MA_240000000404_CN1_Fully_Executed.pdf

Michigan .gov/MiProcure ment

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NovaVision, LLC

SCHEDULE A – STATEMENT OF WORK

CONTRACT ACTIVITIES

Master agreement (MA) No. 240000000404

Election Security Seals

BACKGROUND

The Michigan Department of State Bureau of Elections purchases Election Security Seals to ensure the security of Michigan elections per MCL 168.36 below:

MICHIGAN ELECTION LAW (EXCERPT)

Act 116 of 1954

168.36 Seal.

Sec. 36.

The secretary of state may approve seals to be used for the same purpose as metal seals when required by this act. The secretary of state shall only approve a seal under this section if that seal meets all of the following requirements:

(a) Is designed and manufactured for the purpose of proving authenticity, attesting to accuracy, or closing to outside interference or influence.

(b) Is made out of metal, plastic, fiberglass, or any combination of these materials that would provide resistance to or evidence of a force tending to break the seal.

(c) Contains an embossed or imprinted serial number.

There are currently approximately 10 different seals the Bureau of Elections provides to county and local clerks to maintain the security of election voting system machines and materials.

SCOPE

Selected vendor(s) will supply security election seals, per specifications and within agreed upon lead time. The solicitation resulted in multiple contracts with multiple vendors and also resulted in the same seal being available on separate contracts. If the seal is available on more than one contract, MDOS may, at their discretion, request timing from both vendors and at MDOS’ sole discretion, choose the vendor with the shortest lead-time. This solicitation included the seals described in Schedule C and submission of 20 ~ 30 sample seals for each seal(s) was mandatory.

Bidders were given the option to propose security seals with bar codes with the unique sequential number.

Bidders were also welcome to propose alternate security seals that are used for elections or other purposes as long as they meet the Mandatory Minimum Requirements.

1. Requirements

1.1. General Requirements

http://www.legislature.mi.gov/(S(cooyr4nxsh32jxzgzln4l2zt))/mileg.aspx?page=getobject&objectname=mcl-168-36&query=on&highlight=seal*#2 http://www.legislature.mi.gov/(S(cooyr4nxsh32jxzgzln4l2zt))/mileg.aspx?page=getobject&objectname=mcl-168-36&query=on&highlight=seal*#3 http://www.legislature.mi.gov/(S(cooyr4nxsh32jxzgzln4l2zt))/mileg.aspx?page=getobject&objectname=mcl-168-36&query=on&highlight=seal*#4 http://www.legislature.mi.gov/(S(cooyr4nxsh32jxzgzln4l2zt))/mileg.aspx?page=getobject&objectname=mcl-168-36&query=on&highlight=seal*#5 http://www.legislature.mi.gov/(S(cooyr4nxsh32jxzgzln4l2zt))/mileg.aspx?page=getobject&objectname=mcl-168-36&query=on&highlight=seal*#6 http://www.legislature.mi.gov/(S(cooyr4nxsh32jxzgzln4l2zt))/mileg.aspx?page=getobject&objectname=mcl-168-36&query=on&highlight=seal*#top

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The contractor must provide one or more of the following seal styles meeting specifications (see specifications in Schedule C):

Name Description Padlock Wire hasp and plastic body; Double scored hasp

Pull-Tite Seal, any color Plastic pull-through spring lock seal. Approximately 2.5" head with metal reinforced insertion hole and minimum 5" to maximum 12” tail

Pull-Tite Seal, any color Plastic pull-through spring lock seal. Approximately 2.5" head with metal reinforced insertion hole and minimum 10" to maximum 16” tail

Easy Twist Seal - any color One-piece construction, plastic chamber; 8” wire pull-through locking seal, twist to secure

Memory Pack Seal any color Plastic connecting lock seal; one-piece construction, 1-1/2" x 1-1/4"

Chamber Bag Seal, any color One piece construction, plastic body Tamper-evident adhesive seal Tamper-evident “VOID” sticker, 1” x 4” Tamper-evident adhesive seal Tamper-evident “VOID” sticker, 1/2” x 2” Single use network port seal Seals an RJ-45 network port Single use USB port seal Seals a USB port Bidder alternate proposals Describe your proposed seals below East Twist Seal Diameter of tail .07 MM

1.2. Transition

Per Standard Contract terms, attached.

A. Contract Execution: Contract will be considered executed upon being signed by both the contractor and the State of Michigan.

B. Post-Contract Transition: All invoices must be sent within 45 days after expiration of contract. Any invoices received after 45 days will result in a non-payment of invoice.

1.3. Reserved.

2. Service Requirements

2.1. Timeframes

All Contract Activities are expected to be delivered within 60 calendar days from date of order. The Contractor must notify the State of expected delivery date within 5 business days from the date of order. The receipt of order date is pursuant to the Notices section of the Standard Contract Terms. The contractor will notify and discuss a mutually agreeable delivery date if said items will exceed 60 days.

If the seals are sourced from outside the United States, the contractor was required to provide the country of origin for each such seal type. Delivery expectations remain firm.

Easy Twist Seals – produced in China

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2.2. Delivery

All deliveries will be made at MDOS Sunset Warehouse, 1301 Sunset Ave., Lansing, MI 48917 during State of Michigan business hours.

The Contractor has strong relationships with FedEx, UPS and numerous other freight logistic companies. Their relationship with these companies gives them the flexibility in scheduling shipments to ensure on-time deliveries.

2.3. Delivery Programs

The Contractor must explain in detail its delivery programs (e.g., standard delivery and quick-ship), including any limitations such as quantity.

The Contractor must explain the transportation method (e.g., UPS, FedEx, Contractor fleet, or other third-party carrier) it intends on using in delivery of the Contract Activities.

Due to the relationships outlined in 2.2, the Contractor is able to provide the State with various shipping alternatives to ensure on-time deliveries.

2.4. Packaging and Palletizing

Packaging must be optimized to permit the lowest freight rate but first must adhere to MDOS-required number of pieces per package. Shipments must be palletized whenever possible using manufacturer's standard 4-way shipping pallets.

The Contractor routinely ships products to their customers per their specifications.

Packing and shipping requirements are detailed and communicated to all members of the team to ensure that the requirements are met. This is accomplished through initial meetings and regular communications with the team. Packing & shipping requirements are entered into the customer’s account and are automatically attached to the order when it is entered into our system.

3. Acceptance

3.1. Acceptance, Inspection, and Testing

The State will use the following criteria to determine acceptance of the Contract Activities: per this Statement of Work and the Standard Contract terms, attached.

3.2. Final Acceptance

Per Standard Contract terms, attached.

4. Staffing

4.1. Contractor Representative

The Contractor must appoint at least one individual specifically assigned to State of Michigan accounts, who will respond to State inquiries regarding the Contract Activities, answer questions related to ordering and delivery, etc. (the “Contractor Representative”). The Contractor Representative must be available by both phone and email from 8:00 a.m. through 5:00 p.m. EST Monday through Friday.

The Contractor must notify the Contract Administrator at least 30 calendar days before removing or assigning a new Contractor Representative.

Contractor Representative: Bill Kuhlman, Sales Representative

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4.2. Customer Service Toll-Free Number

The toll-free number for the State to contact the Contractor Representative is 800-336- 6636. The Contractor Representative must be available for calls during the hours of 8:00 am to 5:00 pm EST.

4.3. Reserved

4.4. Work Hours

The Contractor must provide Contract Activities during the State’s normal working hours Monday – Friday, 8:00 a.m. to 5:00 p.m. EST and possible night and weekend hours depending on the requirements of the project.

4.5. Reserved.

4.6. Organizational Chart

The Contractor must provide an overall organizational chart that details staff members, by name and title, and subcontractors.

See Schedule D

4.7. Disclosure of Subcontractors

If the Contractor intends to utilize subcontractors, the Contractor must disclose the following:

The legal business name; address; telephone number; a description of subcontractor’s organization and the services it will provide; and information concerning subcontractor’s ability to provide the Contract Activities.

The relationship of the subcontractor to the Contractor.

Whether the Contractor has a previous working experience with the subcontractor. If yes, provide the details of that previous relationship.

A complete description of the Contract Activities that will be performed or provided by the subcontractor.

4.8. Security

The Contractor will not be accessing any state facilities.

All contractor employees undergo background checks prior to employment. All employees & visitors are issued ID badges and must be worn at all times when in the facility. Different security levels are required to access certain portions of the plan or when particular jobs are run.

4.9. Reserved.

5. Project Management

5.1. Reserved

5.2. Meetings

The Contractor must attend the following meetings:

Kick-off meeting within 30-calendar days of the Effective Date.

The State may request other meetings, as it deems appropriate.

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5.3. Reserved

6. Pricing

6.1. Price Term

Pricing is firm for the entire length of the Contract.

6.2. Price Changes

Adjustments will be based on changes in actual Contractor costs. Any request must be supported by written evidence documenting the change in costs. The State may consider sources, such as the Consumer Price Index; Producer Price Index; other pricing indices as needed; economic and industry data; manufacturer or supplier letters noting the increase in pricing; and any other data the State deems relevant.

Following the presentation of supporting documentation, both parties will have 30 days to review the information and prepare a written response. If the review reveals no need for modifications, pricing will remain unchanged unless mutually agreed to by the parties. If the review reveals that changes are needed, both parties will negotiate such changes, for no longer than 30 days, unless extended by mutual agreement.

The Contractor remains responsible for Contract Activities at the current price for all orders received before the mutual execution of a Change Notice indicating the start date of the new Pricing Period.

7. Ordering

7.1. Authorizing Document

The appropriate authorizing document for the Contract will be a Delivery Order processed by Michigan Department of State Purchasing (MDOS) and emailed to the vendor by either MDOS Purchasing or MDOS Bureau of Elections (BOE).

There may be times when BOE needs to place an emergency order. When and if this happens, a designated BOE employee (name will be provided in an awarded contract) will place the order by phone and confirm the order with a follow up email to the vendor.

7.2. Order Verification

The Contractor must have internal controls approved by Michigan Department of State to verify abnormal orders and to ensure that only authorized individuals place orders.

The Contractor will only accept orders from an official government email address (ie @michigan.gov). Also, NovaVision manages an internal image registry and all imprinted products get search prior to production. If an unauthorized purchase attempt is made, then NovaVision will contact the agency’s point-of-contact, and also get the law enforcement involved, if necessary.

8. Invoice and Payment

8.1. Invoice Requirements

All invoices submitted to the State must include: (a) date; (b) MDOS Delivery Order number; (c) quantity; (d) description of the Contract Activities; (e) unit price; (f) vendor-generated invoice number; (g); delivery date, and (h) total price.

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For emergency orders, invoices must also include the full name of the BOE employee who placed the order and a copy of the confirming email.

Overtime, holiday pay, and travel expenses will not be paid.

8.2. Payment Methods

The State will make payment for Contract Activities via EFT only. Contractor will provide necessary information for EFT payments.

8.3. Procedure

Invoices will be submitted to: sospaymentprocess@michigan.gov. Contractor must include invoice and specified information for each shipment.

9. Reserved.

10. Service-Level Agreements (SLAs)

A. The Contractor will be held accountable to meet the requirements and the service level requirements established in this Contract.

B. The State reserves the right to reconsider or amend SLA amounts for split awards should they occur.

C. Please Note: Should bidders require clarification or have any questions with regard to the SLAs, they should submit them during the Question and Answer Period of this solicitation; please see the Proposal Instructions for the timeline.

Service Level Agreements for this Contract will be as follows:

SLA Metric 1. Timely Deliveries

Definition and Purpose

All orders are expected to be delivered within 60 calendar days from date of order. The Contractor must notify the State of expected delivery date within 5 business days from the date of order. The only exception allowed will be after a contract is in place and if the seal is only available from another country. The extended lead time will only be allowed if agreed to by Michigan Department of State.

AND

The Contractor must ensure that items and quantities delivered are exactly the items, brands, and quantities on the Order Confirmation.

No substitutions will be allowed without prior written permission by the State’s Program Manager and a Change Notice executed by the Contract Administrator.

The entire order will be received on the same day unless a partial delivery has been approved in advance by the Program Manager.

Acceptable Standard

1. All deliveries must occur in accordance with the approved delivery schedule for each Facility and Facility Receiving hours.

See Section 2.2.

mailto:sospaymentprocess@michigan.gov

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SLA Metric 1. Timely Deliveries

2. Extenuating circumstances must be communicated by the Contractor to the Program Manager prior to the scheduled delivery date and time.

3. Items, brands, and quantities delivered will match the Order Confirmation exactly.

4. Signed and dated packing slips will be provided to the Michigan Department of State at the time of delivery.

5. The entire order must be delivered on the same day unless a partial delivery has been approved in advance by the Program Manager.

6. Orders not received in their entirety, as determined by a review of the Data Sources, will be considered inaccurate.

The acceptable standard is 100% compliance.

Credit Due for Failing to Meet the Service Level Agreements

1. $100.00 may be assessed for each of the first five occurrences of non-compliance in a given calendar year.

2. $500.00 may be assessed beginning with the sixth occurrence of non-compliance and on each occurrence thereafter in a given calendar year.

Extenuating circumstances will be reviewed by the Program Manager before any Service Credits are assessed.

At the discretion of the State, these credits may be applied toward any payable due to the Contractor or be payable directly to the State. Payments made directly to the state will be completed within 10 days of notice of assessment.

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NovaVision, LLC

SCHEDULE B - PRICING

Master agreement (MA) No. 240000000404 Election Security Seals

1. The Contractor was required to provide a pricing schedule for the proposed Contract Activities using a simple pricing schedule. The pricing schedule was required to be submitted in a modifiable format (e.g., Microsoft Word or Excel); however, bidders were given the option to also submit an additional pricing schedule in a non-modifiable format (e.g., PDF). Failure to complete the pricing schedule as requested would have resulted in disqualification of the proposal.

2. Price proposals included all costs, including but not limited to, any one-time or set-up charges, fees, and potential costs that Contractor may charge the State (e.g., shipping and handling, per piece pricing, and palletizing).

3. The Contractor was encouraged to offer quick payment terms. The number of days must not include processing time for payment to be received by the Contractor's financial institution.

Quick payment terms: The Contractor did not offer Quick Payment Terms.

4. The Contractor were encouraged to provide tiered pricing terms, provided the pricing remains firm for the entire length of the contract per Section 6.1 of Schedule A – Statement of Work Contract Activities.

5. By submitting its proposal, the Contractor certified that the prices were arrived at independently, and without consultation, communication, or agreement with any other Contractor.

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Item No

Item Name Item Specification Quantity Cost (each)

1. Padlock Seal Blue plastic body wire hasp.

Double Scored

25000 50000 75000 100000 125000

$0.209 $0.196 $0.188 $0.173 $0.167

2. Easy Twist Seal

One piece construction plastic chamber, 8” wire pull through locking seal, twist to secure

25000 50000 75000 100000 125000

$0.406 $0.385 $0.367 $0.350 $0.335

3. Tamper-evident Adhesive Seal

Tamper-evident “VOID” sticker, 1” x 4”

25000 50000 75000 100000 125000

$0.324 $0.313 $0.302 $0.292 $0.282

4. Tamper-evident Adhesive Seal

Tamper-evident “VOID” sticker, ½” x 2”

25000 50000 75000 100000 125000

$0.191 $0.184 $0.178 $0.172 $0.167

5. Single-Use Network Port Seal

Seals an RJ-45 network port 25000 $3.27

6. Single-Use USB Port Seal

Seals a USB port 25000 $13.17

**Minimum of 25,000 seals order quantity for each item**

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SCHEDULE C – SEALS SPECIFICATIONS

Master agreement (MA) No. 2400000000404 Election Security Seals

The colors, numbers, and sample images in the second column are for illustration only.

Optional barcode of sequential number may be on either the front or back of item.

Name and seal specifications Sample image of current seals

Padlock Stainless Steel hasp with plastic body Color: Any Diameter of wire: 0.045” Required: State of Michigan Required: Consecutively numbered 25 per package Optional addition: Barcode of the sequential number

(in addition to the required human-readable printed/embossed sequential number)

Pull-tite Seal

Plastic pull through locking seal Color: Any Minimum 5” to Maximum 12” tail, Approximately 2.5" head with metal reinforced insertion hole Diameter of tail: 0.135” Required: State of Michigan Required: Consecutively numbered 25 per package

Optional addition: Barcode of the sequential number (in addition to the required human-readable printed/embossed sequential number)

Pull-tite Seal

Plastic pull through locking seal Color: Any Minimum 10” to Maximum 16” tail, Approximately 2.5" head with metal reinforced insertion hole Diameter of tail: 0.90” Required: State of Michigan Required: Consecutively numbered 25 per package

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Optional addition: Barcode of the sequential number (in addition to the required human-readable printed/embossed sequential number)

Easy twist

Wire pull-through locking seal, twist to secure Color: Any 8” wire, plastic chamber Diameter of tail: 0.25” Diameter of chamber: 0.580” Required: State of Michigan Required: Consecutively numbered 25 per package

Optional addition: Barcode of the sequential number (in addition to the required human-readable printed/embossed sequential number)

Memory pack Plastic connecting locking seal Color: Any Size when locked: 1.090” wide, 1.490” tall (on center) Diameter of post: 0.80” Required: State of Michigan Required: Consecutively numbered 25 per package

Optional addition: Barcode of the sequential number (in addition to the required human-readable printed/embossed sequential number)

Chamber Bag Plastic one-piece construction Color: Any Width of body: 1.110” Required: State of Michigan Required: Consecutively numbered 25 per package

Optional addition: Barcode of the sequential number (in addition to the required human-readable printed/embossed sequential number)

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Tamper-evident adhesive Tamper-evident “VOID” sticker Size 1” x 4” Color: Any Required: State of Michigan Required: Consecutively numbered 500 seals per package

Optional addition: Barcode of the sequential number (in addition to the required human-readable printed/embossed sequential number)

Tamper-evident adhesive Tamper-evident “VOID” sticker Size 1/2” x 2” Color: Any Required: State of Michigan Required: Consecutively numbered Optional addition: Barcode of the sequential number

(in addition to the printed/embossed sequential number)

500 seals per package

Single-Use network port lock seal that prevents access to an RJ-45 network port

Tamper-evident Color: any Required: State of Michigan (or listed alternative due to space constraint). “SOM” may also be used.

Required: Consecutively numbered Optional addition: Barcode of the sequential number (in addition to the printed/embossed sequential number)

Single-Use USB port lock seal that prevents access to a USB port

Tamper-evident Color: any Required: State of Michigan (or listed alternative due to space constraint). “SOM” may also be used.

Required: Consecutively numbered Optional addition: Barcode of the sequential number (in addition to the printed/embossed sequential number)

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SCHEDULE D – ORGANIZATIONAL CHART

Master agreement (MA) No. 240000000404 Election Security Seals

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STANDARD CONTRACT TERMS

This STANDARD CONTRACT (“Contract”) is agreed to between the State of Michigan (the “State”) and NovaVision, LLC (“Contractor”), a Ohio Limited Liability Company.

This Contract is effective on March, 11, 2024 (“Effective Date”), and unless terminated, will expire on February, 28, 2029 (the “Term”).

This Contract may be renewed for up to two additional one-year period(s). Renewal is at the sole discretion of the State and will automatically extend the Term of this Contract.

The State will document its exercise of renewal options via Contract Change Notice.

The parties agree as follows:

Duties of Contractor. Contractor must perform the services and provide the deliverables (the “Contract Activities”) described in a Statement of Work, the initial Statement of Work is attached as Schedule A – Statement of Work. An obligation to provide delivery of any commodity is considered a service and is a Contract Activity.

Contractor must furnish all labor, equipment, materials, and supplies necessary for the performance of the Contract Activities unless otherwise specified in a Statement of Work.

Contractor must: (a) perform the Contract Activities in a timely, professional, safe, and workmanlike manner consistent with standards in the trade, profession, or industry; (b) meet or exceed the performance and operational standards, and specifications of the Contract; (c) provide all Contract Activities in good quality, with no material defects; (d) not interfere with the State’s operations; (e) obtain and maintain all necessary licenses, permits or other authorizations necessary for the performance of the Contract; (f) cooperate with the State, including the State’s quality assurance personnel, and any third party to achieve the objectives of the Contract;

(g) return to the State any State-furnished equipment or other resources in the same condition as when provided when no longer required for the Contract; (h) assign to the State any claims resulting from state or federal antitrust violations to the extent that those violations concern materials or services supplied by third parties toward fulfillment of the Contract; (i) comply with all State physical and IT security policies and standards which will be made available upon request; and (j) provide the State priority in performance of the Contract except as mandated by federal disaster response requirements. Any breach under this paragraph is considered a material breach.

Contractor must also be clearly identifiable while on State property by wearing identification issued by the State, and clearly identify themselves whenever making contact with the State.

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

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If to State: If to Contractor:

See Contract Administrator information shown below.

Dave Duvall

NovaVision, LLC

524 East Woodland Circle

Bowling Green, OH, 43402 dduvall@novavisioninc.com

419-354-1427

Contract Administrator. The Contract Administrator, or the individual duly authorized for each party, is the only person authorized to modify any terms of this Contract, and approve and execute any change under this Contract (each a “Contract Administrator”):

State: Contractor:

Ross Anderson

430 W. Allegan St.

Lansing, MI, 48933

AndersonR36@michigan.gov

517-241-1513

Dave Duvall

NovaVision, LLC

524 East Woodland Circle

Bowling Green, OH, 43402 dduvall@novavisioninc.com

419-354-1427

Program Manager. The Program Manager for each party will monitor and coordinate the day-to-day activities of the Contract (each a “Program Manager”):

State: Contractor:

David Tarrant

430 W. Allegan St.

Lansing, MI, 48933

TarrantD2@michigan.gov

571-335-3230

Dave Duvall

NovaVision, LLC

524 East Woodland Circle

Bowling Green, OH, 43402 dduvall@novavisioninc.com

419-354-1427

Performance Guarantee. Contractor must at all times have financial resources sufficient, in the opinion of the State, to ensure performance of the Contract and must provide proof upon request. The State may require a performance bond (as specified mailto:dduvall@novavisioninc.com mailto:AndersonR36@michigan.gov mailto:dduvall@novavisioninc.com mailto:TarrantD2@michigan.gov mailto:dduvall@novavisioninc.com

Version 2022-4 Page 16 of 29 in a Statement of Work) if, in the opinion of the State, it will ensure performance of the Contract.

Insurance Requirements.

Contractor, at its sole expense, must maintain the insurance coverage identified below. With respect to Privacy and Security Liability, Contractor may, at the discretion of the DHHS Contract Administrator, defer coverage up to no more than 30 days prior to beginning any work or deliverables under this Contract. All required insurance must: (a) protect the State from claims that may arise out of, are alleged to arise out of, or otherwise result from Contractor's or a subcontractor's performance;

(b) be primary and non-contributing to any comparable liability insurance (including self-insurance) carried by the State; and (c) be provided by a company with an A.M.

Best rating of "A-" or better, and a financial size of VII or better.

Required Limits Additional Requirements

Commercial General Liability Insurance

Minimum Limits:

$1,000,000 Each Occurrence

$1,000,000 Personal & Advertising Injury

$2,000,000 Products/Completed Operations

$2,000,000 General Aggregate

Contractor must have their policy endorsed to add “the State of Michigan, its departments, divisions, agencies, offices, commissions, officers, employees, and agents” as additional insureds using endorsement CG 20 10 11 85, or both CG 20 10 12 19 and CG 20 37 12 19.

Workers' Compensation Insurance

Minimum Limits:

Coverage according to applicable laws governing work activities.

Waiver of subrogation, except where waiver is prohibited by law.

Employers Liability Insurance

Minimum Limits:

$500,000 Each Accident

$500,000 Each Employee by Disease

$500,000 Aggregate Disease

If any of the required policies provide claims-made coverage, the Contractor must:

(a) provide coverage with a retroactive date before the Effective Date of the Contract or the beginning of Contract Activities; (b) maintain coverage and provide evidence of coverage for at least three (3) years after completion of the Contract Activities; and

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(c) if coverage is cancelled or not renewed, and not replaced with another claims-made policy form with a retroactive date prior to the Contract Effective Date, Contractor must purchase extended reporting coverage for a minimum of three (3) years after completion of work.

Contractor must: (a) provide insurance certificates to the Contract Administrator, containing the agreement or delivery order number, at Contract formation and within twenty (20) calendar days of the expiration date of the applicable policies; (b) require that subcontractors maintain the required insurance contained in this Section; (c) notify the Contract Administrator within five (5) business days if any insurance is cancelled; and (d) waive all rights against the State for damages covered by insurance. Failure to maintain the required insurance does not limit this waiver.

This Section is not intended to and is not to be construed in any manner as waiving, restricting or limiting the liability of either party for any obligations under this Contract (including any provisions hereof requiring Contractor to indemnify, defend and hold harmless the State).

Administrative Fee and Reporting. Contractor must pay an administrative fee of 1% on all payments made to Contractor under the Contract including transactions with the State (including its departments, divisions, agencies, offices, and commissions), MiDEAL members, and other states (including governmental subdivisions and authorized entities). Administrative fee payments must be made online by check or credit card at: https://www.thepayplace.com/mi/dtmb/adminfee

Contractor must submit an itemized purchasing activity report, which includes at a minimum, the name of the purchasing entity and the total dollar volume in sales.

Reports should be mailed to MiDeal@michigan.gov.

The administrative fee and purchasing activity report are due within 30 calendar days from the last day of each calendar quarter.

Extended Purchasing Program. This contract is extended to MiDEAL members.

MiDEAL members include local units of government, school districts, universities, community colleges, and nonprofit hospitals. A current list of MiDEAL members is available at www.michigan.gov/mideal.

Upon written agreement between the State and Contractor, this contract may also be extended to: (a) other states (including governmental subdivisions and authorized entities) and (b) State of Michigan employees.

If extended, Contractor must supply all Contract Activities at the established Contract prices and terms. The State reserves the right to impose an administrative fee and negotiate additional discounts based on any increased volume generated by such extensions.

Contractor must submit invoices to, and receive payment from, extended purchasing program members on a direct and individual basis.

Relationship of the Parties. The relationship between the parties is that of independent contractors. Contractor, its employees, and agents will not be considered employees of the State. No partnership or joint venture relationship is created by virtue of this Contract. Contractor, and not the State, is responsible for the https://www.thepayplace.com/mi/dtmb/adminfee http://www.michigan.gov/mideal

Version 2022-4 Page 18 of 29 payment of wages, benefits and taxes of Contractor’s employees and any subcontractors. Prior performance does not modify Contractor’s status as an independent contractor. Neither party has authority to contract for nor bind the other party in any manner whatsoever.

Intellectual Property Rights. If a Statement of Work requires Contractor to create any intellectual property, Contractor hereby acknowledges that the State is and will be the sole and exclusive owner of all right, title, and interest in the Contract Activities and all associated intellectual property rights, if any. Such Contract Activities are works made for hire as defined in Section 101 of the Copyright Act of 1976. To the extent any Contract Activities and related intellectual property do not qualify as works made for hire under the Copyright Act, Contractor will, and hereby does, immediately on its creation, assign, transfer and otherwise convey to the State, irrevocably and in perpetuity, throughout the universe, all right, title and interest in and to the Contract Activities, including all intellectual property rights therein.

Subcontracting. Contractor may not delegate any of its obligations under the Contract without the prior written approval of the State. Contractor must notify the State at least 90 calendar days before the proposed delegation and provide the State any information it requests to determine whether the delegation is in its best interest.

If approved, Contractor must: (a) be the sole point of contact regarding all contractual matters, including payment and charges for all Contract Activities; (b) make all payments to the subcontractor; and (c) incorporate the terms and conditions contained in this Contract in any subcontract with a subcontractor. Contractor remains responsible for the completion of the Contract Activities, compliance with the terms of this Contract, and the acts and omissions of the subcontractor. The State, in its sole discretion, may require the replacement of any subcontractor.

Staffing. The State’s Contract Administrator may require Contractor to remove or reassign personnel providing services by providing a notice to Contractor.

Background Checks. Pursuant to Michigan law, all agencies subject to IRS Pub.

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

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

Version 2022-4 Page 19 of 29 other party. If the State determines that a novation of the Contract to a third party is necessary, Contractor will agree to the novation and provide all necessary documentation and signatures.

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

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

Ordering. Contractor is not authorized to begin performance until receipt of authorization as identified in a Statement of Work.

Acceptance. Contract Activities are subject to inspection and testing by the State within 30 calendar days of the State’s receipt of them (“State Review Period”), unless otherwise provided in a Statement of Work. If the Contract Activities are not fully accepted by the State, the State will notify Contractor by the end of the State Review Period that either: (a) the Contract Activities are accepted but noted deficiencies must be corrected; or (b) the Contract Activities are rejected. If the State finds material deficiencies, it may: (i) reject the Contract Activities without performing any further inspections; (ii) demand performance at no additional cost; or (iii) terminate this Contract in accordance with Section 24, Termination for Cause.

Within 10 business days from the date of Contractor’s receipt of notification of acceptance with deficiencies or rejection of any Contract Activities, Contractor must cure, at no additional cost, the deficiency and deliver unequivocally acceptable Contract Activities to the State. If acceptance with deficiencies or rejection of the Contract Activities impacts the content or delivery of other non-completed Contract Activities, the parties’ respective Program Managers must determine an agreed to number of days for re-submission that minimizes the overall impact to the Contract.

However, nothing herein affects, alters, or relieves Contractor of its obligations to correct deficiencies in accordance with the time response standards set forth in this Contract.

If Contractor is unable or refuses to correct the deficiency within the time response standards set forth in this Contract, the State may cancel the order in whole or in part. The State, or a third party identified by the State, may perform the Contract Activities and recover the difference between the cost to cure and the Contract price plus an additional 10% administrative fee.

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Delivery. Contractor must deliver all Contract Activities F.O.B. destination, within the State premises with transportation and handling charges paid by Contractor, unless otherwise specified in a Statement of Work. All containers and packaging become the State’s exclusive property upon acceptance.

Risk of Loss and Title. Until final acceptance, title and risk of loss or damage to Contract Activities remains with Contractor. Contractor is responsible for filing, processing, and collecting all damage claims. The State will record and report to Contractor any evidence of visible damage. If the State rejects the Contract Activities, Contractor must remove them from the premises within 10 calendar days after notification of rejection. The risk of loss of rejected or non-conforming Contract Activities remains with Contractor. Rejected Contract Activities not removed by Contractor within 10 calendar days will be deemed abandoned by Contractor, and the State will have the right to dispose of it as its own property. Contractor must reimburse the State for costs and expenses incurred in storing or effecting removal or disposition of rejected Contract Activities.

Warranty Period. The warranty period, if applicable, for Contract Activities is a fixed period commencing on the date specified in a Statement of Work. If the Contract Activities do not function as warranted during the warranty period, the State may return such non-conforming Contract Activities to the Contractor for a full refund.

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

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

The State will only disburse payments under this Contract through Electronic Funds Transfer (EFT). Contractor must register with the State at http://www.michigan.gov/SIGMAVSS to receive electronic fund transfer payments. If Contractor does not register, the State is not liable for failure to provide payment.

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

http://www.michigan.gov/SIGMAVSS

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Excluding federal government charges and terms, Contractor warrants and agrees that each of the fees, economic or product terms or warranties granted pursuant to this Contract are comparable to or better than the equivalent fees, economic or product term or warranty being offered to any commercial or government customer (including any public educational institution within the State of Michigan) of Contractor. If Contractor enters into any arrangements with another customer of Contractor to provide the products or services, available under this Contract, under more favorable prices, as the prices may be indicated on Contractor’s current U.S.

and International price list or comparable document, then this Contract will be deemed amended as of the date of such other arrangements to incorporate those more favorable prices, and Contractor will immediately notify the State of such fee and formally memorialize the new pricing in a change notice.

Liquidated Damages. Liquidated damages, if applicable, will be assessed as described in a Statement of Work. The parties understand and agree that any liquidated damages (which includes but is not limited to applicable credits) set forth in this Contract are reasonable estimates of the State’s damages in accordance with applicable law. The parties acknowledge and agree that Contractor could incur liquidated damages for more than 1 event. The assessment of liquidated damages will not constitute a waiver or release of any other remedy the State may have under this Contract for Contractor’s breach of this Contract, including without limitation, the State’s right to terminate this Contract for cause under Section 24 and the State will be entitled in its discretion to recover actual damages caused by Contractor’s failure to perform its obligations under this Contract. However, the State will reduce such actual damages by the amounts of liquidated damages received for the same events causing the actual damages. Amounts due the State as liquidated damages may be set off against any fees payable to Contractor under this Contract, or the State may bill Contractor as a separate item and Contractor will promptly make payments on such bills.

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

Termination for Cause. (a) The State may terminate this Contract for cause, in whole or in part, if Contractor, as determined by the State: (i) endangers the value, integrity, or security of any facility, data, or personnel; (ii) becomes insolvent, petitions for bankruptcy court proceedings, or has an involuntary bankruptcy proceeding filed against it by any creditor; (iii) engages in any conduct that may expose the State to liability; (iv) breaches any of its material duties or obligations under this Contract; or (v) fails to cure a breach within the time stated by the State in a notice of breach, if in its sole discretion the State has chosen to provide a time to cure. Any reference to specific breaches being material breaches within this Contract will not be construed to mean that other breaches are not material.

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(b) If the State terminates this Contract under this Section, the State will issue a termination notice specifying whether Contractor must: (i) cease performance immediately. Contractor must submit all invoices for Contract Activities accepted by the State within 30 days of the date of termination. Failure to submit an invoice within that timeframe will constitute a waiver by Contractor for any amounts due to Contactor for Contract Activities accepted by the State under this Contract or (ii) continue to perform for a specified period. If it is later determined that Contractor was not in breach of the Contract, the termination will be deemed to have been a Termination for Convenience, effective as of the same date, and the rights and obligations of the parties will be limited to those provided in Section 25, Termination for Convenience.

The State will only pay for amounts due to Contractor for Contract Activities accepted by the State on or before the date of termination, subject to the State’s right to set off any amounts owed by the Contractor for the State’s reasonable costs in terminating this Contract. Contractor must promptly reimburse to the State any fees prepaid by the State prorated to the date of such termination, including any prepaid fees. The Contractor must pay all reasonable costs incurred by the State in terminating this Contract for cause, including administrative costs, attorneys’ fees, court costs, transition costs, and any costs the State incurs to procure the Contract Activities from other sources.

Termination for Convenience. The State may immediately terminate this Contract in whole or in part without penalty and for any reason or no reason, including but not limited to, appropriation or budget shortfalls. The termination notice will specify whether Contractor must: (a) cease performance of the Contract Activities immediately. Contractor must submit all invoices for Contract Activities accepted by the State within 30 days of the date of termination. Failure to submit an invoice within that timeframe will constitute a waiver by Contractor for any amounts due Contractor for Contract Activities accepted by the State under this Contract, or (b) continue to perform the Contract Activities in accordance with Section 26, Transition Responsibilities. If the State terminates this Contract for convenience, the State will pay all reasonable costs, as determined by the State, for State approved Transition Responsibilities to the extent the funds are available.

Transition Responsibilities. Upon termination or expiration of this Contract for any reason, Contractor must, for a period of time specified by the State (not to exceed 90 calendar days), provide all reasonable transition assistance requested by the State, to allow for the expired or terminated portion of the Contract Activities to continue without interruption or adverse effect, and to facilitate the orderly transfer of such Contract Activities to the State or its designees. Such transition assistance may include, but is not limited to: (a) continuing to perform the Contract Activities at the established Contract rates; (b) taking all reasonable and necessary measures to transition performance of the work, including all applicable Contract Activities, training, equipment, software, leases, reports and other documentation, to the State or the State’s designee; (c) transferring title in and delivering to the State, at the State’s discretion, all completed or partially completed deliverables prepared under this Contract as of the Contract termination date; and (d) preparing an accurate accounting from which the State and Contractor may reconcile all outstanding

Version 2022-4 Page 23 of 29 accounts (collectively, “Transition Responsibilities”). This Contract will automatically be extended through the end of the transition period.

Return of State Property. Upon termination or expiration of this Contract for any reason, Contractor must take all necessary and appropriate steps, or such other action as the State may direct, to preserve, maintain, protect, or return to the State all materials, data, property, and confidential information provided directly or indirectly to the Contractor by any entity, agent, vendor, or employee of the State.

Indemnification. Contractor must defend, indemnify and hold the State, its departments, divisions, agencies, offices, commissions, officers, and employees harmless, without limitation,…