B02_Attachment 2_SOW_16SEPT2024.pdf

Statement of Work for Filing COVID-19 EIDL Uniform Commercial Code (UCC)

Continuation Statements

Small Business Administration

Office of Financial Programs Operation (OFPO)

September 16, 2024

1. Background

The Small Business Administration (SBA) obtained a security agreement and filed a Uniform Commercial Code (UCC) financing statements on all personal property for all COVID-19 Economic Injury Disaster Loans (COVID EIDLs) that were made in loan amounts greater than $25,000. The UCC financing statement covers all tangible and intangible personal property, with certain exceptions including registered copyrights, certain non-inventory titled goods, and farm products.

The Uniform Commercial Code (as adopted by most states and territories in some form) requires a "continuation statement" to be filed within 6 months before the 5-year anniversary of the original filing date. A continuation statement is an amendment of a financing statement which:

(A) identifies, by its file number, the initial financing statement to which it relates; and

(B) indicates that it is a continuation statement for, or that it is filed to continue the effectiveness of, the identified financing statement.

As of June 7, 2024, the COVID EIDL portfolio comprises 2.12 million active loans, not charged off or paid in full, in the following categories:

Loan Size Collateral Count (as of June 7, 2024)

≤$25,000 None 766,524 >$25,000 - ≤$200,000 Security agreement on personal property and UCC financing statements 1,161,909

>$200,000 - ≤$500,000

Above plus a full, unsecured personal guaranty from all owners of 20% or more

231,639

>$500,000 Above and a lien against real estate, if available (4,634 of which have real estate liens)

52,355

2. Scope

The Contractor must provide all resources necessary to accomplish the tasks and deliverables described in this work statement. The Contractor must file timely and correct UCC continuation statements to extend the effectiveness of the original UCC financing statements that were filed at loan origination.

3. Specific Tasks / Objectives

Task 1. Pre-Filing Check. SBA will provide the Contractor with data files containing the informa�on needed to check UCC financing statements against Secretary of State records and to file correct UCC continuation statements. Data for UCC filings eligible for renewal in FY2025 will be provided within 10 days a�er award.

Data, including a monthly breakdown of projected numbers, for FY2026 and FY2027 will be provided within 10 days at the start of each FY. They are an�cipated to total approximately 200,000 loans.

SBA may provide to the Contractor supplements to the data during each fiscal year, but not later than 30 days prior to the individual UCC filing deadlines. The Contractor will not be responsible for filings that are not provided in advance of 30 days prior to the individual UCC filing deadlines. The data files will include

UCC filing numbers, date of ini�al filing and location of filing (state) and will be provided to the Contractor in a CSV, txt file or similar format.

The projected number of COVID-19 EIDLs that will require a UCC continuation statement during FY2025 is as follows:

FY 2025:

Month Year Count October 2024 29 November 2024 163,445 December 2024 429,044 January 2025 283,606 February 2025 155,199 March 2025 57,741 April 2025 15,535 May 2025 14,445 June 2025 11,441 July 2025 14,707 August 2025 13,725 September 2025 11,714 Total 1,170,631

The above projected number may fluctuate due to payoffs, charge-offs or other ac�vity. Individual filing dates govern. For example, for a filing that was made on May 24, 2020, a renewal can be filed no earlier than November 25, 2024 (the first business day after 6 months before the 5-year anniversary of the original filing date).

Prior to submi�ng a UCC con�nua�on statement, Contractor must verify with the Secretary of State’s office the accuracy of the following:

- Ini�al financing statement number

- Debtor’s name - check that the name of the en�ty is spelled correctly against what the state is showing in its corporate name database, and check if the en�ty is Domes�c (formed in the state SBA is filing in) or Foreign (formed in a different state than the one SBA is filing in).

Contractor must provide SBA with report by the last day of each month of all inaccuracies resul�ng from the Pre-Filing Check. The report must be in SBA’s predetermined format detailing the loan number, the State checked, the Debtor’s name checked, and a descrip�on of the inaccuracy.

Task 2: File UCC Continuation Statements. The Contractor must submit, file and obtain a confirmation of filing (collectively referred to herein as “file” or “filing”) of correct UCC continuation statements on all active COVID EIDLs that have a valid UCC financing statement (not rejected by the Secretary of State for incorrect borrower name or state of incorporation). This filing must be made as early as the first business day after 6 months before the 5-year anniversary of the filing date of the original UCC financing statement, but not later than the day before the 5-year anniversary of the filing date of the original UCC financing statement. The objective is 100% of the filing volume will be completed within 150-179 days of the 5-year anniversary date, but a minimum of 50% of the volume must be completed within 150-179 days of the 5-year anniversary to demonstrate a sufficient pace of filing which will ensure the full population of filings can be completed timely. If a UCC continuation statement is not filed by the 5-year anniversary date for any reason other than an identification on the prefiling rejection report, the Contractor must incur all fees and costs to file a new UCC1 within 10 days of identification of the failure. The Contractor will not be reimbursed for these fees or costs. See Task 5 for more information on UCC1 filings.

Task 3: Monthly Reject Report. The Contractor must provide SBA with a report by the last day of each month in SBA’s predetermined format of each UCC continuation statement that was rejected detailing the loan number, the State checked, the Debtor’s name checked, and a description of the rejection. If the rejection can be cured, SBA will provide corrected information to the Contractor not later than 30 days prior to the UCC filing deadline. The Contractor must file corrected continuation statements for an effective filing date of no later than the day before the 5-year anniversary of the filing date of the original UCC financing statement.

Task 4: Record of Filed UCC Continuation Statements. The Contractor must deliver to SBA a record by the last day of each month in SBA’s predetermined format of each UCC continuation statement that was filed detailing the financing statement number, the state in which the UCC was filed, the filing date, the filing fee cost, and all confirmation data and documentation received by the Contractor upon filing. The Contractor should have capability to invoke SBA's Application Program Interface (APIs) or provide an API that SBA can invoke to securely transfer data between the organizations. These APIs may need customized input and output requirements based on SBAs reporting needs.

Task 5. File New UCC1 Financing Statements. The Contractor must file new UCC1 Financing Statements on an as-needed basis as directed by SBA. SBA will provide the Contractor with data files containing the location of filing (which Secretary of State) and data fields 1 – 5 of the Form UCC1. A Sample Form UCC1 is attached as Exhibit A to this SOW for reference, but forms may vary by jurisdiction. Fields 6a, 6b and 7 are to be left unchecked on this version of the form. If an alternative form will be used, Contractor will coordinate with SBA to obtain any additional necessary data, including entity type. The data will be provided to the Contractor in a CSV, txt file or similar format. The Contractor must file the UCC1 within 10 days of SBA delivering the data file to the Contractor. The Contractor must deliver to SBA a record by the last day of each month in SBA’s predetermined format and content of: (a) each UCC1 financing statement that was filed detailing the financing statement number, the state in which the UCC was filed, the filing date, the filing fee cost and all confirmation data and documentation received by the Contractor upon filing , and (b) each UCC1 financing statement that was rejected and the reason for rejection.

Task 6. Ad Hoc Reports. The Contractor must deliver ad-hoc reports to the SBA on an as-needed basis.

4. Deliverables/Delivery Schedule

Table 1: Deliverables

Deliverable Title Task Reference

Frequency Medium/Format Recipient

Report of inaccuracies from Pre-Filing Checks

Task 1 Monthly – by the last day of each month

As requested by SBA;

CSV, Txt, Excel and/or Similar Format

SBA

(Refer to Task 1 above for details on what to include) Monthly UCC Continuation Statement Reject Report (Refer to Task 3 above for details on what to include)

Task 3 Monthly – by last day of each month

As requested by SBA;

CSV, Txt, Excel and/or Similar Format

SBA

Record of Filed UCC Continuation Statements (Refer to Task 4 above for details on what to include)

Task 4 Monthly – by last day of each month

As requested by SBA;

CSV, Txt, Excel and/or Similar Format

SBA

Record of Filed UCC1 Financing Statements (Refer to Task 5 above for details on what to include)

Task 5 Monthly – by last day of each month

As requested by SBA;

Txt, Excel, CSV, and/or Similar Format

SBA

Monthly UCC1 Financing Statement Reject Report

Task 5 Monthly – by last day of each month

As requested by SBA;

CSV, Txt, Excel and/or Similar Format

SBA

Ad-Hoc Reports Task 6 As Needed As requested by SBA;

Txt, Excel, CSV and/or Similar Format

SBA

Quality Control Plan Section 6 Within 10 days after award

Microsoft Word, PDF, or comparable.

SBA

Transition-in Plan Section 16 Within 10 days after award

Microsoft Word, PDF, or comparable.

SBA

Transition-out Plan Section 16 Within 10 days of notice of termination

Microsoft Word, PDF, or comparable.

SBA

5. Inspection and Acceptance

The government will review, for completeness, preliminary or draft deliverables submitted by the Contractor, and may return them to the Contractor for correction. Absence of comments by the government will not relieve the Contractor of the responsibility for complying with the requirements of this work statement. Final approval and acceptance of deliverables required herein must be provided to the Contractor in writing by the designated government official. The Contractor must not construe any letter of acknowledgment of receipt as a waiver of review, or as an acknowledgment that a deliverable is in conformance with this work statement. Any approval given during preparation of a deliverable, or approval for shipment does not guarantee the final acceptance of the completed deliverable.

6. Quality Control Plan

The contractor shall develop and maintain an effec�ve quality control program to ensure services are performed in accordance with this work statement. The contractor shall implement procedures to iden�fy, prevent, and ensure non-recurrence of defec�ve services. The contractor’s quality control program is the means by which it assures that contractor performance complies with the requirements of the contract. A�er acceptance of the quality control plan, the contractor shall receive the contrac�ng officer’s acceptance in wri�ng of any proposed change to its quality control system.

7. Quality Assurance

The Government shall evaluate the contractor’s performance under this contract in accordance with the Quality Assurance Surveillance Plan. This plan is primarily focused on what the Government must do to ensure that the Contractor has performed in accordance with the performance standards. It defines how the performance standards will be applied, the frequency of surveillance, and the minimum acceptable defect rate(s).

Required Services (Tasks)

Performance Standards

Acceptable Quality Levels

Methods of Surveillance

Incentive (Positive and/or Negative)

Task 2 Timely Submitted UCC Continuation Statement Filings

Filings are successfully submitted no later than the day prior to the 5-year anniversary of the original filing 100% of the time.

Random sampling via review of Record of Filed UCC Continuation Statements (Task 4)

The contractor will not be paid for late filings.

Task 5 Timely Submitted filings for UCC1 Financing Statements

Filings are successfully submitted within 10 days of SBA delivering the data file to the Contractor 100% of the time.

Random sampling via review of the Record of Filed UCC1 Financing Statements (Task 5)

The contractor will not be paid for late filings.

Task 2 The objective is 100% of the filing volume will be completed within 179-150 days prior to the 5-year anniversary date

Between 50%- 100% of the UCC continuation statement filing volume is completed within 179-150 days prior to the 5-year anniversary date.

Random sampling via review of Record of Filed UCC Continuation Statements (Task 4)

Due to the time sensitive nature of this requirement, the government will pursue termination for cause if the contractor is unable to maintain sufficient pace of filing.

8. Security

a. Physical Security The Contractor must establish and comply with appropriate administrative, technical, and physical safeguards to protect all Government data, property, facilities, and personnel.

i. Data All electronic data and documentation provided or made accessible by the Government, and all electronic data and documentation produced during performance of the services associated with this award are the property of, and are owned by, the Government.

The Contractor must not disclose and must safeguard all data and personnel work products that are obtained or generated in the performance of this contract. The Contractor must not access data or documentation that is not required in the performance of services awarded via this contract/task order, even if the data or documentation is available to Contractor personnel. The Contractor must immediately report any instance of non-compliance with this requirement to the Contracting Officer.

The government may authorize Contractor access to controlled, sensitive, classified, or other government information for use in performance of this contract. The term “government information” includes information furnished by the government and information acquired or developed by the Contractor in performance of the contract. The Contractor must provide immediate written notification the Contracting Officer if a breach of any of the requirements in this section occurs.

The Contractor must not publish or otherwise divulge government information, in whole or in part, in any manner or form, or authorize or permit others to do so, taking such measures as are necessary to restrict access to such information to only those employees needing the information to perform work required by the contract, i.e., on a “need to know” basis. The Contractor is cautioned that its employees and subcontractors have no blanket authorization for access to government information based on their employment status.

Government data, including electronic data, must not be removed from the Government facility without the expressed and written permission of the Contracting Officer or the Contracting Officer’s Representative. Government data including documentation must be surrendered to the Government upon contract completion and upon request. Government personnel, including government security personnel, have the express right to inspect documentation for any reason and at any time during the term of this award. The Contractor must ensure that direct and subcontract employees:

• Only access information required to perform their tasks as specified in this contract, and do not access information that is not required to perform these tasks.

• Ensure continuous government access to their work product in support of this contract.

• Do not email government information to non-government email accounts.

• Do not discuss government information with non-government personnel (including the

Contractor employee’s management).

• Do not remove, or conspire to remove, government information out of a government facility or system, either physical and electronic, without written Contracting Officer or Contracting Officer Representative authorization.

• Comply with non-disclosure agreements.

• Protect the confidentiality of government information, and do not disclose government information to any unauthorized person.

ii. Facilities The Contractor and all associated subcontractors’ employees must comply with all facility access and use policies and procedures, including security policies and procedures. Questions must be referred to the Contracting Officer’s Representative. The Contractor must provide all information required for background checks to meet facility access requirements. The Contractor must comply with all personal identity verification requirements associated with facility access. Should the security procedures at any individual facility change, the Government may require changes in Contractor security matters or processes.

iii. Property and Personnel The Contractor must report threats to government property and personnel employed by or supporting the Government.

To help ensure the protection of the life and health of all persons, and to help prevent damage to property, the Contractor must comply with all Federal, State, and local laws and regulations applicable to the work being performed under this contract. These laws are implemented or enforced by the Environmental Protection Agency, Occupational Safety and Health Administration (OSHA) and other regulatory/enforcement agencies at the Federal, State, and local levels.

The Contractor agrees to use only qualified, responsible, ethical, and capable people to perform the work. Contractor employees must perform services at all times in a professional, ethical manner.

Unprofessional, unethical, or threatening conduct will not be tolerated. Contractor employees with knowledge of unprofessional, unethical, or threatening behavior or conduct by any person must immediately report such behavior or conduct to the Contractor. The Contractor must immediately report receipt of a report concerning such behavior or conduct to the Contracting Officer.

The Contractor and its employees must only conduct business covered by this contract during periods paid for by the government and must not conduct any other business on government premises or government time. The Contractor must not use government time, equipment, materials except for the express purpose of providing government support.

Contract personnel attending meetings, answering Government telephones, and working in other situations where their contractor status is not obvious to third parties must identify themselves as contractors to avoid creating an impression that they are Government officials. The Contractor must also ensure that all documents or reports produced by the Contractor are suitably marked as Contractor products or that Contractor participation is appropriately disclosed.

The Contractor must, at its own expense, immediately remove employees who have displayed or are displaying or engaging in unprofessional, unethical, or threatening behavior or conduct. The Contracting Officer may require that the Contractor remove from the job at its own expense, employees who jeopardize or interfere with mission accomplishment, or endanger or threaten to endanger persons or property, or whose continued employment under this contract is inconsistent with the interest of agency security.

9. Government Furnished Property/Equipment/Information

SBA will not be providing government furnished property or equipment to the Contractor. SBA will provide the Contractor with the following informa�on:

Government Furnished Information

Task Reference

Frequency Medium/Format Recipient

UCC Data File needed for Pre-Filing Checks

Task 1 Within 10 days after award and 10 days after the start of a new fiscal year

CSV, Txt, or Similar Format

Contractor

Data File for new UCC1 Financing Statements to be Filed

Task 5 As needed CSV, Txt, or Similar Format

Contractor

10. Type of Contract

The Government anticipates award of a Firm-Fixed-Price/Cost Reimbursement type contract.

11. Period of Performance

The period of performance consists of a base year and 2 option year periods.

Table 2 – Period of Performance

Period Start Date End Date Base November 14, 2024 November 13, 2025 Option 1 November 14, 2025 November 13, 2026 Option 2 November 14, 2026 November 13, 2027

12. Place of Performance

The primary place of performance will be at the Contractor facility or approved alternate work site.

Contractor employees are permitted to telework in accordance with the contract terms and conditions.

13. Hours of Operation

The Contractor is responsible for maintaining an adequate work force for the uninterrupted performance of all tasks and objectives defined within this work statement. When hiring personnel, the Contractor must keep in mind the stability and continuity of the work force are essential.

14. Travel and Other Direct Costs (ODC)

Travel is not required in support of the requirements in this work statement.

15. Conflicts of Interest

No potential organizational conflicts of interest have been identified by the government. The Contractor must ensure that neither the Contractor or any subcontractor is biased because of financial, contractual, organizational, or other interests which relate to the work under this contract. The Contractor agrees it will make an immediate and full disclosure, in writing, to the Contracting Officer of any potential or actual organizational conflict of interest or the existence of any facts that may cause a reasonably prudent person to question the Contractor's impartiality because of the appearance or existence of bias or an unfair competitive advantage. Such disclosure must include a description of the actions the Contractor has taken or proposes to take to avoid, neutralize, or mitigate any resulting conflict of interest.

16. Transition Plan

The Contractor must have an internal transition plan in place with little to no impact on the �mely filing of UCC con�nua�on statements to include the following:

Phase-in Identification of critical steps and technical specifications in assuming full functionality of service as defined in the statement of work, as to not cause any break in the filing of UCC continuation statements.

Back-Up Plan in the event of delays in assuming full functionality of service.

Phase-out Transition out procedures at end of the contract terms, including options.

In case of contract termina�on, the Contractor must provide SBA with a complete and comprehensive record of all successful filings and a separate complete and comprehensive record of all rejected filings, not previously provided. The records must be sortable in format and must include the loan numbers, old and new financing statement numbers, dates of filing, costs and all informa�on and data received from the filing offices. The Contractor must cooperate �mely with reasonable requests by SBA in the phase out. The contractor must submit this informa�on to the government within 10 days of no�ce of termina�on.

EXHIBIT A

Sample UCC 1 Financing Statement Form