ADOA_PA_McKinsey_Fully_Executed.pdf

State of Arizona Participating Addendum Arizona Department of

Administration State Procurement Office

Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

Table of Contents

Scope of Work and Participation 2

Exhibit A - Pricing 6

Attachment A, Part 1: Special Terms and Conditions 12

Supplement A - Contractor Insurance Requirements 49

Supplement B - Warranties and Requirements Related to Arizona Information Technology Statewide

Policies, Standards, and Procedures 54

Attachment A, Part 2: Uniform Terms and Conditions 10.5 58

Participating Addendum | Revision No. 2 | Revised 08-25 | Page 1 of 73

Administration State Procurement Office

Contract No.: CTR079021

Scope of Work and Participation

1. Purpose and Background

1.1. Master Agreement Name and Number: Omnia Partners - Strategic Management

Consulting Services – Contract Number 14-14 https://www.omniapartners.com/suppliers/mckinsey/public-sector/contract-documents#con tract-1747

1.2. Contractor: McKinsey & Company, inc. Washington D.C.

1.3. Participating Entity: State of Arizona

1.4. Purpose: To provide Strategic Management Consulting Services to the State of Arizona and its agencies/partners.

1.5. Legal Authority: In accordance with Arizona Revised Statutes (A.R.S.) § 41-2632, and Arizona Administrative Code (A.A.C.) R2-7-1003, Purchasing from a Cooperative Contract, State establishes this contract with McKinsey & Company to provide the Materials or Services described herein.

1.6. Participation: This Participating Addendum covers participation of Participating Entity in the above-referenced Master Agreement between the State of Arizona and Contractor for Strategic Management Consulting Services. This Participating Addendum may be used by all State Agencies (Eligible Agencies) as well as members of the State of Arizona Purchasing Cooperative (Co-Op Buyers).

1.7. Term: This Participating Addendum shall become effective as of the date of the last signature below and shall terminate upon the expiration or termination of the Master Agreement, as amended, unless the Participating Addendum is terminated sooner in accordance with the terms set forth herein.

2. Primary Contacts

2.1. Primary Contacts: The following (or their named successors) are the primary contact individuals for this Participating Addendum:

2.1.1. Contractor Primary Contact:

Participating Addendum | Revision No. 2 | Revised 08-25 | Page 2 of 73

Administration State Procurement Office

Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

2.1.2. Participating Entity Primary Contact:

3. Participating Addendum Modifications to the Master Agreement

3.1. Participating Addendum Changes to Master Agreement:

3.1.1. This Participating Addendum incorporates the entire Master Agreement, including terms and conditions therein, as applied to the Participating Entity and Contractor, with the limitations, modifications, and additions described in this Section 3 of the Contract Scope of Work (Participating Addendum Modifications to the Master Agreement).

3.1.2. Any limitations, modifications, or additions specified herein shall apply only to the agreement and relationship between Participating Entity and Contractor and shall not amend or affect other participating addenda or the Master Agreement itself.

3.2. Definitions

3.2.1. “Contract” For the purpose of this Participating Addendum, the term Contract refers to the Master Agreement, as defined therein and as modified by this Participating Addendum, and any Amendments to either the Master Agreement or the Participating Addendum.

3.3. Order of Precedence

3.3.1. The following attachments are hereby incorporated into this State of Arizona Participating Addendum (PA):

3.3.1.1. Attachment A, Parts 1 and 2 – Special Terms and Conditions and Uniform Terms and Conditions, collectively;

Participating Addendum | Revision No. 2 | Revised 08-25 | Page 3 of 73

Name:

Address:

Telephone:

Email:

Name:

Address:

Telephone:

Email:

Samantha Harman

1200 19th ST NW, STE 1000, Washington D.C., 20036 202-699-4675 mckinsey_contracts@mckinsey.com

Administration State Procurement Office

Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

3.3.1.2. Attachment B – Boycott of Israel Disclosure; and

3.3.1.3. Attachment C – Forced Labor of Ethnic Uyghurs Ban

3.3.2. Master Contract and Participating Addendum Order of Precedence:

3.3.2.1. State of Arizona Participating Addendum;

3.3.2.2. Master Agreement;

3.3.2.3. Master Agreement Solicitation including all Addenda; and

3.3.2.4. Contract Vendor’s response to the Master Agreement Solicitation.

3.4. Orders: Any Order placed by a Participating Entity, Eligible Agency, or Co-Op Buyer for a Material or Service offered through this Participating Addendum shall be deemed to be a sale under, and subject to the pricing and other terms and conditions of, the Master Agreement unless the parties to the order agree in writing that another contract or agreement applies to the order.

Participating Addendum | Revision No. 2 | Revised 08-25 | Page 4 of 73

Administration State Procurement Office

Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

IN WITNESS, WHEREOF, the parties have executed this Participating Addendum as of the date of execution by both parties below.

Contractor company name Signature of person authorized to sign Contract

Address Printed name and title

City, State, ZIP Contact name and title

☐ By checking this box, Offeror is certifying that it is exempt from the requirements regarding the forced labor of ethnic Uyghurs and boycott of Israel because of one of the following: Contractor is a Sole proprietorship, has fewer than ten (10) employees; or is a non-profit organization.

Contact email address Contact phone number

CERTIFICATION: By signature in the above, Contractor certifies that it:

1. Will not discriminate against any employee or applicant for employment in violation of any Federal anti-discrimination laws, rules, regulations or executive orders,, [Arizona] State Executive Order Nos. 2023-09, 2023-01, 2009-9, and A.R.S. §§ 41-1461 through 41-1465;

2. Has not given, offered to give, nor intends to give at any time hereafter any economic opportunity, future employment, gift, loan, gratuity, special discount, trip, favor, or service to a public servant in connection with the Contract; failure to provide a valid signature affirming the stipulations required by this clause may void the Contract;

3. Has not signed the Contract with a false statement, which will void the Contract and may subject Contractor to legal penalties under law;

4. Complies with A.R.S. § 18-132 when offering electronics or information technology products, services, or maintenance;

5. Did not and will not involve collusion or other anti-competitive practices; and

6. Is not debarred from, or otherwise prohibited from, participating in any contract awarded by any federal entity, or state or local government.

7. Does not participate in, and agrees not to participate in during the term of the contract, a boycott of Israel in accordance with A.R.S. § 35-393 et seq. (Unless exempt)

8. Does not participate in the use of forced labor of ethnic Uyghurs as described in A.R.S. § 35-394. (Unless exempt)

CONTRACT EXECUTION BY PROCUREMENT AUTHORITY

The Contractor is now bound to sell the Materials or Services listed in the attached Contract, including all terms, conditions, and specifications as stated herein. The Contract shall henceforth be referred to as Contract No. CTR079021 with an effective date of October 8, 2025. The Contractor is cautioned not to commence any billable work or to provide any Material or Service under this Contract until Contractor receives an Order or written notice to proceed from the State.

State of Arizona Contract Executed this 8th day of October 2025

Curtis A. Rohlfs Statewide Procurement Manager

Participating Addendum | Revision No. 2 | Revised 08-25 | Page 5 of 73

McKinsey & Company, Inc. Washington D.C.

1200 19th ST NW, STE 1000

Washington, D.C. 20036

Tim Ward, Partner

Tim Ward, Partner

Tim_ward@mckinsey.com;

mckinsey_contracts@mckinsey.com 424-249-2255

Exhibit A - Pricing

Administration State Procurement Office

Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

Exhibit A – Pricing

This section outlines Contractor’s Master Agreement Price Quotations for weekly team bundle rates commensurate with OMNIA #14-14 Strategic Management Consulting Services pricing.

Contractor may propose additional services or price offerings from the cooperative contract price list as relevant to Order(s) specifications. Any changes shall be proposed and incorporated in accordance with

Attachment A Section 3. Contract Changes.

Weekly Team Bundle Rates Contractors perform services for Work in teams to provide the most effective and efficient services, and ensure that we bring the full set of capabilities of our firm—not just the capabilities of select individuals—to the engagements. Contractor’s proposed commercial weekly team bundles rates for the master agreement are provided below for all Work and Orders under the master agreement.

Service Name Service Description FY26 Bundle Rates

Leadership/ Counseling

Leadership counseling integrates five distinctive capabilities into a seamless offering:

● Committed leadership by one Contractor Associate Partner/Partner/Senior Partner (part-time), who is accountable for delivery and actively manages the engagement

● Subject matter experts (SMEs) and extended leadership (part- time), who bring world-class expertise and experience on relevant industry and functional topics

● Proprietary knowledge and tools that help our clients solve problems more efficiently and effectively

● Support for new solutions and advanced analytic techniques

● A research team that is available around-the-clock to answer clients’ questions about issues such as best practices or important trends

$56,100/week

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Administration State Procurement Office

Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

Management Workshop

Management workshop includes:

● A Management Workshop is a one-day event led by two consultants, who meet with a group of clients to help them address a top management issue, understand industry trends, or build their skills. The consultants prepare materials, such as data analysis, interview summaries, market intelligence, best practices, and management options, to help ensure that the workshop is content-rich and fact-based. A Management Workshop includes a minimum of 4 and a maximum of 40 clients

$71,400/workshop

Team A Team A integrates seven distinctive capabilities into a seamless offering:

● Committed leadership by 2-3 Contractor Associate Partners/Partners/Senior Partners (part-time), who are accountable for delivery, actively manage the engagement, and lead problem solving with the team

● A full-time team of one Engagement Manager and one Consultant, who lead the day-to-day work (e.g., interviews and data collection, analysis, problem solving, communications). The full-time team draws upon the following resources, capabilities, and expertise as much as needed to deliver superior results to the client

● Subject matter experts (SMEs) and extended leadership (part- time), who bring world-class expertise and experience on relevant industry and functional topics

● Proprietary knowledge and tools that help our clients solve problems more efficiently and effectively

● Support for new solutions and advanced analytic techniques

● A research team that is available around-the-clock to answer clients’ questions about issues such as best practices or important trends

● World-class graphics support

$214,200/week

Participating Addendum | Revision No. 2 | Revised 08-25 | Page 7 of 73

Administration State Procurement Office

Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

Team B Team B integrates seven distinctive capabilities into a seamless offering:

● Committed leadership by 2-3 Contractor Associate Partners/Partners/Senior Partners (part-time), who are accountable for delivery, actively manage the engagement, and lead problem solving with the team

● A full-time team of one Engagement Manager and two Consultants, who lead the day- to-day work (e.g., interviews and data collection, analysis, problem solving, communications). The full-time team draws upon the following resources, capabilities, and expertise as much as needed to deliver superior results to the client

● Subject matter experts (SMEs) and extended leadership (part- time), who bring world-class expertise and experience on relevant industry and functional topics

● Proprietary knowledge and tools that help our clients solve problems more efficiently and effectively

● Support for new solutions and advanced analytic techniques

● A research team that is available around-the-clock to answer clients’ questions about issues such as best practices or important trends

● World-class graphics support

$255,000/week

Participating Addendum | Revision No. 2 | Revised 08-25 | Page 8 of 73

Administration State Procurement Office

Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

Team C Team C integrates seven distinctive capabilities into a seamless offering:

● Committed leadership by 2-3 Contractor Associate Partners/Partners/Senior Partners (part-time), who are accountable for delivery, actively manage the engagement, and lead problem solving with the team

● A full-time team of one Engagement Manager and three Consultants, who lead the day-to-day work (e.g., interviews and data collection, analysis, problem solving, communications). The full-time team draws upon the following resources, capabilities, and expertise as much as needed to deliver superior results to the client

● Subject matter experts (SMEs) and extended leadership (part- time), who bring world-class expertise and experience on relevant industry and functional topics

● Proprietary knowledge and tools that help our clients solve problems more efficiently and effectively

● Support for new solutions and advanced analytic techniques

● A research team that is available around-the-clock to answer clients’ questions about issues such as best practices or important trends

● World-class graphics support

$300,900/week

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Administration State Procurement Office

Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

Team D Team D integrates seven distinctive capabilities into a seamless offering:

● Committed leadership by 2-3 Contractor Associate Partners/Partners/Senior Partners (part-time), who are accountable for delivery, actively manage the engagement, and lead problem solving with the team.

● A full-time team of one Engagement Manager and four Consultants, who lead the day-to-day work (e.g., interviews and data collection, analysis, problem solving, communications). The full-time team draws upon the following resources, capabilities, and expertise as much as needed to deliver superior results to the client

● Content experts (part-time), who bring world-class expertise and experience on relevant industry and functional topics

● Proprietary knowledge and tools that help our clients solve problems more efficiently and effectively

● Support for new solutions and advanced analytic techniques

● A research team that is available around-the-clock to answer clients’ questions about issues such as best practices or important trends

● World-class graphics support

$321,300/week

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Administration State Procurement Office

Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

Team E Team E integrates seven distinctive capabilities into a seamless offering:

● Committed leadership by one Contractor Associate Partner/Partner/Senior Partner (part- time), who is accountable for delivery, actively manages the engagement, and leads problem solving with the team

● A full-time Consultant, who leads the day- to-day work (e.g., interviews and data collection, analysis, problem solving, communications). The full-time Consultant draws upon the following resources, capabilities, and expertise as much as needed to deliver superior results to the client.

● Subject matter experts (SMEs) and extended leadership (part- time), who bring world-class expertise and experience on relevant industry and functional topics

● Proprietary knowledge and tools that help our clients solve problems more efficiently and effectively

● Support for new solutions and advanced analytic techniques

● A research team that is available around-the-clock to answer clients’ questions about issues such as best practices or important trends

● World-class graphics support

$89,250/week

Participating Addendum | Revision No. 2 | Revised 08-25 | Page 11 of 73

Attachment A, Part 1:

Special Terms and Conditions

Arizona Department of Administration

State Procurement Office Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

Attachment A, Part 1: Special Terms and Conditions

The Special Terms and Conditions modify the Uniform Terms and Conditions. It can modify them by replacing, deleting, appending to, or revising the text of an existing provision or by inserting a new paragraph into an existing article. No other document modifies or adds to the Uniform Terms and Conditions, except as may subsequently be otherwise and expressly agreed and incorporated by Contract Amendment.

1.0 Definition of Terms: As used in the Contract, the terms listed below are defined as follows:

1.1 Arizona Procurement Code: The Arizona Procurement Code consists of Arizona Revised Statutes (A.R.S.) §§ 41-2501 et seq. and Arizona Administrative Code (A.A.C.) R2-7-101 et seq.

1.2 Attachment: means any document titled “Attachment” incorporated into the State of Arizona Participating Addendum.

1.3 Arizona Transaction Privilege Tax (TPT): For information, refer to the Arizona Department of Revenue (DOR) website at: https://azdor.gov/transaction-privilege-tax-tpt

1.4 Contract: For the purpose of this Participating Addendum, the term Contract refers to the Master Agreement, as defined therein and as modified by this Participating Addendum, and any Amendments to either the Master Agreement or the Participating Addendum.

1.5 Contract Terms and Conditions: The Special Terms and Conditions and the Uniform Terms and Conditions taken collectively.

1.6 Contractor: The entity identified on the State of Arizona Participating Addendum signature block who has entered into the Contract with the State.

1.7 Contractor Indemnitor: Contractor or any of its owners, officers, directors, agents, employees, or Subcontractors.

1.8 Co-Op Buyer: A member of the State Purchasing Cooperative that has entered into a “Cooperative Purchasing Agreement” with the Arizona Department of Administration State Procurement Office under A.R.S. § 41-2632. Unless there is an applicable Cooperative Purchasing Agreement in effect at the time, a State Purchasing Cooperative member cannot be a Co-Op Buyer. For reference, “Co-Op Buyer” is to be construed as encompassing an “eligible procurement unit” under A.A.C. R2-7-101(23).

NOTE: Membership in the State Purchasing Cooperative is open to all Arizona political subdivisions, including cities, counties, school districts, and special districts. Membership is also

Participating Addendum | Revision No. 2 | Revised 08-25 | Page 12 of 73 https://azdor.gov/transaction-privilege-tax-tpt

Arizona Department of Administration

State Procurement Office Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company available to non-profit organizations, other state governments, the federal government and tribal nations. For reference, “non-profit organizations” are defined in A.R.S. § 41-2631(4) as any nonprofit corporation as designated by the IRS under Section 501(c)(3) through 501(c)(6) of the tax code.

1.9 Eligible Agency:

1.9.1 If the Special Terms and Conditions indicate that the Contract is a “single-agency” contract, then “Eligible Agency” means the particular State of Arizona agency, university, commission, or board identified therein.

1.9.2 If the Special Terms and Conditions indicate that the Contract is a mandatory statewide contract, then “Eligible Agency” means any State of Arizona department, agency, university, commission, or board.

1.9.3 If the Special Terms and Conditions indicate that the Contract is a “cooperative” contract available for use by Co-Op Buyers, then “Eligible Agency” means any State of Arizona department, agency, university, commission, board, or any Co-Op Buyer.

1.10 Exhibit: means any document titled “Exhibit” incorporated into the Contract or placed in the Exhibits section of the Contract generally containing maps, schematics, examples of reports, or other documents that will be used to perform the requirements of the Scope of Work after contract award.

1.11 Master Agreement: Master Agreement refers to the Master Agreement Name and Number listed in section 1.1 of the Scope of Work and Participation Section of the Participating Addendum in its entirety, including any Amendments to the Master Agreement.

1.12 Order: The instrument by which the Eligible Agency or Co-Op Buyer authorizes a Contractor to perform some or all of the Work. Whether the Contract will have one Order or many Orders depends on the scope of the Contract and how the State will use it. The Special Terms and Conditions provide that information. Any of the following are construed as an “Order”: “Purchase order,” “task order,” “service order,” or “job order”.

1.13 The State’s eProcurement System: The State’s official electronic procurement system, established pursuant to A.A.C. R2-7-201 as set forth in the Arizona Department of Administration State Procurement Office policy document Technical Bulletin No. 020, The State’s eProcurement System–The Official State eProcurement System. Technical Bulletin No. 020 is available online at:

Participating Addendum | Revision No. 2 | Revised 08-25 | Page 13 of 73

Arizona Department of Administration

State Procurement Office Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company https://spo.az.gov/sites/default/files/documents/files/TB_020_APP_20181024.pdf

1.14 State: With respect to the Contract generally, “State” means the State of Arizona and its department, agency, university, commission, or board that has executed the Contract. With respect to administration or rights, remedies, obligations and duties under the Contract for a given Order, “State” means each Eligible Agency or Co-Op Buyer who has issued the Order.

1.15 State Indemnitees: Collectively, the State of Arizona, its departments, agencies, universities, commissions, and boards and, and their respective officers, agents, and employees.

1.16 Participating Addendum: Participating Addendum refers to this agreement, including any Exhibits, Supplements, and Attachments to this agreement, between the State and Contractor to modify the Master Agreement as described herein.

1.17 Work: The totality of the Materials and the Services and all the acts of administration, creation, production, and performance necessary to fulfill and incidental to fulfilling all of Contractor's obligations and duties under the Contract in conformance with the Contract and applicable laws.

2.0 Contract Interpretations

2.1 Usage. Where the Contract:

2.1.1 assigns obligations to Contractor, any reference to “Contractor” is to be construed to be a reference to the Contractor and all Subcontractors, whether they are first-tier Subcontractors, sub-subcontractors, suppliers, sub-suppliers, consultants, or sub-consultants, as well as all of Contractor’s and the Subcontractor’s respective agents, representatives, and employees in every instance unless the context plainly requires that it is a reference only to Contractor as apart from Subcontractors.

2.1.2 uses the permissive “may” with respect to a party’s actions, determinations, etc., the terms is to be interpreted as in A.A.C. R2-7-101(32) [Definitions]. For clarity of intent, any right given to State using “State may” or a like construction denotes discretion and freedom to act so far as any regulatory or operative constraints permit in the relevant circumstances, provided that: (a) where written “may, at its discretion,” the discretion extends to whatever is most advantageous to State; and

(b) where written only as “may,” the discretion is constrained by what is fair, Participating Addendum | Revision No. 2 | Revised 08-25 | Page 14 of 73 https://spo.az.gov/sites/default/files/documents/files/TB_020_APP_20181024.pdf

Arizona Department of Administration

State Procurement Office Contract No.: CTR079021 reasonable, and as accommodating of the respective best interests of both parties as practicable under the circumstances;

2.1.3 uses the imperative “shall” with respect to a party’s actions, duties, etc., the term is to be interpreted as in A.A.C. R2-7-101(44) [Definitions]. Conversely, the phrase “shall not” is to be interpreted as an imperative prohibition.

2.1.4 uses the term “must” with respect to a requirement, criterion, etc., the term is to be interpreted as conveying compulsion or strict necessity;

2.1.5 uses the term “might” with respect to an event, outcome, action, etc., the term is to be interpreted as conveying contingency or non-discretionary conditionality; and

2.1.6 uses the term “will” or the phrases “is to be” or “are to be” with respect to an event, outcome, action, etc., the term or phrase is to be interpreted as conveying such certainty or imperativeness that “shall” is either unnecessary or irrelevant in that instance.

2.2 Contract Order of Precedence

2.2.1 Complementary Documents. All of the documents forming the Contract are complementary. If certain work, requirements, obligations, or duties are set out only in one but not in another, Contractor shall carry out the Work as though the relevant Work, requirements, obligations, or duties had been fully described in all, consistent with the other documents forming the Contract and as is reasonably inferable from them as being necessary to produce complete results.

2.2.2 Conflicts. In case of any inconsistency, conflict, or ambiguity among the documents forming the Contract and their provisions, they are to prevail in the following order, descending from most dominate to most subordinate, provided that, among categories of documents or provisions having the same rank, the document or provision with the latest date prevails. Information being identified in one document, but not in another, is not to be considered a conflict or inconsistency.

2.2.2.1 State of Arizona Participating Addendum, including all Attachments and Exhibits, in the following order:

2.2.2.1.1 Special Terms and Conditions, as modified by Supplements to the Special Terms and Conditions;

2.2.2.1.2 Exhibits to the Special Terms and Conditions;

2.2.2.1.3 Uniform Terms and Conditions;

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Arizona Department of Administration

State Procurement Office Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

2.2.2.1.4 Participating Addendum Scope of Work;

2.2.2.1.5 Exhibits to the Participating Addendum Scope of Work;

2.2.2.1.6 Participating Addendum Specifications; and

2.2.2.1.7 Any other documents referenced or included in the

Participating Addendum.

2.2.2.2 Master Agreement, including all Addenda, in the order of precedence stated therein; and

2.2.2.3 Orders, in reverse chronological order.

3.0 Contract Administration and Operation

3.1 Term of Contract. The term of the Contract will commence on the date indicated in the State of Arizona Participating Addendum signature block and continue for twelve (12) months unless canceled, terminated, or permissibly extended.

3.2 Contract Extensions. State may, at its discretion, request for a mutual agreement to extend the initial Contract term in increments of one (1) or more months and do so one or more times, provided that the maximum aggregate term of the Contract including extensions cannot exceed the maximum aggregate term of the end of the Omnia contract term of November 30, 2030.

3.3 Notices and Correspondence

3.3.1 To Contractor. State shall address all Contract correspondence other than formal notices to the email address indicated as “Default for Type” for “General Mailing Address” in Contractor’s corresponding State’s eProcurement System Vendor Profile; and address any required notices to Contractor to the “Contact Name and Title” at the “Mailing Address” indicated on the Accepted Offer, as that address might have been amended during the term of the Contract.

3.3.2 To State. Contractor shall address all Contract correspondence other than formal notices to the email address indicated in “Contact Instructions” in the State’s eProcurement System Summary for State; and address any required notices to State via email to the Procurement Officer identified as “Purchaser” in the State’s eProcurement System and via mail to the following mailing address:

Arizona Department of Administration State Procurement Office

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Arizona Department of Administration

1802 W. Jackson, #100, Phoenix, AZ 85007

3.3.3 Changes. State may change the designated Procurement Officer, update contact information, or change the applicable mailing address.

3.4 Signing of Contract Amendments. Contractor’s counter-signature (or “approval” in the State’s eProcurement System, in the case of an amendment) is not required to give effect if the Contract Amendment only covers either:

3.4.1 extension of the term of the Contract within the maximum aggregate term; or

3.4.2 modifications of a clerical nature that have no effect on terms, conditions, price, scope, or other material aspect of the Contract.

In every case other than those listed in 3.4.1 and 3.4.2 above, both parties’ signatures (or “approval” in the State’s eProcurement System in the case of an Amendment) are required to give it effect.

3.5 Click-through Terms and Conditions. If either party uses a web-based ordering system, an electronic purchase order system, an electronic order acknowledgement, a form of an electronic acceptance, or any software based ordering system with respect to the Contract (each an “Electronic Ordering System”), the parties acknowledge and agree that an Electronic Ordering System is for ease of administration only, and Contractor is hereby given notice that the persons using Electronic Ordering Systems on behalf of State do not have any actual or apparent authority to create legally binding obligations that vary from the terms and conditions of the Contract. Accordingly, where an authorized State user is required to “click through” or otherwise accept or be made subject to any terms and conditions in using an Electronic Ordering System, any such terms and conditions are deemed void upon presentation. Additionally, where an authorized State user is required to accept or be made subject to any terms and conditions in accessing or employing any Materials or Services, those terms and conditions will also be void.

3.6 Books and Records

3.6.1 Retain Records. In addition to the audit rights detailed in the Uniform Terms and Conditions, State also requires that, pursuant to A.R.S. § 41-2548(B), and performance of the Contract, Contractor shall retain and shall contractually require each Subcontractor to retain books and records relating to any cost and pricing data submitted in satisfaction of § 41-2543 for the period specified in the statute.

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Arizona Department of Administration

State Procurement Office Contract No.: CTR079021

Strategic Management Consulting Services McKinsey & Company

3.6.2 Usage Information. Additionally, any and all information (including, but not limited to, documentation or Data) related to Eligible Agency and Co-Op Buyer usage retained solely within the Contractor’s system (for example, related to punch-out or Contractor catalog sales) shall be considered public information or information that can be shared with and distributed by the State freely and for any purpose under the State’s government purpose rights detailed in Section 3 of the Uniform Terms and Conditions [Ownership of Intellectual Property]. Any modifications to this Contract notwithstanding, the State shall have free use of any and all information related to Eligible Agency or Co-Op Buyer purchasing. Upon request by the State, Contractor shall promptly provide the State with any usage information requested and shall not attempt to limit the State's use in any way.

3.6.3 Right To Audit. The retained books and records are subject to audit by State during that period. Pursuant to A.R.S. § 41-2548(B), Contractor shall retain and shall contractually require each Subcontractor to retain books and records relating to performance under the Contract for the period specified in the statute and those retained books and records are subject to audit by State during that period.

3.6.4 Auditing. Contractor or Subcontractor shall either make all such books and records under subparagraphs 3.6.1 and 3.6.2 available to State at all reasonable times or produce the records at a designated State office on State’s demand, the choice of which being at State’s discretion. For the purpose of this paragraph, “reasonable times” are during normal business hours and in such a manner so as to not unreasonably interfere with normal business activities.

3.7 Subcontract

3.7.1 Initial list. At the time of Contract execution, Contractor’s candidate Subcontractors were identified in Attachment Proposed Subcontractors [Proposed Subcontractors].

Agreeing to them being included signified Procurement Officer’s advance consent for Contractor to enter into a Subcontract with each candidate, which Contractor shall do as promptly as necessary to ensure its ability to carry out the Work in a timely manner.

3.7.2 Additional names. Contractor shall not enter into a Subcontract to perform Work under the Contract, without first obtaining Procurement Officer’s written consent with any prospective Subcontractor that (a) was not listed on the Attachment Proposed Subcontractors at time of Contract execution or (b) is for any Materials or

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Services categories other than the ones for which they were previously consented.

For either case (a) or (b), Contractor shall submit a written request sufficiently in advance of the need date for those materials or services so that performance under the Contract is not impaired. Procurement Officer may request any additional information he or she determines is necessary to assess the submittal, and may withhold consent pending it. Approval of additional subcontractors shall be added to the Contract by a bilateral Contract Amendment.

3.7.3 Flow-down. Contractor shall incorporate the provisions, terms, and conditions of the Contract into every Subcontract by inclusion or by reference, as appropriate.

When making any post-execution consent requests, Contractor shall include its warrant that it will do the same for the pending Subcontracts covered by the request. Entering into Subcontracts will not relieve Contractor of any of its obligations or duties under the Contract, including, among other things, the duty to supervise and coordinate the work of Subcontractors. Nothing contained in any Subcontract will create or is to be construed as creating any contractual relationship between State and the Subcontractor.

3.8 Orders

3.8.1 Order Sufficiency. The Contract was awarded in accordance with the Arizona Procurement Code; the transactions and procedures required by the Arizona Procurement Code for competitive source selection have been met. An Order issued that cites the correct State contract number will suffice to authorize the Contractor to provide the Materials and perform the Services covered by that Order.

3.8.2 Order Terms. All Orders are subject to the Contract Terms and Conditions; an Order cannot modify the Contract Terms and Conditions. Any Contractor terms added to quotes or otherwise unilaterally added to Eligible Agency or Co-Op Buyer Orders are null and void.

3.8.3 Orders. Until the expiration or earlier termination of the Contract, State may issue and Contractor may accept Orders that make proper reference to the Contract and are permissible hereunder, provided that, Contractor is not obliged to accept any Order that is not consistent with the then-current pricing, lead times, scope specifications, compliance or payment provisions of the Contract. Contractor shall fulfill and complete any Orders that are begun but not yet completed as of

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Arizona Department of Administration expiration or earlier termination of the Contract unless State instructs otherwise at the time.

3.8.4 No Minimums or Commitments. (a) Contractor shall not impose any minimum dollar amount, item count, services volume, or services duration on Orders; (b) State makes no commitment of any kind concerning the quantity or monetary value of activity actually initiated or completed during the term of the Contract; (c) Contractor shall only deliver or perform as authorized by Orders; and (d) State is not limited as to the number of Orders it may issue for the Contract. For clarity of intent, the foregoing applies equally whether an Eligible Agency issues the Order or, if applicable, a Co-Op Buyer issues it.

3.8.5 Non-contracted Materials or Services. Any attempt to knowingly represent for sales, marketing, or related purposes that Materials or Services not specifically awarded are under a State contract is a violation of the Contract and law.

3.9 Order Cancellations. State may cancel Orders within a reasonable period after issuance and at its discretion. The same method used for ordering will be used for cancellation.

3.9.1 If State cancels an Order, then State shall:

3.9.1.1 pay Contractor for any portion of the Materials and Services from that Order that have been properly delivered or performed as of the cancellation effective date; and

3.9.1.2 reimburse Contractor for work completed, pricing incurred in fulfilling the Order up to the cancellation effective date and the cost of any obligations incurred in fulfilling the Order up to the cancellation effective date that demonstrably cannot be canceled or that have pre-established cancellation penalties specified in the relevant Subcontracts, to the extent the penalties are reasonable and customary for the work in question.

3.9.2 Contractor shall not charge or be entitled to charge State for any new costs it incurs after receiving the cancellation notice; State is not liable for any Materials that were produced, shipped, or delivered, or Services that were performed before Contractor had acknowledged the corresponding Order.

3.9.3 State shall also be able to cancel Orders freely and without any further obligation at any time prior to Contractor’s formal acknowledgement of the Order.

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3.10 The Contract is a mandatory statewide contract (per A.A.C. R2-7-607) for multiple purchases, projects, or assignments, and a cooperative contract (per A.R.S. § 41-2632 and A.A.C. R2-7-1002(B)) that can be purchased against by some or all Eligible Agencies and any Co‑Op Buyers that elect to participate. Even if only one Eligible Agency needs or elects to purchase against the Contract, it is to be construed as being a cooperative contract hereunder.

3.10.1 Contractor shall verify if an ordering entity is a current Co-Op Buyer before selling Materials to or providing Services for them under the Contract. The current list of Co‑Op Buyers is available on the State Procurement Office website:

https://spo.az.gov/suppliers/usage-reporting

3.10.2 Contractor shall sell to Co-Op Buyers at the same price and on the same lead times and other terms and conditions under which it sells to Eligible Agencies, with the sole exception of any legitimately additional costs for extraordinary shipping or delivery requirements if the Co-Op Buyer is having Materials delivered or installed or Services performed at locations not contemplated in the contracted pricing (e.g.

delivery to a location outside Arizona).

3.10.3 Contractor shall pay State an administrative fee against all Contract sales to Co‑Op Buyers, as provided for under A.R.S. § 41‑2633. Rates are set in accordance with SPO Technical Bulletin (TB) 007, available on the SPO website, which may be revised at the State’s sole discretion as part of Arizona state procurement policy.

For convenience (though note that this link may change over time) TB 007 may be found here:

https://spo.az.gov/suppliers/usage-reporting.

Failure to remit the administrative fees is a material breach of contract, and will entitle the State to its remedies under Contract Terms and Conditions Section 8 and its right to terminate for default under Section 9. Method of calculation, payment procedures, and other details are provided on the State Procurement Office website:

https://spo.az.gov/suppliers/usage-reporting

3.10.4 Contractor shall submit to State a quarterly usage report documenting all Contract sales to both Eligible Agencies and Co‑Op Buyers, itemized separately. Contractor shall further itemize divisions, groups or areas within a given Eligible Agency if they place Orders independently of each other. Failure to submit the report is a material

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Arizona Department of Administration breach of contract, and will entitle the State to its remedies under Contract Terms and Conditions Section 8 and its right to terminate for default under Section 9.

Contractor shall submit the report using the forms and following the instructions on the State Procurement Office website:

https://spo.az.gov/suppliers/usage-reporting.

3.10.5 Contractor shall acknowledge each Order from Eligible Agencies within one (1) business day after receipt by either: (a) “approving” the Order electronically in the State’s eProcurement System, which will indicate Contractor’s unqualified acceptance of the Order as‑issued; or (b) “rejecting” the Order electronically in the State’s eProcurement System, with a concurrent explanation by email to relevant originator as to the reason for rejecting it. By way of reminder, the only grounds on which the Contractor may reject or refuse an Order are those set out in subparagraph 3.8.3 [Orders]. Unless and until Contractor has approved the Order in the State’s eProcurement System, it will have no effect under the Contract and will not oblige either State or Contractor. If the relevant Eligible Agency explicitly instructs at the time that a verbal acceptance is sufficient because of urgency or other unusual circumstances and Contractor duly gives its verbal acceptance, then Contractor will be deemed to have accepted the Order immediately upon commencing performance, provided that, Contractor must follow-up its verbal acceptance by accepting the Purchase Order electronically in the State’s eProcurement System within three (3) business days. Contractor shall thereafter be barred from subsequently rejecting the Order in the State’s eProcurement System and if it does so the rejection will be void.

3.10.6 Contractor shall acknowledge each Order from Co‑Op Buyers in conformance with each Co-Op Buyer’s instructions given at the time of ordering or in any supplemental participating agreement Contractor might have with them. Orders from Co‑Op Buyers create no obligation on State’s part, since they are entirely between the Co-Op Buyer and Contractor. That notwithstanding, Contractor’s obligation under the Contract is to service Co-Op Buyers commercially as though they were with an Eligible Agency, and Contractor’s refusal to do so would be a material breach of the Contract.

3.11 Multiple-Use Provisions. Eligible Agencies may issue Orders for Services in several forms, all of which become final and effective by a Purchase Order in the State’s eProcurement System. Orders issued by Co-Op Buyers will be in whatever form the Co-Op Buyer

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Arizona Department of Administration normally uses. Regardless of origin, Orders must cite the State contract number to be valid. State may, at its discretion in each instance, determine the scope, schedule, and price for each Order in any of the following ways:

3.11.1 By choosing some or all of the Materials or Services items covered by the Contract for which a price is established in the Contract, then preparing an Order using those prices (e.g. filling out an order form), and sending it to the Contractor;

3.11.2 By instructing Contractor to provide a comprehensive proposal of item quantities, combinations, etc., or services hours, personnel, etc., for a defined scope using those established prices as a basis, then validating and negotiating the proposal with Contractor and issuing an Order if and when reaching agreement;

3.11.3 As described in 3.11.2 above but requesting the proposal from both Contractor and other vendors who are contracted within the applicable scope categories and locations, either sequentially or concurrently, then selecting the proposal or proposals combination that is most advantageous to State; or

3.11.4 As described in 3.11.3 above but introducing ad-hoc commercial competition by making the selection and ordering conditional on obtaining more favorable prices than the contractually-established ones.

3.12 Work on State Premises

3.12.1 Compliance With Rules. Contractor is responsible for ensuring that its personnel comply with State’s rules, regulations, policies, documented practices, and documented operating procedures while delivering or installing Materials or performing Services on State’s grounds or in its facilities. For clarity of intent, the foregoing means that if Contractor is required to comply with certain security requirements in order to deliver, install, or perform at that particular location, then it shall do so nonetheless and without entitlement to any additional compensation or additional time for performance if those particular requirements are not expressly stated in the Contract. Contractor is reminded that violation of the prohibition under A.R.S. § 13-1502 against possession of weapons on State’s property by anyone for whom Contractor is responsible is a material breach of contract and grounds for termination for default.

3.12.2 Protection Of Grounds And Facilities. Contractor shall deliver or install the Materials and perform the Services without damaging any State grounds or facilities. Contractor shall repair or replace any damage it does cause promptly and

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Arizona Department of Administration at its own expense, subject to whatever instructions and restrictions State needs to make to prevent inconvenience or disruption of operations. If Contractor fails to make the necessary repairs or replacements in a timely manner, State will be entitled to exercise its remedies under paragraph 8.5 of the Uniform Terms and Conditions [Right of Offset].

3.13 Transitions

3.13.1 During commencement, Contractor shall attend transition meetings with any outgoing suppliers to coordinate and ease the transition so that the impact on State’s operations is kept to a minimum. State may elect to have outgoing suppliers complete some or all of their Work or Orders in progress, even if that Work could be covered under the incoming supplier’s Contract. Conversely, the State may have a continued need for the same Materials and Services upon expiration or earlier termination of the Contract. Accordingly, Contractor shall work closely with any incoming supplier and State to ensure as smooth and complete a transition transfer as is practicable.

3.13.2 Eligible Agency or Co-Op Buyer’s representative will coordinate all transition activities and facilitate joint development of a comprehensive transition plan by both Contractor and the incoming supplier. As with the incoming transition, State may permit Contractor, when Contractor is outgoing, to complete work or orders in progress to ease the transition as is safest and most efficient in each instance.

3.13.3 RESERVED [for additional transition needs including, but not limited to, the transfer of any required data]

4.0 Costs and Payments

4.1 Type of Pricing. Contractor shall include only firm, fixed pricing in the Contract.

4.2 Contractor’s Best Pricing. Contractor warrants that, for the term of the Contract, the prices and discounts set out in the Contract, shall be equal to or better than the Contractor’s corresponding pricing within OMNIA Contract #14-14 Strategic Management Consulting Services.

4.3 Pricing is all-inclusive, including any ancillary fees and costs required to accomplish the Scope of Work and all aspects of Contractor’s offer as agreed to in the Master Agreement and modified by this Participating Addendum.

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4.3.1 Details of service not explicitly stated in the Scope of Work or in Contractor’s Offer, but necessarily a part of, are deemed to be understood by Contractor and included herein. All administrative, reporting, or other requirements, all overhead costs and profit and any other costs toward the accomplishment of the requirements in the Contract are included in the pricing provided.

4.3.2 Additional Charges.