SOW-02 Co-Managed Cloud Operations — ACME Health / Cumberland Valley

Operation of ACME's Azure estate under a co-managed model with a contracted step-down, so that operational capability transfers to ACME on a schedule rather than by intention. ⚠ The step-down milestones are acceptance-gated: Supplier is not paid for a phase until ACME demonstrates the capability that phase transfers.

1. Parties, Instrument and Term

Attribute	Provision
Client	ACME Health
Supplier	Rutherford Cloud Operations
Instrument	SOW-02, issued under the Master Services Agreement
Vendor register reference	VN-02 in the Vendor Management Plan
Vehicle	Fixed price for the operating baseline, time and materials for project work
ACME owner	B. Trammell, VP Infrastructure
Effective	August 28, 2023 — ⚠ subject to execution under §7
Term	From landing zone acceptance through the final step-down boundary.
Governing document	Vendor Management Plan §4 and §5. ⚠ Clauses in those sections are mandatory and are reproduced here in full rather than incorporated by reference.

2. Scope of Services

Ref	Element	Provision
SC-01	Platform operations	Monitoring, patching, backup verification and incident response across the estate, to the service tiers in the Quality Plan.
SC-02	Migration wave support	Engineering support to each migration wave, including rollback execution.
SC-03	Landing zone maintenance	Policy guardrails, network, identity and logging maintained to the design.
SC-04	Step-down capability transfer	⚠ Four contracted phases. Each transfers a defined capability to ACME and is accepted only when ACME performs it unaided.
SC-05	FinOps operations	Tagging enforcement, showback reporting, and reservation recommendations. ⚠ Recommendations only — commitment decisions are ACME's.
SC-06	On-call rota	Named engineers, with ACME engineers progressively taking primary through the step-down.

3. Deliverables and Acceptance

⚠ Acceptance criteria are stated here, before work begins. A deliverable is accepted when the criterion is demonstrated, not when Supplier declares it complete.

Ref	Deliverable	Acceptance criterion
DL-01	Service commencement	Monitoring, alerting and on-call live across the estate
DL-02	Step-down phase 1 accepted	ACME performs routine operations unaided for one full cycle
DL-03	Step-down phase 2 accepted	ACME performs patching and backup verification unaided
DL-04	Step-down phase 3 accepted	⚠ ACME leads incident response; Supplier advises only
DL-05	Step-down phase 4 accepted	ACME operates independently; Supplier moves to advisory retainer
DL-06	Operations runbooks	Handed over and rehearsed by the receiving ACME team

4. Service Levels

Level	Response	Resolution	Definition
Severity 1	15 minutes	Continuous effort	Production outage, Tier 0 or 1
Severity 2	1 hour	8 hours	Degraded service, no workaround
Severity 3	4 hours	3 business days	Degraded, workaround exists
Severity 4	1 business day	Next maintenance window	Request or cosmetic

5. Warranty, Support and Version Obligations

The obligations below are mandatory under Vendor Management Plan §5 and are not subject to negotiation on price. They govern the period after acceptance, which is where the cost of an incomplete statement of work is actually incurred.

Ref	Term	Provision
SW-02	Defect remediation service levels	Response and resolution by severity, using ACME's severity definitions from the Quality Plan, not Supplier's. Severity 1 — a defect harming a member or breaching a regulatory obligation — carries a 1 hour response and continuous effort to resolution.
SW-03	Support staffing and coverage	Named support contacts with a defined escalation path. ⚠ Coverage extends to cutover weekends and hypercare periods on the program calendar, not Supplier's standard business hours. Coverage windows are listed by date in an annex updated at each wave.
SW-04	Version updates and patches	Supplier states who applies updates, in what window, and who tests. Security patches run on a clock separate from feature releases. ACME approves the timing of any update to a production environment.
SW-08	Environment coverage	⚠ Support covers non-production environments. A test environment nobody will fix stops testing, which stops the program.

⚠ SW-03 coverage is stated against the program's wave calendar, not Supplier's standard hours. Every migration wave cutover falls on a weekend by design, which is precisely when a platform behaves unexpectedly and least when Supplier's standard support would be available.

6. General Conditions

Ref	Clause	Provision
GC-01	Governing agreement	This statement of work is issued under the Master Services Agreement between ACME Health and Rutherford Cloud Operations. Where the two conflict, the Master Services Agreement governs except on scope, price and schedule, which this instrument governs.
GC-02	Contracting party across the close	⚠ Executed before closing by ACME Health. Cumberland Valley Health Plan becomes a beneficiary at closing without further action; no novation is required because ACME is the contracting party throughout.
GC-03	Key personnel	Named individuals in §2 may not be substituted without written agreement. A substitution without agreement is a material failure, not an administrative change.
GC-04	Subcontracting	No subcontracting without prior written consent. All obligations of this instrument flow down to any approved subcontractor, including data-handling and audit rights.
GC-05	Data handling and location	⚠ No member-level data is processed, stored or accessed outside the United States. This is a contractual obligation, not a policy preference, and derives from a condition of the state insurance approval.
GC-06	Business associate agreement	A business associate agreement is executed before any access to protected health information, and remains in force through the retention period after termination.
GC-07	Security incident notification	Supplier notifies ACME within 24 hours of discovering a suspected security or privacy incident. ⚠ The clock runs from discovery, not from confirmation.
GC-08	Audit rights	ACME may audit compliance on 10 business days' notice, and without notice following a reported incident.
GC-09	Insurance	Professional liability, cyber liability and workers compensation maintained at the limits in the Master Services Agreement; certificates provided before work begins and on renewal.
GC-10	Change control	Scope changes are priced and approved before work begins, against the program's thresholds ($250,000 Program Manager, $1,000,000 Executive Sponsor, above that the Steering Committee). ⚠ Work performed before approval is performed at Supplier's risk.
GC-11	Intellectual property	Runbooks, automation, infrastructure-as-code and configuration produced under this instrument are the property of ACME Health. Supplier retains its own tooling and methodology.
GC-12	Knowledge transfer	Knowledge transfer is a deliverable with named receivers and an acceptance test, not a by-product of the work. Acceptance is by reverse shadowing: ACME performs unaided while Supplier observes.
GC-13	Termination for convenience	ACME may terminate on 30 days' written notice. Supplier is paid for work accepted and work in progress to the termination date.
GC-14	Transition assistance	⚠ On termination for any reason, Supplier provides transition assistance for up to 90 days at the rates in §4, and returns all data and artifacts in a documented, usable format. "Available on request" is not a format.
GC-15	Surviving obligations	Confidentiality, business associate terms, data return and record retention survive termination.
GC-16	Independence	Supplier confirms no engagement with Cumberland Valley Health Plan, Cheatham Mutual Holdings, or any party adverse to the transaction, and will disclose any such engagement arising during the term.

7. Execution

This statement of work is not effective until executed by an authorized signatory of both parties and endorsed by ACME Legal. ⚠ Work performed before execution is performed at Supplier's risk and is not payable.

For ACME Health

D. Ashmore

EVP & Chief Financial Officer · Executive Sponsor

Date: _______________

For Rutherford Cloud Operations

D. Pennington

President · authorized signatory

Date: _______________

Procurement approval

H. Castellow

VP Procurement, ACME Health

Date: _______________

Legal review and endorsement

L. Hollingsworth

General Counsel, ACME Health

Date: _______________

Four signatures rather than two, and each one is a different check. The business owner confirms the work is wanted and funded; the supplier's officer binds their firm; Procurement confirms the commercial terms match the framework agreement; Legal confirms the clauses that only matter later — data handling, liability, termination and the §5 obligations — are actually present. ⚠ The signature most often skipped under schedule pressure is the legal one, and it is the only one that reads the parts of the document nobody expects to need.