This Corrective Building Plan dated February 2017 (this is by and between the New York City Department of Homeless Services (?Di-18? or the ?Department?) and Children?s Community Services a not-for-pro?t corporation organized under the laws of the State of New York, having its principal of?ces in Queens, New York. CCS and shall be collectively referred to herein as the ?Parties.? WI TNE SSE TH: WHEREAS, the Department awarded contracts to CCS to provide shelter and social services to homeless families with children and individuals (hereinafter referred to as the ?Agreements?); and WHEREAS, the Department has a continued need for the services which CCS provides to homeless families and individuals and seeks to extend the above the Agreements; WHEREAS, CCS serves one of the City?s most economically vulnerable communities and is relied upon by a wide range of clients for services that'are critical for their well-being, providing such programs as shelter services for the homeless; and WHEREAS, CCS warrants and represents that it employed 35 people directly, 750 people indirectly (?temporary staff?) but has now hired the temporary staff for total of 785 direct employees; and WHEREAS, upon review of the matters set forth herein, the Parties agreed that the continued operation of CCS as a service provider funded by DHS remains in the best interests of the City, CCS and the clients it serves on behalf of the City; and WHEREAS, CCS was reviewed by the Department and the Mayor?s Of?ce of Contract Services (MOCS) as part of its due diligence in connection with the above Agreements (the ?Review?), which raised concerns about governance capacity, concerns which were detailed in correspondence and a meeting between the City and CCS and a summary of which has been attached hereto as Exhibit and WHEREAS, the Parties now mutually desire to address the ?ndings of the Review and the governance capacity of the of?cers, in order to support the Department?s determination that CCS remains a viable vendor to provide services under New York City contracts, NOW, THEREFORE, the Parties hereby agree as follows: 1. De?nitions The following de?nitions apply unless explicitly stated otherwise: City Contracts Any and all contracts, including the Agreements that are funded in whole or in part by the City or any agency, authority or subdivision of the City, including but not limited to the Departrnent, which are performed by CCS during the term of this CAP. Page I of 9 Key People Includes directors, of?cers, any individual participating in overall ?nancial policy-making decisions for CCS and/ or any of its af?liate, and each person in a position to control and or direct overall operations. Employee - all of the individuals employed by CCS who are not Key People. Corporate Governance A. Board and Executive Staff: CCS represents that its? current Board of Directors (hereinafter referred to the as ?Board?) consists of ?ve (5) members. CCS acknowledges and agrees that in accordance with the City Contracts, only one member may be interested. (2) CCS agrees that current and future members and of the Board will be submitted to the Department and MOCS for interview and acceptance and that all persons who shall be nominated to serve on the Board and Key People hired during the term of this CAP shall be similarly submitted for interview and acceptance prior to their election. (3) CCS acknowledges and agrees that all current and future members of the Board must complete an ethics and/ or nonpro?t compliance training course within 30 days from the approval of the Board member by the Department and MOCS. (4) CCS agrees that all Key People and Board members (both current and future) must attend Capacity Building Training within 30 days from the approval of the Board member by the Department and MOCS. L. (5) CCS agrees that it shall recruit and retain, in accordance with the provisions of this CAP, a Chair of the Board, Chief Financial Of?cer, Executive Director and Human Resources Director by Friday, December 30, 2016. (6) CCS agrees that by Monday, january 30, 2017, it shall create governance plan that includes the recruitment and of two additional members of the Board, for total of seven (7) Board members, and a review of the corporation?s policies and structure to demonstrate compliance with the New York State Non-Pro?t Corporation Law. (7) CCS represents and covenants that Board minutes shall accurately re?ect and include the consideration and disposition by resolution, of all business items acted upon at the Board meetings, including those concerning all payments and compensation of all Key People and/ or any other employee, including but not limited to salary, bonuses, and bene?ts. Board minutes shall also accurately reflect discussions and recommendations made regarding program and ?scal management, and conflicts of interest policies and procedures. Page 2 of 9 (8) CCS acknowledges and agrees that it shall submit all minutes from a one-year period (12 months) following the execution date of this CAP. B. Human Resources: (1) CCS agrees that it shall develop a strategic plan, for review and approval by the Department and MOCS, which delineates its organizational growth and development for it operation under the Agreements and City Contracts by March 15, 2017. C. Fiscal Policies and Corrective Measures: (1) CCS agrees to hire a duly licensed Independent Auditor and Financial Consultant (?Fiscal Monitor?) to conduct an assessment of ?nancial status and internal controls (?Assessment?). CCS agrees that its selection of a Fiscal Monitor is subject to approval. CCS further agrees that this Assessment shall be completed by March 15, 2017 and shall include, but not be limited to, an examination of accounting systems and records, ledger, statements, budgets and budget development process, staf?ng and comrnunications regarding the ?scal workflow and dissemination of ?scal information. CCS shall deliver a copy of the Assessment to MOCS and DHS within two (2) business days of its completion. CCS shall implement all reasonable recommendations made in the Assessment subject to the oversight of MOCS and DHS. D. Continued Reviews: (1) CCS agrees that it shall comply with Capacity Building and Oversight (CBO) Nonpro?t vendor Review Report process, now required by City Contracts, and that CCS will make its best efforts to fully implement all recommendations resulting from that process. CCS will provide any further documentation or information requested by MOCS in a timely manner. (2) All Board members and Key People shall complete the Core Capacity Assessment Tool and submit the report to CBO upon request. (3) CCS agrees that it shall deliver, on a quarterly basis and in a format designated by the Department and MOCS, a report detailing its implementation of the requirements of this CAP to DHS and MOCS. Required Cooperation with the City Page 3 of9 A. Department of Investigation (D01) Disclosures: (I) CCS acknowledges and agrees that it shall immediately notify DOI in the event that it knows or reasonably should know that CCS and/ or any of its present or former employees, of?cers, directors, agents, or consultants are subpoenaed, interviewed, questioned or otherwise contacted by any government agency, of?cial, and/ or employee in connection with any criminal investigation or proceeding, whether or not CCS and/ or any of its present or former employees, of?cers, directors, agents, or consultants, are under investigation for any alleged violation of criminal law. In the event that any such disclosure is prohibited by law or judicial order, then CCS and/ or any of its present or former employees, of?cers, directors, agents, or consultants shall immediately inform the government agency, of?cial, and/ or employee who has contacted them regarding an investigation and proceeding that CCS and its employees, of?cers, directors, agents, or consultants have a noti?cation requirement under this CAP. (2) CCS acknowledges and agrees that it shall immediately notify DOI in the event that it knoWs or reasonably should know that CCS and/ or any of its present or former employees, of?cers, directors, agents, or consultants are subpoenaed, interviewed, questioned or otherwise contacted by any government agency, of?cial, and or employee in connection with any criminal investigation or proceeding involving or related to allegations or a lack of honesty or business integrity, whether of a criminal or civil or administrative nature and whether or not CCS and/ or any of its present or former employees, of?cers, directors, agents, or consultants are, or are believed to be the subject or target of any such investigation or proceeding, or are noti?ed or otherwise learn that CCS and/ or any of its present or fonner employees, of?cers, directors, agents, or consultants will immediately inform that government agency, of?cial, and/ or employee who has contacted them regarding an investigation or proceeding that CCS and its employees, of?cers, directors, agents, or consultants have a noti?cation requirement under this CAP. B. VENDEX Disclosures: (1) CCS further agrees that it will notify the Department and MOCS in writing of any changes, including additions or deletions, to any and all information that CCS is required to report on its VENDEX questionnaires upon its knowledge of the occurrence of such events. C. Contract Compliance: (1) CCS agrees that it shall fully and faithfully comply with the terms of Investigations Clause contained in all City Contracts. (2) CCS further agrees to comply with the subcontracting clauses contained in all City Contracts, whereby all sub-contracts must be approved by the Department. (3) CCS further agrees that the engagement of any consultant must be subject to a written agreement. D. Operational Plan: Page 4 of 9 CCS agrees to submit Operational Plans for all units housing Dl-lS clients. DHS will designate the Operational Plan form and will provide technical assistance with completing the plan. 4. N0 Waiver Im airment A. Nothing in this CAP shall impair or waive any existing rights of the City to audit, investigate, and evaluate past, current or future acts of CCS. CCS agrees to cooperate fully with any audits or investigations commenced by the City with respect to operations. 5. Miscellaneous A. This CAP shall apply to the successors and assigns of CCS and to any entity with which it may merge or may be acquired. B. Any written noti?cation or report required by or made pursuant to this CAP shall be made, mailed, or delivered as set forth below: To the City: Vincent Pullo Agency Chief Contracting Of?cer New York City Human Resources Administration Department of Social Services 150 Greenwich Street, 37th Fl. New York, NY 10007 To CCS: Thomas Bransky Executive Director Children?s Community Services 229-19 Merrick Boulevard, #302 jamaica, New York, 11413-7013 C. The term of this CAP shall run for ?ve (5) years from the date of its execution. D. This CAP, including all exhibits hereto, by appended and made a part of all City Contracts entered into by CCS during the above-described term. E. This CAP, including all exhibits hereto, embodies the entire understanding and agreement of the Parties with respect to the subject matter herein and merges and supersedes all prior representations, agreements, understandings, whether oral or written, between the Parties with respect to the subiect matter herein, without limitation, all prior drafts of this CAP and any and all written or oral statements or representations by any of?cial, employee, agent, attorney, consultant or independent contractor of the Parties. Page 5 of9 F. No provisions of this CAP nor any exhibit to this CAP shall be amended otherwise modi?ed, in whole or in part, except by a written instrument, duly executed by the Parties. REMAINDER OF PAGE LEFT BLANK Page 6 of 9 7?3 5 Executed on Behalf og/Cgis?hy: ,1 . ,1 [xi] l/ Ry It: 5: gWilliam Rivkiil, Ac?ting Board Branskv, Executive Agency Chief Contracting Of?cer Department of Social Services Unu- i?mzc 7 m' 9 Page 8 of 9 EXHIBIT A Summary of Capacity Building Plan Action Items and Requested Documentation The following summary memorializes discussions with CCS, MOCS and DHS including the meetings held on November 2' AND 18, 2016, Regarding the issues raised by Capacity Building Review, proposed actions steps and document requests. II. Governance and Board Exna_nsion: Current list of all Board Members with contact information Governance policies (Con?ict of Interest and Whistleblower Protection) Board Recruitment Plan Organizational Chart, job descriptions and salary information of current board members and all employees; Proof of satisfaction of tax liens for all Board members Statutory Basis for Involuntary dissolution of Eldom Emmet LLC Board Resolution regarding $100,000 loan made by Thomas Bransky to CCS IRS 990 for FY 2015 Management: Strategic Organizational Plan An Employee Manual Capacity Building and Staf?ng Plan Payroll Schedule Staf?ng plan for every site contracted by DHS, including location address, name of site, . number and type of units, number and type of clients families with children, adult families, etc), and CCS staff members, both direct and temporary staff Finances and Internal Controls: 0 Cost-bene?t analysis of internalizing the hiring process 0 Plan for fundraising, development and diversi?cation of funding streams Documentation\statements for $1.8 million interest bearing loan Page 9 of 9