCUREMENT

Department Technology, Management and Budget 320 S. Walnut Street, Lansing, MI 48933

NOTICE OF CONTRACT

NOTICE OF CONTRACT NO. 250000000256

between

THE STATE OF MICHIGAN

and

CONTRACT SUMMARY

DESCRIPTION: Bridges Maintenance and Operations and Minor Enhancements

INITIAL EFFECTIVE DATE

INITIAL EXPIRATION DATE

INITIAL

AVAILABLE

OPTIONS

EXPIRATION DATE BEFORE

CHANGE(S) NOTED BELOW

2/11/2025 2/10/2030 3 - 1 Year 2/10/2030

PAYMENT TERMS DELIVERY TIMEFRAME

0.5 Net 25; Net 45 N/A

ALTERNATE PAYMENT OPTIONS EXTENDED PURCHASING

P-card Payment Request (PRC) Other Yes No

MINIMUM DELIVERY REQUIREMENTS

N/A

MISCELLANEOUS INFORMATION

THIS IS NOT AN ORDER. This Contract Agreement is awarded on the basis of the State's inquiry bearing the solicitation number 230000003001. Orders for Delivery will be issued directly by the Department through the issuance of a Delivery Order (DO).

ESTIMATED CONTRACT VALUE AT TIME OF EXECUTION $187,708,075.00

CO

N

TR

AC

TO

R

Deloitte Consulting LLP

106 W. Allegan Street, Suite 400

Lansing, Michigan 48933

Hari Murthy

646-300-4550 hamurthy@deloitte.com

CV0001354

ST

AT

E

Pr og ra m

M an ag er

Multiple Multiple

Co nt ra ct

Ad m in ist ra to r Brandon Samuel DTMB

517-249-0439 samuelb@michigan.gov mailto:hamurthy@deloitte.com mailto:samuelb@michigan.gov

Program Managers for

Multi-Agency and Statewide Contracts

AGENCY NAME PHONE EMAIL

DTMB Sanjay Srivastava 517-898-0503 SrivastavaS1@michigan.gov

MDHHS Amy Hundley 517-241-7797 HundleyA@michigan.gov mailto:SrivastavaS1@michigan.g mailto:HundleyA@michigan.gov

Revision 11/28/2022

FOR THE CONTRACTOR:

Company Name

Authorized Agent Signature

Authorized Agent (Print or Type)

Date

FOR THE STATE:

Signature

Name and Title

Agency

Date

TABLE OF CONTENTS

Table of Contents

IT PROFESSIONAL SERVICES CONTRACT TERMS

1. Definitions

2. Statement of Work

3. Performance of Services

4. Notices

5. Contract Administrators

6. Insurance

7. Independent Contractor

9. Assignment

10. Change of Control

11. Reserved

12. Terms of Payment

13. Stop Work Order

14. Termination for Cause

15. Termination for Convenience

16. Transition Responsibilities

17. General Indemnification

18. Infringement Remedies

19. Disclaimer of Damages and Limitation of Liability

20. State Data

21. Non-Disclosure of Confidential Information

22. HIPAA Compliance

23. Data Privacy and Information Security

24. Records Maintenance, Inspection, Examination, and Audit

25. Warranties and Representations

26. Conflicts and Ethics

27. Compliance with Laws

28. Nondiscrimination

29. Unfair Labor Practice

30. Governing Law

31. Non-Exclusivity

32. Force Majeure

33. Dispute Resolution

34. Media Releases

35. Severability

36. Waiver

37. Contract Modification

38. Survival

39. Schedules

40. Entire Agreement

SCHEDULE A – STATEMENT OF WORK

1. DEFINITIONS

2. BACKGROUND

3. PURPOSE

4. IT ENVIRONMENT RESPONSIBILITIES

5. ADA COMPLIANCE

6. USER TYPE AND CAPACITY

7. ACCESS CONTROL AND AUTHENTICATION

8. DATA RETENTION AND REMOVAL

9. END USER AND IT OPERATING ENVIRONMENT

10. SOFTWARE

11. TRAINING SERVICES

12. TRANSITION RESPONSIBILITIES

13. DOCUMENTATION

14. CONTRACTOR PERSONNEL

15. CONTRACTOR KEY PERSONNEL (excluding Contractor Contract Administrator)

16. CONTRACTOR PERSONNEL REQUIREMENTS

17. STATE RESOURCES/RESPONSIBILITIES

18. MEETINGS

19. PROJECT CONTROL & REPORTS

20. PROJECT MANAGEMENT

21. ACCEPTANCE

22. ADDITIONAL INFORMATION

SCHEDULE B - PRICING

SCHEDULE C - Insurance requirements

SCHEDULE D – SERVICE LEVEL AGREEMENT

SCHEDULE D, Attachment 1

SCHEDULE E – DATA SECURitY REQUIREMENTS SCHEDULE E, Attachment 1 – Tax Regulation SCHEDULE F – rESERVED SCHEDULE G – Federal Provisions Addendum

EXHIBIT 1

Byrd Anti-Lobbying Certification

IT PROFESSIONAL SERVICES CONTRACT

TERMS

These Terms and Conditions, together with all Schedules (including the Statement(s) of Work), Exhibits and any other applicable attachments or addenda (Collectively this “Contract”) is agreed to between the State of Michigan (the “State”) and (“Contractor”), a corporation. This Contract is effective on February 11, 2025, and unless terminated, expires on February 10, 2030.

This Contract may be renewed for up to three (3) additional one (1) year periods.

Renewal must be by written notice from the State and will automatically extend the Term of this Contract.

The parties agree as follows:

1. Definitions. For the purposes of this Contract, the following terms have the following meanings:

“Business Day” means a day other than a Saturday, Sunday, or other day on which the State is authorized or required by Law to be closed for business.

“Confidential Information” has the meaning set forth in Section 21.

“Contract” has the meaning set forth in the preamble.

“Contract Administrator” is the individual appointed by each party to (a) administer the terms of this Contract, and (b) approve any Change Notices under this Contract.

Each party’s Contract Administrator will be identified in Section 5.

“Change Notice” has the meaning set forth in Section 37

“Contractor” has the meaning set forth in the preamble.

“Contractor Personnel” means all employees of Contractor, or any Subcontractors involved in the performance of Services and creation of Work Product under this Contract.

“Contractor Technology” means works of authorship, materials, information and other intellectual property created by Contractor prior to (and specifically identified in a Statement of Work as Contractor Technology) or independently of the performance of the Services or payment under this Contract or created by Contractor or its subcontractors at Contractor’s sole expense as a tool for their use in performing the Services, plus any modifications or enhancements thereto and derivate works based thereon that are also created at Contractor’s sole expense.

For the avoidance of doubt, Work Product does not include Contractor Technology;

however, Contractor Technology may be included in Deliverables (the licensing of such is outlined in Section 8).

“Deliverable” means any authorship, materials, information and other intellectual property, whether Work Product, Contractor Technology or pre-existing work or the combination thereof created, provided or otherwise incorporated into the Software by Contractor in performance of this Contract.

“Derivative Work” means any modification, addition, upgrade, update, or improvement of the Software and any other work constituting a derivative work under the United States Copyright Act, 17 U.S.C. Section 101, et seq..

“Effective Date” has the meaning set forth in the preamble.

“Financial Audit Period” has the meaning set forth in Section 24.

“Key Personnel” means any Contractor Personnel identified as key personnel in this Contract or the Statement of Work.

“PAT” means a document or product accessibility template, including any Information Technology Industry Council Voluntary Product Accessibility Template or VPAT®, that specifies how information and software products, such as websites, applications, software, and associated content, conform to WCAG 2.0 Level AA.

“Services” means any of the services Contractor, or any Subcontractor, is required to or otherwise does provide under this Contract, the Statement of Work, or the Service Level Agreement.

“Service Level Agreement” means the service level agreement setting forth Contractor’s support obligations for the Software, attached as Schedule C to this Contract.

“Software” means, collectively, the State’s software applications and systems set forth in an appendix to the Statement of Work.

“State” has the meaning set forth in the preamble.

“State Data” has the meaning set forth in Section 20.a.

“State Review Period” has the meaning set forth in Section 11.

“Statement of Work” has the meaning set forth in Section 2.

“Stop Work Order” has the meaning set forth in Section 13.

“Subcontractor” has the meaning set forth in Section 3.g.

“Transition Responsibilities” has the meaning set forth in Section 16.

“Unauthorized Removal” has the meaning set forth in Section 3.f.ii.

“Unauthorized Removal Credit” has the meaning set forth in Section 3.f.iii.

“WCAG 2.0 Level AA” means level AA of the World Wide Web Consortium Web Content Accessibility Guidelines version 2.0.

“Work Product” means all State-specific deliverables that Contractor is required to, or otherwise does, provide to the State under this Contract including but not limited to customizations, application programming interfaces, computer scripts, macros, user interfaces, reports, project management documents, forms, templates, and other State-specific documents and related materials created by Contractor on behalf of the State pursuant to this Contract.

2. Statement of Work. Contractor shall provide the Services and Work Product pursuant to the Statement of Work, attached as Schedule A to this Contract (the “Statement of Work”). The terms and conditions of this Contract will apply at all times to the Statement of Work. The State shall have the right to terminate the Statement of Work, in whole or in part, as set forth in Sections 14 and 15 of this Contract.

3. Performance of Services.

a. Performance Warranty. Contractor represents and warrants that its Services hereunder shall be performed by competent personnel and shall be of professional quality consistent with generally accepted industry standards for the performance of such services and shall comply in all respects with the requirements of this Contract and the specifications set forth in the Statement of Work and the Service Level Agreement. For any breach of this warranty, the State may, at its option, either terminate the Statement of Work pursuant to the termination provision herein, or require Contractor to provide replacement personnel to the State within thirty (30) calendar days of Contractor’s receipt of notification from the State. Whether or not the departing Contractor Personnel are to continue working while Contractor attempts to find replacement personnel is at the sole discretion of the State.

If Contractor is notified within the first eight (8) hours of assignment that the person is unsatisfactory, Contractor will not charge the State for those hours;

otherwise, the State shall pay for all actual hours worked prior to the State’s notification of a replacement request to Contractor.

b. Software Support. Contractor shall provide support Services for the Software pursuant to the Service Level Agreement attached as Schedule D to this Contract.

c. Accessibility Requirements.

i. All Software and Work Product created or provided by Contractor under this Contract, including associated content and documentation, must conform to WCAG 2.0 Level AA. Contractor must provide a completed PAT for each such deliverable provided under the Contract. All “Not Applicable" or “N/A” responses to the specifications, if any, must be fully explained. A description of the evaluation methods used to support WCAG 2.0 Level AA conformance claims, including, if applicable, any third-party testing, must be provided. Throughout the Term of the Contract, at no additional costs to the State, Contractor must:

1. promptly respond to and resolve, in a manner acceptable to the State, any complaint the State receives regarding the accessibility of any Software or Work Product;

2. upon the State’s written request, provide Software or Work Products in one or more alternative formats and within timeframes specified by the State; and

3. participate in the State of Michigan Digital Standards Review described below.

ii. State of Michigan Digital Standards Review. Prior to Software or Work Products being accepted, put into production, or as otherwise required by the State, the State may conduct a Digital Standards Review to assess their accessibility and compliance with WCAG 2.0 Level AA. Contractor must assist the State with each such review, including submitting documentation or other information regarding accessibility and compliance with WCAG 2.0 Level AA. Contractor must, at its sole cost and expense, remediate all issues resulting from such review in a manner and timeframe accepted in writing by the State, which may include providing a remediation status report and updated PAT to the State and a re-assessment of accessibility.

iii. Failure to comply with the requirements in this Section 3 may constitute a material breach of this Contract.

d. Contractor Personnel

i. Contractor is solely responsible for all Contractor Personnel and for the payment of their compensation, including, if applicable, withholding of income taxes, and the payment and withholding of social security and other payroll taxes, unemployment insurance, workers’ compensation insurance payments and disability benefits.

ii. Prior to any Contractor Personnel performing any Services, Contractor will:

1. ensure that such Contractor Personnel have the legal right to work in the United States;

2. upon request, require such Contractor Personnel to execute written agreements, in form and substance acceptable to the State, that bind such Contractor Personnel to confidentiality provisions that are at least as protective of the State’s information (including all Confidential Information) as those contained in this Contract; and

iii. upon request, or as otherwise specified in a Statement of Work, perform background checks on all Contractor Personnel prior to their assignment. The scope is at the discretion of the State and documentation must be provided as requested. Contractor is responsible for all costs associated with the requested background checks. The State, in its sole discretion, may also perform background checks on Contractor Personnel. Pursuant to Michigan law, all agencies subject to IRS Pub. 1075 are required to ask the Michigan State Police to perform fingerprint background checks on all employees, including Contractor and subcontractor employees, who may have access to any database of information maintained by the federal government that contains confidential or personal information, including, but not limited to, federal tax information. Further, pursuant to Michigan law, any agency described above is prohibited from providing Contractors or subcontractors with the result of such background check. For more information, please see Michigan Public Act 427 of 2018.

iv. Contractor and all Contractor Personnel will comply with all rules, regulations, and policies of the State that are communicated to Contractor in writing, including security procedures concerning systems and data and remote access, building security procedures, including the restriction of access by the State to certain areas of its premises or systems, and general health and safety practices and procedures.

v. The State reserves the right to require the removal of any Contractor Personnel found, in the judgment of the State, to be unacceptable. The State’s request must be written with reasonable detail outlining the reasons for the removal request. Replacement personnel for the removed person must be fully qualified for the position. If the State exercises this right, and Contractor cannot immediately replace the removed personnel, the State agrees to negotiate an equitable adjustment in schedule or other terms that may be affected by the State’s required removal.

e. Contractor’s Key Personnel

i. The State has the right to recommend and approve in writing the initial assignment, as well as any proposed reassignment or replacement, of any Key Personnel. Before assigning an individual to any Key Personnel position, Contractor will notify the State of the proposed assignment, introduce the individual to the State’s Project Manager, and provide the

State with a resume and any other information about the individual reasonably requested by the State. The State reserves the right to interview the individual before granting written approval. In the event the State finds a proposed individual unacceptable, the State will provide a written explanation including reasonable detail outlining the reasons for the rejection.

ii. Contractor will not remove any Key Personnel from their assigned roles on this Contract without the prior written consent of the State. The Contractor’s removal of Key Personnel without the prior written consent of the State is an unauthorized removal (“Unauthorized Removal”). An Unauthorized Removal does not include replacing Key Personnel for reasons beyond the reasonable control of Contractor, including illness, disability, leave of absence, personal emergency circumstances, resignation, or for cause termination of the Key Personnel’s employment.

Any Unauthorized Removal may be considered by the State to be a material breach of this Contract, in respect of which the State may elect to terminate this Contract for cause under Section 14.

iii. It is further acknowledged that an Unauthorized Removal will interfere with the timely and proper completion of this Contract, to the loss and damage of the State, and that it would be impracticable and extremely difficult to fix the actual damage sustained by the State as a result of any Unauthorized Removal. Therefore, Contractor and the State agree that in the case of any Unauthorized Removal in respect of which the State does not elect to exercise its rights under Section 14, Contractor will issue to the State the corresponding credits set forth below (each, an “Unauthorized Removal Credit”):

1. For the Unauthorized Removal of any Key Personnel designated in the Statement of Work, the credit amount will be $25,000.00 per individual if Contractor identifies a replacement approved by the State and assigns the replacement to shadow the Key Personnel who is leaving for a period of at least 30 calendar days before the Key Personnel’s removal.

2. If Contractor fails to assign a replacement to shadow the removed Key Personnel for at least 30 calendar days, in addition to the $25,000.00 credit specified above, Contractor will credit the State $833.33 per calendar day for each day of the 30 calendar-day shadow period that the replacement Key Personnel does not shadow the removed Key Personnel, up to $25,000 maximum per individual. The total Unauthorized Removal Credits that may be assessed per Unauthorized Removal and failure to provide 30 calendar days of shadowing will not exceed $50,000.00 per individual.

iv. Contractor acknowledges and agrees that each of the Unauthorized Removal Credits assessed under Subsection iii above: (i) is a reasonable estimate of and compensation for the anticipated or actual harm to the State that may arise from the Unauthorized Removal, which would be impossible or very difficult to accurately estimate; and (ii) may, at the State’s option, be credited or set off against any Fees or other charges payable to Contractor under this Contract.

f. Subcontractors. Contractor will not, without the prior written approval of the State, which consent may be given or withheld in the State’s sole discretion, engage any third party to perform Services (including to create any Work Product). The State’s approval of any such third party (each approved third party, a “Subcontractor”) does not relieve Contractor of its representations, warranties or obligations under this Contract. Without limiting the foregoing, Contractor will:

i. be responsible and liable for the acts and omissions of each such Subcontractor (including such Subcontractor's employees who, to the extent providing Services or creating Work Product, shall be deemed Contractor Personnel) to the same extent as if such acts or omissions were by Contractor or its employees;

ii. name the State a third-party beneficiary under Contractor’s contract with each Subcontractor with respect to the Services and Work Product;

iii. be responsible for all fees and expenses payable to, by or on behalf of each Subcontractor in connection with this Contract, including, if applicable, withholding of income taxes, and the payment and withholding of social security and other payroll taxes, unemployment insurance, workers' compensation insurance payments and disability benefits; and

iv. prior to the provision of Services or creation of Work Product by any Subcontractor, if requested by the State:

1. obtain from such Subcontractor confidentiality, work-for-hire and intellectual property rights assignment agreements, in form and substance acceptable by the State, giving the State rights consistent with those set forth in Section 8 and, upon request, provide the State with a fully-executed copy of each such contract;

and

2. with respect to all Subcontractor employees providing Services or Work Product, comply with its obligations under subsection d above.

4. Notices. All notices and other communications required or permitted under this Contract must be in writing and will be considered given and received: (a) when verified by written receipt if sent by courier; (b) when actually received if sent by mail without verification of receipt; or (c) when verified by automated receipt or electronic logs if sent by facsimile or email.

If to State: If to Contractor:

Brandon Samuel 320 S. Walnut St. 2nd Floor Lansing, MI 48909-7526 Samuelb@michigan.gov 517-249-0439

Hariharan Murthy, Managing Director Deloitte Consulting LLP 106 W. Allegan Street, suite 400

646-300-4550

5. Contract Administrators. The Contract Administrator for each party is the only person authorized to modify any terms and conditions of this Contract and are identified below:

State: Contractor:

Brandon Samuel 320 S. Walnut St. 2nd Floor Lansing, MI 48909-7526 Samuelb@michigan.gov 517-249-0439

Hariharan Murthy, Managing Director Deloitte Consulting LLP 106 W. Allegan Street, suite 400

646-300-4550

6. Insurance. Contractor must maintain the minimum insurances identified in the Insurance Schedule attached as Schedule C.

7. Independent Contractor. Contractor is an independent contractor and assumes all rights, obligations and liabilities set forth in this Contract. Contractor, its employees, and agents will not be considered employees of the State. No partnership or joint venture relationship is created by virtue of this Contract. Contractor, and not the State, is responsible for the payment of wages, benefits and taxes of Contractor’s employees and any subcontractors. Prior performance does not modify Contractor’s status as an independent contractor.

8. Intellectual Property Rights. The State is and will be the sole and exclusive owner of all right, title, and interest in and to all Work Product developed exclusively for the State under this Contract, including all intellectual property rights to the Work Product. In furtherance of the foregoing:

i. Contractor will create all Work Product as work made for hire as defined in Section 101 of the Copyright Act of 1976; and mailto:Samuelb@michigan.gov mailto:hamurthy@deloitte.com

ii. to the extent any Work Product do not qualify as, or otherwise fails to be, work made for hire, Contractor hereby:

1. assigns, transfers, and otherwise conveys to the State, irrevocably and in perpetuity, throughout the universe, all right, title, and interest in and to such Work Product, including all intellectual property rights to the Work Product; and

2. irrevocably waives any and all claims Contractor may now or hereafter have in any jurisdiction to so-called “moral rights” or rights of droit moral with respect to the Work Product.

a. Each party retains the right to retain and use its skill, knowledge, experience, and know-how, including ideas, concepts, processes, methods and techniques, whether developed prior to, independently of, or in the course of performing the services under this Contract. Contractor retains ownership to all Contractor Technology.

b. Contractor will not include the intellectual property of any third party in any Deliverable without the State's prior written approval.

c. Contractor hereby grants to the State a perpetual, royalty-free license to use, reproduce, perform (publicly or otherwise), display (publicly or otherwise), modify, and create derivative works from the Contractor Technology included in a Deliverable, provided the State will only make such use as is necessary to use, maintain, enhance and support the Software. Except for the foregoing license grant, Contractor or its licensors retain all rights in and to all Contractor Technology and preexisting works.

d. Within 5 business days of the State’s written request, Contractor will provide the State with the source code for Contractor Technology that is incorporated into the Software or is necessary for the State to use, maintain, enhance and support the Software.

e. Section 21(e) as it relates to the return of Confidential Information shall not apply to Contractor Technology licensed to the State in this Section 8.

9. Assignment. Contractor may not assign this Contract to any other party without the prior written approval of the State. Upon notice to Contractor, the State, in its sole discretion, may assign in whole or in part, its rights or responsibilities under this Contract to any other party.

10. Change of Control. Contractor will notify the State, within 30 days of any public announcement or otherwise once legally permitted to do so. For purposes of this Contract, a change in control means any of the following: (a) a sale of more than 50% of Contractor’s stock; (b) a sale of substantially all of Contractor’s assets; (c) a change in a majority of Contractor’s board members; (d) consummation of a merger or consolidation of Contractor with any other entity (e) a change in ownership through a transaction or series of transactions; (f) or the board (or the stockholders) approves a plan of complete liquidation. A change of control does not include any consolidation or merger effected exclusively to change the domicile of Contractor, or any transaction or series of transactions principally for bona fide equity financing purposes.

In the event of a change of control, Contractor must require the successor to assume this Contract and all of its obligations under this Contract.

11. Reserved.

12. Terms of Payment. Invoices must conform to the requirements set forth in a

Statement of Work. All undisputed amounts are payable within 45 days of the State’s receipt. Contractor may only charge for Services and Work Product performed as specified in the Statement of Work. Invoices must include an itemized statement of all charges. The State is exempt from State sales tax for direct purchases and may be exempt from federal excise tax, if Services and Work Product purchased under this Contract are for the State’s exclusive use. Notwithstanding the foregoing, all prices are exclusive of taxes, and Contractor is responsible for all sales, use and excise taxes, and any other similar taxes, duties and charges of any kind imposed by any federal, state, or local governmental entity on any amounts payable by the State under this Contract.

The State has the right to withhold payment of any disputed amounts until the parties agree as to the validity of the disputed amount. The State will notify Contractor of any dispute within a reasonable time. Payment by the State will not constitute a waiver of any rights as to Contractor’s continuing obligations, including claims for deficiencies or substandard Services or Work Product. Contractor’s acceptance of final payment by the State constitutes a waiver of all claims by Contractor against the State for payment under this Contract, other than those claims previously filed in writing on a timely basis and still disputed

The state will only disburse payments under this Contract through Electronic Funds Transfer (EFT), Contractor must register with the State at this SOM SIGMA VSS link to receive electronic fund transfer payments. If Contractor does not register, the State is not liable for failure to provide payment.

Without prejudice to any other right or remedy it may have, the State reserves the right to set off at any time any amount then due and owing to it by Contractor under this Contract against any amount payable by the State to Contractor under this Contract.

13. Stop Work Order. The State may suspend any or all activities under at a Statement of Work at any time. The State will provide Contractor a written stop work order detailing the suspension (a “Stop Work Order”). Contractor must comply with the Stop Work Order upon receipt. Within 90 calendar days, or any longer period agreed to by Contractor, the State will either: (a) issue a notice authorizing Contractor to resume work, or (b) terminate the Statement of Work. The State will not pay for Services or Work Product, Contractor’s lost profits, or any additional compensation during a stop work period.

https://www.michigan.gov/budget/budget-offices/sigma

The parties will agree upon an equitable adjustment through the Change Control Process to (i) extend the milestone dates under the Statement of Work, and (ii) adjust Contractor Personnel staffing requirements, if as a result of the Stop Work Order, Contractor is unable to timely meet all or any remaining milestones under the Statement of Work or its staffing of the project is affected by such Stop Work Order.

Notwithstanding anything contained in this Section, Contractor shall use its commercially reasonable efforts to meet the milestone dates specified in the Statement of Work without any extension.

14. Termination for Cause. The State may terminate this Contract for cause, in whole or in part (including individuals Statements of Work), if Contractor, (a) becomes insolvent, petitions for bankruptcy court proceedings, or has an involuntary bankruptcy proceeding filed against it by any creditor; or (b) breaches any of its material duties or obligations under this Contract and if curable, as determined by the State, fails to cure a breach within the time stated in a notice of breach, which shall be no less than “30” calendar days. Any reference to specific breaches being material breaches within this Contract will not be construed to mean that other breaches are not material.

If the State terminates this Contract under this Section, the State will issue a termination notice specifying whether Contractor must: (a) cease performance immediately, or (b) continue to perform for a specified period. If it is later determined that Contractor was not in breach of the Contract, the termination will be deemed to have been a Termination for Convenience, effective as of the same date, and the rights and obligations of the parties will be limited to those provided in Section 15, Termination for Convenience.

The State will only pay for amounts due to Contractor for Services and Work Product accepted by the State on or before the date of termination, subject to the State’s right to set off any amounts owed by the Contractor for the State’s reasonable costs in terminating this Contract. The Contractor must pay all reasonable costs incurred by the State in terminating this Contract for cause, including administrative costs, attorneys’ fees, court costs, transition costs, and any costs the State incurs to procure the Services and Work Product from other sources subject to the limitation of liability set forth in Section 19. The parties agree that such costs are considered direct damages and not consequential damages.

15. Termination for Convenience. The State may immediately terminate this Contract, in whole or in part (including the Statement of Work), without penalty and for any reason, including but not limited to, appropriation or budget shortfalls. The termination notice will specify whether Contractor must: (a) cease performance of the Services immediately, or (b) continue to perform the Services in accordance with Section 16, Transition Responsibilities. If the State terminates this Contract for convenience, the State will pay all reasonable costs, as determined by the State, for State approved Transition Responsibilities.

16. Transition Responsibilities. Upon termination or expiration of this Contract for any reason, Contractor must, for a period of time specified by the State (not to exceed 365 calendar days), provide all reasonable transition assistance requested by the State, to allow for the expired or terminated portion of the Services to continue without interruption or adverse effect, and to facilitate the orderly transfer of such Services to the State or its designees. Such transition assistance may include, but is not limited to: (a) continuing to perform the Services at the established Contract rates; (b) taking all reasonable and necessary measures to transition performance of the work, including all applicable Services, training, reports and other documentation, to the State or the State’s designee; (c) taking all necessary and appropriate steps, or such other action as the State may direct, to preserve, maintain, protect, or return to the State all materials, data, property, and confidential information provided directly or indirectly to Contractor by any entity, agent, vendor, or employee of the State; (d) transferring title in and delivering to the State, at the State’s discretion, all completed or partially completed Work Product prepared under this Contract as of the Contract termination date; and (e) preparing an accurate accounting from which the State and Contractor may reconcile all outstanding accounts (collectively, “Transition Responsibilities”). This Contract will automatically be extended through the end of the transition period.

17. General Indemnification. Contractor must defend, indemnify and hold the State, its departments, divisions, agencies, offices, commissions, officers, and employees harmless, without limitation, from and against any and all actions, claims, losses, liabilities, damages, costs, attorney fees, and expenses (including those required to establish the right to indemnification), arising out of third party claims or actions of or relating to: (a) any infringement, misappropriation, or other violation of any intellectual property right of any third party in connection with any Service or Work Product or Contractor Technology or other pre-existing work included in a Deliverable provided by Contractor provided under the Contract; and (b) any bodily injury, death, or damage to real or tangible personal property occurring wholly or in part due to negligent or more culpable action or inaction by Contractor (or any of Contractor’s employees, agents, subcontractors, or by anyone else for whose acts any of them may be liable). The parties agree that such damages, costs, fees and expenses are considered direct damages and not consequential damages.

The State will notify Contractor in writing if indemnification is sought; however, failure to do so will not relieve Contractor, except to the extent that Contractor is materially prejudiced. Contractor must, to the satisfaction of the State, demonstrate its financial ability to carry out these obligations.

The State is entitled to: (i) regular updates on proceeding status; (ii) participate in the defense of the proceeding; and (iii) employ its own counsel. Contractor will not, without the State’s written consent (not to be unreasonably withheld), settle, compromise, or consent to the entry of any judgment in or otherwise seek to terminate any claim, action, or proceeding. To the extent that any State employee, official, or law may be involved or challenged, the State may, at its own expense, control the defense of that portion of the claim.

Any litigation activity on behalf of the State, or any of its subdivisions under this Section, must be coordinated with the Department of Attorney General. An attorney designated to represent the State may not do so until approved by the Michigan Attorney General and appointed as a Special Assistant Attorney General.

18. Infringement Remedies. If, in either party’s opinion, any of the Services or Work Product supplied by Contractor or its subcontractors, or its operation, use or reproduction, is likely to become the subject of a copyright, patent, trademark, or trade secret infringement claim, Contractor must, at its expense: (a) procure for the State the right to continue using the Services or Work Product, or if this option is not reasonably available to Contractor, (b) replace or modify the same so that it becomes non-infringing; or (c) accept its return by the State with appropriate credits to the State against Contractor’s charges and reimburse the State for any losses or costs incurred as a consequence of the State ceasing its use and returning it. The parties agree that such losses or costs are considered direct damages and not consequential damages.

19. Disclaimer of Damages and Limitation of Liability.

a. Disclaimer of Damages. NEITHER PARTY WILL BE LIABLE, REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT, TORT, NEGLIGENCE, STRICT LIABILITY OR BY STATUTE OR

OTHERWISE, FOR ANY CLAIM RELATED TO OR ARISING UNDER THIS

CONTRACT FOR CONSEQUENTIAL, INCIDENTAL, PUNITIVE, INDIRECT,

OR SPECIAL DAMAGES, INCLUDING WITHOUT LIMITATION LOST

PROFITS AND LOST BUSINESS OPPORTUNITIES.

b. Limitation of Liability. EXCEPT AS PROVIDED IN SUBSECTION 19(c)

BELOW, IN NO EVENT WILL EITHER PARTY’S AGGREGATE LIABILITY TO

THE OTHER PARTY UNDER THIS CONTRACT, REGARDLESS OF THE

FORM OF ACTION, WHETHER IN CONTRACT, TORT, NEGLIGENCE,

STRICT LIABILITY OR BY STATUTE OR OTHERWISE, FOR ANY CLAIM

RELATED TO OR ARISING UNDER THIS CONTRACT, EXCEED THE

MAXIMUM AMOUNT OF FEES SPECIFIED IN THE APPLICABLE

STATEMENT OF WORK PAID OVER THE PRECEDING TWELVE (12)

MONTHS.

c. EXCEPTIONS. SUBSECTION 19(B) (LIMITATION OF LIABILITY) ABOVE, WILL NOT APPLY TO: (I) CONTRACTOR’S OBLIGATION TO INDEMNIFY

UNDER SECTION 17 OF THIS CONTRACT OR (II) DAMAGES ARISING

FROM CONTRACTOR’S RECKLESSNESS, BAD FAITH, OR INTENTIONAL

MISCONDUCT.

20. State Data.

a. Ownership. The State’s data (“State Data,” which will be treated by Contractor as Confidential Information) includes the State’s data collected, used, processed, stored, or generated as the result of the Services, and data otherwise made available to Contractor for or during the provision of the Services, including but not limited to all text, sound, video, image files, or software. State Data is and will remain the sole and exclusive property of the State and all right, title, and interest in the same is reserved by the State.

This Section survives the termination of this Contract.

b. Contractor Use of State Data. Contractor is provided a limited license to State Data for the sole and exclusive purpose of providing the Services, including a license to collect, process, store, generate, and display State Data only to the extent necessary in the provision of the Services. Contractor must: (a) keep and maintain State Data in strict confidence, using such degree of care as is appropriate and consistent with its obligations as further described in this Contract and applicable law to avoid unauthorized access, use, disclosure, or loss; (b) use and disclose State Data solely and exclusively for the purpose of providing the Services, such use and disclosure being in accordance with this Contract, the Statement of Work, and applicable law; and (c) not use, sell, rent, transfer, distribute, or otherwise disclose or make available State Data for Contractor’s own purposes or for the benefit of anyone other than the State without the State’s prior written consent. This Section survives the termination of this Contract.

c. Compromise of State Data. In the event of any act, error or omission, negligence, misconduct, or breach on the part of Contractor that compromises or is reasonably suspected to compromise the security, confidentiality, or integrity of State Data or the physical, technical, administrative, or organizational safeguards put in place by Contractor that relate to the protection of the security, confidentiality, or integrity of State Data, Contractor must, as applicable: (a) notify the State as soon as practicable but no later than twenty-four (24) hours of becoming aware of such occurrence; (b) cooperate with the State in investigating the occurrence, including making available all relevant records, logs, files, data reporting, and other materials required to comply with applicable law or as otherwise required by the State; (c) perform or take any other actions required to comply with applicable law as a result of the occurrence; (d) pay for any costs associated with the occurrence, including but not limited to any costs incurred by the State in investigating and resolving the occurrence, including reasonable attorney’s fees associated with such investigation and resolution;

(e) pay for any costs associated with required notification and credit monitoring to affected individuals; and (f) without limiting Contractor’s obligations of indemnification as further described in this Contract, indemnify, defend, and hold harmless the State for any and all third party claims, including reasonable attorneys’ fees, costs, and incidental expenses, which may be suffered by, accrued against, charged to, or recoverable from the State in connection with the Contractor’s breach of this Section 20. The parties agree that any damages relating to a breach of this Section 20 are to be considered direct damages and not consequential damages. This Section survives termination or expiration of this Contract so long as Contractor has possession, custody or control of or access to State Data. Notwithstanding anything to the contrary set forth in this Section or any other provision of this Contract, the aggregate liability of Contractor for damages under this Section 20 shall not exceed the greater of One Million Dollars ($1,000,000.00) or the fees specified in the applicable Statement of Work paid over the preceding twelve (12) months.

d. Third-Party Requests. Contractor will immediately notify the State upon receipt of any third-party requests which in any way might reasonably require access to State Data. Contractor will notify the State Program Managers or their designees by the fastest means available and also in writing. Contractor must provide such notification within twenty-four (24) hours from Contractor’s receipt of the request. Contractor will not respond to subpoenas, service of process, FOIA requests, and other legal requests related to the State without first notifying the State.