Example of Collared Fee Language

Collared Arrangement

• 15% collar around the fixed fee in each phase
• Discount for billings beyond the collar: 50%
• Savings Share for billings under the collar:  50%

Billings is defined as the fee that would have applied had the firm billed Company at the alternative hourly rates proposed by the firm in response to this RFP, or the firm's current negotiated discounted rates as reflected in their Master Engagement Letter; whichever is less. 

EXAMPLE: If the Collared Fee for Phase X is $100k ($85k to $115k), then billings beyond $115k will be paid at a 50% discount. For example, if billings amount to $135k, firm will be paid $125k ($115k Fee plus 50% of the $20k overage above the high end of the collar). Alternatively, if billings amount to $65k, firm will be paid $75k ($20k savings below the low end of the collar is split 50-50). If billings amount to between $85k and $115k, firm will be paid the $100k Fixed Fee.