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HomeMy WebLinkAbout16116 ORD - 03/18/1981JD:jkh:3-18-81;1s•t AN ORDINANCE AUTHORIZING THE CITY MANAGER TO EXECUTE A LEASE WITH NATIONAL ADVANCE SYSTEMS CORPORATION FOR A CENTRAL PROCESSING UNIT FOR DATA PROCESSING FOR A TERM OF 24 MONTHS AFTER INITIAL TEST PERIOD WITH OPTION TO PUR- CHASE, FOR A MONTHLY RENTAL CHARGE OF $7,853, ALL AS MORE SPECIFICALLY SET FORTH IN THE OPERATING LEASE AGREEMENT, A SUBSTANTIAL COPY OF WHICH IS ATTACHED HERETO AND MADE A PART HEREOF AS EXHIBIT 1; AND DECLARING AN EMERGENCY. BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: SECTION 1. That the City Manager be and he is hereby authorized to execute a lease with National Advance Systems Corporation for a central processing unit for Data Processing for a term of 24 months after initial test period with option to purchase, for a monthly rental charge of $7,853, all as more specifically set forth in the Operating Lease Agreement, a substantial copy of which is attached hereto and made a part hereof as Exhibit 1. SECTION 2. The necessity to authorize execution of the aforesaid lease at the earliest practicable date creates a public emergency and an imperative public necessity requiring the suspension of the Charter rule that no ordinance or resolution shall be passed finally on the date of its intro- duction but that such ordinance or resolution shall be read at three several meetings of the City Council, and the Mayor, having declared such emergency and necessity to exist, having requested the suspension of the Charter rule and that this ordinance be passed finally on the date of its introduction and take effect and be in full force and effect from and after its passage, IT IS ACCORDINGLY SO ORDAINED, this the % g day of March, 1981. ATTEST: APPR VED: DAY OF MARCH, 1981: J. BRUCE AYCOCK, CITY ATTORNEY By AssCity 't MAYOR THE CIOF CORPUS CHRISTI, TEXAS I4LL$QEILME11. 16116 ,S 6271984 OPERATING LEASE between NATIONAL ADVANCED SYSTEMS CORPORATION 800 East Middlefield Road Mountain View, California 94043 ("NAS") and City of CoPusssCee"sti ( Lehri (Address) Lease No. 2/25/81 #8:006:5 Fxd;6t4F 1 This Lease Is entered into between NAS and Lessee, identified on'the cover page and shall be effective only upon execution by Lessee and, subsequently, by an officer of NAS at Mountain View, California. Lessee hereby agrees to lease from NAS the computer equipment identified in the Schedule(s) of Equipment attached hereto (the "Equipment") under the following terms and conditions. 1. Term of Lease The thirty (30) day trial period as specified in item 1.80 of Bid Invitation #233/80 will commence on the date set forth on the Certificate of Installation which NAS will issue to Lessee on the date which the Equipment is installed by NAS and is certified to be ready for use after successful execution of NAS diagnostics. Rental payments will commence to accrue on the date the Equipment is certified ready for use by the City after a thirty (30) day trial period. Rental payment for the period between certification and the first day of the fallowing month will be a proration based on the number of days elapsed over the number of days in the month. This lease shall remain in force until the first day of the month fol- lowing the twenty forth (24) month from the first full month fol- lowing certification. 2. Renewal Period Subject to NAS' termination rights, the Lease Period shall be renewed automatically for a period of twelve months, at the Unit Monthly Charge, unless Lessee has given NAS notice ninety (90) days prior to the end of the Lease Period of its election not to extend the Lease Period. At least thirty (30) days prior to the date specifed in the notice of its election not to extend the Lease Period, Lessee may elect to rescind such notice by delivery to NAS, on not more than one occasion, written notice to rescind. 3. Termination Neither Lessee or NAS may terminate this Lease during the Lease Period, unless the other is in default. Thereafter, Lessee or NAS may terminate this Lease by giving thirty (30) days written notice prior to the expiration of the Lease Period. 4. Rental Charges Lessee agrees to pay total Rental Payments ("Rental Payments") set forth in the Schedule of Payments, including the interest specified in the Schedule of Payments. 5. Payments (a) Rental Payments shall be payable without notice or demand at the office of the Lessor (or such other place as Lessor may from time to time designate in writing). Any notice, invoicing, purchase orders, quotations or other forms or procedures required by Lessee of Lessor or its assignee sufficiently in advance of payment due date for the completion thereof by Lessor or its assignee prior to such payment date. In addition, Lessee shall pay all transporta- tion, drayage and rigging charges (unless otherwise instructed, NAS will ship via the lowest cost method). -1- (b) 'Lessee reasonably believes that funds can be obtained suf- ficient to make all Rental Payments during the Lease Term and hereby covenants that it will do all things lawfully within its power to obtain, maintain and properly request and pursue funds from which the Rental Payments may be made, including making provisions for such payments to the extent necessary in each biannual or annual budget submitted for the purpose of obtaining funding, using its bona fide best efforts to have such portion of the budget approved and exhausting all available administrative reviews and appeals in the event such portion of the budget is not approved. It is Lessee's intent to make Rental Payments for the full Lease Term if funds are legally available therefor and in that regard Lessee represents that the use of the Equipment is essential to its proper, efficient and economic operation and that the functions performed by the Equipment could not and will not be transferred to other equipment now available or which may be subsequently acquired for use by Lessee during the Lease Term. (c) In the event no funds or insufficient funds are appropriated and budgeted or otherwise available by any means whatsoever in any fiscal year for Rental Payments due under this Lease, then the Lessee shall immediately notify the Lessor or its assignee of such occurence and this Lease shall create no further obligation of Lessee as to such current or succeeding fiscal year and shall be null and void, except as to the portions of Rental Payments herein agreed upon for which funds shall have been appropriated and bud- geted. In such event this Lease shall terminate on the last day of the fiscal year for which appropriations were received without penalty or expense to Lessee of any kind whatsoever. Subsequent to a termination of this Lease, the Lessee shall have no continuing obligation to make Rental payments under this Lease. No right of action or damages shall accrue to—the benefit of Lessor, or its assignee as to that portion of this Lease which may so terminate except as specifically provided in the last paragraph of this Section 5. (d) Notwithstanding the foregoing, Lessee agrees (i) that it will cancel this Lease under the provisions of paragraph 5(c) if any funds are appropriated to it, or by it, for the acquisition, retention or operation of the Equipment or other equipment per- forming functions similar to the Equipment for the fiscal year in which such termination occurs or the next succeeding fiscal year thereafter, and (ii) that it will not during the Lease Term give priority in the application of funds to any other functionally similar equipment or services. Paragraph 5(c) shall not be con- strued so as to permit Lessee to terminate this Lease in order to acquire any other equipment or to allocate funds directly or indirectly to perform essentially the same applications for which the Equipment is intended. 6. Net Lease Lessee's obligation to pay all Charges and other sums payable hereunder, and the rights of NAS in and to such payments, shall be -z- absolute and unconditional and shall not be subject to any abate- ment, reduction, setoff defense, counterclaim or recoupment due or alleged to be due, or by reason of, any past, present or future claims which Lessee may have against NAS or against any person for any reason whatsoever. 7. Title The Equipment shall be at all times be and remain the sole and exclusive property of NAS. Lessee shall have no right, title or interest therein except as expressly set forth in the Lease. Lessee shall keep the Equipment free from any security interests, liens, attachments, or other encumbrances, and if imposed, Lessee shall give NAS immediate written notice thereof. Lessee shall idemnify and save harmless NAS from any loss or damage arising from Lessee's impairment of NAS' interest in the Equipment. 8. Installation NAS will install the Equipment at the location designated by Lessee in the Schedule of Equipment. Lessee shall, at its expense, have the site prepared in accordance with NAS specifications on or before the estimated installation date. Installation facilities shall be furnished by Lessee. Unless NAS is previously notified in writing to the contrary, Lessee warrants that as of 30 days acceptance testing after the Installation Date, Lessee shall have unconditionally accepted each item of Equipment. The Equipment shall not be relocated from the site, or to another location, without prior written consent of NAS, and any such move will be by a method previously approved in writing by NAS at Lessee's expense. 9. Maintenance and Repair NAS shall maintain and repair the Equipment at its expense during the term of this Lease. NAS shall be entitled to inspect the Equipment during reasonable business hours. 10. Unauthorized Modification Lessee will not make modifications to the Equipment without the prior written consent of NAS. Equipment so modified must be returned to its original condition on termination of this Lease. If the modification, in the opinion of NAS, interferes with the normal and satisfactory operation or maintenance of the Equipment and thereby increases the cost of maintenance or creates a safety hazard, Lessee, will, at its expense, remove the modification within thirty (30) days of notice to do so. 11. Risk of Loss NAS shall assume the risk of loss or damage to the Equipment, except that Lessee shall bear the risk of loss or damage arising from: nuclear reaction, nuclear radiation, radioactive contamin- ation; or the intentional or negligent acts or omissions of Lessee, its employees, agents or invites. -3- 12. Taxes' Lessee shall keep the equipment free and clear of all levies, liens and encumbrances. Lessor is responsible for taxes, whether municipal, state or federal, including, but not limited to, sales, use, excise and property taxes, including penalties and interest with respect thereto. 13. Lessee's Representation and Warranties Lessee Warrants for the benefit of NAS and, if requested by NAS, will provide an opinion of counsel acceptable to NAS to the effect that: (a) Lessee is a duly constituted political subdivision or agency of the State of Texas and is authorized by the Consti- tution and laws of such State and its own internal or administrative procedure to enter into the transactions contemplated by this Lease and to carry out its obligations hereunder. (b) This Lease has been duly authorized, executed and deli- vered by Lessee and constitutes a valid and binding contract upon Lessee, enforceable in accordance with its terms. (c) Lessee agrees that it will do or cause to be done all things necessary to preserve and keep the Lease in full force and effect. Lessee further represents, covenants and warrants that Lessee has compiled with all bidding requirements where necessary and that this Lease will not violate any judgement, order, law or regulation applicable and adoption as a valid obligation on its part and that Lessee has sufficient appropriations or other funds avail- able to pay all amounts due hereunder for the current fiscal year. 14. Equipment is Personal Property Lessee warrants that the Equipment is, and shall at all times be and remain, personal property. If requested by NAS, Lessee will obtain prior to delivery of any item of Equipment or at any other time a certificate in form satisfactory to NAS from all parties having an interest in the real property where the Equipment may be located waiving any interest in the Equipment. 15. NAS' Warranty and Limitation of Liability NAS warrants that on the Date of Installation each item of Equipment will be in good working order and will perform in accordance with NAS' published specifications. In the event that each item of Equipment does not so perform, NAS, at its option, shall at its cost repair or replace such Equipment. NAS shall have no other obligation concerning the performance of the Equipment. THE FOREGOING WARRANTY SHALL NOT APPLY TO ELECTRICAL WORK EXTERNAL TO THE EQUIPMENT, OR MAINTENANCE OF ANY COMPUTER ACCESSORIES, ATTACHMENTS, EQUIPMENT, OR OTHER DEVICES NOT FURNISHED BY NAS, NOR WILL IT APPLY TO: REPAIR OF DAMAGE RESULTING FROM ACCIDENT, MOVE- MENT OF THE EQUIPMENT, NEGLECT, MISUSE, OR FROM OTHER THAN NAS REPRESENTATIES: EQUIPMENT WHICH HAS NDT BEEN PROVIDED A SUITABLE INSTALLATION ENVIRONMENT WITH ALL FACILITIES PRESCRIBED BY NAS; OR REPAIR OR DAMAGE TO OTHER PRODUCTS INTERCONNECTED TO THE EQUIPMENT COVERED HEREUNDER. - 4 - • THE FOREGOING OBLIGATIONS ARE IN LIEU OF ALL OTHER WARRANTIES, EXPRESSED OR IMPLIED, INCLUDING MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL NAS BE LIABLE FOR SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES ARISING OUT OF OR RELATED TO THE LEASE, INSTALLATION, MAINTENANCE, USE OR PERFORMANCE OF THE EQUIPMENT. 16. Assignment by NAS Should NAS elect to assign this Lease, such assignment shall not relieve NAS of any obligation hereunder; however, Lessee understands and acknowledges that NAS has entered into this Lease in anticipa- tion of its being able to assign, sell, grant, transfer, convey or mortgage its interests under this Lease or in the Equipment to a third party (the "Assignee") after approval is granted by Lesse, such approval not to be unreasonably withheld, and that the Assignee will, in entering into such transaction with NAS, be acting in reliance upon and entitled to the benefits of this Lease. And NAS may require Lessee to acknowledge in writing such assignment and promptly pay to Assignee, when due, the rentals and any other payments that thereafter will become due to NAS hereunder, notwith- standing and defense, setoff, or counterclaim whatsoever that Lessee may from time to time have against NAS, whether arising from any breach or default by NAS of this Lease, or any defect in condition, operation, fitness for use, damage to or destruction of the Equip- ment or the computer to which the Equipment is attached, or any interruption or cessation of use or possession of the Equipment for any reason whatsoever. (Lessee, nevertheless, reserves its right of recourse directly against NAS arising out of any such defense, setoff or counterclaim, since any payments made by Lessee to Assignee shall, to the extent thereof discharge the obligations of Lessee to NAS hereunder). Lessee will not, after such notice of assignment, permit the Lease to be amended or waived without the prior written consent of Assignee. Lessee will not require Assignee to perform any additional obligations by such assignment. Any assignment will not impair Lessee's right of quiet enjoyment of the Equipment. Any Assignee may reassign its rights with the same effect as the original assignment. Lessee shall execute all docu- ments reasonably required to perfect an Assignee's interest in the Equipment. LESSEE FURTHER ACKNOWLEDGES THAT ASSIGNEE IS NOT A MANUFACTURER OR VENDOR OF EQUIPMENT AND THAT ASSIGNEE HAS NOT MADE (AND DOES NOT HEREBY MAKE) ANY REPRESENTATION, WARRANTY OR COVENANT WITH RESPECT TO MERCHANTABILITY, FITNESS FOR ANY PURPOSE, CONDITION, QUALITY, INSTALLATION, DURABILITY, PATENT INFRINGEMENT, SUITABILITY OR CAPABILITY OF THE EQUIPMENT IN ANY RESPECT OR IN CONNECTION WITH ANY OF THE PURPOSES OR USES OR LESSEE: OR ANY OTHER REPRESENTATION, WARRANTY OR COVENANT OF ANY KIND OR CHARACTER EXPRESSED OR IMPLIED. 17. Desgination of Ownership Lessee shall not remove any NAS identification placed on the Equip- ment. Lessee agrees to execute a Uniform Commercial Code Financing Statement and all other instruments necessary to perfect NAS' interest in the Equipment. NAS may file a copy of this Lease as a Financing Statement. -5- 18. Surrender of Equipment Upon termination of this Lease, Lessee shall return the Equipment to NAS, freight pre -paid, in good condition, excepting only fair wear and tear. Before returing the Equipment, Lessee shall obtain NAS' prior written approval of packing and transportation methods. 19. Lessee Assignment or Sublease Without the prior written consent of NAS, Lessee shall not: (a) assign, transfer, pledge or hypothecate its interest in the Lease or the Equipment; (b) sublet the Equipment or any part thereof; or, (c) permit the Equipment or any part thereof to be used by anyone other than Lessee or Lessee's or any part thereof to be used by anyone other than Lessee or Lessee's employees. Any transaction in vio- lation of the foregoing shall be void. 20. Default A. Events of Default: The occurrence of any of the following events shall give NAS the option to terminate this Lease. (i) The nonpayment of charges or of any other funds due hereunder within five (5) days or notice of such nonpayment, or, (ii) the default to Lessee under any other term, covenant or condition of this Lease which is not cured within ten (10) days of notice, or, (iii) any affirmative act of insolvency by Lessee, the filing by Lessee of any petition or action under any bankruptcy, reorganization, insolvency or moratorium law, or any other law for the relief of debtors, or, (iv) the filing of any involuntary petition under any bankruptcy statute against Lessee which is not dismissed within sixty (60) days from the date of said filing or appointment, or, (v) the subjection of a substantial part of Lessee's property or any part of the Equipment to any levy or seizure. B. Remedies: NAS' election to terminate this Lease shall be given by written notice to Lessee. Lessee hereby authorized NAS, at any time after the date of the notice, to enter, with or without legal process, the premises where Equipment is located and take possession of it. Lessee shall forthwith pay to NAS any accrued and unpaid lease payments, plus any damages NAS may incur as a result of Lessee's default, including reasonable attorney's fees and costs incurred in enforcing NAS' rights. NAS shall have the right to retain, lease, or sell, all or any part of the Equipment at private or public sale, with or without notice, without having the Equipment present at the place of sale; and NAS may use Lessee's premises for any or all of the foregoing activities at Lessee's expense. None of the foregoing remedies is intended to be exclusive, but each shall be cumulative and in addition to any other remedy available to NAS at law or in equity. 21. Patent Indemnification Except as provided in the paragraph below, and subject to the limitation set forth below, NAS will defend any suit or proceeding brought against the Lessee if it is based on a claim that any -6- Equipment, or any part thereof, made to NAS' design by or for NAS and furnished hereunder constitutes an infringement of any United States patents, if notified promptly in writing and given full and complete authority, information, and assistance (at NAS' expense) for the defense of same. NAS will pay damages and costs therein awarded against the Lessee but shall not be responsible for any compromise made without its written consent. In providing• such defense, or in the event that such Equipment, or part thereof, is held to constitute infringement and the use of such Equipment, or part thereof, is enjoined, NAS shall retain the right, at its sole discretion, to either procure for Lessee the right to continue using the Equipment, or any part thereof, or modify it so that it becomes noninfringing, or remove it, and this Lease shall then terminate with no further liability or obligation of NAS to Lessee. NAS' indemnity is expressly limited to United States patents only. In no event shall NAS' total liability to Lessee under the foregoing indemnity exceed the aggregate lease payments previously paid applicable to the alleged infringing Equipment. NAS makes no express or implied warranty that the Equipment leased hereunder will not infringe any United States or foreign patents, trademarks, or copyrights. The lease of the Equipment hereunder does not convey any license by implication, estoppel, or otherwise, covering com- binations of the Equipment with other devices or elements. Lessee shall hold NAS harmless against any expense or liability from claims of unfair competition or infringement or contributory infringment of any patents, trademarks, or copyrights related to the Equipment or any part hereof leased hereunder arising from: (i) NAS' compliance with Lessee's designs, specifications, or instruction, (ii) use of any Equipment in combination with products not supplied by NAS, or (iii) use of any Equipment in connection with a manu- facturing or other process. 22. Excuse of Performance NAS shall not be liable for any failure or delay in the performance of any of its obligations hereunder caused by strike, lockout or other industrial disturbance, fire, earthquake, explosion, flood, storm, act of God, accident, governmental action or regulations, machinery or equipment breakdown, lack of transportation or distri- bution facilities, failure to obtain materials from subcontractors or any cause whatsoever (whether or not the same class or kind as those set forth above) beyond its reasonable control. 23. Quiet Possession Provided no Event of Default has occurred and is continuing here- under, Lessee shall have quiet use and possession of the Equipment without interference or interruption from Lessor or anyone claiming . by, through or under Lessor. 24. Governing Law This Lease shall be governed by and construed in accordance with the laws of the State of Texas. -7- 25. Notices and Reports Any notice or report shall be given in writing and shall be deemed to have been served on the date of such notice, when mailed postage prepaid, to the address shown on the cover page or such other address as may be specified by either party. 26. Additional Conditions Provided that exhibits are attached hereto and executed by auth- orized officers of Lessee and NAS, Lessee shall have such options with respect to this Lease and the Equipment as are set forth in such exhibits. The provisions of such exhibits, if any, shall apply to this Lease as though set forth in full herein. 27. Entire Agreement This Lease including the exhibits, if any, annexed hereto, con- stitutes the entire agreement between Lessee and NAS and can only be modified by a written agreement duly signed and approved by NAS at its home office. If any provision of this Lease shall be held invalid, illegal, or unenforceable, the remaining provisions shall not in any way be affected. THE LESSEE ACKNOWLEDGES THAT HE HAS READ THIS LEASE, UNDERSTANDS IT, AND AGREES TO BE BOUND BY ITS TERMS AND CONDITIONS. FURTHER, THE LESSEE AGREES THAT IT IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE LEASE BETWEEN THE PARTIES, WHICH SUPERSEDES ALL PROPOSALS OR PRIOR AGREEMENTS, ORAL OR WRITTEN, AND ALL OTHER COMMUNICATIONS BETWEEN THE PARTIES RELATIVE TO THE SUBJECT MATTER OF THIS LEASE. 28. Financial Statements: Lessee shall promptly furnish, or cause to be furnished to NAS or its Assignees, such financial or other reports respecting the condition of Lessee, or the Equipment as NAS may from time to time request. Executed this day of , 19q_. LESSOR: LESSEE: NAS By: By: Name: Patrick B. Brennan Name: Title: Treasurer Title: -8- Ship To: Customer: Address: SCHEDULE OF EQUIPMENT NAS Operating Lease No. Bill To: Purchase Unit Total Item Model Qty. Description Price Charge Charge AS/5000 N2 1 CPU $220,000 $7,853/mo Memory 2MB Main memory incl Console Operator console incl LESSOR: LESSEE: National Advanced Systems Corp. BY: �i4E': Name: Patrick R RrPnnen Title: Traacorpr Grand Total $ 7 1153/mo Monthly Charge By: Name: Title: - 9 - NAS Operating Lease No. EXHIBIT B Purchase Option This exhibit is hereby incorporated into that certain Operating Lease (the "Lease") between the parties hereto and more particulary identified by the NAS Operating Lease Number set forth above. So long as no Event of Default shall have occurred and be continuing under the Lease and provided that the Lease has not been terminated, the Lessee shall have the option to purchase the Equipment or, at the option of NAS, a model of identical configuration at any time during the Lease Period of any Renewal Period for a purchase price equal to the then current price of the Equipment minus purchase credits of 75% of the total Charges paid under the Lease applied to a maximum of 75% of the then current price of the Equipment (the "Purchase Price"). Not less than days prior to the end of the term of the Lease, the Lessee may exercise, by written notification to NAS, the purchase option described above. At any time during the Lease Period or any Renewal Period, if the Lessee has elected to purchase the Equipment, the Lessee shall purchase from NAS and NAS shall sell to the Lessee, without recourse or warranty, the Equipment for a cash consideration equal to the Purchase Price. Upon payment of such Purchase Price, NAS shall, upon the request of the Lessee, execute and deliver to the Lessee a bill of sale (without representations or warranties except that the Equipment if free and clear of all liens, claims, security interests and other encumbrances by or in favor of any person claiming by, through or under the Lessor) for the Equipment. All terms used herein shall have the meanings set forth in the Lease. National Advanced Systems Corp. (LESSEE) /VZ By 'authorized signature) By (authorized signature) Patrick B. Brennan Printed Name Printed Name Treasurer TITLE DATE TITLE DATE To Customer: Equipment Location: (Name) (Address) Installation Date: CERTIFICATE OF INSTALLATION by NAS NAS hereby certifies to Customer that the Equipment described below has been installed and is operating in accordance with Customer's Agree- ment with NAS, and pursuant to such Agreement, the Installation Date of the Equipment, as defined in the Agreement, is the date set forth above. The Equipment hereby certified as "installed" by NAS as of the date is: Quantity Model Description Serial Number Executed by NAS this day of , 198 . NAS Authorized Representative (Signature) (Print Name) (Title) - 12 - Corpus Christi, Texas J day of TO THE MEMBERS OF THE CITY COUNCIL Corpus Christi, Texas , 19� For the reasons set forth in the emergency clause of the foregoing ordinance, a public emergency and imperative necessity exist for the suspension of the Charter rule or requirement that no ordinance or resolution shall be passed finally on the date it is introduced, and that such ordinance or resolution shall be read at three meetings of the City Council; I, therefore, request that you suspend said Charter rule or requirement and pass this ordinance finally,on the date it is introduced, or at the present meeting of the City Council. Respectfully, MAYOR THE CITY OF CORPUS CHRISTI, TEXAS The Charter rule was suspended by the Luther Jones Edward L. Sample Dr. Jack Best Jack K. Dumphy Leopoldo Luna Betty N. Turner Cliff Zarsky The above ordinance was Luther Jones Edward L. Sample Dr. Jack Best Jack K. Dumphy Leopoldo Luna Betty N. Turner Cliff Zarsky following passed by the vote: following vote: 16116