CONTRACT NO - Michigan...2.060 Contract Management 16 2.061 Contractor Personnel Qualifications 16 2.062 Contractor Key Personnel 16 2.063 Re-assignment of Personnel at the MBA’s

CONTRACT NO. XXXXXXXbetween

THE MACKINAC BRIDGE AUTHORITY (MBA)and

NAME & ADDRESS OF CONTRACTOR: PRIMARY CONTACT EMAIL

TELEPHONE CONTRACTOR #, MAILCODE

MBA CONTACTS AGENCY NAME PHONE EMAIL

PROJECT MANAGER MBA Mike Litzner

CONTRACT SUMMARY:DESCRIPTION: Descriptive Contract Title (Not always the same language as provided in MAIN)

New Toll Collection System

INITIAL TERM EFFECTIVE DATEINITIAL EXPIRATIONDATE AVAILABLE OPTIONS

6 Years 4 one-year extensionsPAYMENT TERMS F.O.B SHIPPED SHIPPED FROM

N/A N/A N/A N/AMINIMUM DELIVERY REQUIREMENTS:

N/AMISCELLANEOUS INFORMATION:

ESTIMATED CONTRACT VALUE AT TIME OF EXECUTION:Notice of Contract #:

FOR THE CONTRACTOR: FOR THE MBA:

Firm Name Signature

Authorized Agent Signature Name/Title

Authorized Agent (Print or Type) Enter Name of Agency

Date Date

Mackinac Bridge Authority

Contract # XXXXXNew Toll Collection System

MBA Project Manager: Mike LitznerTelephone Number:

E-Mail Address:

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Table of ContentsArticle 1 – Project Overview 8

1.000 Project Identification 81.001 Project Purpose 81.002 Background 8

1.100 Scope of Work and Deliverables 81.101 In Scope 81.102 Not Applicable 81.103 Not Applicable 81.104 Not Applicable 8

1.200 Roles and Responsibilities 81.201 Contractor Staff, Roles, And Responsibilities 81.202 MBA Staff, Roles, And Responsibilities 9

1.300 Project Plan 91.301 Project Plan Management 91.302 Reports 9

1.400 Project Management 91.401 Project Management 9

1.500 Acceptance 91.501 Criteria 91.502 Not Applicable 10

1.600 Compensation and Payment 101.601 Compensation And Payment 101.602 Not Applicable 10

Article 2 Terms and Conditions 11

2.000 Contract Structure and Term 112.001 Contract Term 112.002 Options to Renew 112.003 Legal Effect 112.004 Attachments & Exhibits 112.005 Not Applicable 112.006 Order of Precedence 112.007 Headings 112.008 Not Applicable 112.009 Reformation and Severability 11

2.010 Consents and Approvals 112.011 No Waiver of Right to Strict Adherence to Contract 112.012 Survival 12

2.020 Contract Administration 122.021 Not Applicable 122.022 Not Applicable 122.023 Project Manager 122.024 Change Requests 122.025 Notices 132.026 Binding Commitments 142.027 Relationship of the Parties 142.028 Not Applicable 142.029 Assignments 14

2.030 General Provisions 142.031 Media Releases 142.032 Not Applicable 142.033 Permits 142.034 Not Applicable 142.035 Not Applicable 142.036 Freedom of Information 142.037 Disaster Recovery 14

2.040 Financial Provisions 142.041 Fixed Prices for work 14

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2.042 Adjustments for Reductions in required work 152.043 Work Covered 152.044 Invoicing and Payment – In General 152.045 Pro-ration 152.046 Antitrust Assignment 152.047 Final Payment 152.048 Not applicable 15

2.050 Taxes 152.051 Employment Taxes 152.052 Sales and Use Taxes 15

2.060 Contract Management 162.061 Contractor Personnel Qualifications 162.062 Contractor Key Personnel 162.063 Re-assignment of Personnel at the MBA’s Request 162.064 Contractor Personnel Location 162.065 Contractor Identification 162.066 Cooperation with Third Parties 172.067 Contract Management Responsibilities 172.068 Contractor Return of MBA Equipment/Resources 17

2.070 Subcontracting by Contractor 172.071 Contractor full Responsibility 172.072 MBA Consent to delegation 172.073 Subcontractor bound to Contract 172.074 Flow Down 172.075 Competitive Selection 18

2.080 MBA Responsibilities 182.081 Equipment 182.082 Facilities 18

2.090 Security 182.091 Background Checks 182.092 Security Breach Notification 182.093 PCI DATA Security Requirements 18

2.100 Confidentiality 192.101 Confidentiality 192.102 Protection and Destruction of Confidential Information 192.103 Not Applicable 192.104 Not Applicable 192.105 Respective Obligations 19

2.110 Records and Inspections 192.111 Inspection of Work Performed 192.112 Examination of Records 202.113 Retention of Records 202.114 Audit Resolution 202.115 Errors 20

2.120 Warranties 202.121 Warranties and Representations 202.122 Warranty of Merchantability 212.123 Warranty of Fitness for a Particular Purpose 212.124 Warranty of Title 212.125 Equipment Warranty 222.126 Equipment to be New 222.127 Prohibited Products 222.128 Consequences for Breach 22

2.130 Insurance 222.131 Liability Insurance 222.132 Subcontractor Insurance Coverage 232.133 Certificates of Insurance and Other Requirements 23

2.140 Indemnification 242.141 General Indemnification 242.142 Code Indemnification 242.143 Employee Indemnification 242.144 Patent/Copyright Infringement Indemnification 24

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2.145 Continuation of Indemnification Obligations 252.146 Indemnification Procedures 25

2.150 Termination 262.151 Notice and Right to Cure 262.152 Termination for Cause 262.153 Termination for Convenience 262.154 Not Applicable 262.155 Termination for Criminal Conviction 262.156 Termination for Approvals Rescinded 272.157 Rights and Obligations upon Termination 272.158 Reservation of Rights 27

2.160 Not Applicable 272.161 Not Applicable 27

2.170 Transition Responsibilities 272.171 Contractor Transition Responsibilities 272.172 Contractor Personnel Transition 272.173 Contractor Information Transition 282.174 Contractor hardware and Software Transition 282.175 Transition Payments 282.176 MBA Transition Responsibilities 28

2.180 Stop Work 282.181 Stop Work Orders 282.182 Cancellation or Expiration of Stop Work Order 282.183 Allowance of Contractor Costs 29

2.190 Dispute Resolution 292.191 In General 292.192 Informal Dispute Resolution 292.193 Injunctive Relief 292.194 Continued Performance 30

2.200 Federal and State Contract Requirements 302.201 Nondiscrimination 302.202 Unfair Labor Practices 302.204 Not Applicable 30

2.210 Governing Law 302.211 Governing Law 302.212 Compliance with Laws 302.213 Jurisdiction and venue 30

2.220 Limitation of Liability 312.221 Limitation of Liability 31

2.230 Disclosure Responsibilities 312.231 Disclosure of Litigation 312.232 Not Applicable 322.233 Bankruptcy 32

2.240 Performance 322.241 Time of Performance 322.242 Key Performance Indicators (KPI) 322.243 Liquidated Damages 322.244 Not Applicable 342.245 Loss of Revenue 34

2.250 Approval of Deliverables 342.251 Delivery of Deliverables 342.252 Contractor System Testing 352.253 Approval of Deliverables (General 352.254 Process for Approval of Written Deliverables 362.255 Process for Approval of the NTCS 372.256 Final Acceptance 37

2.260 Ownership 372.261 Ownership of Work Product by MBA 372.262 Vesting of Rights 372.263 Rights in Data 37

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2.264 Ownership of Materials 38

2.270 MBA Standards 382.271 Existing Technology Standards 382.272 Acceptable Use Policy 382.273 Systems Changes 39

2.280 Extended Purchasing 392.281 Not Applicable 392.282 Not Applicable 39

2.290 Environmental Provision 392.291 Environmental Provision 39

2.300 Deliverables 402.301 Software 402.302 Hardware 40

2.310 Software Warranties 412.311 Performance Warranty 412.312 No Surreptitious Code Warranty 412.313 Not Applicable 412.314 Third-party Software Warranty 412.315 Not Applicable 41

2.320 Software Licensing 422.321 Cross-License, Deliverables Only, License to Contractor 422.322 Cross-License, Deliverables and Derivative Work, License to Contractor 422.323 License Back to the MBA 422.324 License Retained by Contractor 422.325 Pre-existing Materials for Custom Software Deliverables 42

2.330 Source Code Escrow 422.331 Definition 422.332 Delivery of Source Code into Escrow 432.333 Delivery of New Source Code into Escrow 432.334 Verification 432.335 Escrow Fees 432.336 Release Events 432.337 Release Event Procedures 432.338 License 432.339 Derivative Works 44

Glossary 45Exhibit A – Contractor’s Proposal 48

Exhibit B – Request for Proposal 49

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THIS TOLL SYSTEM INTEGRATION PROCUREMENT CONTRACT (“Contract”) is made and entered into as of the ______ dayof _______, 2018 (“Effective Date”), by and between the MACKINAC BRIDGE AUTHORITY (MBA), , and _______________,a _______________ corporation authorized to do business in the State of Michigan (“Contractor”). The MBA and theContractor may be referred to individually, as “Party” or collectively, as “Parties.”

WHEREAS, The MBA desires to engage a qualified and experienced contractor to provide the design, implementation,warranty, and maintenance of a New Toll Collection System (“NTCS”) that will perform all functions typical of an electronictolling system for the Mackinac Bridge (“Project”), as more fully described in (a) this Contract, and (b) the Request forProposals, Requisition #2495, and any addenda thereto and any documents referenced therein (collectively, the “RFP”);

WHEREAS, the Contractor has represented to the MBA that it is experienced and qualified and willing to provide all of thelabor, materials, equipment, and expertise needed to successfully provide the NTCS as is more fully described in the RFP;

WHEREAS, the MBA has relied upon such representations and selected the Contractor to furnish the Work; and

WHEREAS, the MBA is authorized to contract for the Work that in the judgment of the MBA is necessary for completionof the design, construction, installation, testing, implementation, maintenance, and the provision of services andDeliverables required under this Contract and includes, without limitation, all plant, labor, materials, hardware, systems,taxes, services and software and other facilities, installation, testing, operations and maintenance and other thingsnecessary or proper for or incidental to the carrying out and completion of the terms of this Contract.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the receipt and sufficiencyof which are hereby acknowledged, the Parties hereto, intending to be legally bound, agree as follows:

1. Recitals. The recitals set forth above are true and correct and are incorporated into this Contract.

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Article 1 – Project Overview

1.000 Project Identification

1.001 PROJECT PURPOSEThe MBA has issued this Contract to ___________ to implement a new toll collection system at theMackinac Bridge.

The Contractor must procure the hardware and software needed to implement the tolling system.

1.002 BACKGROUND

Existing SoftwareThe MBA currently uses the Conduent Vector ® toll collection software system.

About the BridgeThe Mackinac Bridge spans the Straits of Mackinac, connecting Mackinaw City in Michigan’s LowerPeninsula, with St. Ignace in the Upper Peninsula.

1.100 Scope of Work and Deliverables

1.101 IN SCOPEThe Contractor must provide all Work as required by this Contract.

1.102 NOT APPLICABLE



1.200 Roles and Responsibilities

1.201 CONTRACTOR STAFF, ROLES, AND RESPONSIBILITIES

A. Contractor StaffThe Contractor must comply with all staffing requirements as described in this Contract.

B. On -Site Work RequirementsSite Investigation. The Contractor has carefully and thoroughly reviewed all of the site conditions at theMackinac Bridge Toll Plaza, Tunnel, and Administration Building (“Project Site”). The Contractor issatisfied as to the general, local and site conditions, and the condition of any and all plazas, equipment,and hardware on or related to the Project Site that may affect cost, progress, performance orcompletion of the Project. The Contractor agrees that the conditions at the Project Site are sufficientand no changes need to be made for the Contractor to perform completely and fully the Work as setforth in this Contract. The silence of any specification as to any detail, or the omission of a detaileddescription concerning any point, must be interpreted to mean that only the best commercial practice isto prevail and only material and workmanship of the first quality may be used.

Hours of Operation.a. The MBA working hours are 8:00 a.m. to 5:00 p.m. ET, Monday through Friday, with work

performed as necessary after those hours to meet Project deadlines.b. The MBA is not obligated to provide oversight of the Contractor work outside of the MBA

working hours. The MBA reserves the right to modify the work hours in the best interest of theProject.

c. Contractor must observe the same standard holidays as the MBA employees. The MBA doesnot compensate for holiday pay.

Travel.

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a. No travel or expenses will be reimbursed. This includes travel costs related to training providedto the MBA by the Contractor.

b. Travel time will not be reimbursed.

Additional Security and Background Check Requirements. The Contractor must present certificationsto the MBA of Michigan State Police Background checks (ICHAT) and documentation certifyingnegative drug tests results for all controlled substances for all individuals performing work pursuant tothis Contract.

The Contractor must pay for all costs associated with ensuring their staff meets all requirements as setforth in this Contract.

1.202 MBA STAFF, ROLES, AND RESPONSIBILITIES

The MBA will provide the following resources for the Contractor’s use on this Project: Limited work space Desk Telephone Access to printer and copier

The MBA will provide an MBA Project Manager, and other Project support personnel who will provide directionand support as-needed, including review and resolution of issues, review and comment on ProjectDeliverables, and review and comment on change control requests.

1.300 Project Plan

1.301 PROJECT PLAN MANAGEMENTThe Contractor must provide the plans described in the RFP, including a Project Management Plan.

1.302 REPORTSThe Contractor must provide reports as described in the RFP.

1.400 Project Management

1.401 PROJECT MANAGEMENTThe Contractor must provide project management as described in the RFP.

1.500 Acceptance

1.501 CRITERIA

Document Deliverable Acceptance Documents must be dated and in electronic format, compatible with Microsoft Office ® suite or in PDF

format. Draft documents are not accepted as final Deliverables. The documents will be reviewed in accordance with the requirements of this Contract. The MBA will review documents within the timeframes listed in the RFP. The document review process

is described in Section 2.250 herein.

System Deliverable Acceptance

Testing must demonstrate the NTCS’s compliance with the requirements of this Contract. At aminimum, the testing must confirm the following:o Functional - the capabilities of the system with respect to the functions and features described in

this Contract.

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o Performance - the ability of the system to meet a series of Key Performance Indicators (KPIs)which measure the reliability, timeliness, and accuracy of the NTCS.

Final acceptance of the System depends on the successful completion of System Acceptance Test(SAT) as described in detail in the RFP.


1.600 Compensation and Payment

1.601 COMPENSATION AND PAYMENT

Method of PaymentThe price charged to the MBA by the Contractor for the NTCS under this Contract is as good as or better thanthe price that the Contractor or subsidiaries has charged other customers as of the Effective Date under thesame commercial terms and conditions as contained in this Contract.

Section 1.10 of the RFP describes how the Contractor will be compensated.

InvoicingThe Contractor must submit properly itemized invoices to the MBA Project Manager. Invoices must provideand itemize, as applicable:

Contract number; Contractor name, address, phone number, and Federal Tax Identification Number; Description of any completed milestones; Price for each item, or Contractor’s list price for each item and applicable discounts; Maintenance charges; Net invoice price for each item; Total invoice price; and Payment terms.

The MBA will pay for maintenance charges, on a monthly basis, in arrears. Payment of maintenance service ofless than one (1) month’s duration must be prorated at 1/30th of the basic monthly maintenance charges foreach calendar day.

Incorrect or incomplete invoices must be returned to the Contractor for correction and reissue.


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Article 2 Terms and Conditions

2.000 Contract Structure and Term

2.001 CONTRACT TERMThis Contract is for a period of 6 years beginning on the Effective Date of this Contract.

2.002 OPTIONS TO RENEWThis Contract may be renewed in writing by mutual agreement of the parties not less than 30 days before itsexpiration. This Contract may be renewed for up to 4 additional 1-year periods.

2.003 LEGAL EFFECTThe Contractor must not proceed with the performance of the Work to be done under this Contract, includingthe purchase of necessary materials, until both parties have signed this Contract and the Contractor receives aNotice to Proceed.

Except as otherwise agreed in writing by the parties, the MBA will not be liable for costs incurred by theContractor, or payment under this Contract, until this Contract has been signed by all the parties and a Noticeto Proceed has been issued.

2.004 ATTACHMENTS & EXHIBITSAll exhibits appended to or referenced in this Contract, are incorporated in their entirety and form part of thisContract.


2.006 ORDER OF PRECEDENCEThis Contract, including any exhibits, constitutes the entire agreement between the parties with respect to thesubject matter and supersedes all prior agreements, whether written or oral, with respect to the subject matter.The RFP, which is incorporated herein by reference as Exhibit A, and the Contractor’s Proposal (and anydocuments referenced therein) submitted in response to the RFP, which is incorporated herein by reference asExhibit B “Contractor’s Proposal”), are integral parts of this Contract.

The RFP, the Contractor’s Proposal, this Contract (including all Change Orders, and exhibits referenced in thisContract) must be collectively referred to as the “Contract.” In case of any discrepancies between the body ofthis Contract and any exhibits hereto, the body of this Contract will govern. In case of any discrepanciesbetween the Exhibit A, attached to this Contract, and Exhibit B, attached to this Contract, Exhibit A will govern.

2.007 HEADINGSCaptions and headings used in this Contract are for information and organization purposes. Captions andheadings, including inaccurate references, do not, in any way, define or limit the requirements or terms andconditions of this Contract.


2.009 REFORMATION AND SEVERABILITYEach provision of this Contract is severable from all other provisions of this Contract and, if one or more of theprovisions of this Contract is declared invalid, the remaining provisions of this Contract remain in full force andeffect.

2.010 Consents and ApprovalsExcept as expressly provided otherwise in this Contract, if either party requires the consent or approval of theother party for the taking of any action under this Contract, the consent or approval must be in writing andsigned by the other party before it is deemed valid.

2.011 NO WAIVER OF RIGHT TO STRICT ADHERENCE TO CONTRACTIf a party to this Contract fails to require strict adherence to any term of this Contract, said party has notwaived the right to later require strict adherence to that term, or any other term, of this Contract.

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2.012 SURVIVALAny provisions of this Contract that impose continuing obligations on the parties, including without limitation theparties’ respective warranty, indemnity and confidentiality obligations, survive the expiration or termination ofthis Contract for any reason. Specific references to survival in this Contract are solely for identificationpurposes and not meant to limit or prevent the survival of any other section.

2.020 Contract Administration



2.023 PROJECT MANAGERThe following individual will serve as the MBA Project Manager:

Michael C. Litzner, CFOMackinac Bridge AuthorityN415 I-75, St. Ignace, MI 49781Office (906) 643-1326Cell (231) 437-0032Fax (906) [email protected]

2.024 CHANGE REQUESTSThe MBA reserves the right to request from time to time any changes to the requirements and specifications ofthis Contract and the Work to be performed by the Contractor under this Contract. During the course ofordinary business, it may become necessary for the MBA to discontinue certain business practices or createadditional services or Deliverables.

If the MBA requests or directs the Contractor to perform any services or provide Deliverables that are outsidethe scope of the Contractor’s responsibilities under this Contract (“New Work”), the Contractor must notify theMBA promptly before commencing performance of the requested activities it believes are New Work. If theContractor fails to notify the MBA before commencing performance of the requested activities, any suchactivities performed before the Contractor gives notice will be conclusively considered to be in-scope servicesand/or Deliverables and not New Work.

When New Work is requested, the Contractor must provide a detailed outline of all work to be done, includingtasks necessary to accomplish the additional services and/or deliverables, timeframes, listing of Key Personnelassigned, estimated hours for each individual per task, and a complete and detailed cost proposal.

If the MBA requests or directs the Contractor to perform any services or provide deliverables that areconsistent with and similar to the Work being provided by the Contractor under this Contract, but which theContractor reasonably and in good faith believes are not included within this Contract then before performingsuch services or providing such deliverables, the Contractor must notify the MBA in writing that it considers theservices or deliverables to be New Work for which the Contractor should receive additional compensation. Ifthe Contractor fails to notify the MBA in writing of said claim for additional compensation, the Contractor herebywaives any right to additional compensation for performing that service or providing that deliverable. If theContractor does so notify the MBA, then such a service or deliverable must be governed by the procedures inthis section.

In the event prices or service levels are not acceptable to the MBA, the New Work may be subject tocompetitive bidding based upon the specifications.

The process for administering changes shall be as follows:

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(1) If the MBA requires the Contractor to perform New Work that would affect the Contract completionschedule or the amount of compensation due to the Contractor (a “Change”), the MBA will submit awritten request for the Contractor to furnish a proposal for carrying out the requested Change (a “ChangeRequest”).

(2) In addition, the Contractor will be entitled to propose a Change to the MBA, on its own initiative, shouldthe Contractor believe the proposed Change would benefit the Project.

(3) Upon receipt of a Change Request or on its own initiative, the Contractor must examine the implicationsof the requested Change on the technical specifications, the Contract schedule, and the price of the NewWork and must submit to the MBA, without undue delay, a written proposal for carrying out the Change.The Contractor’s proposal must include any associated changes in the technical specifications, theContract schedule, and the price and method of pricing of the New Work. If the New Work is to beperformed on a time and materials basis, the labor rates in the Contractor’s original Proposal must applyto the provision of such New Work. If the Contractor is of the opinion that a requested Change is notrecommended, it must nevertheless provide a written proposal and carry out the Change as specified ifthe MBA directs it to do so.

(4) The MBA has the right to accept a Contractor proposal for Change, to reject it, or to reach anotheragreement with the Contractor. Should the parties agree on carrying out a Change, a written ContractChange Notice must be prepared and signed by both parties , describing the Change and its effects onthe Work and any affected components of this Contract (a “Contract Change Notice”).

(5) No proposed Change(s) will be performed by the Contractor until an executed Contract Change Noticehas been issued by the MBA.

(6) If the MBA requests or directs the Contractor to perform any activities that the Contractor believesconstitute a Change, the Contractor must notify the MBA in writing that it believes the requested activitiesare a Change, before beginning work on the requested activities. If the Contractor fails to notify the MBAin writing before beginning work on the requested activities, the Contractor hereby waives any right toassert any claim for additional compensation or additional time for performing the requested activities. Ifthe Contractor commences performing work outside the scope of this Contract and then ceasesperforming that work, the Contractor must, at the request of the MBA, retract any out-of-scope work thatwould adversely affect the Project.

2.025 NOTICESAny notice given to a party under this Contract must be in writing and will be deemed effective, if addressed tothe party as addressed below, upon: (i) delivery, if hand delivered; (ii) receipt of a confirmed transmission byfacsimile if a copy of the notice is sent by another means specified in this Section 2.025; (iii) the third BusinessDay after being sent by U.S. mail, postage pre-paid, return receipt requested; or (iv) the next Business Dayafter being sent by a nationally recognized overnight express courier with a reliable tracking system.

MBA:

Michael C. Litzner, CFOMackinac Bridge AuthorityN415 I-75, St. Ignace, MI 49781Office (906) 643-1326Cell (231) 437-0032Fax (906) [email protected]

Contractor:

XXXXXXXXXXXXXXXXXXXXXXXX

Either party may change its address where notices are to be sent by giving written notice to the other Party.

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2.026 BINDING COMMITMENTSThe Contractor’s Project Manager has the authority to make binding commitments on the Contractor’s behalfwithin the bounds set forth in this Contract.

2.027 RELATIONSHIP OF THE PARTIESThe relationship between the MBA and the Contractor is that of client and independent contractor. No agent,employee, or servant of the Contractor or any of its Subcontractors will be deemed to be an employee, agentor servant of the MBA for any reason. The Contractor is solely and entirely responsible for its acts and the actsof its agents, employees, servants and Subcontractors during the performance of the Work.


2.029 ASSIGNMENTSThe MBA may assign this Contract to any other State agency, department, division or department without theprior consent of the Contractor.

The Contractor may not assign this Contract to another party without the prior written permission of the MBA.In addition, the Contractor may not sublet any portion of this Contract without the prior written approval of theMBA. If the Contractor intends to assign this Contract or any of the Contractor's rights or duties under thisContract, the Contractor must notify the MBA in writing at least 90 days before the proposed assignmentthe Contractor may not, without the prior written approval of the MBA, assign its right to receive payments dueunder this Contract. If the MBA permits an assignment, the Contractor is not relieved of its responsibility toperform any of its contractual duties and the requirement under this Contract that all payments must be madeto one entity continues.

2.030 General Provisions

2.031 MEDIA RELEASESNews releases (including promotional literature and commercial advertisements) pertaining to the Project towhich it relates must not be made without prior written approval from the MBA, and then only in accordancewith the explicit written instructions from the MBA. No results of the activities associated with the RFP andContract are to be released without prior written approval of the MBA and then only to persons designated.


2.033 PERMITSThe Contractor must obtain and pay any associated costs for all required governmental permits, licenses andapprovals for the delivery, installation and performance of the Work.



2.036 FREEDOM OF INFORMATIONAny and all information submitted to the MBA, in any form whatsoever, including but not limited to written,electronic, e-mail, US Mail, Courier, etc. is subject to the provisions of the Michigan Freedom of InformationAct, 1976 Public Act No. 442, as amended, MCL 15.231, et seq (the “FOIA”). This Contract, and any futureamendments thereto, are also subject to the FOIA.

2.037 DISASTER RECOVERYThe Contractor and the MBA recognize that the MBA provides essential services in times of natural or man-made disasters. Therefore, except as so mandated by Federal disaster response requirements, Contractorpersonnel dedicated to providing Work under this Contract must provide the MBA with priority service for repairand work in the event of a natural or man-made disaster.

2.040 Financial Provisions

2.041 FIXED PRICES FOR WORK

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This Contract specifies the firm, fixed prices for all Work, and the associated payment milestones and paymentamounts. The MBA may make progress payments to the Contractor when requested as work progresses, butnot more frequently than monthly, in amounts approved by the MBA Project Manager. The Contractor mustshow verification of measurable progress at the time of requesting progress payments.

2.042 ADJUSTMENTS FOR REDUCTIONS IN REQUIRED WORKIf the Work required under this Contract is subsequently reduced by the MBA, the parties will negotiate anequitable reduction in the Contractor’s charges commensurate with the reduction in scope.

2.043 WORK COVEREDThe MBA is not obligated to pay any amounts in addition to the charges specified in this Contract for any andall Work to be provided by the Contractor and its Subcontractors, if any, under this Contract.

2.044 INVOICING AND PAYMENT – IN GENERAL(a) Each Contractor invoice must show details as to charges by Work component at a level of detail

reasonably necessary to satisfy the MBA’s accounting and charge-back requirements. Invoices for Workperformed on a time and materials basis must show, for each individual, the number of hours of Workperformed during the billing period, the billable skill/labor category for such person and the applicablehourly billing rate. Prompt payment by the MBA is contingent on the Contractor’s invoices showing thecorrect amount owed.

(b) Correct invoices will be due and payable by the MBA within 45 days after receipt, provided the MBAdetermines that the invoice was properly rendered and invoiced milestones have been completed andapproved by the MBA.

(c) All invoices should reflect actual Work done. The MBA may make progress payments to the Contractorwhen requested as Work progresses, but not more frequently than monthly, in amounts approved by theMBA Project Manager, after negotiation. The Contractor must show verification of measurable progress atthe time of requesting progress payments.

2.045 PRO-RATIONTo the extent there is Work that is to be paid for on a monthly basis, the cost of such Work must be pro-ratedfor any partial month.

2.046 ANTITRUST ASSIGNMENTThe Contractor assigns to the MBA and/or the State of Michigan any claim for overcharges resulting fromantitrust violations to the extent that those violations concern materials or services supplied by third parties tothe Contractor, toward fulfillment of this Contract.

2.047 FINAL PAYMENTThe making of final payment by the MBA to Contractor does not constitute a waiver by either party of any rightsor other claims as to the other party’s continuing obligations under this Contract, nor must it constitute a waiverof any claims by one party against the other arising from unsettled claims or failure by a party to comply withthis Contract, including claims for work not reasonably known until after acceptance to be defective orsubstandard. The Contractor’s acceptance of final payment by the MBA under this Contract will constitute awaiver of all claims by the Contractor against the MBA for payment under this Contract, other than thoseclaims previously filed in writing on a timely basis and still unsettled.


2.050 Taxes

2.051 EMPLOYMENT TAXESThe Contractor must pay any and all applicable federal, State of Michigan, and/or local taxes.

2.052 SALES AND USE TAXESThe Contractor must register and remit sales and use taxes on taxable sales of tangible personal property orservices delivered into the State of Michigan. Contractors that lack sufficient presence in Michigan to berequired to register and pay tax must do so as a volunteer. This requirement extends to: (1) all members ofany controlled group as defined in § 1563(a) of the Internal Revenue Code and applicable regulations of which

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the company is a member, and (2) all organizations under common control as defined in § 414(c) of theInternal Revenue Code and applicable regulations of which the company is a member that make sales at retailfor delivery into the State of Michigan are registered with the State of Michigan for the collection andremittance of sales and use taxes. In applying treasury regulations defining “two or more trades or businessesunder common control” the term “organization” means sole proprietorship, a partnership (as defined in § 701(a)(2) of the Internal Revenue Code), a trust, an estate, a corporation, or a limited liability company.

2.060 Contract Management

2.061 CONTRACTOR PERSONNEL QUALIFICATIONSAll persons assigned by the Contractor to the performance of Work under this Contract must be employees ofthe Contractor or its majority-owned (directly or indirectly, at any tier) subsidiaries (or an MBA-approvedSubcontractor) and must be fully qualified to perform the Work assigned to them. The Contractor must includea similar provision in any subcontract entered into with a Subcontractor. For the purposes of this Contract,independent contractors engaged by the Contractor solely in a staff augmentation role must be treated by theMBA as if they were employees of the Contractor for this Contract only; however, the MBA understands thatthe relationship between the Contractor and Subcontractor is an independent contractor relationship.

2.062 CONTRACTOR KEY PERSONNEL(a) The Contractor must provide the names of the Key Personnel in its Proposal.(b) Key Personnel must be dedicated to the Project as defined in this Contract.(c) The MBA has the right to approve or reject in writing the initial assignment, as well as any proposed

reassignment or replacement, of any Key Personnel. Before assigning an individual to any KeyPersonnel position, the Contractor must notify the MBA of the proposed assignment, must introduce theindividual to the appropriate MBA representatives, and must provide the MBA with a resume and anyother information about the individual reasonably requested by the MBA. The MBA reserves the right tointerview the individual before granting written approval. In the event the MBA finds a proposed individualunacceptable, the MBA will provide a written explanation including reasonable detail outlining the reasonsfor the rejection.

(d) The Contractor must not remove any Key Personnel from their assigned roles on this Contract without theprior written consent of the MBA. The Contractor’s removal of Key Personnel, without the prior writtenconsent of the MBA, is an unauthorized removal (“Unauthorized Removal”). Unauthorized Removal doesnot include replacing Key Personnel for reasons beyond the reasonable control of the Contractor,including illness, disability, leave of absence, personal emergency circumstances, resignation or forcause termination of the Key Personnel’s employment. Unauthorized Removal does not includereplacing Key Personnel because of promotions or other job movements allowed by the Contractorpersonnel policies as long as the MBA receives prior written notice before shadowing occurs and theContractor provides 30 days of shadowing unless parties agree to a different time period. The MBA mustreview any Key Personnel replacements, and appropriate transition planning will be established. AnyUnauthorized Removal may be considered by the MBA to be a material breach of this Contract, in respectof which the MBA may elect to exercise its termination and cancellation rights.

2.063 RE-ASSIGNMENT OF PERSONNEL AT THE MBA’S REQUESTThe MBA reserves the right to require the removal of Contractor personnel from the Project, if in the judgmentof the MBA, they are determined to be unacceptable. Replacement personnel for the removed person must befully qualified for the position in sole discretion of the MBA.

2.064 CONTRACTOR PERSONNEL LOCATIONKey Personnel must, at a minimum, spend at least the amount of time on-site at MBA facilities as indicated inthis Contract. Subject to availability, selected Contractor personnel may be provided office space at theBridge.

2.065 CONTRACTOR IDENTIFICATIONContractor employees must be clearly identifiable while on MBA property by wearing an MBA-issued badge, asrequired. Contractor employees are required to clearly identify themselves and the company they work forwhenever making contact with MBA personnel by telephone or other means.

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2.066 COOPERATION WITH THIRD PARTIESThe Contractor agrees to cause its personnel and the personnel of any Subcontractors to cooperate with theMBA and its agents and other contractors As reasonably requested by the MBA in writing, the Contractor mustprovide to the MBA’s agents and other contractors reasonable access to the Contractor’s Project personnel,systems and facilities to the extent the access relates to activities specifically associated with this Contract andmust not interfere or jeopardize the safety or operation of the systems or facilities. The MBA acknowledgesthat Contractor’s time schedule for this Contract is very specific and agrees not to unnecessarily orunreasonably interfere with, delay or otherwise impeded the Contractor’s performance under this Contract withthe requests for access.

2.067 CONTRACT MANAGEMENT RESPONSIBILITIESThe Contractor agrees that it is responsible for all acts and omissions of its employees, as well as the acts andomissions of any other personnel furnished by the Contractor to perform the Work. The Contractor must haveoverall responsibility for managing and successfully performing and completing the Work, subject to the overalldirection and supervision of the MBA and with the participation and support of the MBA as specified in thisContract.

The Contractor must provide the Work directly or through its affiliates, subsidiaries, or subcontractors.Regardless of the entity providing the Work, the Contractor must act as a single point of contact coordinatingthese entities to meet the MBA’s need for the Work. Nothing in this Contract, however, will be construed toauthorize or require any party to violate any applicable law or regulation in its performance of this Contract.

2.068 CONTRACTOR RETURN OF MBA EQUIPMENT/RESOURCESThe Contractor must return to the MBA any MBA-furnished equipment, facilities and other resources when nolonger required for the Contract in the same condition as when provided by the MBA, reasonable wear and tearexcepted.

2.070 Subcontracting by Contractor

2.071 CONTRACTOR FULL RESPONSIBILITYThe Contractor will have full responsibility for the successful performance and completion of all of the requiredWork. The Contractor is the sole point of contact for the MBA with regard to all contractual matters under thisContract, including payment of any and all charges for the Work.

2.072 MBA CONSENT TO DELEGATIONThe Contractor must not delegate any duties under this Contract to a Subcontractor without the prior writtenapproval of the MBA. The MBA has the right of approval of all Subcontractors and to require the Contractor toreplace any Subcontractors found, in the reasonable judgment of the MBA, to be unacceptable. The MBA’srequest must be written, outlining the reasons for the removal request. Replacement Subcontractor(s) for theremoved Subcontractor must be fully qualified for the position in the sole discretion of the MBA.

2.073 SUBCONTRACTOR BOUND TO CONTRACTIn any subcontracts entered into by the Contractor for the performance of the Work, the Contractor mustrequire the Subcontractor, to the extent of the Work to be performed by the Subcontractor, to be bound to theContractor by the terms of this Contract and to assume toward the Contractor all of the obligations andresponsibilities that the Contractor, by this Contract, assumes toward the MBA. The MBA reserves the right toreceive copies of and review all subcontracts. The management of any Subcontractor is the responsibility ofthe Contractor, and the Contractor remains responsible for the performance of its Subcontractors to the sameextent as if the Contractor had not subcontracted such performance. The Contractor must make all paymentsto Subcontractors or suppliers. Except as otherwise agreed in writing by the MBA and the Contractor, the MBAmust not be obligated to direct payments for the Work, other than to the Contractor. The MBA’s writtenapproval of any Subcontractor engaged by the Contractor to perform any obligation under this Contract doesnot relieve the Contractor of any obligations or performance required under this Contract.

2.074 FLOW DOWN

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Except where specifically approved in writing by the MBA on a case-by-case basis, the Contractor must flowdown the obligations in Sections 2.031, 2.060, 2.100, 2.110, 2.120, 2.130, and 2.200 in all of its agreementswith any Subcontractors.

2.075 COMPETITIVE SELECTIONThe Contractor must select subcontractors (including suppliers) on a competitive basis to the maximumpractical extent, consistent with the objectives and requirements of this Contract.

2.080 MBA Responsibilities

2.081 EQUIPMENTThe MBA will provide only the equipment and resources identified in this Contract.

2.082 FACILITIESThe Contractor will have reasonable access to, and unless agreed otherwise by the parties in writing, mustobserve and comply with all rules and regulations relating to each of the MBA Facilities (including hours ofoperation) used by the Contractor in the course of providing the Work. The Contractor agrees that it must not,without the prior written consent of the MBA, use any MBA Facilities or access any MBA information systemsprovided for the Contractor’s use, or to which the Contractor otherwise gains access in the course ofperforming the Work, for any purpose other than providing the Work to the MBA.

2.090 Security

2.091 BACKGROUND CHECKSOn a case-by-case basis, the MBA may investigate the Contractor's personnel before they are granted accessto MBA facilities and systems. The scope of the background check is at the discretion of the MBA and theresults will be used to determine Contractor personnel eligibility for working within MBA facilities and systems.The investigations will include Michigan State Police Background checks (ICHAT) and may include NationalCrime Information Center (NCIC) Finger Prints. Proposed Contractor personnel may be required to completeand submit an RI-8 Fingerprint Card for the NCIC Finger Print Check.

All Contractor personnel must comply with the MBA’s security and acceptable use policies for State ITequipment and resources. See:

https://www.michigan.gov/documents/dtmb/1340.00.01_Acceptable_Use_of_Information_Technology_Standard_458958_7.pdf

https://www.michigan.gov/documents/dmb/1340_193162_7.pdf

2.092 SECURITY BREACH NOTIFICATIONIf the Contractor breaches any part of this Section 2.090 (and all subsections), the Contractor must (i) promptlycure any deficiencies and (ii) comply with any applicable federal and State laws and regulations pertaining tounauthorized disclosures. The Contractor and the MBA must cooperate to mitigate, to the extent practicable,the effects of any breach, intrusion, or unauthorized use or disclosure. The Contractor must report to the MBAin writing any use or disclosure of Confidential Information, whether suspected or actual, other than asprovided for by this Contract, immediately.

2.093 PCI DATA SECURITY REQUIREMENTSThe Contractor must adhere to all Payment Card Industry (PCI) Data Security requirements. The Contractoragrees that they are responsible for security of cardholder data in their possession. The Contractor agreesthat data can ONLY be used for assisting the MBA in completing a transaction, supporting a loyalty program,supporting the MBA, providing fraud control services, or for other uses specifically required by law.

The Contractor agrees to provide business continuity in the event of a major disruption, disaster or failure.

The Contractor must contact the MBA immediately to advise them of any breaches in security where card datahas been compromised. In the event of a security intrusion, the Contractor agrees the Payment Card Industry

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representative, or a Payment Card Industry approved third party, must be provided with full cooperation andaccess to conduct a thorough security review. The review must validate compliance with the Payment CardIndustry Data Security Standard for protecting cardholder data.

The Contractor agrees to properly dispose of sensitive cardholder data when no longer needed. TheContractor must continue to treat cardholder data as Confidential Information upon Contract termination.

The Contractor must provide the MBA documentation showing PCI Data Security certification has beenachieved and continues to meet PCI compliance via audits no less often than yearly. The Contractor mustadvise the MBA of all failures to comply with the PCI Data Security Requirements. Failures include, but arenot limited to, system scans and self-assessment questionnaires. The Contractor must provide a time line forcorrective action.

2.100 Confidentiality

2.101 CONFIDENTIALITYAs used in this Section 2.100 (and all subsections), “Confidential Information” means any and all informationprovided to the Contractor by the MBA under its performance under this Contract. The Contractoracknowledges that it will continue to possess Confidential Information that has been developed or received byit.

2.102 PROTECTION AND DESTRUCTION OF CONFIDENTIAL INFORMATIONThe Contractor must use at least the same degree of care to prevent disclosing to third parties the ConfidentialInformation of the MBA as it employs to avoid unauthorized disclosure, publication or dissemination of its ownConfidential Information of like character, but in no event less than reasonable care. The Contractor must not(i) make any use of the Confidential Information of the MBA except as contemplated by this Contract, (ii)acquire any right in or assert any lien against the Confidential Information of the MBA, or (iii) if requested to doso, refuse for any reason to promptly return the MBA’s Confidential Information. The Contractor must limitdisclosure of the MBA’s Confidential Information to employees and Subcontractors who must have access tofulfill the purposes of this Contract. Disclosure to, and use by, a Subcontractor is permissible where (A) use ofa Subcontractor is authorized under this Contract, (B) the disclosure is necessary or otherwise naturally occursin connection with Work that is within the Subcontractor's scope of responsibility, and (C) the Contractorobligates the Subcontractor in a written Contract to maintain the MBA’s Confidential Information in confidence.At the MBA's request, any employee of the Contractor and of any Subcontractor having access or continuedaccess to the MBA’s Confidential Information may be required to execute an acknowledgment that theemployee has been advised of the Contractor’s and the Subcontractor’s obligations under this Section 2.10(and all subsections) and of the employee’s obligation to the Contractor or Subcontractor, as the case may be,to protect the Confidential Information from unauthorized use or disclosure.

Upon termination or cancellation of this Contract for any reason, the Contractor must certify to the MBA thatthe Contractor has destroyed all MBA Confidential Information.



2.105 RESPECTIVE OBLIGATIONSThe Contractor’s obligations under this Section 2.100 (and subsections) must survive the termination orexpiration of this Contract for any reason.

2.110 Records and Inspections

2.111 INSPECTION OF WORK PERFORMEDThe MBA’s authorized representatives must at all times and with 24 hours prior written notice, have the right toenter the Contractor’s premises, or any other places, where the Work is being performed, and must be grantedaccess to inspect, monitor, or otherwise evaluate interim drafts of documents or Work-in-progress. TheContractor must provide all reasonable facilities and assistance for the MBA’s representatives.

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2.112 EXAMINATION OF RECORDSFor seven years after the Contractor provides any Work under this Contract (the "Audit Period"), the MBA mayexamine and copy any of the Contractor’s books, records, documents and papers pertinent to establishing theContractor’s compliance with this Contract and with applicable laws and rules. The MBA must notify theContractor 10 days before examining the Contractor's books and records. The MBA does not have the right toreview any information deemed confidential by the Contractor to the extent access would require theconfidential information to become publicly available. This provision also applies to the books, records,accounts, documents and papers, in print or electronic form, of any parent, affiliated or subsidiary organizationof the Contractor, or any Subcontractor of the Contractor performing Work in connection with this Contract.

2.113 RETENTION OF RECORDSThe Contractor must maintain at least until the end of the Audit Period, all pertinent financial and accountingrecords (including information pertaining to this Contract and to the Work, equipment, and commoditiesprovided under this Contract) pertaining to , according to generally accepted accounting principles and otherprocedures specified in this Section 2.110 (and all subsections). Financial and accounting records, exclusiveof access to the Contractor’s cost structure and profit factors, must be made available, upon request, to theMBA at any time during the Audit Period. If an audit, litigation, or other action involving the Contractor’srecords is initiated before the end of the Audit Period, the records must be retained until all issues arising out ofthe audit, litigation, or other action are resolved or until the end of the Audit Period, whichever is later.

2.114 AUDIT RESOLUTIONIf necessary, the Contractor and the MBA must meet to review each audit report promptly after issuance. TheContractor must respond to each audit report in writing within 30 days from receipt of the report, unless ashorter response time is specified in the report. The Contractor and the MBA must develop, agree upon andmonitor an action plan to promptly address and resolve any deficiencies, concerns, and/or recommendations inthe audit report.

2.115 ERRORSIf the audit demonstrates any errors in the documents provided to the MBA, then the amount in error must bereflected as a credit or debit on the next invoice and in subsequent invoices until the amount is paid orrefunded in full. However, a credit or debit may not be carried for more than four invoices. If a balanceremains after four invoices, then the remaining amount must be due as a payment or refund within 45 days ofthe last quarterly invoice that the balance appeared on or termination of this Contract, whichever is earlier.

In addition to other available remedies, the difference between the payment received and the correct paymentamount is greater than 10%, then the Contractor must pay all of the reasonable costs of the audit.

2.120 Warranties

2.121 WARRANTIES AND REPRESENTATIONSThe Contractor represents and warrants:(a) It is capable in all respects of fulfilling and must fulfill all of its obligations under this Contract. The

performance of all obligations under this Contract must be provided in a timely, professional, andworkman-like manner and must meet the performance and operational standards required under thisContract.

(b) This Contract identifies the Work necessary for the NTCS to operate in compliance with this Contract’srequirements and other standards of performance.

(c) It is the lawful owner or licensee of any Deliverable licensed or sold to the MBA by the Contractor ordeveloped by the Contractor under this Contract, and the Contractor has all of the rights necessary toconvey to the MBA the ownership rights or licensed use, as applicable, of any and all Deliverables. Noneof the Deliverables provided by the Contractor to the MBA under neither this Contract, nor their use by theMBA must infringe the patent, copyright, trade secret, or other proprietary rights of any third party.

(d) If, under this Contract, the Contractor procures any equipment, software or other Deliverable for the MBA(including equipment, software and other Deliverables manufactured, re-marketed or otherwise sold bythe Contractor under the Contractor’s name), then in addition to the Contractor’s other responsibilities

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with respect to the items in this Contract, the Contractor must assign or otherwise transfer to the MBA orits designees, or afford the MBA the benefits of, any manufacturer's warranty for the Deliverable.

(e) The Contract signatory has the power and authority, including any necessary corporate authorizations,necessary to enter into this Contract, on behalf of the Contractor.

(f) It is qualified and registered to transact business in all locations where required.(g) Neither the Contractor nor any Affiliates, nor any employee of either, has, must have, or must acquire,

any contractual, financial, business, or other interest, direct or indirect, that would conflict in any manneror degree with the Contractor’s performance of its duties and responsibilities to the MBA under thisContract or otherwise create an appearance of impropriety with respect to the award or performance ofthis Agreement. The Contractor must notify the MBA about the nature of the conflict or appearance ofimpropriety within two days of learning about it.

(h) Neither the Contractor nor any Affiliates, nor any employee of either has accepted or must acceptanything of value based on an understanding that the actions of the Contractor or Affiliates or employeeon behalf of the MBA would be influenced. The Contractor must not attempt to influence any MBAemployee by the direct or indirect offer of anything of value.

(i) Neither the Contractor nor any Affiliates, nor any employee of either has paid or agreed to pay anyperson, other than bona fide employees and consultants working solely for the Contractor or the Affiliate,any fee, commission, percentage, brokerage fee, gift, or any other consideration, contingent upon orresulting from the award or making of this Contract.

(j) The prices proposed by the Contractor were arrived at independently, without consultation,communication, or agreement with any other Bidder for the purpose of restricting competition; the pricesquoted were not knowingly disclosed by the Contractor to any other Bidder; and no attempt was made bythe Contractor to induce any other person to submit or not submit a proposal for the purpose of restrictingcompetition.

(k) All financial statements, reports, and other information furnished by the Contractor to the MBA as part ofits response to the RFP or otherwise in connection with the award of this Contract fairly and accuratelyrepresent the business, properties, financial condition, and results of operations of the Contractor as ofthe respective dates, or for the respective periods, covered by the financial statements, reports, otherinformation. Since the respective dates or periods covered by the financial statements, reports, or otherinformation, there have been no material adverse changes in the business, properties, financial condition,or results of operations of the Contractor.

(l) All written information furnished to the MBA by or for the Contractor in connection with this Contract,including its bid, is true, accurate, and complete, and contains no untrue statement of material fact oromits any material fact necessary to make the information not misleading.

(m) It is not in material default or breach of any other contract or agreement that it may have with the MBA orany of its departments, commissions, boards, or agencies. The Contractor further represents andwarrants that it has not been a party to any contract with the MBA or any of its departments that wasterminated by the MBA or the department within the previous five years for the reason that the Contractorfailed to perform or otherwise breached an obligation of the contract.

(n) If any of the certifications, representations, or disclosures made in the Contractor’s original bid responsechange after Contract award, the Contractor is required to report those changes immediately to the MBA.

2.122 WARRANTY OF MERCHANTABILITYGoods provided by the Contractor under this agreement must be merchantable. All goods provided under thisContract must be of good quality within the description given by the MBA, must be fit for their ordinary purpose,must be adequately contained and packaged within the description given by the MBA, must conform to theagreed upon specifications, and must conform to the affirmations of fact made by the Contractor or on thecontainer or label.

2.123 WARRANTY OF FITNESS FOR A PARTICULAR PURPOSEWhen the Contractor has reason to know or knows any particular purpose for which the goods are required,and the MBA is relying on the Contractor’s skill or judgment to select or furnish suitable goods, there is awarranty that the goods are fit for such purpose.

2.124 WARRANTY OF TITLE

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The Contractor must, in providing goods to the MBA, convey good title in those goods, whose transfer is rightand lawful. All goods provided by the Contractor must be delivered free from any security interest, lien, orencumbrance of which the MBA, at the time of contracting, has no knowledge. Goods provided by theContractor, under this Contract, must be delivered free of any rightful claim of any third person by ofinfringement or the like.

2.125 EQUIPMENT WARRANTYTo the extent the Contractor is responsible under this Contract for maintaining equipment/system(s), theContractor represents and warrants that it must maintain the equipment/system(s) in good operating conditionand must undertake all repairs and preventive maintenance according to the applicable manufacturer'srecommendations for the period specified in this Contract.

The Contractor represents and warrants that the equipment/system(s) are in good operating condition andoperates and performs to the requirements and other standards of performance contained in this Contract,when installed, at the time of Final Acceptance by the MBA, and for a period of (1) one year commencing uponthe first day of revenue collection with the NTCS.

The Contractor must adjust, repair or replace all equipment that is defective or not performing in compliancewith this Contract. The Contractor must assume all costs for replacing parts or units and their installationincluding transportation and delivery fees, if any.

The Contractor must provide a toll-free telephone number to allow the MBA to report equipment failures andproblems to be remedied by the Contractor.

The Contractor agrees that all warranty service it provides under this Contract must be performed by OriginalEquipment Manufacturer (OEM) trained, certified and authorized technicians.

The Contractor is the sole point of contact for warranty service. The Contractor warrants that it must passthrough to the MBA any warranties obtained or available from the original equipment manufacturer, includingany replacement, upgraded, or additional equipment warranties.

2.126 EQUIPMENT TO BE NEWAll equipment provided under this Contract by the Contractor must be new except where the Contractor haschosen to re-use equipment specifically listed in the RFP as available for such re-use.

2.127 PROHIBITED PRODUCTSThe MBA will not accept salvage, distressed, outdated or discontinued merchandise.

2.128 CONSEQUENCES FOR BREACHIn addition to any remedies available in law, if the Contractor breaches any of the warranties contained in thisSection 2.120 (and all subsections), the breach may be considered as a default in the performance of amaterial obligation of this Contract.

2.130 Insurance

2.131 LIABILITY INSURANCEThe Contractor must provide proof of the minimum levels of insurance coverage as indicated below. Theinsurance must protect the MBA from claims that may arise out of or result from the Contractor’s performanceof Work under the terms of this Contract, whether the Work is performed by the Contractor, or by anyonedirectly or indirectly employed by the Contractor, or by anyone for whose acts the Contractor may be liable.The Contractor must require its subcontractors to also comply with the insurance requirements of this section2.130 (and all subsections) at subcontractors’ expense.

The Contractor waives all rights in relation to applicable insurance against the State of Michigan, MBA, and alldepartments, divisions, agencies, offices, commissions, officers, employees and Contract related agents forrecovery of damages to the extent these damages are covered by the applicable insurance policies the theContractor is required to maintain under this Contract.

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All insurance coverage provided relative to this Contract is PRIMARY and NON-CONTRIBUTING to anycomparable liability insurance (including self-insurances) carried by the MBA.

The insurers selected by the Contractor must have an A.M. Best rating of A or better, or as otherwise approvedin writing by the MBA, or if the ratings are no longer available, with a comparable rating from a recognizedinsurance rating agency. All policies of insurance required in this Contract must be issued by companies thatare licensed to do business in the State of Michigan.

Where specific limits are shown, they are the minimum acceptable limits. If the Contractor’s policy containshigher limits, the MBA is entitled to coverage to the extent of the higher limits to the referenced types ofpolicies required.

The Contractor is required to pay for and provide the type and amounts of insurance listed below:

1. Commercial General Liability with the following minimum coverage:$2,000,000 General Aggregate Limit$2,000,000 Products/Completed Operations Aggregate Limit$1,000,000 Personal & Advertising Injury Limit$1,000,000 Each Occurrence LimitSuch required limits may be met through a combination of primary, excess liability insurance, orgeneral aggregate limit.

The Contractor must list the State of Michigan, MBA, and all departments, divisions, agencies, offices,commissions, officers, and employees as ADDITIONAL INSUREDS on the Commercial General Liabilitycertificate. The Contractor also agrees to provide evidence on the certificate that insurance policies contain awaiver of subrogation by the insurance company.

2. If a motor vehicle is used to provide services or products under this Contract, the Contractormust have business vehicle liability insurance on any auto including owned, hired and non-owned vehiclesused in the Contractor‘s business for bodily injury and property damage as required by law.

The Contractor must list the State of Michigan, MBA, and all departments, divisions, agencies, offices,commissions, officers, and employees of MBA as ADDITIONAL INSUREDS on the business vehicle liabilitycertificate. The Contractor also agrees to provide evidence on the certificate that insurance policies contain awaiver of subrogation by the insurance company.

3. Workers’ compensation coverage must be provided according to applicable laws governing theemployees and employers work activities in the state of the the Contractor’s domicile. If a self-insurer providesthe applicable coverage, proof must be provided of approved self-insured authority by the jurisdiction ofdomicile. For employees working outside of the state of qualification, the Contractor must provide appropriatecertificates of insurance proving mandated coverage levels for the jurisdictions where the employees’ activitiesoccur.

4. Employers liability insurance with the following minimum limits:$100,000 each accident$100,000 each employee by disease$500,000 aggregate disease

2.132 SUBCONTRACTOR INSURANCE COVERAGEExcept where the MBA has approved in writing a Contractor subcontract with other insurance provisions, theContractor must require all of its Subcontractors under this Contract to purchase and maintain the insurancecoverage as described in this Section 2.130 (and all subsections) for the Contractor in connection with theperformance of work by those Subcontractors. Subcontractor(s) must fully comply with the insurancecoverage required in this Section. Failure of Subcontractor(s) to comply with insurance requirements does notlimit the Contractor’s liability or responsibility.

2.133 CERTIFICATES OF INSURANCE AND OTHER REQUIREMENTS

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The Contractor must furnish to the MBA Project Manager, standard certificate(s) of insurance (the“Certificates”). verifying insurance coverage or providing satisfactory evidence of self-insurance as required inthis Section 2.130 (and all subsections). The Certificate must be on the standard “accord” form or equivalent.The Contract Number must be shown on the Certificate Of Insurance To Assure Correct Filing. AllCertificate(s) are to be prepared and submitted by the Insurance Provider. All Certificate(s) must contain aprovision indicating that coverage afforded under the policies MUST NOT BE CANCELLED without 30 daysprior written notice, except for 10 days for non-payment of premium, having been given to the MBA. Beforethis Contract is signed, and not less than 20 days before the insurance expiration date every year thereafter,the Contractor must provide evidence, in the form of renewal or replacement certificates of insurance, that theMBA and its contract-related agents, officers and employees are listed as additional insured under eachcommercial general liability and commercial automobile liability policy. Any attorney retained by the insurer torepresent the MBA under this Section 2.130 (and all subsections), must be approved by the Attorney Generalof the State of Michigan, at his or her sole discretion, and be designated as a Special Assistant AttorneyGeneral by the Attorney General.

The Contractor must maintain all required insurance coverage throughout the term of this Contract and anyextensions. Claims-made Commercial General Liability policies are not permitted under this Contract and willnot be accepted by the MBA. The minimum limits of coverage specified above are not intended, and must notbe construed; to limit any liability or indemnity of the Contractor under this Contract to any indemnified party orother persons. The Contractor is responsible for all deductibles with regard to the insurance. If the Contractorfails to pay any premium for required insurance as specified in this Contract, or if any insurer cancels orsignificantly reduces any required insurance as specified in this Contract, then the MBA may, after the MBAhas given the Contractor at least 30 days written notice, pay the premium or procure similar insurancecoverage from another company or companies unless the Contractor provides a renewal or replacementcertificate of insurance. The MBA may deduct any part of the cost from any payment due the Contractor, orthe Contractor must pay that cost upon demand by the MBA.

2.140 Indemnification

2.141 GENERAL INDEMNIFICATIONIn addition to the protection afforded by any policy of insurance, the Contractor agrees to indemnify, defend,and save harmless the State of Michigan, the MBA, and all officers, agents, and employees thereof

a) From any and all claims by persons, firms, or corporations for labor, services, materials, or suppliesprovided to the Contractor in connection with the Contractors performance of the Work; and

b) From any and all claims for injuries to or death of any and all persons, for loss of or damage toproperty, for environmental damage, degradation, and response and cleanup costs, and for attorneyfees and related costs arising out of, under, or by reason of the Contractors performance of the Workunder this Contract, except claims resulting from the sole negligence or willful acts or omissions of saidindemnitee, its agents, or its employees.

2.142 CODE INDEMNIFICATIONThe Contractor must indemnify, defend and hold harmless the MBA from any claim, loss, or expense arisingfrom the Contractor’s breach of the No Surreptitious Code Warranty.

2.143 EMPLOYEE INDEMNIFICATIONIn any claims against the State of Michigan, the MBA, its departments, divisions, agencies, sections,commissions, officers, employees and agents, by any employee of the Contractor or any of its subcontractors,the indemnification obligation under this Contract must not be limited in any way by the amount or type ofdamages, compensation or benefits payable by or for the Contractor or any of its subcontractors underworker’s disability compensation acts, disability benefit acts or other employee benefit acts. Thisindemnification clause is intended to be comprehensive. Any overlap in provisions, or the fact that greaterspecificity is provided as to some categories of risk, is not intended to limit the scope of indemnification underany other provisions.

2.144 PATENT/COPYRIGHT INFRINGEMENT INDEMNIFICATION

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The Contractor must indemnify, defend and hold harmless the State of Michigan, the MBA, its departments,divisions, agencies, sections, commissions, officers, employees and agents, from and against all losses,liabilities, damages (including taxes), and all related costs and expenses (including reasonable attorneys’ feesand costs of investigation, litigation, settlement, judgments, interest and penalties) incurred in connection withany action or proceeding threatened or brought against the MBA to the extent that the action or proceeding isbased on a claim that any piece of equipment, software, commodity or service supplied by the Contractor or itssubcontractors, or the operation of the equipment, software, commodity or service, or the use or reproductionof any documentation provided with the equipment, software, commodity or service infringes any United Statespatent, copyright, trademark or trade secret of any person or entity, which is enforceable under the laws of theUnited States.

In addition, should the equipment, software, commodity, or service, or its operation, become or in the MBA’s orthe Contractor’s opinion be likely to become the subject of a claim of infringement, the Contractor must at theContractor’s sole expense (i) procure for the MBA the right to continue using the equipment, software,commodity or service or, if the option is not reasonably available to the Contractor, (ii) replace or modify to theMBA’s satisfaction the same with equipment, software, commodity or service of equivalent function andperformance so that it becomes non-infringing, or, if the option is not reasonably available to the Contractor,(iii) accept its return by the MBA with appropriate credits to the MBA against the Contractor’s charges andreimburse the MBA for any losses or costs incurred as a consequence of the MBA ceasing its use andreturning it.

2.145 CONTINUATION OF INDEMNIFICATION OBLIGATIONSThe Contractor’s duty to indemnify under this Section 2.14 (and all subsections) continues in full force andeffect, notwithstanding the expiration or termination of this Contract, with respect to any claims based on factsor conditions that occurred before expiration or termination.

2.146 INDEMNIFICATION PROCEDURESThe procedures set forth below must apply to all indemnity obligations under this Contract.(a) After the MBA receives notice of the action or proceeding involving a claim for which it will seek

indemnification, the MBA will promptly notify the Contractor of the claim in writing. Within 10 daysfollowing receipt of written notice from the MBA relating to any claim, the Contractor must notify the MBAin writing whether the Contractor agrees to assume control of the defense and settlement of that claim (a“Notice of Election”). After notifying the Contractor of a claim and before the MBA receiving theContractor’s Notice of Election, the MBA is entitled to defend against the claim, at the Contractor’sexpense, and the Contractor must be responsible for any reasonable costs incurred by the MBA indefending against the claim during that period.

(b) If the Contractor delivers a Notice of Election relating to any claim: (i) the MBA is entitled to participate inthe defense of the claim and to employ counsel at its own expense to assist in the handling of the claimand to monitor and advise the MBA about the status and progress of the defense; (ii) the Contractor must,at the request of the MBA, demonstrate to the reasonable satisfaction of the MBA, the Contractor’sfinancial ability to carry out its defense and indemnity obligations under this Contract; (iii) the Contractormust periodically advise the MBA about the status and progress of the defense and must obtain the priorwritten approval of the MBA before entering into any settlement of the claim or ceasing to defend againstthe claim and (iv) to the extent that any principles of Michigan governmental or public law may beinvolved or challenged, the MBA has the right, at its own expense, to control the defense of that portion ofthe claim involving the principles of Michigan governmental or public law. But the MBA may retain controlof the defense and settlement of a claim by notifying the Contractor in writing within 10 days after theMBA’s receipt of the Contractor’s information requested by the MBA under clause (ii) of this paragraph ifthe MBA determines that the Contractor has failed to demonstrate to the reasonable satisfaction of theMBA the Contractor’s financial ability to carry out its defense and indemnity obligations under this Section2.140 (and all subsections). Any litigation activity on behalf of the MBA, or any of its subdivisions underthis Section 2.140 (and all subsections), must be coordinated with the Department of Attorney General.Any attorney retained by either the Contractor or the Contractor’s insurer to represent the MBA under thisSection 2.140 (and all subsections), must be approved by the Attorney General of the State of Michigan,

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at his or her sole discretion, and be designated as a Special Assistant Attorney General by the AttorneyGeneral.

(c) If the Contractor does not deliver a Notice of Election relating to any claim of which it is notified by theMBA as provided above, the MBA may defend the claim in the manner as it may deem appropriate, at thesole cost and expense of the Contractor.

2.150 Termination

2.151 NOTICE AND RIGHT TO CUREIf the Contractor breaches this Contract, and the MBA in its sole discretion determines that the breach iscurable, then the MBA must provide the Contractor with written notice of the breach and a time period (not lessthan 30 days) to cure the breach. The notice of breach and opportunity to cure is inapplicable for repeatedbreaches or if the MBA determines in its sole discretion that the breach poses a serious and imminent threat tothe health or safety of any person or the imminent loss, damage, or destruction of any real or tangible personalproperty or causes the MBA to be unable to collect, track, and audit tolling operations.

2.152 TERMINATION FOR CAUSE(a) The MBA may terminate this Contract, for cause, by notifying the Contractor in writing, if the Contractor (i)

breaches any of its duties or obligations under this Contract, or (ii) fails to cure a breach within the timeperiod specified in the written notice of breach provided by the MBA.

(b) If this Contract is terminated for cause, the Contractor must pay all costs incurred by the MBA interminating this Contract, including but not limited to, MBA administrative costs, reasonable attorneys’fees and court costs, and any additional costs the MBA may incur to procure the Work required by thisContract from other sources. Re-procurement costs are not consequential, indirect or incidentaldamages, and cannot be excluded by any other terms otherwise included in this Contract, provided thecosts are not in excess of 50% more than the prices for the Work provided under this Contract.

(c) If the MBA chooses to partially terminate this Contract for cause, charges payable under this Contractmust be equitably adjusted to reflect the Work that is terminated and the MBA must pay for all Work forwhich Final Acceptance has been granted provided up to the termination date. Work and relatedprovisions of this Contract that are terminated for cause must cease on the effective date of thetermination.

(d) If the MBA terminates this Contract for cause under this Section 2.150 (and all subsections), and it isdetermined, for any reason, that Contractor was not in breach of Contract under the provisions of thisSection 2.150 (and all subsections), that termination for cause must be deemed to have been atermination for convenience, effective as of the same date, and the rights and obligations of the partiesmust be limited to that otherwise provided in this Contract for a termination for convenience.

2.153 TERMINATION FOR CONVENIENCEThe MBA may terminate this Contract for its convenience, in whole or part, if the MBA determines that atermination is in the MBA’s best interest. Reasons for the termination must be left to the sole discretion of theMBA and may include, but not necessarily be limited to (a) the MBA no longer needs the Work specified in thisContract, (b) relocation of office, program changes, changes in laws, rules, or regulations make implementationof the NTCS no longer practical or feasible, (c) unacceptable prices for New Work requested by the MBA, or(d) falsification or misrepresentation, by inclusion or non-inclusion, of information material to a response to anyChange Request issued by the MBA. The MBA may terminate this Contract for its convenience, in whole or inpart, by giving the Contractor written notice at least 30 days before the date of termination. If the MBAchooses to terminate this Contract in part, the charges payable under this Contract must be equitably adjustedto reflect the Work that is terminated. Work provisions of this Contract that are terminated for conveniencemust cease on the effective date of the termination.


2.155 TERMINATION FOR CRIMINAL CONVICTIONThe MBA may terminate this Contract immediately and without further liability or penalty in the event theContractor, an officer of the Contractor, or an owner of a 25% or greater share of the Contractor is convicted ofa criminal offense related to a State, public or private contract or subcontract.

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2.156 TERMINATION FOR APPROVALS RESCINDEDThe MBA may terminate this Contract if any final administrative or judicial decision or adjudication disapprovesa previously approved request for purchase of personal services under Constitution 1963, Article 11, § 5, andCivil Service Rule 7-1. In that case, the MBA will pay the Contractor for only the Work completed to that pointunder this Contract. Termination may be in whole or in part and may be immediate as of the date of the writtennotice to the Contractor or may be effective as of the date stated in the written notice.

2.157 RIGHTS AND OBLIGATIONS UPON TERMINATION(a) If the MBA terminates this Contract for any reason, the Contractor must (a) stop all Work as specified in

the notice of termination, (b) take any action that may be necessary, or that the MBA may direct, forpreservation and protection of Deliverables or other property derived or resulting from this Contract thatmay be in the Contractor’s possession, (c) return all materials and property provided directly or indirectlyto the Contractor by any entity, agent or employee of the MBA, (d) transfer title in, and deliver to, theMBA, unless otherwise directed, all Deliverables intended to be transferred to the MBA at the terminationof this Contract and which are resulting from this Contract (which must be provided to the MBA on an “As-Is” basis except to the extent the amounts paid by the MBA in respect of the items included compensationto the Contractor for the provision of warranty services in respect of the materials), and (e) take any actionto mitigate and limit any potential damages, or requests for the Contractor adjustment or terminationsettlement costs, to the maximum practical extent, including terminating or limiting as otherwiseapplicable those subcontracts and outstanding orders for material and supplies resulting from theterminated Contract.

(b) If the MBA terminates this Contract before its expiration for its own convenience, the MBA will pay theContractor for all charges due for Work provided before the date of termination and, if applicable, as aseparate item of payment under this Contract, for Work In Progress, on a percentage of completion basisat the level of completion determined solely by the MBA. All completed or partially completed Workprepared by the Contractor under this Contract, at the option of the MBA, becomes the MBA’s property,and the Contractor is entitled to receive equitable fair compensation for the Work. Regardless of thebasis for the termination, the MBA is not obligated to pay, or otherwise compensate, the Contractor forany lost expected future profits, costs or expenses incurred with respect to Work not actually performedfor the MBA.

(c) Upon a good faith termination, the MBA may assume, at its option, any subcontracts and agreements forWork provided under this Contract, and may further pursue completion of the Work under this Contract byreplacement contract or otherwise as the MBA may in its sole judgment deem expedient.

2.158 RESERVATION OF RIGHTSAny termination of this Contract by a party must be with full reservation of, and without prejudice to, any rightsor remedies otherwise available to the party with respect to any claims arising before or as a result of thetermination.

2.160 Not Applicable


2.170 Transition Responsibilities

2.171 CONTRACTOR TRANSITION RESPONSIBILITIESIf the MBA terminates this Contract, for convenience or cause, or if this Contract is otherwise dissolved,voided, rescinded, nullified, expires or rendered unenforceable, the Contractor must comply with directionprovided by the MBA to assist in the orderly transition of equipment, services, software, leases, etc. to the MBAor a third party designated by the MBA. If this Contract expires or terminates, the Contractor agrees to makeall reasonable efforts to effect an orderly transition of services within a reasonable period of time that in noevent will exceed 30 days. These efforts must include, but are not limited to, those listed in Section 2.150 (andall subsections).

2.172 CONTRACTOR PERSONNEL TRANSITION

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The Contractor must work with the MBA, or a specified third party, to develop a transition plan setting forth thespecific tasks and schedule to be accomplished by the parties, to effect an orderly transition. The Contractormust allow as many personnel as practicable to remain on the job to help the MBA, or a specified third party,maintain the continuity and consistency of the Work required by this Contract. In addition, during or followingthe transition period, in the event the MBA requires the Work of the Contractor’s subcontractors or vendors, asnecessary to meet its needs, the Contractor agrees to reasonably, and with good-faith, allow the MBA to usethe services of the Contractor’s subcontractors or vendors. The Contractor must notify all of the Contractor’ssubcontractors of procedures to be followed during transition.

2.173 CONTRACTOR INFORMATION TRANSITIONThe Contractor must provide reasonably detailed specifications for all Work needed by the MBA, or specifiedthird party, to properly provide the Work required under this Contract. The Contractor must provide the MBAwith asset management data generated from the inception of this Contract through the date on which thisContractor is terminated in a comma-delineated format unless otherwise requested by the MBA. TheContractor must deliver to the MBA any remaining owed reports and documentation still in the Contractor’spossession subject to appropriate payment by the MBA.

2.174 CONTRACTOR HARDWARE AND SOFTWARE TRANSITIONThe Contractor must reasonably assist the MBA in the acquisition of any Contractor hardware or softwarerequired to perform the Work under this Contract. This must include any documentation being used by theContractor to perform the Work under this Contract. If the MBA transfers any software licenses to theContractor, those licenses must, upon expiration of this Contract, transfer back to the MBA at their currentrevision level. Upon notification by the MBA, the Contractor may be required to freeze all non-critical changesto Deliverables and services.

2.175 TRANSITION PAYMENTSIf the transition results from a termination for any reason, the termination provisions of this Contract mustgovern reimbursement. If the transition results from expiration, the Contractor will be reimbursed for allreasonable transition costs (i.e. costs incurred within the agreed period after Contract expiration that resultfrom transition operations) at the rates agreed upon by the MBA. The Contractor must prepare an accurateaccounting from which the MBA and the Contractor may reconcile all outstanding accounts.

2.176 MBA TRANSITION RESPONSIBILITIESIn the event that this Contract is terminated, dissolved, voided, rescinded, nullified, or otherwise renderedunenforceable, the MBA agrees to reconcile all accounts between the MBA and the Contractor, complete anypending post-Project reviews and perform any others obligations upon which the MBA and the Contractoragree.

2.180 Stop Work

2.181 STOP WORK ORDERSThe MBA may, at any time, by written notification (“Stop Work Order”) to the Contractor, require that theContractor stop all, or any part, of the Work called for by this Contract for a period of up to 90 calendar daysafter the Stop Work Order is delivered to the Contractor, and for any further period to which the parties mayagree. The Stop Work Order must be identified as a Stop Work Order and must indicate that it is issued underthis Section 2.180 (and subsections). Upon receipt of the Stop Work Order, the Contractor must immediatelycomply with its terms and take all reasonable steps to minimize incurring costs allocable to the Work coveredby the Stop Work Order during the period of Work stoppage. Within the period of the Stop Work Order, theMBA must either: (a) cancel the Stop Work Order; or (b) terminate the Work covered by the Stop Work Orderas provided in Section 2.182.

2.182 CANCELLATION OR EXPIRATION OF STOP WORK ORDERThe Contractor must resume work if the MBA cancels a Stop Work Order or if it expires. The parties mustagree upon an equitable adjustment in the delivery schedule, the Contract price, or both, and this Contractmust be modified, in writing, accordingly, if: (a) the Stop Work Order results in an increase in the time requiredfor, or in the Contractor’s costs properly allocable to, the performance of any part of the Contract; and (b) theContractor asserts its right to an equitable adjustment within 30 calendar days after the end of the period of

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work stoppage; provided that, if the MBA decides the facts justify the action, the MBA may receive and actupon a Contractor proposal submitted at any time before final payment under the Contract. Any adjustmentmust conform to the requirements of Section 2.024.

2.183 ALLOWANCE OF CONTRACTOR COSTSIf the Stop Work Order is not canceled and the Work covered by the Stop Work Order is terminated for reasonsother than material breach, the termination must be deemed to be a termination for convenience underSection 2.153, and the MBA must pay reasonable costs resulting from the Stop Work Order in arriving at thetermination settlement. The MBA must not be liable to the Contractor for loss of profits because of a StopWork Order issued under this Section 2.180 (and all subsections).

2.190 Dispute Resolution

2.191 IN GENERALAny claim, counterclaim, or dispute between the MBA and the Contractor arising out of or relating to thisContract must be resolved as follows. For all Contractor claims seeking an increase in the amounts payableto the Contractor under this Contract, or the time allotted for the Contractor’s performance, the Contractor mustsubmit a letter, together with all data supporting the claims, executed by the Contractor’s Project Manager orthe Project Manager's designee certifying that (a) the claim is made in good faith, (b) the amount claimedaccurately reflects the adjustments in the amounts payable to the Contractor or the time allotted for theContractor’s performance for which the Contractor believes the MBA is liable and covers all costs of every typeto which the Contractor is entitled from the occurrence of the claimed event, and (c) the claim and thesupporting data are current and complete to the Contractor’s best knowledge and belief.

2.192 INFORMAL DISPUTE RESOLUTIONThe Parties shall attempt to resolve all disputes, as follows:1) The MBA Project Manager and the Contractor’s Project Manager, or their representatives, shall meetas often as the parties reasonably deem necessary to gather and furnish to each other all information withrespect to the matter at issue which the parties believe to be appropriate and germane in connection with thedispute. The representatives must discuss the problem and negotiate in good faith in an effort to resolve thedispute without the necessity of any formal proceeding.(2) During the course of negotiations, all reasonable requests made by one party to another for non-privileged information reasonably related to this Contract shall be honored in order that each of the parties maybe fully advised of the other’s position.(3) The specific format for the discussions must be left to the discretion of the designated MBA andContractor representatives, but may include the preparation of agreed upon statements of fact or writtenstatements of position.(4) If, after no more than 30 calendar days, the Project Managers are unable to resolve the dispute, theyshall each provide written statements of position to the MBA Secretary. The MBA Secretary shall evaluate thepositions, and provide a written statement of opinion regarding the issue(s) in dispute.(5) If the Contractor requests, the issue may also be presented to the MBA’s Tolling CommitteeChairperson for review. If this step is taken, the Chairperson will provide a further written statement of opinionwhich shall be considered the MBA’s final action and the exhaustion of administrative remedies.

This Section 2.190 (and all subsections) must not be construed to prevent either party from instituting, and aparty is authorized to institute, formal proceedings earlier to avoid the expiration of any applicable limitationsperiod, to preserve a superior position with respect to other creditors, or under Section 2.193.

The MBA will not mediate disputes between the Contractor and any other entity concerning responsibility forperformance of Work under this Contract.

2.193 INJUNCTIVE RELIEFThe only circumstance in which disputes between the MBA and the Contractor will not be subject to theprovisions of Section 2.192 is where a party makes a good faith determination that a breach of the terms of thisContract by the other party is that the damages to the party resulting from the breach must be so immediate,

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so large or severe and so incapable of adequate redress after the fact that a temporary restraining order orother immediate injunctive relief is the only adequate remedy.

2.194 CONTINUED PERFORMANCEEach party agrees to continue performing its obligations under this Contract while a dispute is being resolvedexcept to the extent the issue in dispute precludes performance (dispute over payment must not be deemed topreclude performance) and without limiting either party’s right to terminate this Contract as provided in Section2.150, as the case may be.

2.200 Federal and State Contract Requirements

2.201 NONDISCRIMINATIONIn the performance of this Contract, the Contractor agrees not to discriminate against any employee orapplicant for employment, with respect to his or her hire, tenure, terms, conditions or privileges of employment,or any matter directly or indirectly related to employment, because of race, color, religion, national origin,ancestry, age, sex, height, weight, and marital status, physical or mental disability. The Contractor furtheragrees that every subcontract entered into for the performance of this Contract or any purchase order resultingfrom this Contract must contain a provision requiring non-discrimination in employment, as specified here,binding upon each Subcontractor. This covenant is required under the Elliot Larsen Civil Rights Act, 1976 PA453, MCL 37.2101, et seq., and the Persons with Disabilities Civil Rights Act, 1976 PA 220, MCL 37.1101, etseq., and any breach of this provision may be regarded as a material breach of this Contract.

2.202 UNFAIR LABOR PRACTICESUnder 1980 PA 278, MCL 423.321, et seq., the MBA must not award a Contract or subcontract to an employerwhose name appears in the current register of employers failing to correct an unfair labor practice compiledunder section 2 of the Act. This information is compiled by the United States National Labor Relations Board.A Contractor of the MBA, in relation to this Contract, must not enter into a contract with a Subcontractor,manufacturer, or supplier whose name appears in this register. Under section 4 of 1980 PA 278, MCL423.324, the MBA may void any Contract if, after award of the Contract, the name of the Contractor as anemployer or the name of the Subcontractor, manufacturer or supplier of the Contractor appears in theregister.2.203 Workplace Safety and Discriminatory HarassmentIn performing Work for the MBA, the Contractor must comply with the Department of Civil Services Rule 2-20regarding Workplace Safety and Rule 1-8.3 regarding Discriminatory Harassment. In addition, the Contractormust comply with Civil Service regulations and any applicable agency rules provided to the Contractor. ForCivil Service Rules, see http://www.mi.gov/mdcs/0,1607,7-147-6877---,00.html.


2.210 Governing Law

2.211 GOVERNING LAWThis Contract must in all respects be governed by, and construed according to, the substantive laws of theState of Michigan without regard to any Michigan choice of law rules that would apply the substantive law ofany other jurisdiction to the extent not inconsistent with, or pre-empted by federal law.

2.212 COMPLIANCE WITH LAWSThe Contractor must comply with all applicable state, federal and local laws and ordinances in providing theWork under this Contract..

2.213 JURISDICTION AND VENUEAny dispute arising from this Contract must be resolved in the State of Michigan. With respect to any claimbetween the parties, the Contractor consents to venue in Mackinac County, Michigan, and irrevocably waivesany objections it may have to the jurisdiction on the grounds of lack of personal jurisdiction of the court or thelaying of venue of the court or on the basis of forum non conveniens or otherwise. The Contractor agrees toappoint agents in the State of Michigan to receive service of process.

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2.220 Limitation of Liability

2.221 LIMITATION OF LIABILITYNeither the Contractor nor the MBA will be liable to each other, regardless of the form of action, forconsequential, incidental, indirect, or special damages. This limitation of liability does not apply to claims forinfringement of United States patent, copyright, trademark or trade secrets; to claims for personal injury ordamage to property caused by the gross negligence or willful misconduct of the Contractor; to claims coveredby other specific provisions of this Contract calling for Liquidated Damages; or to court costs or attorney’s feesawarded by a court in addition to damages after litigation based on this Contract.

The Contractor’s liability for damages to the MBA is limited to the value of this Contract. The foregoinglimitation of liability does not apply to claims for infringement of United States patent, copyright, trademarks ortrade secrets; to claims for personal injury or damage to property caused by the gross negligence or willfulmisconduct of the Contractor; to claims covered by other specific provisions of this Contract calling forLiquidated Damages; or to court costs or attorney’s fees awarded by a court in addition to damages afterlitigation based on this Contract.

The MBA’s liability for damages to the Contractor is limited to the value of this Contract.

2.230 Disclosure Responsibilities

2.231 DISCLOSURE OF LITIGATIONThe Contractor must disclose any material criminal litigation, investigations or proceedings involving theContractor (and each Subcontractor) or any of its officers or directors or any litigation, investigations orproceedings under the Sarbanes-Oxley Act. In addition, each Contractor (and each Subcontractor) must notifythe MBA of any material civil litigation, arbitration or proceeding which arises during the term of this Contractand extensions, to which Contractor (or, to the extent the Contractor is aware, any Subcontractor) is a party,and which involves: (i) disputes that might reasonably be expected to adversely affect the viability or financialstability of the Contractor or any Subcontractor; or (ii) a claim or written allegation of fraud against theContractor or, to the extent the Contractor is aware, any Subcontractor by a governmental or public entityarising out of their business dealings with governmental or public entities. The Contractor must disclose inwriting to the MBA Project Manager any litigation, investigation, arbitration or other proceeding (collectively,"Proceeding") within 30 days of its occurrence. Details of settlements that are prevented from disclosure bythe terms of the settlement may be annotated. Information provided to the MBA from the Contractor’s publiclyfiled documents referencing its material litigation must be deemed to satisfy the requirements of this Section2.230 (and all subsections) .

If any Proceeding disclosed to the MBA under this Section 2.230 (and all subsections), or of which the MBAotherwise becomes aware, during the term of this Contract would cause a reasonable party to be concernedabout:(a) the ability of the Contractor (or a Subcontractor) to continue to perform this Contract according to its terms

and conditions, or(b) whether the Contractor (or a Subcontractor) in performing Work for the MBA is engaged in conduct which

is similar in nature to conduct alleged in the Proceeding, which conduct would constitute a breach of thisContract or a violation of Michigan law, regulations or public policy, then the Contractor must provide theMBA all reasonable assurances requested by the MBA to demonstrate that:

(1) The Contractor and its Subcontractors must be able to continue to perform this Contract and anyStatements of Work according to its terms and conditions, and

(2) The Contractor and its Subcontractors have not and must not engage in conduct in performing the Workwhich is similar in nature to the conduct alleged in the Proceeding.

(c) The Contractor must make the following notifications in writing:(1) Within 30 days of the Contractor becoming aware that a change in its ownership or officers has

occurred, or is certain to occur, or a change that could result in changes in the valuation of itscapitalized assets in the accounting records, the Contractor must notify the MBA Project Manager.

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(2) The Contractor must also notify the MBA Project Manager within 30 days whenever changes to assetvaluations or any other cost changes have occurred or are certain to occur as a result of a change inownership or officers.

(3) The Contractor must also notify the MBA Project Manager within 30 days whenever changes tocompany affiliations occur.


2.233 BANKRUPTCYThe MBA may, without prejudice to any other right or remedy, terminate this Contract, in whole or in part, and,at its option, may take possession of the “Work in Progress” and finish the Work in Progress by whateverappropriate method the MBA may deem expedient if:

(a) the Contractor files for protection under the bankruptcy laws;(b) an involuntary petition is filed against the Contractor and not removed within 30 days;(c) the Contractor becomes insolvent or if a receiver is appointed due to the Contractor's insolvency;(d) the Contractor makes a general assignment for the benefit of creditors; or(e) the Contractor or its affiliates are unable to provide reasonable assurances that the Contractor or its

affiliates can deliver the Work under this Contract.

The Contractor must fix appropriate notices or labels on the Work in Process to indicate ownership by theMBA. To the extent reasonably possible, materials and Work in Progress must be stored separately from otherstock and marked conspicuously with labels indicating ownership by the MBA.

2.240 Performance

2.241 TIME OF PERFORMANCE(a) The Contractor must provide the resources necessary to complete all Work according to the time

schedules contained in this Contract.(b) The Contractor must notify the MBA immediately of any circumstances that may jeopardize the timely and

successful completion of any Work in this Contract.(c) If the Contractor believes that a delay in performance by the MBA has caused or will cause the Contractor

to be unable to perform its obligations according to specified Contract time periods, the Contractor mustnotify the MBA and perform its obligations according to the Contract time periods notwithstanding theMBA’s failure. The Contractor will not be in default for a delay in performance to the extent the delay iscaused by the MBA.

2.242 KEY PERFORMANCE INDICATORS (KPI)Section 7 of the RFP lists the Key Performance Indicators that will apply to the NTCS. In addition to the

provisions of that section, the following provisions must apply:

(a) When calculating performance, all decimals must be rounded to two decimal places, with five and greaterrounding up and four and less rounding down unless otherwise specified.

(b) If the required performance level for any individual KPI is not achieved during any two consecutivemonths, the Contractor must perform a root cause analysis for the shortfall in performance and a detailedwritten plan for how the System or service associated with the shortfall will be changed in order to avoidfuture shortfalls. The Contractor will provide its analysis and mitigation plan within two weeks of the endof the second consecutive month of the shortfall.

2.243 LIQUIDATED DAMAGESTime is of the Essence: Time is an essential element of this Contract. MBA will assess Liquidated Damagesfor the Contractor’s failure to meet Project milestones according to Table 7-1 in the RFP.

Performance is of the Essence: The performance of the Contractor and the NTCS are critical to the missionof MBA. The MBA will assess Liquidated Damages for the Contractor’s failure to meet the KPIs listed in Tables7-2 through 7-4 in the RFP.

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Effective Staffing of the Project is of the Essence: The MBA will assess Liquidated Damages forUnauthorized Removal of Key Personnel as described below in this section.

Keeping Toll Lanes Operating is of the Essence: The MBA requires that when Work is performed by theContractor in the toll lanes that the Contractor will return the lane to normal operation in accordance withapproved lane closure plans. The MBA will assess Liquidated Damages for failure to return lanes to normaloperation as scheduled.

A) Difficulty of Ascertaining Certain Damages: The amount of Liquidated Damages as set forth in thisContract is fixed and agreed to by and between the Contractor and the MBA because both Partiesagree and acknowledge the impracticability and extreme difficulty of fixing and ascertaining the truevalue of the damages which the MBA will sustain:

a. by failure of the Contractor to meet Project milestones;b. failure to staff the Project as required by this Contract;c. failure to return toll lanes to normal operation, and/ord. failure to meet the performance levels set forth in Section 7 (Key Performance Indicators) of the

RFP.

Such damages might include loss of revenue, service charges, interest charges, harm andinconvenience to the public, delays caused to other activities of the MBA by failure to perform thisContract, increase of inspection and administrative costs, and other damages, some of which areindefinite and not susceptible of easy proof. Said amounts are in each instance agreed by both Partiesto be a reasonable estimate of the amount of damages which the MBA will sustain in each instance andsaid amount must be deducted from any monies due or that may become due to the Contractor,provided however, that due consideration must be taken of any adjustment of the time for performancegranted under the provisions of Section 2.241 (Time of Performance).

B) Cap on Liquidated Damages. In any given calendar month in which Liquidated Damages were incurred,The Contractor must not be responsible to make payment or otherwise be liable for LiquidatedDamages in an amount greater than the Monthly Maintenance Fee for the month following the month inwhich Liquidated Damages were incurred. In the event Liquidated Damages are assessed in the lastmonth of the Term of this Contract, then the Contractor must not be responsible to make payment tothe MBA for Liquidated Damages in an amount greater than the Monthly Maintenance Fee for themonth in which Liquidated Damages were incurred.

The Contractor’s total liability for Liquidated Damages is capped at 50% of this Contract’s value.

C) Unenforceability of Liquidated Damages. If any of the Liquidated Damages are found for any reason tobe void, invalid or otherwise inoperative so as to disentitle the MBA from claiming all or part of theLiquidated Damages, then the MBA is entitled to claim against the Contractor damages at law or in equityfor the Contractor's failure to complete or otherwise perform the Work as set forth in Section 7(Performance Requirements and KPIs) of the RFP.

D) Closure of Lanes; Failure to Reopen. Should the Contractor fail to reopen lane(s) at the times specifiedin the Contractor’s applicable lane closure plan or as otherwise directed in writing by the MBA, theContractor must pay Liquidated Damages in the amount of $500.00 per hour or any portion thereof.

E) No Waiver. Permitting the Contractor to continue and finish the Work or any part of the Work after theexpiration of the time allowed for completion or after any extension of time, must not operate as a waiverof the rights of the MBA under this Section 2.230 or any other section of this Contract.

Liquidated Damages Related to Effective StaffingIt is acknowledged that an Unauthorized Removal will interfere with the timely and proper completion of theWork, to the loss and damage of the MBA, and that it would be impracticable and extremely difficult to fix the

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actual damage sustained by the MBA as a result of any Unauthorized Removal. Therefore, the Contractor andthe MBA agree that in the case of any Unauthorized Removal in respect of which the MBA does not elect toexercise its rights under Section 2.152, the MBA may assess Liquidated Damages against the Contractor asspecified below.

For the Unauthorized Removal of any Key Personnel designated in this Contract, the Liquidated Damagesamount is $20,000.00 per individual if the Contractor identifies a replacement approved by the MBA underSection 2.060 and assigns the replacement to the Project to shadow the Key Personnel who is leaving for aperiod of at least 30 days before the Key Personnel’s removal.

If the Contractor fails to assign a replacement to shadow the removed Key Personnel for at least 30 days, inaddition to the $20,000.00 Liquidated Damages for an Unauthorized Removal, the Contractor must pay theamount of $666.67 per day for each day of the 30 day shadow period that the replacement Key Personneldoes not shadow the removed Key Personnel, up to $20,000.00 maximum per individual. The total LiquidatedDamages that may be assessed per Unauthorized Removal and failure to provide 30 days of shadowing mustnot exceed $40,000.00 per individual.

Liquidated Damages Related to Closure of Lanes; Failure to ReopenShould the Contractor fail to reopen lane(s) at the times specified in the Contractor’s applicable lane closureplan or as otherwise directed in writing by the MBA, the Contractor must pay Liquidated Damages in theamount of $500.00 per hour or any portion thereof.


2.245 LOSS OF REVENUEIf Contractor meets an applicable KPI, but the MBA nevertheless incurs a loss of Gross Toll Revenue as aresult of the acts or inactions of the Contractor or the Contractor Parties, then for each event in which the MBAincurs a loss of Gross Revenue that exceeds $5,000.00, the Contractor must be obligated to make the MBAwhole and make payment to the MBA of all tolls associated with lost Transactions. In the event that the MBAis unable to determine lost Gross Revenue because data is lost or otherwise unavailable, then the Partiesagree that lost Gross Toll Revenue must be based on historical figures (traffic) maintained by the MBA. TheMBA, at its option, may either reduce the amount of the subsequent monthly maintenance fee or warranty fee,as applicable, by the amount of Gross Toll Revenue due as set forth above or require the Contractor to makepayment within thirty (30) Days of the MBA’s notice to the Contractor.

Once the Project is open to tolling and thereafter during the Contractor’s performance of the maintenanceservices, if as a result of the acts or inactions of the Contractor or Contractor Parties, the NTCS provided bythe Contractor fails to properly process a Transaction in accordance with the RFP requirements within sixty(60) Days after the date the Transaction occurred (“Stale Transactions”), then the Contractor must beresponsible to make payment to the MBA for the amount of lost tolls represented by each Stale Transaction.The Contractor must make payment to the MBA of such loss of revenue within thirty (30) Days of the MBA’snotice to the Contractor.

2.250 Approval of Deliverables

2.251 DELIVERY OF DELIVERABLESA list of the documents to be prepared and delivered by the Contractor including, for each document, thescheduled delivery date and an allowed the MBA review period is presented in Appendix C of the RFP. AllDeliverables must be completed and delivered for MBA review and written approval and, where applicable,tested and/or installed in accordance with the MBA-approved delivery schedule and any other requirements ofthis Contract.

Prior to delivering any Deliverable to the MBA, the Contractor must first perform all required quality assuranceactivities, and, verify that the Deliverable is complete and in conformance with its specifications. Beforedelivering a Deliverable to the MBA, the Contractor must certify to the MBA that (1) it has performed suchquality assurance activities, (2) it has performed any applicable testing, (3) it has corrected all material

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deficiencies discovered during such quality assurance activities and testing, and (4) the Deliverable is in asuitable state of readiness for the MBA’s review and approval.

In discharging its obligations under this Section 2.250 (and all subsections), the Contractor must be at all times(except where the parties agree otherwise in writing) in compliance with Level 3 of the Software EngineeringInstitute’s Capability Maturity Model for Software (“CMM Level 3”) or its equivalent.

2.252 CONTRACTOR SYSTEM TESTINGThe Contractor must be responsible for testing the NTCS in the Contractor’s development environment prior toturning over the NTCS to the MBA for acceptance testing and approval. The required testing is detailed inSection 3 of the RFP. In addition to those requirements the Contractor’s testing must include the following,plus any other testing required by CMM Level 3 or the Contractor’s system development methodology:

a) The Contractor must be responsible for performing unit testing and incremental integration testing ofthe components of the NTCS.

b) The Contractor’s testing must also include integration testing of each software component to ensureproper inter-operation with all other components, interfaces and other components that are intended tointer-operate, and must include regression testing, volume and stress testing to ensure that the NTCSis able to meet the MBA’s requirements.

2.253 APPROVAL OF DELIVERABLES (GENERALAll Deliverables (Written Deliverables and NTCS) require formal written approval by the MBA, in accordancewith the following procedures. Formal approval by the MBA requires that the Deliverable be confirmed inwriting by the MBA to meet its specifications, which, in the case of the NTCS, must include the successfulcompletion of the System Acceptance Testing, to be led by the MBA with the support and assistance of theContractor. The parties acknowledge that the approval process set forth herein will be facilitated by ongoingconsultation between the parties, visibility of interim and intermediate Deliverables and collaboration on keydecisions.

The MBA’s obligation to comply with any MBA review period is conditioned on the timely delivery ofDeliverables being reviewed. If the Contractor fails to provide a Deliverable to the MBA in a timely manner, theMBA will nevertheless use reasonable efforts to complete its review or testing within the applicable MBAreview period.

Before commencement of its review or testing of a Deliverable, the MBA may inspect the Deliverable toconfirm that all components of the Deliverable (e.g., software, associated documentation, and other materials)have been submitted. If the MBA determines that the Deliverable is incomplete, the MBA may refuse deliveryof the Deliverable without performing any further inspection or testing of the Deliverable. Otherwise, the reviewperiod must be deemed to have started on the day the MBA receives the submittal.

The MBA will approve in writing a Deliverable upon confirming that it conforms to and, in the case of the NTCS,performs in accordance with, its specifications without material deficiency. The MBA may, but must not berequired to, conditionally approve in writing a Deliverable that contains material deficiencies if the MBA electsto permit the Contractor to rectify them post-approval. In any case, the Contractor must be responsible forworking diligently to correct within a reasonable time at the Contractor’s expense all deficiencies in theDeliverable that remain outstanding at the time of MBA approval.

If, after three (3) opportunities (the original and two repeat efforts), the Contractor is unable to correct alldeficiencies preventing MBA approval of a Deliverable, the MBA may: (i) demand that the Contractor cure thefailure and give the Contractor additional time to cure the failure at the sole expense of the Contractor; or (ii)keep this Contract in force and do, either itself or through other parties, whatever the Contractor has failed todo, in which event the Contractor must bear any excess expenditure incurred by the MBA in so doing beyondthis Contract’s price for such Deliverable and must pay the MBA an additional sum equal to ten percent (10%)of such excess expenditure to cover the MBA’s general expenses without the need to furnish proof insubstantiation of such general expenses; or (iii) terminate this Contract for default, either in whole or in part bynotice to the Contractor (and without the need to afford the Contractor any further opportunity to cure).

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Notwithstanding the foregoing, the MBA must not use, as a basis for exercising its termination rights under thisSection 2.250 (and all subsections), deficiencies discovered in a repeat MBA review period that couldreasonably have been discovered during a prior MBA review period.

The MBA, at any time and in its own discretion, may halt the testing or approval process if such processreveals deficiencies in or problems with a Deliverable in a sufficient quantity or of a sufficient severity as tomake the continuation of such process unproductive or unworkable. In such case, the MBA may return theapplicable Deliverable to the Contractor for correction and re-delivery prior to resuming the review or testingprocess and, in that event, the Contractor must correct the deficiencies in such Deliverable in accordance withthis Contract, as the case may be.

Approval in writing of a Deliverable by the MBA must be provisional; that is, such approval must not precludethe MBA from later identifying deficiencies in, and declining to accept, a subsequent Deliverable based on orwhich incorporates or inter-operates with an approved Deliverable, to the extent that the results of subsequentreview or testing indicate the existence of deficiencies in the subsequent Deliverable, or if the Application ofwhich the subsequent Deliverable is a component otherwise fails to be accepted pursuant to Section 2.080.

Limitations on the Contractor’s Right to Rely: No review, comment, objection, rejection, approval, disapproval,acceptance, certification (including certificates of acceptance and project acceptance), concurrence,monitoring, testing, inspection, spot checking, auditing or other oversight by or on behalf of the MBA or theirrepresentatives or agents, and no lack thereof by the MBA or their representatives or agents, must constituteacceptance of materials or Work or waiver of any legal or equitable right under this Contract, at Law, or inequity. The MBA must be entitled to remedies for unapproved deviations and nonconforming Work and toidentify additional Work which must be done to bring the Project into compliance with requirements of the thisContract, regardless of whether previous review, comment, objection, rejection, approval, disapproval,acceptance, certification, concurrence, monitoring, testing, inspection, spot checking, auditing or otheroversight were conducted or given by the MBA or the MBA contractors, or their representatives or agents.Regardless of any such activity or failure to conduct any such activity by the MBA or other MBA contractors, ortheir representatives or agents, the Contractor at all times must have an independent duty and obligation tofulfill the requirements of this Contract. Any approval by the MBA must not be deemed to relieve or otherwisewaive any of the the Contractors obligations or requirements under this Contract, unless the same is thesubject matter of an Amendment, and in no case must such approval or Amendment be deemed a waiver ofany applicable rule, regulation or Law. The Contractor agrees and acknowledges that any such activity orfailure to conduct any such activity by the MBA, or MBA-designated representatives:

a) is solely for the benefit and protection of the MBA;b) does not relieve the Contractor of its responsibility for the selection and the competent performance of

all the Contractor-related entities;c) does not create or impose upon the MBA or other third party providing approval on the MBA’s behalf

any duty or obligation toward the Contractor to cause it to fulfill the requirements of this Contract;d) must not be deemed or construed as any kind of warranty, express or implied, by the MBA;e) may not be relied upon by the Contractor or used as evidence in determining whether the Contractor

has fulfilled the requirements of this Contract; andf) may not be asserted by the Contractor against the MBA as a defense, legal or equitable, to, or as a

waiver of or relief from, the Contractor’s obligation to fulfill the requirements of this Contract.

2.254 PROCESS FOR APPROVAL OF WRITTEN DELIVERABLESThe MBA Review Period for written Deliverables must be the number of days set forth in Appendix C of theRFP following delivery of the final version of the written Deliverable (failing which the MBA review period, bydefault, must be seven (7) calendar days for written Deliverables of one hundred (100) pages or less and ten(10) business days for written Deliverables of more than one hundred (100) pages). The MBA agrees to notifythe Contractor in writing by the end of the MBA review period either stating that the written Deliverable isapproved in the form delivered by the Contractor or describing any deficiencies that must be corrected prior toapproval of the written Deliverable (or at the MBA’s election, subsequent to approval of the writtenDeliverable). If the MBA delivers to the Contractor a notice of deficiencies, the Contractor must correct the

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described deficiencies and within five (5) calendar days resubmit the Deliverable in a form that shows allrevisions made to the original version delivered to the MBA. Upon receipt of a corrected written Deliverablefrom the Contractor, the MBA will have five (5) calendar days to review the corrected written Deliverable toconfirm that the identified deficiencies have been corrected.

2.255 PROCESS FOR APPROVAL OF THE NTCSThe Contractor will conduct testing of the NTCS in accordance with the following procedures to determinewhether it meets the criteria for MBA approval – i.e., whether it conforms to and performs in accordance withthe requirements and specifications without material deficiencies.

At least thirty (30) days (or such other number of days as the parties may agree to in writing) prior to theContractor’s delivery of the NTCS to the MBA for testing, the Contractor must provide to the MBA a set ofproposed test plans, including test cases, scripts, data and expected outcomes, for the MBA’s use (which theMBA may supplement in its own discretion) in conducting testing of the NTCS.

The testing will consist of executing test scripts from the proposed testing submitted by the Contractor, but mayalso include any additional testing deemed appropriate by the MBA. If the MBA determines during the testingthat the NTCS contains any deficiencies, the MBA will notify the Contractor of the deficiency in writing. TheContractor must modify promptly the NTCS to correct the reported deficiencies, conduct appropriate testing(including, where applicable, regression testing) to confirm the proper correction of the deficiencies and re-deliver the corrected version for re-testing

Within three (3) business days after conclusion of any test, the MBA will give the Contractor a written noticeindicating the MBA’s approval or rejection of the NTCS according to the criteria and process set out in thisSection 2.255.

2.256 FINAL ACCEPTANCE“Final Acceptance” is considered to occur when the NTCS successfully passes the System Acceptance Testas described in the RFP.

2.260 Ownership

2.261 OWNERSHIP OF WORK PRODUCT BY MBAExcept as provided under Section 2.30 (and all subsections), the MBA owns all Deliverables, as they are workmade for hire by the Contractor for the State. The State owns all United States and international copyrights,trademarks, patents or other proprietary rights in the Deliverables.

2.262 VESTING OF RIGHTSWith the sole exception of any preexisting licensed works identified in this Contract, the Contractor assigns,and upon creation of each Deliverable automatically assigns, to the State, ownership of all United States andinternational copyrights, trademarks, patents, or other proprietary rights in each and every Deliverable, whetheror not registered by the Contractor, insofar as any the Deliverable, by operation of law, may not be consideredwork made for hire by the Contractor for the MBA. From time to time upon the MBA’s request, the Contractormust confirm the assignment by execution and delivery of the assignments, confirmations of assignment, orother written instruments as the MBA may request. The MBA may obtain and hold in its own name allcopyright, trademark, and patent registrations and other evidence of rights that may be available forDeliverables.

2.263 RIGHTS IN DATAThe MBA is the owner of all data made available by the MBA to the Contractor or its agents, Subcontractors orrepresentatives under this Contract. The Contractor must not use the MBA’s data for any purpose other thanproviding the Work, nor will any part of the MBA’s data be disclosed, sold, assigned, leased or otherwisedisposed of to the general public or to specific third parties or commercially exploited by or on behalf of theContractor. No employees of the Contractor, other than those on a strictly need-to-know basis, have access tothe MBA’s data. The Contractor must not possess or assert any lien or other right against the MBA’s data.Without limiting the generality of this Section 2.260 (and all subsections), the Contractor must only usepersonally identifiable information as strictly necessary to provide the Work and must disclose the information

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only to its employees who have a strict need-to-know the information. The Contractor must comply at all timeswith all laws and regulations applicable to the personally identifiable information.

The MBA is the owner of all MBA-specific data under this Contract. The MBA may use the data provided bythe Contractor for any purpose. The MBA will not possess or assert any lien or other right against this theContractor’s data. Without limiting the generality of this Section 2.263, the MBA may use personallyidentifiable information only as strictly necessary to utilize the Work and must disclose the information only toits employees who have a strict need to know the information, except as provided by law. The MBA mustcomply at all times with all laws and regulations applicable to the personally identifiable information. Othermaterial developed and provided to the MBA remains the MBA’s sole and exclusive property.

2.264 OWNERSHIP OF MATERIALSThe MBA and the Contractor will continue to own their respective proprietary technologies developed beforeentering into this Contract. Any hardware bought through the Contractor by the MBA, and paid for by the MBA,must be owned by the MBA. Any software licensed through the Contractor and sold to the MBA, must belicensed directly to the MBA.

a. MBA Ownership. The Contractor must obtain in the MBA’s name and MBA must own all of theequipment located in/on MBA facilities as required by this Contract. In particular, the Contractor mustpurchase on behalf of the MBA all in lane and roadside equipment and hardware that will be deployedfor the Project (excepting any currently installed equipment and hardware that will be incorporated intothe Contractor’s solution). For clarification purposes, the data remains at all times the sole property ofthe MBA and the software must be licensed to the MBA as set forth in Section 2.320 (SoftwareLicensing) of this Contract. The equipment must in all ways during the Term, conform to therequirements for each item of equipment as set forth in this Contract regardless of the fact that theMBA must maintain ownership.

b. Bill of Sale. Any invoices furnished by the Contractor to the MBA for equipment and spares must havean original and signed Bill of Sale in the MBA’s name on a form reasonably acceptable to the MBAthat fully evidences the MBA’s ownership as required in this Contract.

c. FOB Destination. Transportation of all software, equipment, supplies and any other item that must betransported so that the Contractor may furnish the work, must be FOB Destination. Freight, handling,hazardous material charges, taxes, and distribution and installation charges must be included in thetotal price of each item. Any additional charges must not be honored for payment unless authorized inwriting by the MBA. A complete packing list must accompany each shipment.

d. Maintenance. The Contractor must maintain in good working order throughout the Term of thisContract, the NTCS and all of its subsystems as set forth in Section 3 and 7 of the RFP and theapproved Maintenance Plan.

2.270 MBA Standards

2.271 EXISTING TECHNOLOGY STANDARDSThe Contractor must adhere to all existing standards as described within the comprehensive listing of theMBA’s existing technology standards at https://www.michigan.gov/dtmb/0,5552,7-358-82547_56579_56755---,00.html.

2.272 ACCEPTABLE USE POLICYTo the extent that the Contractor has access to the MBA computer system, the Contractor must comply withthe MBA’s Acceptable Use Policy, see https://www.michigan.gov/documents/dmb/1340_193162_7.pdf.

All Contractor employees must be required, in writing, to agree to the MBA’s Acceptable Use Policy beforeaccessing the MBA system. The MBA reserves the right to terminate the Contractor’s access to the MBAsystem if a violation occurs.

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2.273 SYSTEMS CHANGESThe Contractor is not authorized to make changes to any MBA systems without written authorization from theMBA Project Manager. Any changes the Contractor makes to the MBA systems with the MBA’s approval mustbe done according to applicable MBA procedures, including security, access and configuration managementprocedures.

2.280 Extended Purchasing



2.290 Environmental Provision

2.291 ENVIRONMENTAL PROVISIONEnergy Efficiency Purchasing Policy: The MBA seeks wherever possible to purchase energy efficientproducts. This includes giving preference to U.S. Environmental Protection Agency (EPA) certified ‘EnergyStar’ products for any category of products for which EPA has established Energy Star certification. For otherpurchases, the MBA may include energy efficiency as one of the priority factors to consider when choosingamong comparable products.

Environmental Purchasing Policy: The MBA of Michigan is committed to encouraging the use of productsand services that impact the environment less than competing products. The MBA is accomplishing this byincluding environmental considerations in purchasing decisions, while remaining fiscally responsible, topromote practices that improve worker health, conserve natural resources, and prevent pollution.Environmental components that are to be considered include: recycled content and recyclables; energyefficiency; and the presence of undesirable materials in the products, especially those toxic chemicals whichare persistent and bioaccumulative. The Contractor should be able to supply products containing recycled andEnvironmentally Preferable materials that meet performance requirements and is encouraged to offer suchproducts throughout the duration of this Contract. Information on any relevant third party certification (such asGreen Seal, Energy Star, etc.) should also be provided.

Hazardous Materials: For the purposes of this Section 2.290 (and all subsections), “Hazardous Materials” isa generic term used to describe asbestos, ACBMs, PCBs, petroleum products, construction materials includingpaint thinners, solvents, gasoline, oil, and any other material the manufacture, use, treatment, storage,transportation or disposal of which is regulated by the federal, State or local laws governing the protection ofthe public health, natural resources or the environment. This includes, but is not limited to, materials the asbatteries and circuit packs, and other materials that are regulated as (1) “Hazardous Materials” under theHazardous Materials Transportation Act, (2) “chemical hazards” under the Occupational Safety and HealthAdministration standards, (3) “chemical substances or mixtures” under the Toxic Substances Control Act, (4)“pesticides” under the Federal Insecticide Fungicide and Rodenticide Act, and (5) “hazardous wastes” asdefined or listed under the Resource Conservation and Recovery Act.(a) The Contractor must use, handle, store, dispose of, process, transport and transfer any material

considered a Hazardous Material according to all federal, State and local laws. The MBA must provide asafe and suitable environment for performance of Contractor’s Work. Before the commencement ofWork, the MBA must advise the Contractor of the presence at the work site of any Hazardous Material tothe extent that the MBA is aware of the Hazardous Material. If the Contractor encounters materialreasonably believed to be a Hazardous Material and which may present a substantial danger, theContractor must immediately stop all affected Work, notify the MBA in writing about the conditionsencountered, and take appropriate health and safety precautions.

(b) Upon receipt of a written notice, the MBA will investigate the conditions. If (a) the material is a HazardousMaterial that may present a substantial danger, and (b) the Hazardous Material was not brought to thesite by the Contractor, or does not result in whole or in part from any violation by the Contractor of anylaws covering the use, handling, storage, disposal of, processing, transport and transfer of HazardousMaterials, the MBA must order a suspension of Work in writing. The MBA must proceed to have the

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Hazardous Material removed or rendered harmless. In the alternative, the MBA must terminate theaffected Work for the MBA’s convenience.

(c) Once the Hazardous Material has been removed or rendered harmless by the MBA, the Contractor mustresume Work as directed in writing by the MBA. Any determination by the Michigan Department ofCommunity Health or the Michigan Department of Environmental Quality that the Hazardous Material haseither been removed or rendered harmless is binding upon the MBA and the Contractor for the purposesof resuming the Work. If any incident with Hazardous Material results in delay not reasonableanticipatable under the circumstances and which is attributable to the MBA, the applicable KPIs for theaffected Work will not be counted in a time as mutually agreed by the parties.

(d) If the Hazardous Material was brought to the site by the Contractor, or results in whole or in part from anyviolation by the Contractor of any laws covering the use, handling, storage, disposal of, processing,transport and transfer of Hazardous Material, or from any other act or omission within the control of theContractor, the Contractor must bear its proportionate share of the delay and costs involved in cleaningup the site and removing and rendering harmless the Hazardous Material according to Applicable Laws tothe condition approved by applicable regulatory agency(ies).

Labeling: Michigan has a Consumer Products Rule pertaining to labeling of certain products containingvolatile organic compounds. For specific details visit http://www.michigan.gov/deq/0,1607,7-135-3310_4108-173523--,00.html

Refrigeration and Air Conditioning: The Contractor must comply with the applicable requirements ofSections 608 and 609 of the Clean Air Act (42 U.S.C. 7671g and 7671h) as each or both apply to this Contract.

Environmental Performance: Waste Reduction Program – The Contractor must establish a program topromote cost-effective waste reduction in all operations and facilities covered by this Contract. TheContractor's programs must comply with applicable Federal, State, and local requirements, specificallyincluding Section 6002 of the Resource Conservation and Recovery Act (42 U.S.C. 6962, et seq.).

2.300 Deliverables

2.301 SOFTWAREThe software Deliverable for this Contract includes all modules necessary to enable the NTCS to fully meet thefunctional and performance requirements of this Contract.

2.302 HARDWAREThe Contractor’s proposal includes a list of the items of hardware the MBA is required to purchase forexecuting this Contract. The list includes all hardware required to complete this Project if any additionalhardware is required in order for the Deliverables to meet the requirements of this Contract, such hardwaremust be provided to the MBA by the Contractor at no additional charge (except where agreed upon andspecified in a Contract Change Notice). The proposal also identifies any items of hardware to be provided bythe MBA.

2.303 SPARE PARTSSpare Parts Inventory. The Contractor must be solely responsible for maintaining an adequate inventory ofequipment, spares and consumables (individually, “Spare” and collectively, “Spares”). The MBA must owneach Spare upon payment by the MBA to the Contractor (except in the event the Contractor elects to utilize theinitial Spares inventory during the warranty period set forth in this Contract, in which case the Contractor isresponsible for funding the replenishment of the inventory levels to their original quantities at no additional costto the MBA). The Contractor must turn over to the MBA upon termination of this Contract the remaininginventory of Spares.

Quality Control. The Contractor must ensure that all parts, components, equipment, materials, and other itemspurchased for use in the NTCS are new. All Spares purchased for use in the NTCS must be new, of goodquality and designed to reliably carry out their functions within the System and meet the requirements of thisContract.

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2.304 RISK OF LOSSThe Contractor must have sole responsibility for risk of loss to the Contractor and the Contractor Party-ownedfacilities, equipment and other goods. The Contractor must have sole responsibility for risk of loss to thehardware, equipment, material and supplies provided by TSI through this Contract. The Contractor mustassume the risk of loss for all equipment and materials, until the MBA’s Acceptance of the applicable Work,unless damage is the sole result of the MBA’s gross negligence or willful misconduct. The Contractor assumesall risk of loss for Spares until a particular Spare is properly placed into the System and Accepted by the MBA.The Contractor must maintain adequate insurance for the risk of loss assumed in this Section 2.304.Notwithstanding the above, if equipment is installed in the lane and the road is open to tolling, if through nofault of the Contractor a third party motorist damages the equipment, then the Contractor must not beresponsible for the cost of repairs to the damaged equipment or replacement of the damaged equipment.

2.310 Software Warranties

2.311 PERFORMANCE WARRANTYThe Contractor represents and warrants that the NTCS, after Final Acceptance, must perform and operate incompliance with the requirements and other standards of performance contained in this Contract (including alldescriptions, specifications and drawings made a part of this Contract) for a period of one year. In the event ofa breach of this warranty, the Contractor must promptly correct the affected Deliverable(s) at no charge to theMBA.

2.312 NO SURREPTITIOUS CODE WARRANTYThe Contractor represents and warrants that no copy of licensed Software provided to the MBA contains or willcontain any Self-Help Code or any Unauthorized Code as defined below. This warranty is referred to in thisContract as the “No Surreptitious Code Warranty.”

As used in this Contract, “Self-Help Code” means any back door, time bomb, drop dead device, or othersoftware routine designed to disable a computer program automatically with the passage of time or under thepositive control of a person other than the licensee of the software. Self-Help Code does not include Softwareroutines in a computer program, if any, designed to permit an owner of the computer program (or other personacting by authority of the owner) to obtain access to a licensee’s computer system(s) (e.g. remote access viamodem) for purposes of maintenance or technical support.

As used in this Contract, “Unauthorized Code” means any virus, Trojan horse, spyware, worm or otherSoftware routines or components designed to permit unauthorized access to disable, erase, or otherwise harmsoftware, equipment, or data; or to perform any other such actions. The term Unauthorized Code does notinclude Self-Help Code. Unauthorized Code does not include Software routines in a computer program, if any,designed to permit an owner of the computer program (or other person acting by authority of the owner) toobtain access to a licensee’s computer system(s) (e.g. remote access via modem) for purposes ofmaintenance or technical support.

In addition, the Contractor must use up-to-date commercial virus detection software to detect and remove anyviruses from any software prior to delivering it to the MBA.


2.314 THIRD-PARTY SOFTWARE WARRANTYThe Contractor represents and warrants that it must disclose the use or incorporation of any third-partysoftware into the NTCS. At the time of delivery, the Contractor must provide in writing the name and use ofany third-party Software, including information regarding the Contractor’s authorization to include and utilizesuch software. The notice must include a copy of any ownership agreement or license that authorizes theContractor to use the third-party Software.


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2.320 Software Licensing

2.321 CROSS-LICENSE, DELIVERABLES ONLY, LICENSE TO CONTRACTORThe MBA grants to the Contractor, the royalty-free, world-wide, non-exclusive right and license under anyDeliverable now or in the future owned by the MBA, or with respect to which the MBA has a right to grant suchrights or licenses, to the extent required by the Contractor to market the Deliverables and exercise its full rightsin the Deliverables, including, without limitation, the right to make, use and sell products and services based onor incorporating such Deliverables.

2.322 CROSS-LICENSE, DELIVERABLES AND DERIVATIVE WORK, LICENSE TO CONTRACTORThe MBA grants to the Contractor, a royalty-free, world-wide, non-exclusive right and license under anyDeliverable and/or derivative work now or in the future owned by the MBA, or with respect to which the MBAhas a right to grant such rights or licenses, to the extent required by the Contractor to market the Deliverablesand/or derivative work and exercise its full rights in the Deliverables and/or derivative work, including, withoutlimitation, the right to make, use and sell products and services based on or incorporating such Deliverablesand/or derivative work.

2.323 LICENSE BACK TO THE MBAUnless otherwise specifically agreed to by the MBA, before initiating the preparation of any Deliverable that is aderivative of a preexisting work, the Contractor must cause the MBA to have and obtain the irrevocable,nonexclusive, worldwide, royalty-free right and license to (1) use, execute, reproduce, display, perform, anddistribute internally or externally all preexisting works and Derivative Works thereof, and (2) authorize orsublicense others from time to time to do any or all of the foregoing to other authorized agents for the solepurpose of providing the Work as set forth in this Contract and expressly conditioned upon sublicenseeexecuting confidentiality agreements acceptable to the Contractor prior to accessing the Contractor’s LicensedSoftware.

2.324 LICENSE RETAINED BY CONTRACTORThe Contractor grants to the MBA a non-exclusive, royalty-free, site-wide, irrevocable, non-transferable licenseto use the Software and related documentation according to the terms and conditions of this Contract for thesole purposes as set forth in this Contract. For the purposes of this license, “site-wide” includes any MBAfacilities regardless of its physical location.

The MBA will make and maintain no more than one archival copy of each item of Software, and each copy willcontain all legends and notices and must be subject to the same conditions and restrictions as the original.The MBA may also make copies of the Software in the course of routine backups of hard drive(s) for thepurpose of recovery of hard drive contents.

In the event that the Contractor must, for any reason, cease to conduct business, or cease to support theSoftware, the MBA must have the right to convert these licenses into perpetual licenses, with rights of quietenjoyment, but subject to separate licensing and payment obligations as mutually agreed to at that time.

2.325 PRE-EXISTING MATERIALS FOR CUSTOM SOFTWARE DELIVERABLESNeither the Contractor nor any of its Subcontractors must incorporate any preexisting materials (includingStandard Software) into the NTCS or use any pre-existing materials to produce the NTCS if such pre-existingmaterials will be needed by the MBA in order to use the NTCS unless (i) such pre-existing materials and theirowners are identified to the MBA in writing and (ii) such pre-existing materials are either readily commerciallyavailable products for which the Contractor or its Subcontractor, as the case may be, has obtained a license (inform and substance approved by the MBA) in the name of the MBA, or are materials that the Contractor or itsSubcontractor, as the case may be, has the right to license to the MBA and has licensed to the MBA on termsand conditions approved by the MBA prior to using such pre-existing materials to perform the Work.

2.330 Source Code Escrow

2.331 DEFINITION“Source Code Escrow Package” must mean:

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(a) A complete copy in machine-readable form of the source code and executable code of the LicensedSoftware, including any updates or new releases of the product;

(b) A complete copy of any existing design documentation and user documentation, including any updates orrevisions; and/or

(c) Complete instructions for compiling and linking every part of the source code into executable code forpurposes of enabling verification of the completeness of the source code as provided below. Suchinstructions must include precise identification of all compilers, library packages, and linkers used togenerate executable code.

2.332 DELIVERY OF SOURCE CODE INTO ESCROWThe Contractor must deliver a baseline Source Code Escrow Package to the Escrow Agent, pursuant to theEscrow Contract, which must be entered into on commercially reasonable terms subject to the provisions ofthis Contract within (30) thirty days of the execution of this Contract .

2.333 DELIVERY OF NEW SOURCE CODE INTO ESCROWIf at anytime during the term of this Contract, the Contractor provides a maintenance release or upgradeversion of the Licensed Software, the Contractor must within ten (10) days deposit with the Escrow Agent, inaccordance with the Escrow Contract, a Source Code Escrow Package for the maintenance release orupgrade version, and provide the MBA with notice of the delivery.

2.334 VERIFICATIONThe MBA reserves the right at any time, but not more than once a year, either itself or through a third partycontractor, upon thirty (30) days written notice, to seek verification of the Source Code Escrow Package.

2.335 ESCROW FEESThe Contractor must pay all fees and expenses charged by the Escrow Agent during the term of this Contract.

2.336 RELEASE EVENTSThe Source Code Escrow Package may be released from escrow to the MBA, temporarily or permanently,upon the occurrence of one or more of the following:(a) The Contractor becomes insolvent, makes a general assignment for the benefit of creditors, files a

voluntary petition of bankruptcy, suffers or permits the appointment of a receiver for its business orassets, becomes subject to any proceeding under bankruptcy or insolvency law, whether domestic orforeign;

(b) The Contractor has wound up or liquidated its business voluntarily or otherwise and the MBA has reasonto believe that such events will cause the Contractor to fail to meet its warranties and maintenanceobligations in the foreseeable future;

(c) The Contractor voluntarily or otherwise discontinues support of the provided products or fails to supportthe products in accordance with its maintenance obligations and warranties and the Contractor fails tocure the default within a 30 day cure period.

2.337 RELEASE EVENT PROCEDURESIf the MBA desires to obtain the Source Code Escrow Package from the Escrow Agent upon the occurrence ofan event in this Section 2.330 (and subsections), then:(a) The MBA must comply with all procedures in the Escrow Contract;(b) The MBA must maintain all materials and information comprising the Source Code Escrow Package in

confidence in accordance with this Contract;(c) If the release is a temporary one, then the MBA must promptly return all released materials to the

Contractor when the circumstances leading to the release are no longer in effect.

2.338 LICENSEUpon release from the Escrow Agent pursuant to an event described in this Section 2.330 (and subsections),the Contractor automatically grants the MBA a non-exclusive, irrevocable license to use, reproduce, modify,maintain, support, update, have made, and create derivative works. Further, the MBA must have the right touse the Source Code Escrow Package in order to maintain and support the Licensed Software so that it can beused by the MBA as set forth in this Contract.

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2.339 DERIVATIVE WORKSAny derivative works to the source code released from escrow that are made by or on behalf of the MBA mustbe the sole property of the MBA. The MBA acknowledges that its ownership rights are limited solely to thederivative works and do not include any ownership rights in the underlying source code.

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Glossary

Term Definition or Meaning6C RFID Protocol. ISO 18000-63 (aka “ISO 18000-6C”, or simply

“6C”)Audit Period See Section 2.110 herein.Authority The Mackinac Bridge Authority. Also “MBA”Back Office (BOS) One of the “Functional Areas” of MBA’s system concept for the

NTCS. Includes various subsystems such as TransactionProcessing, Customer Service, Website, etc.

Bridge The Mackinac Bridge

Business Day

Whether capitalized or not, must mean any day other than aSaturday, Sunday or MBA-recognized legal holiday (as identifiedin the Collective Bargaining Agreement for MBA employees)from 8:00am EST through 5:00pm EST unless otherwise MBAd.

Business Rules A set of rules which govern how the system will be used toachieve the business processes of MBA.

Collector Also “Toll Collector”. The person who staffs a toll booth inStaffed Operation.

Contract See Section 2.006 herein.Contractor The Prime Contractor selected to serve and as the TSI and

signatory to the Contract.COTS Commercial Off the Shelf SoftwareCSR Customer Service Representative. An MBA staff member that

provides service to customers either on the phone or in personat the Point of Sale window.

Day Calendar day unless otherwise specified.DDD Detailed Design Document

Deliverable Physical goods and/or commodities as required or identified by aStatement of Work

DVAS Digital Video Audit SystemETC Electronic Toll CollectionFAT Factory Acceptance TestFinal SystemAcceptance

A milestone at which MBA formally notifies the TSI that theNTCS has passed the System Acceptance Test.

Host One of the “Functional Areas” of MBA’s system concept for theNTCS. Includes the primary and secondary Host Subsystems.A “Host” can include various devices including servers, storageunits, communications devices, etc.

Key Personnel See Section 2.062 herein.KPI Key Performance Indicator. As set of performance requirements

that will be measured on a periodic basis in order to assess theconformance of the NTCS to the Contract requirements.

Legacy System The toll collection system in operation at the Bridge on the dateof execution of the Contract.

MaintenancePeriod

The period of time which will begin on the one year anniversaryof the NTCS going into revenue service or the date of FinalSystem Acceptance, whichever occurs last, and end withexpiration of the Contract.

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Term Definition or MeaningMBA Mackinac Bridge Authority

MBA Location Any physical location where the MBA performs work. MBALocation may include MBA-owned, leased, or rented space.

MDOT Michigan Department of TransportationMIB Management Information BaseMOMS Maintenance Online Management SystemMOT Management of TrafficNew Work Any Services/Deliverables outside the scope of this Contract.NTCS New Toll Collection SystemNTP Notice To ProceedPlaza One of the “Functional Areas” in MBA’s system concept for the

NTCS. Includes subsystems for Point of Sale, DVAS, etc.POS Point of Sale. Customer service window in the plaza building

where customers can be serviced to open/close accounts, getMacPasses, make payments, resolve issues, etc.

Price Proposal A spreadsheet which presents the Proposer’s pricing for theproject, as detailed in the Contract.

Prime Contractor The company/firm that is wholly responsible for performing theservices and providing the Deliverables required herein

Principal in Charge The senior manager/executive of the Prime Contractor who hasdirect responsibility/management duties over the project teamworking on the Project.

Project The effort of the TSI, MBA, and other entities to achieve the goalof implementing a compliant NTCS at the Bridge which meets allof the requirements of this RFP and then maintaining thatSystem for the duration of the Contract.

Contractor ProjectManager

An employee of the Prime Contractor who is designated tomanage the Contractor’s efforts to complete the Project.

MBA ProjectManager

An employee of MBA designated to manage the project onbehalf of MBA.

Project Site See Section 1.201Proposal A document submitted by a Proposer in response to this RFP.Proposer A firm/company that chooses to submit a Proposal in response

to this RFP.ProxCard A device which uses proximity technology to communicate

wirelessly with a “Proximity Reader” in order to transmit data andidentify the card holder’s MacPass account.

RDD Reports Detailed DesignRFID Radio Frequency IdentificationRFP The Request for Proposal for Requisition #2495Roadside One of the “Functional Areas” in MBA’s system concept for the

NCTS. Includes various subsystems such as the lane controller,classification system, In booth subsystem, etc.

RTM Requirements Traceability MatrixSelection Team The team of MDOT and MBA personnel who will evaluate

Proposals submitted in response to this RFP and select the bestvalue Proposal.

SNMP Simple Network Management Protocol

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Term Definition or MeaningStatement of Work The formal set of work that the TSI shall be required to

perform/provide. See Section 3 of the RFP.

SubcontractorA company Contractor delegates performance of a portion of theServices to, but does not include independent contractorsengaged by Contractor solely in a staff augmentation role.

TechnicalRequirements

A statement of the requirements that the NTCS shall have tomeet.

Transaction Record A set of data elements corresponding to the passage of avehicle through a toll lane, and including various attributes andinformation about the vehicle, the lane, time/date, etc.

TSI - Toll SystemIntegrator (TSI)

Toll System Integrator. AKA Contractor. The firm that isselected and awarded the contract, is signatory to the Contract,and is responsible for performing the Statement of Work.

TST Touch Screen TerminalTVL Tag Validation ListUnauthorized Code See Section 2.312 herein.UnauthorizedRemoval

See Section 2.062 herein.

UPS Uninterruptible Power SupplyUTM Universal Transaction MessageWarranty Period The period of time that begins when the NTCS goes into

revenue service and ends one year later or when Final SystemAcceptance is granted.

Work Any and all actions taken by the Contractor necessary tocomplete all requirements set forth in this Contract.

Work in ProgressA Deliverable (i.e. document, software module, etc.) that hasbeen partially prepared, but has not been presented to the MBAfor Approval.

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Exhibit A – Contractor’s Proposal

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Exhibit B – Request for Proposal