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HomeMy WebLinkAboutS21 - Card Meter Systems for Copier Equipment0 CITY OF NEWPORT BEACH CITY COUNCIL STAFF REPORT Agenda Item No. S21 March 9, 2004 TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: LIBRARY SERVICES LINDA KATSOULEAS, LIBRARY DIRECTOR, 949 - 717 -3810 lindak @city.newport- beach.ca.us SUBJECT: APPROVAL OF AGREEMENT WITH KEY GOVERNMENT FINANCE, INC. AND CARD METER SYSTEMS (CMS) TO PURCHASE NEW COPIER EQUIPMENT AND PROVIDE PUBLIC PRINT, COPY AND COMPUTER ACCESS AT THE NEWPORT BEACH PUBLIC LIBRARIES RECOMMENDATION: Approve a Lease /Purchase Agreement with Key Government Finance, Inc., and a • Document Management and Support Services Agreement with Card Meter Systems (CMS) to provide equipment, service and software for public copying, printing and computer access /time management at the Libraries for a fee of $4,785.90 per month and authorize the Mayor and City Clerk to execute the agreements subject to final review and approval by the City Attorney. DISCUSSION: Library customers have had access to copying and printing services at the libraries through Affiliated Photocopier Specialists (APS). This company's business has declined in recent years due to their inability to keep abreast of current technology. The equipment that was placed in our libraries was aging and APS would not upgrade the machines. The Library also needed a vendor with the software technology for public PC management that would allow the customers access to our Libraries' computers and databases for a scheduled amount of time. APS was not able to offer this product. For these reasons the Library began a search for a new vendor. Based on vendor demonstrations and recommendations from other Library jurisdictions, both public and academic, the Newport Beach Library has chosen the vendor CMS to provide customer printing, copying and PC access /time management. Under the agreement with CMS, the City will purchase the new copier • equipment through a financing agreement with Key Government Finance, Inc. Approval of Agreement with Card Meter Systems to Provide Public Print, Copy & Computer Access at the Newport Beach Public Libraries March 9, 2004 Page 2 • CMS will install the new equipment, which includes copiers, printers, microform reader /printers and payment stations, at our four libraries. CMS will provide service maintenance to all pieces of equipment on a schedule determined mutually by the vendor and the Library. It will also provide emergency service with a guaranteed four- (4) hour response time at no additional charge. CMS will handle the collection of money and provide the Library with a monthly accounting of use and remittance of revenue. The initial term of this agreement shall be for a period of sixty (60) months. The total amount of the contract is $260,763.51. This agreement may be renewed for an additional one (1) year term upon the written mutual consent of both parties. The contract price is subject to a 13% price increase March 12, 2004. Funding: A customer use fee of $0.20 per black & white page will offset funds for the lease and service of the equipment. At a monthly fee of $4,785.90, the break -even point for this service would be 23,930 black & white copies. Based on historical statistics for printing /copying services we should meet or exceed this number. Funds have also been included in the Library's Maintenance and Operations account • 4010 -8030 if expected revenues drop below the break -even point. Preparedd by: Submitted by: Melissa Kelly Linda Katsoule Library Support Services Supervisor Library Director Attachment: Lease /Purchase Agreement CMS Document Management and Support Services Agreement E - Accepted by Lessor. Key Government Finance, Inc. 1000 South McCaslin Blvd. Superior, CO 80027 B. Name: Title: Date: 1 TZ) Tax - Exempt Lease /Purchase Agreement, Dated 12115/2 003 Agreed to b Lessee: City of Newport Beach 3300 Newport Blvd. Newport Beach,.CA 92663 -3884 B Name: Title: bate: AGREEMENT: Lessor hereby leases to Lessee and Lessee hereby rents from Lessor all the Property described in Property Schedule incorporated herein by reference, upon the terms and conditions set forth herein and as supplemented by the terms and conditions set forth in the Property Schedule. This Tax - Exempt Lease / Purchase Agreement together with the Property Schedule shall be defined as the Agreement. LEASE TERM: The Lease Tern of the Property listed in the Property Schedule shall commence upon the date of acceptance of the Property by Lessee and continue for the time period set forth in the Property Schedule. This Agreement cannot be canceled or terminated by Lessee except as expressly provided herein. This Agreement is a triple net lease. LEASE PAYMENTS: Lessee shall pay rent to Lessor for the Property in the amounts, and on the dates specified, in the Property Schedule. Lessor and Lessee intend that the obligation of Lessee to pay. Lease Payments hereunder shall not in any way be construed to be a debt of Lessee in contravention of any applicable constitutional or statutory limitations or requirements conceming the creation of indebtedness by Lessee, nor shall anything contained herein constitute a pledge of the general tax revenues, funds or monies of Lessee. NO OFFSET: SUBJECT TO THE RIGHT TO NON - APPROPRIATE, THE OBLIGATIONS OF LESSEE TO PAY THE LEASE PAYMENTS DUE UNDERTHE PROPERTY SCHEDULE AND TO PERFORM AND OBSERVE THE OTHER COVENANTS AND AGREEMENTS CONTAINED IN THIS AGREEMENT `;HALL BE ABSOLUTE AND UNCONDITIONAL IN ALL EVENTS WITHOUT ABATEMENT, DIMINUTION, DEDUCTION, SET -OFF OR DEFENSE, FOR WY REASON, INCLUDING WITHOUT LIMITATION, ANY DEFECTS, MALFUNCTIONS, BREAKDOWNS OR INFIRMITIES IN THE PROPERTY OR ANY OCCIDENT, CONDEMNATION OR UNFORESEEN CIRCUMSTANCES. THIS PROVISION SHALL NOT LIMIT LESSEE'S RIGHTS OR ACTIONS AGAINST ANY VENDOR. Lessee shall pay when due all taxes and governmental charges assessed or levied against or with respect to the Property. LATE CHARGES: Should Lessee fail to duly pay any part of any Lease Payment or other sum to be paid to Lessor under this Agreement on the date on which such amount is due hereunder, then Lessee shall pay late charges on such delinquent payment from the due date thereof until paid at the rate of 12% per annum or the highest rate permitted by law, whichever is less. MAINTENANCE OF PROPERTY: At all times during the Lease Term, Lessee shall, at Lessee's own cost and expense, maintain, preserve, and keep the Property in good working order, and condition, and from time to time make or cause to be made all necessary and proper repairs, replacements, and renewals to the Property, which shall become part of the Property. The Property is and will remain personal property. INSURANCE OF PROPERTY: All risk of loss to the Property shall be bome by the Lessee. At all times during the Lease Tenn, Lessee shall, at Lessee's own cost and expense, cause casualty, public liability, and property damage insurance to be carried and maintained (or shall provide Lessor with a certificate stating that adequate self- insurance has been provided) with respect to the Property, sufficient to protect the full replacement value of the Property and to protect from liability in all events for which insurance is customarily available. Lessee shall furnish to Lessor certificates evidencing such coverage throughout the Lease Tenn. Any insurance policy to be carried and maintained pursuant to this Agreement shall be so written or endorsed as to make losses, if any, payable to Lessee and Lessor as their respective interests may appear. All such liability insurance shall name Lessor as an additional insured. Each insurance policy carried and maintained pursuant to this Agreement shall contain a provision to the effect that the insurance company shall not cancel the policy or modify it materially or adversely to the interest of the Lessor without first giving written notice thereof to Lessor at least 30 days in advance of such change of status. QUIET ENJOYMENT AND TERMINATION OF LESSOR'S INTEREST: To secure Lessee's obligations hereunder, Lessor is granted a security interest in the Property, including substitutions, repairs, replacements and renewals, and the proceeds thereof, which is a first lien thereon. Lessee hereby authorizes Lessor to file all financing statements which Lessor deems necessary or appropriate to estaDlish, maintain and perfect such security interest- Provided there does not exist an Event of Default as defined herein, the Lessee shall have the right of quiet enjoyment of the Property throughout the Lease Tenn. If Lessee shall have performed all of its obligations and no default shall have occurred and be continuing under this Agreement, and this Agreement shall not have been earlier terminated with respect to the Property, then, at the end of the Lease Tenn with respect to any Rem of Property, Lessor's interest in such Property shall terminate. Unless otherwise required by law, title to the Property shall be in the name of Lessee, subject to Lessors interest hereunder. TAX EXEMPTION: The parties contemplate that interest payable under this Agreement will be excluded from gross income for federal income tax purposes under Section 103 of the Internal Revenue Code of 1966, as amended (the "Code "). The tax - exempt status of this Agreement provides the inducement for the Lessor to offer financing at the interest rate set forth herein. Therefore, should this Agreement be deemed by any taxing authority not to be exempt from taxation, Lessee agrees that the interest rate shall be adjusted, as of the date of loss of tax exemption, to an interest rate calculated to provide Lessor or its assignee an after tax yield equivalent to the tax exempt rate and Lessor shall notify Lessee of the taxable rate. Provided, however. that the provision of the preceding sentence shall apply only upon a final determination that the interest payments are not excludable from gross income under Section 103(a) of the Code, and shall not apply if the determination is based upon the individual tax circumstances of the Lessor, or a finding that the party seeking to exclude such payments from gross income is not the owner and holder of the - obligation under the Code. REPRESENTATIONS AND WARRANTIES OF LESSEE: Lessee hereby represents and warrants to Lessor that: (a) Lessee is a State, possession of the United States, the District of Columbia, or political subdivision thereof as defined in Section 103 of the Code and Treasury Regulations and Rulings related thereto. If Lessee is incorporated, it is duly organized and existing under the Constitution and laws of its jurisdiction of incorporation and will do or cause to be done all things necessary to preserve and keep such organization and existence in full force and effect. (b) Lessee has been duly authorized by the Constitution and laws of the applicable jurisdiction and by a resolution of its governing body (which resolution, if requested by Lessor, is attached hereto), to execute and deliver this Agreement and to carry out its obligations hereunder. (c) All legal requirements have been met, and procedures have been followed, including public bidding, in order to ensure the enforceability of this Agreement. (d) The Property will be used by Lessee only for essential governmental or proprietary functions of Lessee consistent with the scope of Lessee's authority and will not be used in a trade or business of any person Page T of 2 or entity, by the federal government or for any personal, family or household use. Lessee's need for the Properly is not expected to diminish during the tens of the Agreement. (e) Lessee has funds available to pay Lease Payments until the end of its current appropriation period, and it intends to request funds to make Lease Payments in each appropriation period, from now unfit the end of the term of this Agreement. (f) The Lessee shall comply at all times with all applicable requirements of the Code, including but not limited to the registration and reporting requirements of Section 149, to maintain the • federal tax- exempt status of the Agreement. The Lessee shall maintain a system with respect to this Agreement, which tracks the name, and ownership interest of each assignee who has both the responsibility for administration of, and ownership interest in this Agreement. (g) Lessee's exact legal name is as set forth on the first page of this Agreement. Lessee will not change its legal name in any respect without giving thirty (30) days prior written notice to Lessor. INDEMNIFICATION OF LESSOR: To the extent permitted by law, Lessee shall indemnify and save Lessor harmless from and against all claims, losses, costs, expenses, liability and damages, including legal fees and expenses, arising out of (a) the use, maintenance, condition or management of, the Properly by Lessee, (b) any breach or default on the part of Lessee in the performance of any of its obligations under this Agreement or any other agreement made and entered in connection with the lease of the Property, (c) any act of negligence of Lessee, or its successors or assigns, or any of its agents, contractors, servants, employees, or licensees with respect to the Property, (d) the acquisition, delivery, and acceptance of the Property, (e) the actions of any other party including, but not limited to, the ownership, operation, or use of the Property by Lessee, or (f) Lessor's exercise and performance of its powers and duties hereunder. No indemnification will be made for negligence or breach of duty under this Agreement by Lessor, its directors, officers, agents, employees, successors, or assignees. Lessee's obligations under this Section shall remain valid and binding notwithstanding termination or assignment of this Agreement. , NON - APPROPRIATION: If sufficient funds are not appropriated to make Lease Payments under this Agreement, this Agreement shall terminate and Lessee shall not be obligated to make Lease Payments under this Agreement beyond the then current fiscal year for which funds have been appropriated. Upon such an event, Lessee shall, no later than the end of the fiscal year for which Lease Payments have been appropriated, deliver possession of the Property to Lessor. If Lessee fails to deliver possession of the Property to Lessor, the termination shall nevertheless be effective but Lessee shall be responsible for the payment of damages in an amount equal to the portion of Lease Payments thereafter coming due that is attributable to the number of days after the termination during which the Lessee fails to deliver possession and for any other loss suffered by Lessor as a result of Lessee's failure to deliver possession as required. Lessee shall notify Lessor in writing within seven (7) days after the failure of the Lessee to appropriate funds sufficient for the payment of the Lease Payments, but failure to provide such notice shall not operate to extend the Lease Term or result in any liability to Lessee. ASSIGNMENT BY LESSEE: Without Lessor's prior written consent, Lessee may not, by operation of law or otherwise, assign, transfer, pledge, hypothecate or otherwise dispose of the Property, this Agreement or any interest therein. ASSIGNMENT BY LESSOR: Lessor may assign, sell or encumber all or any part of this Agreement, the Lease Payments and any other rights or interests of Lessor hereunder. Such assignees may include trust agents for the benefit of holders of certificates of participation. Fy-NTS OF DEFAULT: Lessee shall be in default under this Agreement upon the occurrence of any of the fdlowing events or conditions ( "Events of Default"), unless such Event of Default shall have been specifically waived by Lessor in writing: (a) Default by Lessee in payment of any Lease Payment or any other indebtedness or obligation now or hereafter owed by Lessee to Lessor under this Agreement or in the performance of any obligation, covenant or liability contained in this Agreement and the continuance of such default for ten (10) consecutive days after written notice thereof by Lessor to Lessee, or (b) any warranty, representation or statement made or furnished to Lessor by or on behalf of Lessee proves to have been false in any material respect when made or furnished, or (c) actual or attempted sale, lease or encumbrance of any of the Property, or the making of any levy, seizure or attachment thereof or thereon, or (d) dissolution, termination of existence, discontinuance of the Lessee, insolvency, business failure , failure to pay debts as they mature, or appointment of a receiver of any part of the property of, or assignment for the benefit of creditors by the Lessee, or the commencement of any proceedings under any bankruptcy, reorganization or arrangement laws by or against the Lessee. REMEDIES OF LESSOR: Upon the occurrence of any Event of Default and at any time thereafter, Lessor may, without any further notice, exercise one or more of the following remedies as Lessor in its sole discretion shall elect: (a) terminate the Agreement and all of Lessee's rights hereunder as to any or all items of Property; (b) proceed by appropriate court action to personally, or by its agents, take possession from Lessee of any or all items of Property wherever found and for this purpose enter upon Lessee's premises where any item of Property is located and remove such item of Property free from all claims of any nature whatsoever by Lessee and Lessor may thereafter dispose of the Property; provided, however, that any proceeds from the disposition of the Property in excess of the sum required to (i) pay to Lessor an amount equal to the total unpaid principal component of Lease Payments under the Property Schedule, including principal component not otherwise due until future fiscal years, (ii) pay any other amounts then due under the Property Schedule and this Agreement, and (iii) pay Lessor's costs and expenses associated with the disposition of the Properly and the Event of Default (including attorneys fees), shall be paid to Lessee or such other creditor of Lessee as may be entitled thereto, and further provided that no deficiency shall be allowed against Lessee; (c) proceed by appropriate court action or actions to enforce performance by Lessee of its obligations hereunder or to recover damages for the breach hereof or pursue any other remedy available to Lessor at law or in equity or otherwise; (d) declare all unpaid Lease Payments and other sums payable hereunder during the current fiscal year of the Lease Tenn to be immediately due and payable without any presentment, demand or protest and / or take any and all actions to which Lessor shall be entitled under applicable law. No right or remedy herein conferred upon or reserved to Lessor is exclusive of any right or remedy herein or at law or in equity or otherwise provided or permitted, but each shall be cumulative of every other right or remedy given hereunder or now or hereafter existing at law or in equity or by statute or otherwise, and may be enforced concurrently therewith or from time to lime. Lessee agrees to pay to Lessor or reimburse Lessor for, in addition to all other amounts due hereunder, all of Lessor's costs of collection, including reasonable attorney fees, whether or not suit or action is filed thereon. Lessee and Lessor hereby irrevocably waive all right to trial by jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise) arising out of or relating to this Agreement. NOTICES: All notices, and other communications provided for herein shall be deemed given when delivered or mailed by certified mail, postage prepaid, addressed to Lessor or Lessee at their respective addresses set forth herein or such other addresses as either of the parties hereto may designate in writing to the other from time to time for such purpose. .. AMENDMENTS AND WAIVERS: This Agreement and the Property Schedule executed by Lessor and Lessee constitute the entire agreement between Lessor and Lessee with respect to the Property and this Agreement may not be amended except in writing signed by both parties. CONSTRUCTION: This Agreement shall be governed by and construed in accordance with IheJaws of the Lessee's Slate. Tiles of sections of this Agreement are for convenience only and shall not define or limit the terms or provisions hereof. Time is of the essence under this Agreement. This Agreement shall inure to the benefit of and shall be binding upon Lessor and Lessee and their respective successors and assigns. This Agreement may be simultaneously executed in counterparts, each shall be an original with all being the same instrument. • Page 2 of 2 Schedule to Tax - Exempt Lease /Purchase Agreement This Property Schedule is entered into pursuant to Tax - Exempt Lease /Purchase Agreement dated as of 12/15/2003 between Lessor and Lessee. 1. Interpretation. The terms and conditions of the Tax - Exempt Lease /Purchase Agreement (the "Agreement ") are incorporated herein. 2. Property Description. The Property subject to this Property Schedule is described in Exhibit A, attached hereto. 3. Term and Pavments. Lease Term and Lease Payments are per the table below. If the Payment Due Dates are not defined, they shall be defined as the last day of each monthly period in the table below commencing with the Acceptance Date as stated in the Certificate of Acceptance, attached as Exhibit B, hereto. If the parties enter into an escrow agreement for the acquisition of the Property, then the escrow agreement shall be attached hereto as Exhibit D. In lieu of the Acceptance Date for commencement of Lease Payments, the date of deposit of the Property Cost into the escrow by Lessor shall be used. Lessee shall have the option to prepay the Lease Payments due under this Property Schedule by paying the Concluding Balance shown in the table below, plus any other amounts due and owing at the time of prepayment, subject to per diem adjustment. 4. Expiration. Lessor, at its sole determination, may choose not to accept this Property Schedule if the fully executed, original Agreement (including this Property Schedule and all ancillary documents) are not received by Lessor at its place of business by 1/15/2004. 5. Property Cost. The total acquisition cost of the Property is $260,763.51, this includes sales tax. 6. Opinion of Counsel. Lessee has provided the opinion of its legal counsel substantially in the forth as attached as Exhibit C, hereto. E Payment No. Due Date Payment Amount Principal Portion Interest Portion Prepayment Balance 1 15- Jan -2004 4,785,901 3.947.11 838.79 264,520.89 2 15-Feb-2004 - ' " "' "'4';785'.90 "' 3,959.81 826.09 260,442.29 3 15- Mar -2004 4,785.90 3,972.54 813.36 256,350.57 4 15-Apr-2004 4,785.90 3,985.32 800.58 252,245.69 5 15-May-2004 4,785.90 3,998.14 787.76 248,127.60 6 15- Jun -2004 4,785.90 4,011.00 774.90 243,996.27 7 15- Jul -2004 4,785.90 4,023.91 761.99 239,851.65 8 15-Aug-2004 4,785.90 4,036.85 749.05 235,693.69 9 15-Sep -2004 4,785.90 4,049.83 736.07 231,522.36 10 15 -Oct -2004 4,785.90 4,062.86 723.04 227,337.62 11 15- Nov -2004 4,785.90 4,075.93 709.97 223,139.41 12 15-Dec -2004 4,785.90 4,089.04 696.86 218,927.70 13 15-Jan -2005 4,785.90 4,102.19 68171 214,702.44 14 15-Feb -2005 4,785.90 4,115.39 670.51 210,463.59 15 15-Mar -2005 4,785.90 4,128.63 657.27 206,211.10 16 15-Apr -2005 4,785.90 4,141.91 643.99 201,944.94 17 15-May-20051 4,785.90 4,155.23 630.67 197,665.05 18 15- Jun -2005 4,785.90 4,168.60 617.30 193,371.40 19 15-Ju1.2005 4,785.90 4,182.01 603.89 189,063.93 20 15-Aug-20051 4,785.90 4,195.46 590.44 184,742.61 21 - 5-Sep-2005 4,785.90 4,208.95 576.95 180,407.39 22 15- Oct -2005 4,785.90 4,222.49 563.41 176,058.22 23 15- Nov -2005 4,785.90 4,236.07 549.83 171,695.07 24 15- Dec -2005 4,765.90 4,249.70 536.20 167,317.87 25 15- Jan -2006 4,785.90 4,263.37 522.53 162,926.60 26 15- Feb -2006 4,785.90 4,277.08 508.82 158,521.21 27 1 15-Mar -2006 4,785.90 4,290.841 495.06 154,101.64 28 15-Apr-2006 4,785.90 4,304.64 481.26 149,667.86 29 15 -Ma -2006 4,785.90 4,318.49 467.41 145,219.81 30 15- Jun -2006 4,785.90 4,332.38 453.52 140,757.46 31 15-Jul-20061 4,785.901 4,346.32 439.581 136,280.75 32 15-Aug-2006i 4,785.90J 4,360.30 425.601 131,789.64 33 15-Sep-2006 4,785.901 4,374.32 411.581 127,264.09 34 15- Oct -2006 4,785.90 4,388.39 397.51 122,764.04 35 15- Nov -2006 4,785.90 4,402.51 38339 116,229.46 36 15- Dec -2006 4,785.90 4,416.67 369.23 113,680.29 37 15- Jan -2007 4,785.90 4,430.88 355.02 109,116.48 38 15- Feb -2007 4.785.90 4.445.13 340.77 104,538.00' 39 15-Mar -2007 4,785.90 4,459.43 326.47 99,944.78 40 15-Apr-200 4,785.90 4,473.77 312.13 95,336.79 41 15-May-2007 4,785.90 4,488.17 297.73 90,713.98 42 15-Jun -2007 4,785.90 4,502.60 283.30 86,076.30 43 15-Jul -2007 4,785.90 4,517.09 268.81 81,423.71 44 15-Au -2007 4,785.90 4,531.62 254.28 76,756.14 45 15-Sep-2007 4,785.90 4,546.19 239.71 72,073.56 46 15-0d -2007 4,785.90 4,560.82 225.08 67,375.92 47 15- Nov -2007 4,785.90 4,575.49 210.41 62,663.17 48 15- Dec -2007 4,785.90 41590.20 195.70 57,935.26 49 15-Jan -2008 4,785.90 4,604.97 180.93 53,192.14 50 15- Feb -2008 4,785.90 4,619.78 166.12 48,433.77 51 15-Mar -2008 4,785.90 4,634.64 151.26 43,660.09 52 15-Apr-200 4,785.90 4,649.55 136.35 38,871.05 53 —15-May-2008 4,785.90 4,664.51 121.39 34,066.61 54 15-Jun -2008 4,785-901 4,679.51 106.39 29,246.71 55 15-Jul -2008 4,765.90 4,694.56 91.34 24,411.31 56 15-Aug-2001i 4,785.90 4,709.661 76.24 19,560.36 57 15-Sep-200 4,7a5.901 4,724.81 61.09 14,693.80 58 15-Oct -2008 4,785.90 4,740.01 45.89 9,811.59 59 15-Nov -2008 4,785.90 4,755.26 30.64 4,913.67 60 15-Dec -2008 4,785.90 4 770.551 15.35 0.00 • IN WITNESS WHEREOF, Lessor and Lessee have caused this Property Schedule to be executed in their names by their duly authorized representatives. Lessor. Key'Govemment Finance, Inc. B: Name: Title: Lessee: City of Newport Beach B: Name: Title: Attest: u u is E • Attachment A - Equipment List Description Qty EquipmentDetail • Platen Cover 1018 • PS450 Paper Bank (500 x 2) • FAC17 Small Cabinet Savin 2518 Copier with Coin, Card and Bill 4 CMS Meter Interface Acceptance CMS Model 100 DX Debit Caryl Reader • CMS 100CBC Coin/Bill Unit • Includes Supplies for the term of the agreement, excluding paper Magnetic Card Dispenser 4 Card dispenserwith $1 or $5 cards • DigiNet Print Release Station Solution DigiNet e- Services Kiosk including Pay to Print, CMS Model 800 DX PC Time Self- Service, Cash Transfer Station with 3 CMS 100CBC Coin /Bill Unit Coin, Card, Bill and Online Account Acceptance, Kyocera 1900N Laser Printers WITH Laser Printer Includes Supplies for the term of the agreement, excluding paper PC Cop Time Management Solution Inc Unlimited PC Client Licenses • Roll Fiche Carrier 200 (RFC200) Universal Fiche and Film Carriers • ImageScan Touchscreen Control Software Canon Microform Digital Reader Printer Model 3 SCSI Board Kit & Cable MS -400 Installation Kit for RFC200 • EZ02 16 -32X Zoom Lens • PC w/ 15' Touchscreen Monitor • Workstation Desk Unit • Machine will also be used as a Black & White Copier/ Printer • Fully networked Color Copier /Printer Savin C240&SP Color MFP Platen Cover Type 120 Copier/Printer /release station accepting Coins, PS520 Large Capacity Tray Bills, Cards, and Online Account. post Script 3 DigiNet e- Services Kiosk including Pay to Print, 1 CMS model 800 Meter PC Time Self- Service, Cash Transfer Station with DigiNet Print Release Station Coin, Card, Bill and Online Account Acceptance CMS CBC 100 unit Coin /Bill Unit • Copier Controller • CMS Meter Interface • DigiNet Print Release Station Solution • Indudes Supplies for the term of the agreement, excluding paper Card activated Typewriters 1 CardActivalej typewriters controlled with CMS model 100 meter Card Activated Facsimile machine 1 Sharp Facsimile machine controlled with CMS model 100 meter Platen Cover 1018 Savin 2518 Copier with Coin, Card, Bill and PS450 Paper Bank (500 x 2) Online Account Acceptance FAC17 Small Cabinet CopiedPrinter CMS Meter Interface 3 CMS Model 800 DX Debit Card Reader DigiNet e- Services Kiosk including Pay to Print, CMS 100CBC Coin /Bill Unit PC Time Self- Service, Cash Transfer Station with Includes Supplies for the term of the agreement, excluding Coin, Card, Bill and Online Account Acceptance paper Di i4 Net Print Release Station Solution Pre - encoded Debit Cards 5000 CMS will provide the initial 5,000 CMS a -Cards at no cost to the Customer EXHIBIT B Certificate of Acceptance to Tax - Exempt Lease/Purchase Agreement • This Certificate of Acceptance is pursuant to Tax - Exempt Lease/Purchase Agreement dated as of 12/15/2003 and the related Property Schedule, between Lessor and Lessee (the "Agreement "). Property Acceptance. Lessee hereby certifies and represents to Lessor that the Property referenced in the Agreement has been acquired, made, delivered, installed and accepted as of the date indicated below. Lessee has conducted such inspection and/or testing of the Property as it deems necessary and appropriate and hereby acknowledges that it accepts the Property for all purposes. Lessee will immediately begin making Lease Payments in accordance with the fimes and amounts specified herein. LESSOR MAKES NO (AND SHALL NOT BE DEEMED TO HAVE MADE ANY) WARRANTIES, EXPRESS OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING, WITHOUT LIMITATION, THE DESIGN, OPERATION OR CONDITION OF, OR THE QUALITY OF THE MATERIAL, EQUIPMENT OR WORKMANSHIP IN, THE PROPERTY, ITS MERCHANTABILITY OR ITS FITNESS FOR ANY PARTICULAR PURPOSE, THE STATE OF TITLE THERETO OR ANY COMPONENT THEREOF, THE ABSENCE OF LATENT OR OTHER DEFECTS (WHETHER OR NOT DISCOVERABLE), AND LESSOR HEREBY DISCLAIMS THE SAME; IT BEING UNDERSTOOD THAT THE PROPERTY IS LEASED TO LESSEE "AS IS" ON THE DATE OF THIS AGREEMENT OR THE DATE OF DELIVERY, WHICHEVER IS LATER AND ALL SUCH RISKS, IF ANY, ARE TO BE BORNE BY LESSEE. 2. Bank Qualification. Lessee designates this Property Schedule as a " qualified tax- exempt obligation' as defined in Section 265(b)(3)(B) of the Internal Revenue Code of 1966, as amended. Lessee reasonably anticipates issuing tax- exempt obligations (excluding private activity bonds other than qualified 501(cK3) bonds and including all tax- exempt obligations of subordinate entities of the Lessee) during the calendar year this Property Schedule was funded, in an amount not exceeding $10,000,000. Lessee initial here, only if Bank Qualification is applicable. IN WITNESS WHEREOF, Lessee has caused this Certificate of Acceptance to be executed by their duly authorized representative. Acceptance Date: Lessee: Clty of Newport Beach B: Name: Title: L I 40 • Lessee's Counsel's Opinion EXHIBIT C [To be provided on letterhead of Lessee's counsel.] [Address to Lessor and Lessee] RE: Agreement between Key Government Finance, Inc. and City of Newport Beach. Ladies and Gentlemen: We have acted as special counsel to City of Newport Beach ( "Lessee "), in connection with the Tax - Exempt Lease/Purchase Agreement, and Property Schedule dated as of 1211512003, between City of Newport Beach, as Lessee, and Key Government Finance, Inc. as Lessor, and any amendment or addendum thereto, if any (together, the "Agreement"). We have examined the law and such certified proceedings and other papers as we deem necessary to render this opinion. Based upon the foregoing, we are of the opinion that, under existing law: 1. Lessee is a public body corporate and politic, duly organized and existing under the laws of the State, and has a substantial amount of one or more of the following sovereign powers: (a) the power to tax, (b) the power of eminent domain, and (c) the police power. 2. Lessee has all requisite power and authority to enter into the Agreement and to perform its obligations thereunder. 3. All proceedings of Lessee and its governing body relating to the authorization and approval of the Agreement, the execution thereof and the transactions contemplated thereby have been conducted in accordance with all applicable open meeting laws and all other applicable state and federal laws. 4. The Agreement has been duly executed and delivered by Lessee and constitute legal, valid and binding obligations of Lessee, enforceable against Lessee in accordance with the terms thereof, except insofar as the enforcement thereof may be limited by any applicable bankruptcy, insolvency, moratorium, reorganization or other laws of equitable principles of general application, or of application to municipalities or political subdivisions such as the Lessee, affecting remedies or creditors' rights generally, and to the exercise of judicial discretion in appropriate cases. 5. As of the date hereof, based on such inquiry and investigation as we have deemed sufficient, no litigation is pending, (or, to our knowledge, threatened) against Lessee in any court (a) seeking to restrain or enjoin the delivery of the Agreement; (b) questioning the authority of Lessee to execute the Agreement, or the validity of the Agreement, or the payment of principal of or interest on, the Property Schedule; (c) questioning the constitutionality of any statute, or the validity of any proceedings, authorizing the execution of the Agreement; or (d) affecting the provisions made for the payment of or security for the Agreement. This opinion may be relied upon by Lessor, its successors and assigns, and any other legal counsel who provides an opinion with respect to the Agreement and the Property Schedule. Very truly yours, • By. Request for Certificate of Insurance (Please fill out and fax this form to your insurance company)• TO: Insurance Company: Contact Name: Telephone Number. Fax Number. FROM: Customer /Lessee Name: City of Newport Beach 3300 Newport Blvd. Newport Beach, CA 92663 -3884 Contact Name: Mr. Sean Bearly Telephone Number: 949- 717 -3820" Fax Number. City of Newport Beach is in the process of financing certain equipment from Key Government Finance, Inc. In •order to facilitate this transaction, please submit a Certificate of Insurance to: Key Government Finance, Inc. and its Assigns 1000 S. McCasiin Boulevard Superior, CO 80027 City of Newport Beach requests that Key Government Finance, Inc. be listed as: "Key Government Finance, Inc. and its Assigns" and named ADDITIONAL INSURED as to public liability coverage and SOLE LOSS PAYEE as to property coverage. A copy of said certificate should be forwarded to Key Government Finance, Inc. as described below. NOTE: Coverage is to include (1) insurance against all risks of physicat loss or damage to the Equipment (including theft and collision for Equipment consisting of motor vehicles) and (2) commercial general liability insurance (including blanket contractual liability coverage and products liability coverage) for personal and bodily injury and property damage. In addition, Key Government Finance, Inc. is to receive 30 days' prior written notice of cancellation or material change in coverage. Please fax this completed information to: Key Government Finance, Inc. Attention: Cindy Sherwood Fax Number: 720- 304 -1479 Phone Number: 720 -304 -1163 Please contact the person above if you have any questions. Thank you! • Form 8038 -G (Rev. November 2000) Department of the Treasury Information Return for Tax - Exempt Governmental Obligations ' (Under Internal Revenue Code section 149(e)) OMB No. 1545 -0720 ' See separate instructions. (Cautiom If the issue price is under $100,000, use Form 8036-GC) Reporting Authority If Amended Retum, check here ' L7 1 Issuer's name 2 Issuers employer Identification number City of Newport Beach 95- 6000751 3 Number and street (or P. O. box if mail is not delivered to street address) Room7suite 4 Report number 3300 Newport Blvd. 24 Proceeds used for bond issuance costs (including underwriters' discount ) ............................. 24 NIA 3 5 City, town, or post office, state, and ZIP code 6 Dale of issue Newport Beach, CA 92663 -3884 17 7 Name of issue B CUSIP number Property Schedule No. 01 to Tax - Exempt Lease /Purchase Agreement i 29 N/A 9 Name and title of officer or legal representative whom the IRS may call for more information 10 Telephone number of officer or legal representative Mr. Sean Bearly, 949 -717 -3820 is Type of Issue (check applicable box(es) and enter the issue price for each) See instructions and atlach schedule 110 Education ............................................................................................................................. ............................... 12❑ Health and hospital ............................................................................................................. ............................... 13❑ Transportation ..................................................................................................................... ............................... 14❑ Public Safety ........................................................................................................................ ............................... 15❑ Environmental (including sewage bonds) ............................................................................ ............................... 1 S Housing ....................................................................:........................................................... ............................... 17❑ Utilities ................................................................................................................................. ............................... 180 Other. Describe (see instructions) ' 19 If obligations are TANS or RANs, check box ' ❑ If obligations are BANS, check box ' ❑ 20 If obligations are in the form of a lease or installment sale, check box ........................' ® - 11 $260,763 12 22 N/A 13 23 N/A 14 24 Proceeds used for bond issuance costs (including underwriters' discount ) ............................. 24 NIA 15 16 17 18 i 29 N/A Description of Obligations (Complete for the entire issue for which this form is being filed.) Iprice (a) Final maturity date (b) Issue price (c) Stated redemption at maturity (d) Weighted average maturity (e) Yield 21 1 1 $260,763 1 N/A 5 years 3.860 Uses of Proceeds of Bond Issue (including underwriters' discount) 22 Proceeds used for accrued interest ...................................................................................................... ............................... 22 N/A 23 Issue price of entire issue (enter amount line 21, column ( b)) .............................................................. ............................... 23 N/A 24 Proceeds used for bond issuance costs (including underwriters' discount ) ............................. 24 NIA 25 Proceeds used for credit enhancement .................................................... ............................... 25 N!A 26 Proceeds allocated to reasonably required reserve or replacement fund . ............................... 26 2/LA 27 Proceeds used to currently refund prior issues ........................................ ............................... 27 N/A 28 Proceeds used to advance refund prior issues ........................................ ............................... 28 NIA i 29 N/A 29 (Total add lines 24 through 28) 30 N/A 30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here) ................. ............................... Description of Refunded Bonds (Complete this part only for refunding bonds.) 30 Enter the remaining weighted average maturity of the bonds to be currently refunded ................................. ..........._.. ' N/A Years 31 Enter the remaining weighted average maturity of the bonds to be advance refunded ........... ..__._..._..__.......... ...... ' N/A yearn 32 Enter the last date on which the refunded bonds will be called ................................................... ............................... ' N/A 33 Enter the dale(s) the refunded bonds were issued ' NIA ajor Miscellaneous 35 Enter the amount of the state volume cap allocated to the issue under section 141( b)( 5) ....................... ............................... 35 0.00 36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment mnlracl (see instructions) . 36a 0.00 b Enter the final maturity date of the guaranteed investment contract. ' f' 37 Pooled financings: a Proceeds of this issue that are to be used to make loans to other governmental units 371 0.00 b If this issue is a loan made from the proceeds of another tax -exempt issue, check box ' ❑' and enter the name of the issuer' and the date of the issue ' 38 If the issuer has designated the issue under section 265(b)(3)(B)(i)(111) (small issuer exception), check box ................. ............................... ' ❑ 39 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box .........._._ .............._.............................. ...................._.......... ' ❑ 40 If the issuer has identified a hedge, check box ................................................................................................................. ............................... ' ❑ Please Under penalties of perjury, I declare that I have examined this return, and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete. Sign Here t Signature of Issuer's authorized representative Date Type or print name and title For Paperwork Reduction Act Notice, see page 2 of the Instructions. Cat. No. 63773S Form 8038 -G (Rev. 11 -2000) Notification of Tax Treatment • Key Government Finance, Inc. is required to collect and remit sales /use tax in the taxing jurisdiction where your equipment will be located. In the event we do not receive a valid sales tax exemption certificate prior to the date your lease commences, you will be charged sales /use tax. Personal property tax returns will be filed as required by local law. In the event that any tax abatements or special exemptions are available on the equipment you will be leasing from us, please notify us as soon as possible and forward the related documentation to us. This will ensure that your leased equipment will be reported correctly. Please indicate below if you feel that your lease is subject to tax or whether a valid exemption exists. I agree that my lease is subject to sales /use tax. I am exempt from sales /use tax and I have attached a completed exemption certificate to Key Government Finance, Inc. I have previously provided a completed exemption certificate to Key Government Finance, Inc. which is valid for this transaction. I am exempt from state tax but subject to local tax. I have attached a completed exemption certificate. I have a valid abatement or property tax exemption (documentation attached). If applicable to the tax rates in your state, are you outside the city limits or in an unincorporated area? • Additional comments: Lessee: City of Newport Beach B: Name: Title: • 0 CMS Inc. Document Management and Support Services Agreement E Newport Beach Public Libraries J This agreement is entered into this tenth day of March 2004, by and between Newport Beach Public • Libraries and /or City of Newport Beach (hereinafter referred to as "Customer"), and CMS, Inc. (hereinafter referred to as "CMS "), 1104 N Anita Avenue, Tucson, Arizona 85705. The Customer and CMS agree as follows with regard to the installation and operation of the following Outsourcing Services by CMS for the Customer. Article I. Customer Requirements The following documents are included and made part of this agreement that are required in order for CMS to fulfill obligations as outlined in this Document Services Agreement. (Signatory must be a Corporate /Board Officer): • CMS Document Services Agreement • Key Government Finance, Inc. — Tax Exempt Lease /Purchase Agreement dated 12115/2003 Customer will additionally provide the following documentation: • Board /council approval Letter authorizing acceptance and signing of these agreements Article I. GENERAL SERVICES Section 1.01 Installation Plan Upon acceptance and consummation of these Agreements, CMS will provide the Customer with a • complete installation plan detailing all periods and schedules. After installation customer will sign additional delivery/acceptance documents as provided by CMS. Section 1.02 Equipment CMS will provide the services outlined in this agreement to all equipment listed in Attachment A of this agreement. CMS may add equipment as needed as determined by Customer and /or CMS and as agreed to in writing. Additional equipment charges may apply and will automatically made part of this Agreement by signing of Addendum. Section 1.03 Revenue Reporting CMS' personnel will download the information from CMS equipment each month. CMS will compile the information and detailed reports will be provided to the customer the following month. These reports will include listing of the equipment by location number; volume on each copier, laser printer or reader printer and revenue, and network print volumes. Reports will be provided and are reflective of the month's activity. Invoices for charges in excess of the monthly allowance will be invoiced separately once collections /accounting reconciliation's are complete. CMS Document Management and Support Services Agreement Page 2 of 12 • • Section 1.04 Electronic Controls and Cash Collection Services CMS's personnel will routinely replenish the coin supplies for all equipment as well as the debit card supplies for the card dispensers on a scheduled basis. The Customer will provide these services outside of the scheduled times. During periods of peak activity, supplies may be replenished on a more frequent basis to ensure that the needs of the end user are met on a mutually agreed schedule. CMS will collect and process all cash from vend devices and will process all funds for the Customer and remit monthly to the Customer the reimbursable revenue as agreed in the pricing section of this Agreement. Customer agrees CMS will not be responsible for any cash variances. Section 1.05 Billing and Reporting (a) Usage Reports CMS personnel will download all electronically stored information from each unit monthly. CMS will compile the information and detailed reports will be provided to the Customer the following month. These reports will include listing of the equipment by location number, volume on each copier, printer, or reader - printer; revenues by equipment type by coin, card type (public, staff, or CMS service) and pricing level; total account volume by equipment type; and summary of staff usage by individual, department, and/or budget number, if applicable. (b) Revenue Report(s) • Revenue report(s) identify machine locations, gross revenue, applicable revenue return, and charges for staff copies /prints, overages /shortages and the net amount due the Customer or CMS. Reports will be provided monthly to the Customer approximately 30 days from the last day of each month's end. (c) Equipment Performance Reports CMS will provide equipment performance reports on a monthly basis to the Customer that includes number of service calls, type of service calls and average response time. Section 1.06 Hours of Service CMS will provide equipment maintenance from: Monday through Friday 8:00 AM to 7:00 PM These hours may be adjusted by CMS with the written approval of the Customer and /or as mutually requested by the Customer and agreed upon in writing by both parties, dependent upon volume, workload, and other requirements. The Customer understands and acknowledges that service hours for holidays will be adjusted to CMS's calendared holidays indicated below: • 0 Christmas Day CMS Document Management and Support Services Agreement Page 3 of 12 • Thanksgiving Day • • Independence Day • New Year's Day • Memorial Day • Labor Day • Martin Luther Kin Jr. Day • President's Day • Easter • Veteran's Day • Columbus Day Section 1.07 Personnel (a) Operations Manager CMS will provide an experienced Operations Manager to oversee the Agreement. The Operations Manager will coordinate all team efforts. (b) Account Manager An experienced Account Manager will supervise the account. This professional will have account responsibility for the customer for all services included in this agreement. The Account Manager will be responsible for all operations including management of service. The Account Manager will distribute and collect CMS' Customer Surveys and meet with the Agreement Administrator(s) and /or assigned staff members at the Libraries • on a frequent basis and will track all customer feedback to discuss the outcomes. The Account Manager will oversee the Programs offered by CMS and will coordinate the ongoing training for the Customer's staff on CMS equipment. The Account Manager will set up a contact program whereby he will routinely call and /or visit with the designated Customer contacts. In addition, the Account Manager will inform the Customer of new products, advancements, and CMS policy updates and will foster an open line of communication with the Customer. The Account Manager will be responsible for all technical staff. The Account Manager will meet with the Customer at least once each quarter to review CMS' Track -it service program, review Cabot billing and discuss any other issues as they arise. (c) Technicians CMS will provide technician(s) that are factory- trained in operation and repair of all equipment covered in this agreement. To maximize equipment productivity, CMS technician(s) will visit the equipment on a scheduled basis to supply, repair and perform preventive maintenance. These preventive maintenance visits are not considered or calculated into the service response times or call numbers. (d) Uniforms CMS personnel will be uniformed and carry CMS ID Cards for easy identification by the Customer. CMS Document Management and Support Services Agreement Page 4 of 12 • • (e) Service Tools CMS service personnel will be equipped with a cell phone /pager, a vehicle that is stocked with the parts, supplies and paper. Section 1.08 Performance Guarantee CMS also offers its Performance Guarantee that states, "If the equipment supplied by CMS for the Customer is not performing within the machine's design specifications and cannot be repaired by CMS or its assigned servicing dealer and our team of Factory Trained Technical personnel, CMS will replace the equipment with a like model with comparable features at no cost to the Customer. (Excluding the Minolta Reader Printers) The Performance Guarantee begins the day of installation and all machines must be serviced by CMS or it's assigned servicing dealer and operated using only genuine parts and supplies. The guarantee is applicable only to machines that have not been damaged by accident or misuse and that are supplied with proper voltage. Section 1.09 Service Response CMS will respond to service calls dependent upon the call requirement within an average of four (4) hour(s) from dispatch of call via onsite, e-mail, and /or phone response to all Customers sites designated and included within this agreement. Additional locations and services may only be added in writing and made as an Addendum to this agreement. Section 1.10 Response Time Guarantee • CMS guarantees Service Response times of a maximum of four (4) hours. If CMS fails to respond to a service call acknowledging a service request within 4 hours for reasons directly attributed to causes directly within CMS' control (excluding and not limited to natural disasters, major traffic delays, power outages, out of coin /change, manufacturing delays etc.), CMS will issue the Customer a monthly credit according to the following schedule of penalties: Over 4 hours: $100.00 (one hundred dollars) of non - response per instance credited against billings. Section 1.11 Preventive Maintenance CMS will provide service maintenance to all copiers, printers, meters, card equipment and DigiNet Network Print Vend Solution, listed on Attachment (A), on a predetermined schedule and on an emergency service basis and supplied or provided by CMS. To ensure trouble free operation and maximize equipment productivity, the following steps are performed at each visit. 1. Paper supply checked /stocked. 2. Toner refilled and waste toner checked and emptied. 3. Exteriors of the equipment cleaned. 4. Inspect copy /print quality and adjust, if necessary. 5. Inspect operation of equipment for proper functionality. 6. Perform copier /printer diagnostic routines. 7. Communicate with attending staff and end user. 8. Perform ongoing preventive maintenance. • 9. Collections /fund replenishment 10. Card machines loaded CMS Document Management and Support Services Page 5 of 12 CMS technicians are trained to provide all preventive maintenance with a minimum amount of • interruption to end users, and will work with staff to coordinate the most convenient maintenance schedule. Customer understands and acknowledges that holiday's hours will be coordinated with CMS holiday schedule accordingly. Section 1.12 Loaner Equipment CMS will maintain loaner equipment to rotate in the event of major failure. This spare equipment will be used in the event equipment cannot be repaired in the required period as outlined in this Agreement. The loaner equipment is limited to copiers and metering equipment only. Section 1.13 Fix in Four Hours after Response or Replace CMS will replace any copier /printer that cannot be returned to service within four (4) hours of a technician's arrival with the appropriate parts /supply items to correct the problem. CMS will coordinate replacement of the affected equipment accordingly with one of CMS' loaner machines. Equipment will be scheduled for install from the closest CMS Service Center maintaining the replacement units. Section 1.14 Training CMS will conduct ongoing training (or as requested by the Customer) in use of equipment placed or supported by CMS. CMS will train the staff on how to effectively operate all equipment provided; including clearing, paper jams, change replenishment, adding paper and toner, etc. • CMS will maintain supply inventory at both campuses where staff may be able to add supplies in the event of an emergency. CMS will also leave keys to all vend equipment in the event a runs out of change. Training for staff will be coordinated on a scheduled or as needed basis as well. Additionally, when any new equipment is installed, one or more comprehensive training sessions will be coordinated with the end - users, and subsequent sessions will be scheduled as needs warrant. Section 1.15 Supplying Equipment As part of CMS's program, CMS will provide the necessary parts and supplies except paper for all CMS supported equipment listed in this agreement. The Customer must provide all paper for this equipment and must be of the type and quality as required by CMS and/or the manufacturer as requested by CMS. Customer may purchase said supplies from CMS at CMS current published price list in effect at time of purchase. Section 1.16 Handling Refunds to System End -User CMS will reimburse Customer for any refunds issued by the customer to a patron for a malfunctioning piece of equipment, but not for operator- induced errors. In the event an end -user requests a refund for printed or copied documents, Customer will use its best judgment on whether to issue the refund or not. Customer will keep a log of refunds detailing end -user name, phone number, email address (if available), amount refunded, reason for refund and Customers staff member name issuing refund. CMS will collect refund log on a monthly basis and will reimburse the Customer. • CMS Document Management and Support Services Agreement Page 6 of 12 • Section 1.17 Program Development The Customer agrees to meet with CMS at least quarterly to review services that are being provided to the Customer, and to provide input on CMS's performance. CMS will use these meetings to gauge its level of performance and make adjustments accordingly. Article II. UPGRADES /ADDITIONS Under CMS' Document Services programs your copy and print volumes may increase or decrease. In the event increased demands are of such proportions that additional equipment is needed, Customer may request CMS to add additional equipment and CMS may add additional equipment only upon written acceptance of a new agreement covering this equipment and services. Customer may not remove equipment from this Agreement. Article III. FINANCIAL CONSIDERATION Section 3.01 Term of Agreement The initial term of this Agreement shall be for a period of sixty (60) months. This agreement may be renewed for an additional one (1) year term upon the written mutual consent of both parties. Section 3.02 Payment for services The pricing is based upon information furnished by both parties that is believed to be accurate • and complete. If such information should prove to be inaccurate or incomplete in any material respect, the parties will negotiate in good faith to make appropriate adjustments to the provisions, services, or pricing under this agreement. In the event the parties decide to revise the services in the agreement, the pricing will be amended as agreed in writing by both parties. • Prices include all proposed equipment, service, supplies, (excluding paper) parts, and labor for all components included in Agreement. Customer agrees to pay as agreed below: (a) Monthly Payment for term of Agreement • Customer pays CMS a flat fee of $4,785.90 per month. This price includes 33,000 black- and -white copies /prints and 1,000 color copies /prints each per month at no additional cost. The Customer keeps the difference between what it charges for copies and the $4,785.90. (b) Minimum Volume included in monthly payment Minimum of 33,000 (thirty -three thousand) black and white copies /prints and 1,000 color copies /prints each per month. The break -even point is 23,930 black & white copies. Anything over that the Customer makes a monthly Income, while anything under that, the Customer pays out more than it takes in revenue. CMS Document Management and Support Services Agreement Page 7 of 12 (c) Per Page Charges /Overages and Revenue Reimbursement • Copies /Prints up to 33,000 a month will be billed as detailed above. There will be no revenue reimbursement for the initial copies /prints up to 33,000 per month, as all funds will be applied to the Customer's monthly investment. • Black- and -white copies over 33,000 in a month will be billed at $0.10 per copy. • Color copies over 1,000 in a month will be billed at $0.35 per copy. • All cash collected by CMS will be remitted to the Customer. Customer will use the revenue to apply to the monthly payment. • Pricing includes sales tax (d) Staff Copy Charges • CMS will provide a Copier with service and supplies for staff usage at a per page price of $0.045. (e) After hours Service Charges Monday through Friday No charge 8:00 AM to 7:00 PM Emergency Saturday $150.00 per call 1 10:00 AM to 5:00 PM Emergency Sunday $150.00 per call 1 12:OOPM to 6:00 PM Section 3.03 Patron prices (a) Copy and Laser Print Public Pricing The Customer can set the copy and print -vend price or charge anything it chooses. Article IV. ADDITIONAL AGREEMENT COMPONENTS Section 4.01 Additional Obligations of the Customer I. The Customer agrees to be responsible for the costs of electricity necessary to operate the equipment and to maintain in good repair the electrical outlets and facilities from which the equipment operates, and as specified by the Manufacture or CMS. The Customer shall also provide, at the Customer's expense, dedicated outlets with appropriate ampere's and electrical as certain equipment may also require a dedicated outlet for the operation of the equipment. II. The Customer agrees to allow CMS access to the equipment during its business hours in order to repair and service it. The Customer further agrees to give immediate notice to CMS once it has learned that the equipment is malfunctioning or otherwise not producing good quality documents. III. The Customer agrees to provide a secure environment for CMS' equipment. IV. The Customer agrees to reimburse CMS for lost or stolen supplies or components that have been released directly to Customer(s) or Customer(s) personnel. The Customer agrees to reimburse CMS at the then - published price list for reimbursement for these Items. V. The Customer agrees not to hire or solicit for hire any of CMS's employees, contractors, and /or those related to the performance of this agreement without the express written consent of CMS. Customer agrees to a reimbursement of two times the annual salary of the individual(s) hired by the customer. CMS Document Management and Support Services Agreement Page 8 of 12 L J 11 • • VI. The Customer provides paper. Section 4.02 Payment Terms Invoices are payable upon receipt. A 1.5% per month charge will be assessed for delinquent payments. Customer is liable for and shall pay to CMS all taxes imposed on the billing for Services by CMS to Customer at the same time and in the same manner that Customer pays CMS for the provision of Services. Customer shall provide CMS any resale certificates, information regarding out of state use of materials, Services or sales of other exception certificates or information. "Tax' includes, but is not limited to, sales and use, rental, excise, gross receipts, transfer, service, and occupational or privilege Taxes. Customer agrees to remit all payments for charges incurred through this program and for services rendered. Section 4.03 Appropriation of Funds Customer states and represents that it is the Customer's intent to make all payments hereunder for that full term of this agreement. In the event, through no action initiated by Customer, its funding body does not appropriate funds for the continuation of this Agreement for any fiscal year after the first fiscal year of this Agreement, and it has no funds to continue this Agreement from other sources, Customer may, at the beginning of the fiscal year for which it provides written notice to CMS that such funds will no longer be appropriated, terminate the Services portion of the Agreement and shall pay all valid sums due and wing to CMS through the Agreement effective date. is Section 4.04 Insurance • CMS shall carry Worker's Compensation Insurance in compliance with the laws of the State of California as well as, public liability and property damage insurance, including automotive liability in the following amounts. Bodily injury including death: limits of one million dollars ($1,000,000) for each person and one million dollars ($1,000,000) for each accident. Property damage: limits of one million ($1,000,000) for each accident and one million dollars ($1,000,000) for the aggregate of operations. CMS shall indemnify and hold harmless the Customer, employees and agents of each, from any and all property damage or loss claims, liability, damages, expenses (including attorney's fees and expenses) and any other amounts arising out of the performance of this agreement. Section 4.05 Confidentiality The contents of this agreement and all attachments to it are CMS' Private Data and are provided for the exclusive use of the Customer. The contents herein are not to be reproduced, divulged, or disclosed without the prior written permission of CMS. Further, Customer and CMS mutually agree that any information they may acquire concerning technical developments, business operations, methods or costs of the other shall be kept in strictest confidence, and shall not be divulged or disclosed to any other person or firm for a period of 3 years after expiration or termination of this Agreement. CMS Document Management and Support Services Agreement Page 9 of 12 Section 4.06 Exclusivity • The Customer shall grant CMS an exclusive right to provide the services as described herein for the term of this Agreement, under the terms and conditions of this Agreement except where Agreement or services are already in place. Section 4.07 Force Majeure CMS shall not be liable under the provision of this Agreement for damages or default on account of strikes, lockouts, accidents, fires, delays in manufacturing, delays of carriers, vendors, supplier's acts of God, governmental actions, state of war, or any other causes beyond the control of CMS, whether or not similar to those enumerated. CMS is also no responsible for delays attributed to V party manufacturer delays. Section 4.08 Notice Any notice of other communication given hereunder shall be in writing and mailed to CMS Inc., 1104 N Anita Avenue, Tucson, AZ 85705 and Newport Beach Public Library, 1000 Avocado Ave., Newport Beach, CA 92660. Section 4.09 Assignment No assignment by Customer without the prior written consent of CMS. Customer shall not (a) assign, transfer, pledge or hypothecate this Agreement, the equipment or any part thereof, or any interest therein, or (b) sublet or rent the equipment or any part thereof or permit the equipment or • any part thereof to be used by anyone other than Customer or Customer's employees. Consent to any of the foregoing prohibited acts applies only in the given instance; and is not consent to any subsequent like act by Customer or ay other person. Section 4.10 CMS' Assignment CMS agrees not to assign or transfer any of its obligations under this agreement without the prior written consent of the Customer, whose consent shall not be unreasonably withheld. Section 4.11 Warranties CMS will warrant all equipment provided by CMS for the term of this agreement for all equipment, products and software provided as part of this agreement as either the manufacturer, Dealer, servicing agent, or distributor of all products provided. In the event there is a defect, malfunction or failure, CMS will within a commercially reasonable time period, repair, replace or remedy any malfunctioning equipment and software products provided by CMS as part of this agreement. CMS warranty does not cover damage caused by abuse, misuse, mishandling, misapplication and computer viruses, unless these situations are caused or contributed to by CMS. Section 4.12 Governing Law This Agreement shall be governed by the laws of the State of California. CMS Document Management and Support Services Page 10 of 12 • • Section 4.13 Severability In the event of the covenants, terms or conditions of this Agreement are found or deemed to be invalid or unenforceable; this Agreement shall in all other respects remain binding on the parties. Section 4.14 Cancellation for Cause The Customer may cancel the CMS Service portion of this agreement upon 60 days written notice to CMS. Customer reserves the right to cancel this agreement due to failure on the part of CMS to carry out any term, promise or condition of this agreement. The Customer will issue sixty - day (60) notice of default to CMS if CMS fails to carry out any term, or condition of this agreement. If CMS does not correct the problem(s) within thirty days (30) after receiving the notice of default, the Customer may cancel this agreement if the Customer cancels this agreement pursuant to this clause. Section 4.15 Entry/Access The Customer agrees to grant CMS access to the Customer place of business at all times in order to complete any necessary work. Customer hereby grants to CMS, and its agents and employees a license to enter upon the premises of Customer and for an unimpeded access to any and all equipment placed thereon by CMS, at all reasonable business hours, for the purpose of servicing, repairing, replacing, • substituting, and /or removing any and all of said equipment. The license granted hereunder shall be irrevocable during the term of this Agreement and a reasonable time after termination thereof, not to exceed ninety (90) days. J Section 4.16 Parking Customer shall provide adequate parking for all CMS vehicles associated with the services of this program with the locations being of the greatest ease into the facility as allowed by law. Customer will provide and arrange for vendor parking permits, if necessary. CMS shall be subject to all current and future Customers parking regulations and restrictions for the term of this agreement. Section 4.17 Mutual Consent From time to time, certain aspects of this program may need to be altered, changed, or may be modified to incorporate other services. Both CMS and /or Customer may effect these changes or make alterations only upon the written mutual consent and acceptance of both parties and upon incorporation into this agreement. Section 4.18 Loss or Damage CMS is not responsible for any physical damage done to any of the equipment for the duration of this agreement and agrees to perform all necessary repairs as defined in this agreement. CMS Document Management and Support Services Agreement Page 11 of 12 Section 4.19 Entire Agreement • The Customer acknowledges that it has read this Agreement, understands it and agrees to be bound by its terms and conditions. Further, the Customer acknowledges that this Agreement is the complete and exclusive statement of the understanding between the parties and it supersedes all proposals or prior agreements, oral or written, and all other communications between the parties relating to the subject matter of this agreement. IN WITNESS WHEREOF, the parties have caused this agreement to be signed by their duly authorized representatives on the dates set for below. CUSTOMER By: Typed Name: Title: Date: f: users at/shared/ag/CMS & Library Agreement.doc CMS Document Management and Support Services Agreement CMS Inc. By: Typed Name: Title: Date: Page 12 of 12 J •