Foley_Response.pdf

REQUEST FOR

BEST AND FINAL OFFER ARIZONA STATE

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page of

4873-1012-6893.3

August 2, 2022

Pursuant to A.A.C. R2-7-C315, the Arizona State Retirement System (ASRS) hereby requests a Best and Final Offer from your company. This represents an opportunity to officially amend your original Offer with changes that would make the Offer more competitive.

1. Using Attachment A: Offer and Acceptance included in this document, indicate which services you are offering, sign and resubmit.

2. Using Attachment B: Exceptions included in this document, indicate the negotiated exceptions that will replace the language in the original Solicitation documents. ASRS requests Offeror submit only those exceptions that ASRS has indicated it can agree to consider as part of negotiation discussions.

Submissions of exceptions not agreed upon during negotiation discussions may impact evaluation of the Offer.

3. Using Attachment C: Pricing Schedule included in this document, present your company’s best and final pricing for any and all items.

4. As a follow up to the ASRS Determination on Confidential Information, when uploading your Offer documents ensure the confidential box is checked for any documents that were determined to be confidential; ensure that the confidential box is not checked for any documents that were determined not to be confidential.

5. In APP, on the Items (F) tab, a Unit price of $1.00 must be entered and saved.

6. If you wish to make any revisions to your original Offer, include the changes in your response to this request. In order to make any such changes, in the Suppliers Documents section, remove the original attachment(s) that require changes, and then add the new, revised attachment.

Your response to this request will supersede any previous Offers or discussions. If you do not respond to an item, your original Offer will be considered your final Offer.

All Offerors must select one of the following:

Offeror is not submitting any revisions. Offeror understands that the original response will be considered the final Offer.

Offeror is submitting the following revised attachment(s), in its entirety, with this form as part of the Best and Final Offer. (List all documents, identifying the revised sections, below)

Attachment B: Exceptions Attachment C: Pricing Schedule

FOLEY & LARDNER LLP

Company Name Signature of Person Authorized to Sign

August 5, 2022 Thomas A. Hickey III Date Printed Name

REQUEST FOR

BEST AND FINAL OFFER ARIZONA STATE

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page

This document must be completed and submitted, along with any other Best and Final Offer documents, in APP.

In order to ensure your Best and Final Offer will be considered, it must be submitted in the APP system no later than 12:00 P.M. (MST), August 5, 2022 unless otherwise subsequently communicated by ASRS in the APP Discussion Forum. After a final Offer is received, it is extremely difficult to change it; therefore, if you need clarification on any item, please do not hesitate to send a message through the APP Discussions with Buyer tab before submitting the Offer.

**IMPORTANT NOTES AND REMINDERS REGARDING SUBMISSION IN APP

All Attachments should be uploaded in the APP system via the Your Offer Infos & Docs tab by going to the Supplier Documents section and selecting “Add Document”. Always select document type “Supplier Technical Document.”

Items that are not confidential should be uploaded and the “Confidential” box should not be checked.

On the Items (F) tab, a Unit price of $1.00 must be entered and saved.

Online tutorials and quick reference guides for using APP are accessible from the APP website at https://spo.az.gov/suppliers/app-support/quick-reference-guides , including links to “Submitting a Best and Final Offer”. For technical questions regarding the system, the APP helpdesk staff is available to assist by telephone at 602-542-7600 or by email at app@azdoa.gov. Due to a fluctuating volume of calls and emails, allow at least 24 hours to receive a response.

https://spo.az.gov/suppliers/app-support/quick-reference-guides

BEST AND FINAL OFFER

ATTACHMENT A: Offer and Acceptance ARIZONA STATE

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page

CERTIFICATION: By signature in the section above, the Offeror certifies it:

1. Will not discriminate against any employee or applicant for employment in violation of Federal Executive Order 11246, [Arizona] State Executive Order 2009-9 or A.R.S. §§ 41−1461 through 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 submitted Offer. Failure to provide a valid signature affirming the stipulations required by this clause shall result in rejection of the Offer. Signing the Offer with a false statement shall void the Offer, any resulting contract and may be subject to legal remedies provided by law.

3. Is not debarred by, or otherwise prohibited from participating in any publically-funded contract awarded by any Federal, State or local jurisdiction.

4. Is lawfully authorized to conduct business in Arizona or has no impediments to conduct business in Arizona.

5. Does not participate in, and agrees not to participate in during the term of the Contract, a boycott of goods or services from the state of Israel in accordance with A.R.S. §35-393 and §35-393.01. This certification does not include boycotts prohibited by 50 United States Code Section 4842 or a regulation issued pursuant to that section in accordance with A.R.S. §35-393.03.

TO THE ARIZONA STATE RETIREMENT SYSTEM (ASRS): The Undersigned hereby offers and agrees to provide investment legal consulting services in compliance with the Scope of Work, Special and Uniform Terms and Conditions, Instructions to Offerors, Attachments (Response Forms), Solicitation or Contract Amendments, and Offeror’s Best and Final Offer as accepted by ASRS, as part of the Solicitation.

The Offer and Acceptance form within the Solicitation shall be submitted with the Offer in the State’s eProcurement system and shall include a signature by a person authorized to sign the Offer. The signature shall signify the Offeror’s intent to be bound by the Offer and the terms of the Solicitation and that the information provided is true, accurate and complete. Failure to submit verifiable evidence of an intent to be bound, such as a signature, shall result in rejection of the Offer.

FOLEY & LARDNER LLP

Company Name Signature of Person Authorized to Sign Offer

111 Huntington Avenue

Thomas A. Hickey III, Partner

Address Printed Name and Title

Boston MA 02199

Thomas A. Hickey III, Partner

City State Zip Contact Name and Title

39-0473800

617.342.4097 tahickey@foley.com

Federal tax identifier (EIN or SSN) Contact Phone and Email Address

ATTACHMENT A: Offer and Acceptance ARIZONA STATE

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page

ACCEPTANCE OF OFFER BY ASRS: The Offer is hereby accepted. The Offeror is now bound (as Contractor) to carry out the Work outlined in the Contract and based upon the Solicitation.

Contract No. ________________________________________________________________________

The effective date of the Contract is ____________________________________________________

Awarded this _______ day of __________ 20 ______________

ASRS Signature

ASRS Name

ASRS Title

Note: The Contractor is cautioned not to commence any billable work or to provide any service under this Contract until Contractor receives a purchase order, contract release document or written notice to proceed.

ATTACHMENT B: Exceptions ARIZONA STATE

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page

Indicate below any exceptions taken to the requirements or terms contained in this Solicitation. Provide both an explanation for the exception and Offeror’s recommended alternative language.

Certain exceptions may have a negative impact on the evaluation of the Offeror’s proposal. As indicated in the Instructions to Offerors, Section 6.4 (Consideration of Exceptions) “. . . if an Offer is conditioned on exceptions to the Scope of Work and Terms and Conditions, the Offer may be determined to be not susceptible for award and rejected . . .”

Please indicate as appropriate:

☐ TAKES NO EXCEPTIONS

☒ TAKES EXCEPTIONS TO THE FOLLOWING:

Identify the section of the Scope of Work or the Special or Uniform Terms and Conditions of the Solicitation, and any Attachments. Identify the clause name and number (where applicable), provide the reason for the exception, and propose requested alternative language by restating and redlining the clause. Copy and paste a new row for each new exception.

Section /

Paragraph or Exhibit Reference

Solicitation Language (Copy and Paste from Solicitation) Proposed Changes / Alternate Language

2A, Section 1.3 1.3 Services rendered under this Contract shall comply with the ASRS Strategic Plan, the ASRS Board Governance Policy Handbook, SIP006, Strategic Asset Allocation Policy (SAAP) and the ASRS Investment Policy Statement.

Services rendered under this Contract shall comply with the ASRS Strategic Plan, the ASRS Board Governance Policy Handbook, SIP006, Strategic Asset Allocation Policy (SAAP) and the ASRS Investment Policy Statement, to the extent applicable to Contractor.

Explanation: Given the general nature of these documents, we suggest adding the clarifying language above.

2B, Section 1.3 Definition of Terms

1.3 “Subcontractor” has the meaning given in A.R.S. § 41-2503(38), which, for convenience of reference only, is “… a person who contracts to perform work or render service to … [C]ontractor or to another [S]ubcontractor as a part of a contract with a state governmental unit. . . .” The Contract is to be construed as “a contract with a state governmental unit” for purposes of the definition. For clarity of intent, a person carrying out any element of the Work is a Subcontractor from the moment they first carry out that element of the Work regardless of whether or not a Subcontract exists then or subsequently.

“Subcontractor” has the meaning given in A.R.S. § 41- 2503(38), which, for convenience of reference only, is “… a person who contracts to perform work or render service to … [C]ontractor or to another [S]ubcontractor as a part of a contract with a state governmental unit. . . .” The Contract is to be construed as “a contract with a state governmental unit” for purposes of the definition. For clarity of intent, a person carrying out any element of the Work is a Subcontractor from the moment they first carry out that element of the Work regardless of whether or not a Subcontract exists then or subsequently, but does not include those persons carrying out the routine administration of the Contractor’s business.

Explanation: We need to clarify that the definition of subcontractor is limited to those subcontractors specifically hired to work on ASRS matters, and does not include firm-wide subcontractors used to support the routine business administration of the firm (such as word processing and document management). We also note that while we cannot exclude the possibility, RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page given the nature of the work we do not anticipate using any subcontractors specific to this engagement.

2B, Section 4.1 Pricing and Payments

4.1. Most Favored Client Pricing.

Contractor represents and warrants that its fee structure under this Contract is, and at all times during the term of this Contract and any extension will remain, the equal of or less than any fee structure offered for similar services to any other of its customers. Within thirty (30) days of offering a more advantageous fee structure to any other customer, Contractor shall offer the ASRS for immediate implementation at least the same fee structure

Most Favored Client Pricing. Contractor represents and warrants that with regard to the “most favored customer” pricing provision, as a large, national law firm, Foley has many different clients with various billing arrangements, and as such, it would not be feasible to guarantee any client preferential treatment with regard to pricing. Foley’s “floor rates” are deeply discounted from the normal rates that we charge for our services and we are certainly happy to discuss other alternative fee arrangements that would be mutually beneficial to our longstanding partnership.

Explanation: Foley can represent to ASRS that the discounted rates it is proposing here are significantly lower than its standard rates, but Foley’s numerous client relationships, with varied terms, make it impossible to agree to the proposed language without these alterations.

2B, Section 6.3 Contract Termination

6.3 The ASRS may recover reasonable

excess costs from the Contractor by:

The ASRS may recover reasonable transition costs from the Contractor by:

Explanation: “Excess costs” is undefined, so we propose changing to “reasonable transition costs.”

Section 7.1 7.1 Risk of Loss. Contractor shall bear all risk of loss to Materials while in pre-production, production, storage, transit, staging, assembly, installation, testing, and commissioning, if and as those duties are within the scope of the Work, until they have been accepted as conforming by State in the particular location and situation specified in the Order, or as specified generally elsewhere in the Contract if the Order does not provide particulars, provided that, risk of loss for non-conforming Materials will remain with Contractor notwithstanding acceptance to the extent the loss stems from the nonconformance.

Strike all

Explanation: Does not relate to legal services.

2B, Section 7.2 Indemnification Clause

7.2 To the fullest extent permitted by law, Contractor shall defend, indemnify, and hold harmless the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees (hereinafter referred to as “Indemnitee”) from and against any and all claims, actions, liabilities, damages, losses, or expenses (including court costs, To the fullest extent permitted by law, Contractor shall defend, indemnify, and hold harmless the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employeesASRS (hereinafter referred to as “Indemnitee”) from and against any and all claims, actions, liabilities, damages, losses, or expenses (including court costs, attorneys’ fees, and costs of claim processing, investigation and litigation) (hereinafter referred to as “Claims”) for bodily injury or personal injury (including death), or loss or damage to

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page attorneys’ fees, and costs of claim processing, investigation and litigation) (hereinafter referred to as “Claims”) for bodily injury or personal injury (including death), or loss or damage to tangible or intangible property caused, or alleged to be caused, in whole or in part, by the negligent or willful acts or omissions of Contractor or any of its owners, officers, directors, agents, employees or subcontractors. This indemnity includes any claim or amount arising out of, or recovered under, the Workers’ Compensation Law or arising out of the failure of such Contractor to conform to any federal, state, or local law, statute, ordinance, rule, regulation, or court decree.

It is the specific intention of the parties that the Indemnitee shall, in all instances, except for Claims arising solely from the negligent or willful acts or omissions of the Indemnitee, be indemnified by Contractor from and against any and all claims. It is agreed that Contractor will be responsible for primary loss investigation, defense, and judgment costs where this indemnification is applicable. In consideration of the award of this contract, the Contractor agrees to waive all rights of subrogation against the State of Arizona, its officers, officials, agents, and employees for losses arising from the work performed by the Contractor for the State of Arizona. This indemnity shall not apply if the contractor or sub-contractor(s) is/are an agency, board, commission or university of the State of Arizona.

tangible or intangible property caused, or alleged to be caused, in whole or in part, by the negligent or willful acts or omissions of Contractor or any of its owners, officers, directors, agents, employees or subcontractors (hereinafter referred to as “Claims”).

This indemnity includes any cClaim or amount arising out of, or recovered under, the Workers’ Compensation Law or arising out of the failure of such Contractor to conform to any federal, state, or local law, statute, ordinance, rule, regulation, or court decree. It is the specific intention of the parties that the Indemnitee shall, in all instances, except for Claims arising solely from the negligent or willful acts or omissions of the Indemnitee, be indemnified by Contractor from and against any and all cClaims. It is agreed that Contractor will be responsible for primary loss investigation, defense, and judgment costs where this indemnification is applicable. In consideration of the award of this contract, the Contractor agrees to waive all rights of subrogation against the State of Arizona, its officers, officials, agents, and employees for losses arising from the work performed by the Contractor for the State of Arizona. This indemnity shall not apply if the contractor or sub-contractor(s) is/are an agency, board, commission or university of the State of Arizona.

Explanation: The first edit shown here, narrowing the definition of indemnitees, has been discussed and agreed to by ASRS. The second set of edits, moving the parenthetical defining “Claims” to a different location without altering it and consistently using the capitalized defined term “Claims”, was requested by Foley’s general counsel to avoid any ambiguity about the claims covered by the indemnity provision. We consider this to be a clarifying change.

2B, Section 7.5.1 Additional Insurance Requirements

7.5.1. The Contractor's policies, as

applicable, shall stipulate that the insurance afforded the Contractor shall be primary and that any insurance carried by the ASRS, its agents, officials, employees or the State of Arizona shall be excess and not contributory insurance, as provided by A.R.S. § 41-621 (E).

Except with respect to Professional Liability Insurance, the Contractor's policies, as applicable, shall stipulate that the insurance afforded the Contractor shall be primary and that any insurance carried by the ASRS, its agents, officials, employees or the State of Arizona shall be excess and not contributory insurance, as provided by A.R.S. § 41-621 (E).

Explanation: Foley’s professional liability insurance does not provide such primary, excess, and non-contributory terms, nor will our insurer agree to endorse the policy to include them.

2B, Section 7.7 Acceptability of Insurers

7.7 Contractor’s insurance shall be placed

with companies licensed in the State of Arizona or hold approved non- admitted status on the Arizona Department of

Contractor’s insurance shall be placed with companies licensed in the State of Arizona or hold approved non-admitted status on the Arizona Department of Insurance List of Qualified

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page

Insurance List of Qualified Unauthorized Insurers. Insurers shall have an “A.M. Best” rating of not less than A- VII. The ASRS in no way warrants that the above-required minimum insurer rating is sufficient to protect the Contractor from potential insurer insolvency.

Unauthorized Insurers. Insurers shall have an “A.M.

Best” rating of not less than A- VII or a Fitch rating of not less than A. The ASRS in no way warrants that the above-required minimum insurer rating is sufficient to protect the Contractor from potential insurer insolvency.

Explanation: Our professional liability insurer is not rated by A.M. Best, but instead is Fitch rated.

2B, Section 7.10 Approval and Modifications

7.10. Approval and Modifications

The ASRS, in consultation with ADOA-Risk Management Division, reserves the right to review or make modifications to the insurance limits, required coverages, or endorsements throughout the life of this contract, as deemed necessary. Such action will not require a formal Contract amendment but may be made by administrative action.

7.10. Approval and Modifications

The ASRS, in consultation with ADOA-Risk Management Division, reserves the right to review or make modifications to the insurance limits, required coverages, or endorsements throughout the life of this contract, as mutually agreed by ASRS and Contractor.

Explanation: Foley cannot agree in advance to unilateral changes to Contract terms by ASRS, as Foley may not be able to comply with them. Rather, Foley welcomes a discussion with ASRS should it seek to alter its insurance terms.

2B, Section 8.2.2.1 Definitions

8.2.2.1 Attempts (either failed or

successful) to gain unauthorized access to a system or it’s data/information;

Attempts to gain unauthorized access to a system or it’s data/information;

Explanation: Our security and technology teams employ an array of monitoring and alerting capabilities that look for and act on potentially malicious or anomalous activity with respect to our network, data, and other technology infrastructure. It is not uncommon for these tools to generate alerts and other reports that require further triage, analysis, investigation, and possible remediation. In most cases, we are able to determine that an alert like this is not tied to an actual risk or compromise. We treat every alert as a suspected event and conduct our response and investigative activities accordingly.

We want to ensure that all notifications we provide to ARS are contextually appropriate, relevant, actionable, and reflect sound analysis that a risk does indeed exist. We want to avoid over-saturating Exelon with alerts and reports that have not yet been analyzed and confirmed to be impactful to Exelon and/or its data.

Therefore, we maintain that it is most effective for all involved to define notification requirements in a way that ensures that timely, accurate, and actionable notifications are provided in a way that eliminates – to the extent possible – alerts that create “noise” and false positive

2B, 8.3.3.1 Contractor’s Obligation Regarding Information Security and Data Privacy

8.3.3.1 Contractor shall abide by and

secure data related to the performance of this Contract in a manner substantially similar to the State of Arizona’s policy or its corresponding standards for data classification (https://aset.az.gov/resources/psp).

Contractor shall abide by and secure data related to the performance of this Contract in a manner consistent with the ISO27001 framework for managing information systems and industry-accepted security practices.

Explanation: Counsel will implement reasonable technical, administrative, and physical safeguards consistent with industry accepted security practices, RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page such as ISO/IEC 27001, to ensure the security and confidentiality of all Client data for which Counsel becomes a holder as part of performing services under this Agreement, and will comply with all applicable state and federal data privacy laws and requirements.

2B, 8.3.3 Contractor’s Obligation Regarding Information Security and Data Privacy

8.3.3 The ASRS shall have the right to

assess, inspect, review, monitor and validate compliance with information and data requirements of the Contract. The ASRS’s right to inspect shall apply to all physical locations where performance of this Contract occurs, to personnel performing work authorized by this Contract, to any records (as defined by A.R.S. §41-151.18) or devices used in performance of this Contract, and to documented policies and procedures, including but not limited to information security and privacy controls. The right to inspect shall apply to all subcontractors or other agents who perform under the Contract.

The ASRS shall have the right to remotely review \and validate compliance with information and data requirements of the Contract. The ASRS’s right to inspect shall apply to remote review of documented policies and procedures, including but not limited to information security and privacy controls. In the event that ASRS requests a physical visit to Contractor’s facilities for purposes of this paragraph, Contractor will consider such request in good faith and consistent with its obligations to its clients generally and its own security needs.

Explanation: Counsel will implement reasonable technical, administrative, and physical safeguards consistent with industry accepted security practices, such as ISO/IEC 27001, to ensure the security and confidentiality of all Client data for which Counsel becomes a holder as part of performing services under this Agreement, and will comply with all applicable state and federal data privacy laws and requirements. While we are willing to work with ASRS in the event a valid need for physical inspection were to arise, there are some forms of access that would not be reasonable, and/or that would be legally or ethically prohibited.

2B, 8.4 Information Security and Data Privacy Incident Reporting

8.4 To comply with 8.3, unless authorized

by law or in writing by the ASRS, Contractor shall report any unauthorized use or disclose of CI or Sensitive Data.

Contractor shall make the report to the ASRS’s Privacy or Information Security Officer within 24 hours after the Contractor learns of the unauthorized access, use or disclosure. In its report, the Contractor shall, at a minimum:

To comply with 8.3, unless authorized by law or in writing by the ASRS, Contractor shall report any unauthorized use or disclose of CI or Sensitive Data.

Contractor shall make the report to the ASRS’s Privacy or Information Security Officer promptly, not to exceed 48 hours after the Contractor learns of the unauthorized access, use or disclosure. In its report, the Contractor shall, at a minimum:

Explanation: Prior to notification, the firm must determine the impact, nature, and scope of the incident. In order to ensure that we are providing the most accurate and targeted information possible, we prefer 48 hours to gather this information and formulate a notification.

2B, Section 8.5.2 Unauthorized Access Mitigation

8.5.2 Mitigation will include the Contractor’s

cooperation with the ASRS to investigate the unauthorized access, use or disclosure, identify the individuals and their contact information for purposes of breach notification and other collaboration as may be reasonably requested to notify, respond to inquiries and remediate the risk associated with the unauthorized access, including credit protection or other

Mitigation will include the Contractor’s cooperation with the ASRS to investigate the unauthorized access, use or disclosure, identify the individuals and their contact information for purposes of breach notification and other collaboration as may be reasonably requested to notify, respond to inquiries and remediate the risk associated with the unauthorized access, including credit protection or other information theft prevention services. Upon mutual agreement of the parties, the Contractor may pay for or reimburse the

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page information theft prevention services. The ASRS at its sole discretion may require the Contractor to pay for or reimburse the ASRS for expenses and costs associated with unauthorized access and risk mitigation.

ASRS for expenses and costs associated with unauthorized access and risk mitigation.

Explanation: Normal contract law regarding damages should apply.

2B, 8.6.1 Secure Facilities

8.6.1 The Contractor’s work area(s) shall

provide for a secure locked location where uncompleted work shall be stored. This area shall be secure enough whereby access by unauthorized personnel shall be restricted or eliminated. The ASRS reserves the right to visit the Contractors to confirm security, throughout the term of the Contract.

The Contractor’s work area(s) shall provide for a secure locked location where uncompleted work shall be stored. This area shall be secure enough whereby access by unauthorized personnel shall be restricted or eliminated. The ASRS reserves the right to visit the Contractor's facilities, on reasonable terms consistent with Contractor's obligations to its clients and general need for security.

Explanation: We have modified this language to remain practicable and to permit Foley to meet its obligations to other clients.

2B, 8.6.3 Secure Facilities

8.6.3 Contractor must provide the ASRS

with an information safeguard management plan for its primary sites and work that will be performed by employees, agents or subcontractors at locations other than the primary site including but not limited to personal residences and other remote locations. The ASRS must be notified in writing of any changes in operations or this plan. The ASRS reserves the right to approve and monitor the information safeguard plan. The Contractor, its subcontractors and agents shall maintain a complete, current and accurate log identifying the location of each person completing work for the ASRS that requires access, use or disclosure of confidential or sensitive information.

Contractor must make available to the ASRS a summary of the information safeguard management plan for its primary sites and work that will be performed by employees, agents or subcontractors at locations other than the primary site including but not limited to personal residences and other remote locations. The ASRS must be notified in writing of any changes in operations or this plan. The Contractor, its subcontractors and agents shall maintain a complete, current and accurate log identifying the location of each person completing work for the ASRS that requires access, use or disclosure of confidential or sensitive information.

Explanation: Foley can agree to cooperate with ASRS to reasonably discuss this information, but cannot agree to allow ASRS to approve Foley's policies, which apply firmwide. While we cannot provide the full document on a routine basis, Foley can allow ASRS to view relevant portions on an interactive platform.

2B, 8.8.2 Personnel Security and Background Checks

8.8.2 Notwithstanding any additional

security requirements in the Scope of Work, as deemed necessary by the ASRS, Contractor’s personnel or subcontractors with access to confidential information or sensitive data and/or infrastructure may be subject to background checks at the Contractor’s expense, including but not limited to fingerprint criminal background clearance prior to beginning performance of the Contract and periodically thereafter as may be required by the ASRS to comply with law or agency policy, standard or procedure.

Notwithstanding any additional security requirements in the Scope of Work, as deemed necessary by the ASRS, Contractor’s personnel or subcontractors with access to confidential information or sensitive data and/or infrastructure may be subject to background checks at the Contractor’s expense, including but not limited to criminal background clearance prior to beginning performance of the Contract and periodically thereafter as may be required by the ASRS to comply with law or agency policy, standard or procedure.

Explanation: This is not included in our current background check process.

2B, 8.11 8.11 Contractor shall require all tiers of subcontractors or agents who perform work

Contractor shall require all tiers of subcontractors or agents who perform work under this Contract to abide

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page

Subcontracts and Agents under this Contract to provide a written and signed assurance to abide by and comply with the information security and data privacy provisions of this Contract.

by industry-accepted information security and privacy best practices.

Explanation: Foley cannot agree in advance to this provision because we cannot anticipate what a subcontractor would agree to. Note: we do not anticipate needing subcontractors to fulfill this contact.

2C, 1.13 Definition of Terms

1.13 “Subcontract” means any Contract, express or implied, between the Contractor and another party or between a subcontractor and another party delegating or assigning, in whole or in part, the making or furnishing of any material or any service required for the performance of the Contract.

“Subcontract” means any Contract, express or implied, between the Contractor and another party or between a subcontractor and another party delegating or assigning, in whole or in part, the making or furnishing of any material or any service required for the performance of the Contract, except for those contracts necessary for the routine administration of the Contractor’s business.

Explanation: This makes clear the exclusion of subcontracts with firm-wide vendors necessary to support the centralized business of the firm.

2C, 3.4 Facilities Inspection and Materials Testing

3.4 Facilities Inspection and Materials

Testing. The Contractor agrees to permit access to its facilities, subcontractor facilities and the Contractor’s processes or services, at reasonable times for inspection of the facilities or materials covered under this Contract. The State shall also have the right to test, at its own cost, the materials to be supplied under this Contract. Neither inspection of the Contractor’s facilities nor materials testing shall constitute final acceptance of the materials or services. If the State determines non-compliance of the materials, the Contractor shall be responsible for the payment of all costs incurred by the State for testing and inspection.

Strike all.

Explanation: Does not relate to legal services.

2C, Section 3.7 Property of the State

3.7 Any materials, including reports, computer programs and other deliverables, created under this Contract are the sole property of the State. The Contractor is not entitled to a patent or copyright on those materials and may not transfer the patent or copyright to anyone else. The Contractor shall not use or release these materials without the prior written consent of the State.

Any materials, including reports, computer programs and other deliverables, created under this Contract, other than internal Contractor communications, are the sole property of the State. The Contractor is not entitled to a patent or copyright on those materials and may not transfer the patent or copyright to anyone else. The Contractor shall not use or release these materials without the prior written consent of the State.

Explanation: Certain internal Contractor communications, such as internal accounting communications or communications with the Firm’s in-house counsel, are excepted from this section.

2C, Section 3.9 Federal Immigration and Nationality Act

3.9 Federal Immigration and Nationality

Act. The Contractor shall comply with all federal, state and local immigration laws and regulations relating to the immigration status of their employees during the term of the Contract. Further, the Contractor shall flow down this requirement to all

Federal Immigration and Nationality Act. The Contractor shall comply with all federal, Arizona state, and Arizona local immigration laws and regulations relating to the immigration status of [its] employees during the term of the Contract. Further, the Contractor shall flow down this requirement to all subcontractors utilized during the term of the Contract. The State shall

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page subcontractors utilized during the term of the Contract. The State shall retain the right to perform random audits of Contractor and subcontractor records or to inspect papers of any employee thereof to ensure compliance. Should the State determine that the Contractor and/or any subcontractors be found noncompliant, the State may pursue all remedies allowed by law, including, but not limited to;

suspension of work, termination of the Contract for default and suspension and/or debarment of the Contractor.

retain the right to perform random audits of Contractor and subcontractor employment records or to inspect papers of any employee who provides services under the contract thereof to ensure compliance. Should the State determine that the Contractor and/or any subcontractors be found noncompliant, the State may pursue all remedies allowed by law, including, but not limited to; suspension of work, termination of the Contract for default and suspension and/or debarment of the Contractor.

Explanation: In § 3.9, the word “its” is substituted for “their” in reference to the Contractor, which is singular in the sentence. As to the other exceptions in §§ 3.9 and 3.10, we understand that these contract provisions are to implement the Legal Arizona Workers Act, and the exceptions align with that Act. Further, in addition to aligning with A.R.S. § 41-4401(B), the reference to “employment records” aligns with the first sentence of § 3.9 focusing on the immigration status of the Contractor’s employees.

2C, Section 3.10 E- Verify Requirements

3.10 E-Verify Requirements. In accordance

with A.R.S. § 41-4401, Contractor warrants compliance with all Federal immigration laws and regulations relating to employees and warrants its compliance with Section A.R.S. § 23-214, Subsection A.

E-Verify Requirements. In accordance with A.R.S. § 41-4401, Contractor warrants compliance with all Federal immigration laws and regulations relating to employees and warrants its compliance with Section A.R.S. § 23- 214, Subsection A. When used in 3.9 and

3.10 of this contract, the term “employee” shall have the same meaning as defined by A.R.S. § 23-211 of the Legal Arizona Workers Act.

Explanation: In § 3.9, the word “its” is substituted for “their” in reference to the Contractor, which is singular in the sentence. As to the other exceptions in §§ 3.9 and 3.10, we understand that these contract provisions are to implement the Legal Arizona Workers Act, and the exceptions align with that Act. Further, in addition to aligning with A.R.S. § 41-4401(B), the reference to “employment records” aligns with the first sentence of § 3.9 focusing on the immigration status of the Contractor’s employees.

2C, Section 6.1 Risk of Loss

6.1 The Contractor shall bear all loss of

conforming material covered under this Contract until received by authorized personnel at the location designated in the purchase order or Contract. Mere receipt does not constitute final acceptance. The risk of loss for nonconforming materials shall remain with the Contractor regardless of receipt.

Strike all.

Explanation: Does not relate to legal services.

2C, Section 6.2 Indemnification

6.2.1 Contractor/Vendor Indemnification

(Not Public Agency) The parties to this Contract agree that the State of Arizona, its departments, agencies, boards and commissions shall be indemnified and held harmless by the Contractor for the vicarious liability of the State as a result of

Strike all.

To avoid ambiguity as to this extremely important topic, Foley proposes deleting this section to avoid any doubt that section 7.2 of the Special Terms and Conditions, where we have also commented, controls this topic.

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page entering into this Contract. However, the parties further agree that the State of Arizona, its departments, agencies, boards and commissions shall be responsible for its own negligence. Each party to this Contract is responsible for its own negligence.

6.2.2. Public Agency Language Only Each

party (as 'indemnitor') agrees to indemnify, defend, and hold harmless the other party (as 'indemnitee') from and against any and all claims, losses, liability, costs, or expenses (including reasonable attorney's fees) (hereinafter collectively referred to as 'claims') arising out of bodily injury of any person (including death) or property damage but only to the extent that such claims which result in vicarious/derivative liability to the indemnitee, are caused by the act, omission, negligence, misconduct, or other fault of the indemnitor, its officers, officials, agents, employees, or volunteers.

2C, Section 7.2 Quality

7.2 Unless otherwise modified elsewhere

in these terms and conditions, the Contractor warrants that, for one year after acceptance by the State of the materials, they shall be:

7.2.1. Of a quality to pass without objection

in the trade under the Contract description;

7.2.2. Fit for the intended purposes for

which the materials are used;

7.2.3. Within the variations permitted by

the Contract and are of even kind, quantity, and quality within each unit and among all units;

7.2.4. Adequately contained, packaged

and marked as the Contract may require;

and

7.2.5. Conform to the written promises or

affirmations of fact made by the Contractor.

Strike all.

Explanation: Does not relate to legal services.

2C, Section 7.3 Fitness

7.3 The Contractor warrants that any

material supplied to the State shall fully conform to all requirements of the Contract and all representations of the Contractor, and shall be fit for all purposes and uses required by the Contract.

Strike all.

Explanation: Does not relate to legal services.

2C, Section 7.4 Inspection/Testing

7.4 The warranties set forth in

subparagraphs 7.1 through 7.3 of this paragraph are not affected by inspection or testing of or payment for the materials by the State.

Strike all.

Explanation: Does not relate to legal services.

2C, Section 8.1 Right to Assurance

8.1 If the State in good faith has reason to

believe that the Contractor does not intend to, or is unable to perform or continue

If the State in good faith has reason to believe that the Contractor does not intend to, or is unable to perform or continue performing under this Contract, the

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page performing under this Contract, the Procurement Officer may demand in writing that the Contractor give a written assurance of intent to perform. Failure by the Contractor to provide written assurance within the number of Days specified in the demand may, at the State’s option, be the basis for terminating the Contract under the Uniform Terms and Conditions or other rights and remedies available by law or provided by the Contract.

Procurement Officer may reasonably demand in writing that the Contractor give a written assurance of intent to perform the timing and conditions of such assurance to be commercially reasonable in the circumstances. Failure by the Contractor to provide written assurance within 15 Days may, at the State’s option, be the basis for terminating the Contract under the Uniform Terms and Conditions or other rights and remedies available by law or provided by the Contract.

Explanation: Foley accepts that ASRS may need to seek assurances of performance in the event a problem arises, but the proposed language would have given ASRS discretion to be unreasonable in such demands.

2C, Section 8.2 Stop Work Order

8.2.1. The State may, at any time, by

written order to the Contractor, require the Contractor to stop all or any part, of the work called for by this Contract for period(s) of days indicated by the State after the order is delivered to the Contractor. The order shall be specifically identified as a stop work order issued under this clause. Upon receipt of the order, the Contractor shall immediately comply with its terms and take all reasonable steps to minimize the incurrence of costs allocable to the work covered by the order during the period of work stoppage.

8.2.2. If a stop work order issued under

this clause is canceled or the period of the order or any extension expires, the Contractor shall resume work. The Procurement Officer shall make an equitable adjustment in the delivery schedule or Contract price, or both, and the Contract shall be amended in writing accordingly.

Strike all.

Explanation: The stricken language appears designed to operate in a contract for public works, not one for legal services.

2C, Section 8.4 Nonconforming Tender

8.4. Nonconforming Tender. Materials or

services supplied under this Contract shall fully comply with the Contract. The delivery of materials or services or a portion of the materials or services that do not fully comply constitutes a breach of Contract.

On delivery of nonconforming materials or services, the State may terminate the Contract for default under applicable termination clauses in the Contract, exercise any of its rights and remedies under the Uniform Commercial Code, or pursue any other right or remedy available to it.

Strike all.

Explanation: The stricken language appears designed to operate in a contract for goods, not one for legal services.

Strike all.

RETIREMENT SYSTEM

3300 N Central Ave

14th Floor Phoenix, AZ 85012

ASRS Investment Legal Consulting Services

Solicitation Code: BPM004386

Page

2C, Section 8.5 Right of Offset

8.5 The State shall be entitled to offset

against any sums due the Contractor, any expenses or costs incurred by the State, or damages assessed by the State concerning the Contractor’s non-conforming performance or failure to perform the Contract, including expenses, costs and damages described in the Uniform Terms and Conditions.

Explanation: To avoid any doubt, Foley prefers to delete this section such that Section 6 of the Special Terms and Conditions controls this subject matter, with no addition of this language.

2C, Section 9.5.3 Termination for Default

9.5.3 The State may, upon termination of

this Contract, procure, on terms and in the manner that it deems appropriate, materials or services to replace those under this Contract. The Contractor shall be liable to the State for any excess costs incurred by the State in procuring materials or services in substitution for those due from the Contractor.

The State may, upon termination of this Contract, procure, on terms and in the manner that it deems appropriate, materials or services to replace those under this Contract. The Contractor agrees to reimburse the State for any reasonable costs associated with transition to new counsel.

Explanation: Consistent with 2B Section 6.3, we can agree to reasonable transition costs.

ATTACHMENT C: Pricing Schedule ARIZONA STATE

RETIREMENT SYSTEM

3300 N Central Ave 14th Floor

Phoenix, AZ 85012

Investment Legal Consulting Services Solicitation Code: BPM004386 Part 3 of 3 – Offer Forms

Page of

4873-1012-6893.3

The ASRS reserves the right to select the pricing method that is most advantageous to the ASRS based on the prices submitted below.

The ASRS, at its discretion, may award contracts for all or any portion of the services for which an Offeror has provided a response.

Offeror must complete the Items tab in APP by entering $1 in the Unit Price field. Failure to do this may prevent the Offer from being awarded by the ASRS through APP.

1. Hourly Fees*

State pricing below for the services described in the Scope of Work. Pricing should be provided as an hourly billable rate.

In addition to Offeror's key personnel assigned under a Contract, ASRS assumes a complement of Offeror staff may also be assigned to and work on a task or service requested by ASRS. Offeror should categorize staff by general titles/classifications and then provide the maximum (highest) hourly rate within that category that Offeror is proposing to invoice the ASRS. While Offeror may bill ASRS less than the max rate in any category of staff, it may not bill more than the rate listed on this Pricing Schedule.

Example:

RATE/POSITION/TITLE

MAX HOURLY

RATE

YEAR 1

GUARANTEE

MAX HOURLY

RATE

3 YR

GUARANTEE

MAX HOURLY

RATE

5 YR

GUARANTEE

Partner $400 $400 $425

Associate $300 $300 $300

Legal Secretary $150 $150 $150

Foley & Lardner Response: The parties agree that additional professionals may participate as approved professionals under the contract, and that approved professionals’ rates may be adjusted when their status with Foley changes (e.g.

from Of Counsel to Partner, or from Associate to Senior Counsel), subject to the following limitations.

First, rates for additional professionals, or for professionals whose status changes, shall be appropriate for their individual qualifications and seniority, and shall in no event exceed the rates specified in Table 1 below, as applicable:

TABLE 1

TITLE

MAX HOURLY

RATE

YEAR 1

GUARANTEE

MAX HOURLY

RATE

YEAR 3

GUARANTEE

MAX HOURLY

RATE

YEAR 5

GUARANTEE

Partner $995 $1,115 $1,250

Of Counsel $785 $880 $985

Senior Counsel $700 $785 $880

3300 N Central Ave 14th Floor

Phoenix, AZ 85012

Investment Legal Consulting Services Solicitation Code: BPM004386 Part 3 of 3 – Offer Forms

Page of

4873-1012-6893.3

TABLE 1

TITLE

MAX HOURLY

RATE

YEAR 1

GUARANTEE

MAX HOURLY

RATE

YEAR 3

GUARANTEE

MAX HOURLY

RATE

YEAR 5

GUARANTEE

Associate $625 $700 $785

Paralegal $395 $420 $445

Second, prior to any…