Exhibit A - Model Capital Lease Agreement.pdf

RFP AADA 2018-0295

Exhibit A – Model Lease Purchase Agreement

STATE OF COLORADO

Department of Personnel & Administration

Equipment Lease Purchase Agreement with

Routing # CORE

TABLE OF CONTENTS

1. PARTIES 1

2. EFFECTIVE DATE - NOTICE OF NONLIABILITY 1

3. RECITALS 2

4. DEFINITIONS 2

5. TERM 3

6. LEASE 3

7. EQUIPMENT 3

8. PAYMENT 5

9. PURCHASE OPTION 6

10. REPRESENTATIONS - WARRANTIES - COVENANTS 7

11. INSURANCE 8

12. EVENTS OF DEFAULT 8

13. REMEDIES 9

14. INDEMNIFICATION 9

15. NOTICES - REPRESENTATIVES 10

16. GOVERNMENTAL IMMUNITY 10

17. GENERAL PROVISIONS 10

18. COLORADO SPECIAL PROVISIONS FOR LEASE AGREEMENT 13

19. SIGNATURE PAGE 15

Exhibit A Equipment Description Exhibit B Rental Payment Schedule Exhibit C Certificate of Acceptance

Exhibit D

Exhibit E

Maintenance Agreement Equipment Warranties

1. PARTIES

This Equipment Lease Purchase Agreement (the “Lease Agreement”) is entered into by and between

_____(“Lessor”), and the STATE OF COLORADO acting by and through the Department of Personnel

& Administration (the “State” or “DPA”). Lessor and the State hereby agree to the following terms and conditions.

2. EFFECTIVE DATE - NOTICE OF NONLIABILITY

This Lease Agreement shall not be effective or enforceable until it is approved and signed by the Colorado State

Controller or designee (the “Effective Date”). The State shall not be liable to pay or reimburse Lessor for any performance hereunder including, but not limited to, costs or expenses incurred, or be bound by any provision hereof prior to the Effective Date.

3. RECITALS

a. Authority. Authority to enter into this Contract exists in § 24-30-1101, et seq. C.R.S.

b. Consideration. The Part ies (as su ch term is d efine d in §4(a)) acknowle dge that the mutual promises and covenants contained herein and other good and valuable consideration are sufficient and adequate to support this Lease Agreement.

c. Purpose. The State desires to lease from the Lessor and the Lessor desires to lease to the State a production inserter pursuant to a lease purchase agreement.

d. References. All references in this Lease Agreement to sections (whether spelled out or using the § symbol), subsections, exhibits or other attachments, are references to sections, subsections, exhibits or other attachments contained herein or therein or incorporated as a part hereof or thereof, unless otherwise noted.

4. DEFINITIONS

a. Defined Terms. The following terms as used herein shall be construed and interpreted as follows:

i. “CGIA” means the Colorado Governmental Immunity Act, §24-10-101, et seq., C.R.S., as may be amended.

ii. “Casualty Loss” means substantial damage to, destruction, loss, condemnation, or theft of substantially all of an item of Equipment.

iii. “Certificate of Acceptance” means a certificate, substantially in the form of Exhibit C, signifying the acceptance of by the State of the Equipment subject to this Lease Agreement.

iv. “Equipment” means the production inserting equipment, systems and associated services described in

Exhibit A and includes all replacements, repairs, restorations, Modifications and improvements of or to such Equipment.

v. “Equipment Location” means the location for the Equipment specified in Exhibit A.

vi. “Event of Default” is defined in §12.

vii. “Event of Nonappropriation” is defined in §8(g)(ii).

viii. “Exhibit” means the following documents, attached hereto and incorporated by reference herein:

Exhibit A, Equipment Description and Exhibit B. Rental Payment Schedule, Exhibit C, Certificate of Acceptance, Exhibit D, Maintenance Agreement.

ix. “Fiscal Year” means the State’s fiscal year, which begins on July 1 of each calendar year and ends on June 30 of the following calendar year.

x. “Lease Agreement” means this Equipment Lease Purchase Agreement, its terms and conditions, attached Exhibits, documents incorporated by reference under its terms, and any future modifying agreements, exhibits, attachments or references incorporated herein pursuant to Colorado State law, State fiscal rules, and State Controller policies.

xi. “Lease Commencement Date” means the date of acceptance by the State of the Equipment subject to this Lease Agreement.

xii. “Lease Term” means the term of this Lease Agreement, as set forth in §5.

xiii. “Lessor” means the Party identified as such in §1 of this Lease Agreement and such Party’s permitted successors or assigns.

xiv. “Maximum Agreement Amount” means the cumulative not-to-exceed amount for this Lease

Agreement, as set forth in Exhibit B.

xv. “Modification” means a field installable upgrade, feature, addition, accessory or modification to

Equipment, which is made by or for the original manufacturer of such Equipment.

xvi. “Party” means the State or Lessor and “Parties” means both the State and Lessor.

xvii. “Purchase Price” is defined in §9(b).

xviii. “Rental Payment” means the rental payment payable by the State under Exhibit B, consisting of a principal component and an interest component.

xix. “Rental Payment Date(s)” means the dates identified in the Rental Payment Schedule for the payment of Rental Payment(s).

xx. “Rental Payment Schedule” means the Rental Payment Schedule, attached as Exhibit B.

xxi. “State Controller” means the Colorado State Controller or authorized designee of the Colorado

State Controller.

b. Additional Terms. Any other term used in this Lease Agreement that is defined in an Exhibit or attachment shall be construed and interpreted as defined in that Exhibit or Attachment.

5. TERM

The Lease Term shall commence upon execution of the Certificate of Acceptance, Lease Commencement Date, and shall terminate on the thirty-six (36) month anniversary of the Lease Commencement Date, in accordance with §7., unless sooner terminated as specified elsewhere herein.

6. LEASE

a. Agreement to Lease. The State agrees to lease from Lessor and Lessor agrees to lease to the State the Equipment identified in Exhibit A, subject to the terms and conditions of and for the purposes set forth in this Lease Agreement.

b. Continuation of Lease Term. The State intends, subject to §§8(g), 9, 11(b) and 17(b), to continue the

Lease Term for the thirty-six (36) month term of the Schedule of Payments. Sufficient funds are available for the payment of all Rental Payments during the current Fiscal Year, and the State reasonably believes that an amount sufficient to make all Rental Payments during the entire Lease Term can be obtained from legally available funds of the State.

7. EQUIPMENT

a. Equipment Subject to Lease. Equipment available for lease under this Lease Agreement shall be limited to the

Equipment identified in Exhibit A. The execution of this Lease Agreement by Lessor shall constitute the lease to the State of the Equipment and the execution of this Lease Agreement by the State shall constitute the acquisition and lease of such Equipment from the Lessor by the State, in accordance with the terms hereof.

b. Title. During the Lease Term, title to the Equipment and all additions, repairs, replacements, or

Modifications shall be retained by Lessor. The State shall not create or suffer any levy, lien, or encumbrance on the Equipment except those created by Lessor.

c. Personal Property. The Equipment is and at all times shall be and remain personal property, notwithstanding that the Equipment, or any part thereof, may be or hereafter become in any manner, affixed or attached to, embedded in, or permanently rested upon real property or any building thereon, or attached in any manner to real property by means of cement, plaster, nails, bolts, screws or otherwise.

d. Selection - Use – Location. The State shall be responsible for the selection and use of the Equipment. The

State shall cause all Equipment to be operated in accordance with applicable manufacturers’ operating instructions, laws, and governmental regulations. The State shall not move the Equipment from the Equipment

Location or any alternate operating location necessary because of relocation of the State program requiring use of the Equipment without the prior written consent of Lessor, which shall not be unreasonably withheld.

e. Equipment Warranties. Lessor represents and covenants, each of which is relied on by the State in entering into this Lease Agreement, that the Equipment meets all criteria and specifications and requirements noted in this RFP and its Exhibits. Additionally, all manufacturer’s warranties remain intact and are attached hereto as Exhibit E –

Equipment Warranties. Lessor shall assign to the State, to the extent assignable, all warranties that are in effect upon transfer of title by the Lessor to the State and shall forward to the State all applicable warranty notices.

f. Inspection – Marking. The Lessor shall affix to the Equipment all labels supplied to the State by Lessor, identifying Lessor’s ownership interest in the Equipment. Lessor shall maintain all maintenance records related to the equipment.

g. Financing Statements. The State agrees to the filing of financing statements, including affidavits, notices and similar instruments, which Lessor files as it deems necessary or appropriate to evidence and maintain Lessor’s ownership interest in the Equipment and, upon assignment of Lessor’s interest hereunder, the ownership interest of Lessor’s assignee.

h. Delivery – Installation. Lessor shall deliver, install, test, and ensure full operational functionality of the

Equipment and software.

i. Acceptance. The State shall inspect all Equipment as soon as reasonably practicable after its delivery to the

Equipment Location. Upon the completion of the installation, testing, and verification of full operational functionality of the Equipment and software by Lessor, the State shall accept the Equipment and software as fully operational or shall reject if not operational to the State’s satisfaction. Upon acceptance of the Equipment and software, the State shall promptly execute and deliver to Lessor a Certificate of Acceptance, substantially in the form of Exhibit C, evidencing that the Equipment has been accepted by the State.

j. Maintenance – Repair. The Lessor, at no additional expense, shall keep the Equipment in good repair, condition and working order, ordinary wear and tear excepted and shall keep the software fully operational and up to date. The State shall contract with the Lessor for maintenance services for the Equipment and software see the maintenance contract attached as Exhibit D Maintenance Agreement. All replacement parts and repairs at any time made to the Equipment shall become the property of Lessor. The State shall pay all utility and other charges incurred in the use and maintenance of the Equipment. The State shall pay such charges as the same may become due; provided that the State may contest in good faith any charge and permit the contested charge to remain unpaid during the period of such contest, unless the failure to pay such charges will create a lien upon the

Equipment; and, provided further, that with respect to charges that lawfully may be paid in installments over a period of years, the State shall be obligated to pay only such installments as accrue during the Lease Term and in compliance with §17(b).

k. Alterations – Modifications – Parts.

i. Authority. The State may make such alterations, additions, or Modifications to the Equipment as the State may deem desirable in the conduct of its business without the consent of Lessor, provided the Equipment shall be of a value and utility not less than the value and utility of the Equipment immediately prior to the making of such alterations, additions, or Modifications and that such alterations, additions, or Modifications to the Equipment conform to the requirements of the

Maintenance Agreement. The State shall obtain written consent of Lessor, which shall not be unreasonably withheld, before making any alteration, addition, or Modification which would reduce the value and utility of the Equipment which may not conform to the requirements of the Maintenance

Agreement. completion thereof from its value and utility immediately prior to the making of such alteration, addition or Modification.

ii. Return of Equipment. Upon the State’s termination of this Lease Agreement, other than termination upon payment in full of the Purchase Price as set forth in the Rental Payment Schedule or prepayment pursuant to §8(f), Modifications maintained as a part of the Equipment and alterations and additions which the State fails to remove from the Equipment shall be the property of Lessor, free of all encumbrances. Any part installed as a part of the Equipment in connection with warranty or maintenance service shall be the property of Lessor.

iii. Restoration. If alterations, additions or Modifications are removed from the Equipment, the Equipment shall be restored, at the State’s expense, to its original unmodified condition as described in §7(i), eligible for manufacturer’s maintenance service, prior to its return to Lessor. Restoration shall include the replacement of the original parts removed in connection with the installation of an alteration, addition, or

Modification.

l. Relocation. Upon Lessor’s prior written consent, which shall not be unreasonably withheld, the State may relocate the Equipment from the Equipment Location. No relocation shall relieve the State of its obligations under this Lease Agreement. In no event shall the State remove Equipment from the continental United States.

m. Surrender of Possession. Upon termination of this Lease Agreement, other than termination upon payment in full of the Purchase Price as set forth in the Rental Payment Schedule or prepayment pursuant to §8(f), the

State shall execute and deliver to Lessor such documents as Lessor may request to evidence the legal title of

Lessor to the Equipment and the termination of the State’s leasehold interest therein. The State promptly shall return the Equipment, freight prepaid, to a location in the continental United States specified by Lessor.

The State shall pay any costs and expenses to uninstall and remove the Equipment, which payments shall not be applied towards the Maximum Agreement Amount or expended from funds appropriated for Rental

Payments hereunder. Any parts removed in connection therewith, as permitted under §7(i), shall not constitute Equipment under this Lease Agreement.

8. PAYMENT

a. Maximum Agreement Amount. The cumulative not-to-exceed amount payable to Lessor under this Lease

Agreement by the State shall not exceed the Maximum Payment Amount in Exhibit B, as determined by the

State from available funds, and the State’s financial obligation is limited to this amount. Increases or decreases to the not-to-exceed amount shall require a formal written amendment approved by the State Controller. The total Rental Payments payable hereunder shall be limited to the unpaid obligated balance of this Lease

Agreement.

b. Use of Funds. Funds available for payment by the State to Lessor under this Lease Agreement shall be used only for Rental Payments, maintenance, or other expenses related to the Equipment.

c. Rental Payments. The State shall make Rental Payments under this Lease Agreement in the amounts and on the Rental Payment Dates specified in the Rental Payment Schedule in Exhibit B. All Rental Payments shall be forwarded to Lessor at the address specified in §14. Rental Payments for Lease Term shall be set forth in the Rental Payment Schedule.

d. Interest. A portion of each Rental Payment shall be paid as and represents the payment of interest. The interest component of each Rental Payment shall be equal to the amounts set forth in the Rental Payment Schedule in

Exhibit B, calculated using the interest rate set forth in Exhibit B on the basis of a 365 day year, actual days elapsed. The interest and principal amounts of each Rental Payment payable under this Lease Agreement shall be set forth on the Rental Payment Schedule.

e. Delinquent Payments. If any portion of a Rental Payment is received by Lessor later than the applicable Rental

Payment Date set forth on the Rental Payment Schedule, such uncontested delinquent amounts shall bear interest on the unpaid amount beginning on the 46 th day after the Rental Payment is due at a rate not to exceed one percent

(1%) per month until paid in full. Lessor shall invoice the State separately for accrued interest on delinquent

Rental Payments. The billing shall reference the delinquent payment, the amount of the penalty, number of day’s interest to be paid and the interest rate.

f. Prepayment. Upon 30 days prior written notice to Lessor, the State shall have the option to prepay all of the

Rental Payments due under this Lease Agreement on any Rental Payment Date identified in the Rental

Payment Schedule. Upon payment of all amounts then due, plus the Purchase Price set forth on the Rental

Payment Schedule, Lessor shall transfer title to the Equipment to the State as provided in §9(d).

g. Contingency - Available Funds – Current Expense – No Pledge or Lien.

i. Contingency. The State is prohibited by law from making commitments beyond the term of the State’s current Fiscal Year. Therefore, the State’s ability to make payment under this Lease Agreement beyond the

State’s current Fiscal Year is contingent upon the continuing availability of State appropriations as provided in the Colorado Special Provisions. If State or federal funds are used to fund this Lease

Agreement, in whole or in part, the State’s performance hereunder is contingent upon the continuing availability of such funds. Payments pursuant to this Lease Agreement shall be made only from available funds encumbered for this Lease Agreement and the State’s liability for such payments shall be limited to the amount remaining of such encumbered funds. Upon such termination of this Lease Agreement, the State shall deliver to Lessor possession of all leased Equipment and such documents as Lessor may request in accordance with §7(l).

ii. Available Funds. The State intends, but is not required to do all things lawfully within its power to obtain and maintain funds sufficient to discharge its obligations to make all Rental Payments due under this

Lease Agreement. If the Colorado General Assembly, in its discretion, does not allocate sufficient funds for any Fiscal Year beyond the then current Fiscal Year Term of this Lease Agreement (an “Event of

Nonappropriation”), this Lease Agreement shall be terminated without penalty and the State shall not be obligated to make the Rental Payments remaining beyond the State’s then current Fiscal Year Term. The

State shall notify Lessor in writing as soon as the State becomes aware of an Event of Nonappropriation, and if possible, prior to the end of the then current Fiscal Year of the Lease Term, but the failure to give such notice shall not extend the term of this Lease Agreement beyond the then current Fiscal Year.

iii. Current Expense. The State’s obligations under this Lease Agreement shall be subject to the State’s right to terminate this Lease Agreement in accordance with subsection ii , Available Funds , and shall not constitute a mandatory charge or requirement for payment of any amounts in excess of amounts appropriated for any Fiscal Year beyond the Fiscal Year for which such appropriation has been made. The obligation of the State to pay Rental Payments or other amounts due under this Lease Agreement constitutes a current expense of the State payable exclusively from the State’s funds and shall not in any way be construed to be a general obligation of indebtedness or multiple fiscal year financial obligation of the State of Colorado, or any agency or department thereof, within the meaning of any provision of section 20 of Article X or sections 1, 2, 3, 4, or 5 of Article XI of the Colorado Constitution or statutory limitation or requirement applicable to the State concerning the creation of indebtedness or a multiple fiscal year financial obligation. This Lease Agreement does not directly or indirectly obligate the

State to make any payments beyond those appropriated for any Fiscal Year for which such payments have been appropriated. The State shall be under no obligation whatsoever to exercise its option to purchase the Equipment.

iv. No Pledge or Lien. Neither the State, nor Lessor acting on the State’s behalf, has pledged the full faith and credit of the State of Colorado or any agency or department thereof to the payment of

Rental Payments or other amounts due under this Lease Agreement and this Lease Agreement shall not directly or contingently obligate the State of Colorado or any agency or department thereof to apply money from, or levy or pledge any form of taxation to the payment of any amounts due under this Lease Agreement. No provision of this Lease Agreement shall be construed or interpreted as creating a delegation of governmental powers nor as a donation by or a lending of the credit of the

State of Colorado, within the meaning of section 1 or 2 of Article XI of the Constitution of the State of Colorado. No provision of this Lease Agreement shall be construed to pledge or to create a lien on any class or source of moneys of the State of Colorado, nor shall any provision of this Lease

Agreement restrict the future issuance of any obligations of the State of Colorado payable from any class or source of money of the State.

h. Erroneous Payments. At the State’s sole discretion, payments made to Lessor in error for any reason, may be recovered from Lessor by deduction from subsequent payments to Lessor under this Lease Agreement.

9. PURCHASE OPTION

a. Exercise. The State shall have the option to purchase all of the Equipment identified in the Schedule, at the following times:

i. Upon any Rental Payment Date set forth in the Rental Payment Schedule;

ii. In the event of a Casualty Loss with respect to substantially all of the Equipment; or

iii. Upon the expiration of the Lease Term.

b. Purchase Price. The Purchase Price for the Equipment upon exercise of the Purchase Option shall be equal to the Purchase Price identified in the Rental Payment Schedule for the next Rental Payment Date or the Purchase

Price shall be the amount of the Rental Payments paid in full per the Rental Payment Schedule.

c. Notice of Exercise. The State shall provide Lessor with not less than 30 days prior written notice, in accordance with §15, of its intention to exercise the State’s option to purchase the Equipment, setting forth the

Rental Payment Date upon which the State will exercise its option to purchase the Equipment and the Purchase

Price to be paid therefor.

d. Transfer of Title. Upon payment in full of the Purchase Price by the State, Lessor shall convey all right, title and interest in and to the Equipment to the State through a bill of sale, in form satisfactory to the State and shall terminate any UCC filings. Thereafter, Lessor shall have no further interest in the Equipment and shall take such measures as may be necessary to transfer title of the Equipment to the State, free from any encumbrances or liens.

10. REPRESENTATIONS - WARRANTIES - COVENANTS

a. Lessor. Lessor makes the following specific representations and covenants, each of which was relied on by the

State in entering into this Lease Agreement.

i. Legal Authority – Signature. Lessor possesses the legal authority to enter into this Lease Agreement and to perform its obligations hereunder. Lessor has taken all actions required by its procedures, and bylaws, and/or applicable laws to exercise that authority, and to lawfully authorize its undersigned signatory to execute this Lease Agreement and to bind Lessor to the terms hereof.

ii. Enforceability. This Lease Agreement is the valid, legal, and binding agreement of Lessor, enforceable in accordance with its terms.

iii. Licenses - Permits. As of the Effective Date Lessor has, and at all times during the Lease Term hereof shall have and maintain at its sole expense, all licenses, certifications, approvals, insurance, permits, and other authorizations required by law to perform its obligations hereunder. Lessor, if a foreign corporation or other foreign entity transacting business in the State of Colorado, currently has obtained and shall maintain any applicable certificate of authority to transact business in the

State of Colorado and has designated a registered agent in Colorado to accept service of process.

iv. Quiet Enjoyment. Neither Lessor nor anyone acting or claiming through Lessor, by assignment or otherwise, shall interfere with the State’s quiet enjoyment of the use of the Equipment so long as an

Event of Default or Event of Nonappropriation shall not have occurred and be continuing.

v. Compliance with Laws. Lessor has complied with the provisions of all applicable statutes, rules and regulations in order to enter into this Lease Agreement with the State to provide for the acquisition, installation, and leasing of the Equipment.

vi. Litigation. Within 10 days after being served with any pleading in a legal action filed with a court of administrative agency, related to or which may affect Lessor’s ability to perform its obligations hereunder, Lessor shall notify the State of such action and deliver copies of such pleadings to the

State’s principal representative as identified herein. If the State’s principal representative is not then serving, such notice and copies shall be delivered to the executive director of the Colorado Department of Personnel & Administration.

b. The State. The State makes the following specific representations and covenants, each of which was relied on by Lessor in entering into this Lease Agreement.

i. Legal Authority - Signature. The State possesses the legal authority to enter into this Lease Agreement and to perform its obligations hereunder. The State has taken all actions required by all applicable procedures, laws and regulations to exercise that authority, and to lawfully authorize its undersigned signatory to execute this Lease Agreement, or any part hereof, and to bind the State to the terms hereof.

ii. Enforceability. This Lease Agreement is the valid, legal, and binding agreement of the State, enforceable against the State in accordance with its terms.

iii. Compliance with Laws. The State has complied with the provisions of all applicable statutes, rules and regulations in order to enter into this Lease Agreement with Lessor to provide for the acquisition, installation and leasing of the Equipment as set forth herein.

iv. Encumbrances. The Equipment is free and clear of any encumbrance or lien created by the State other than the State’s leasehold interest created by this Lease Agreement.

v. Litigation. There is no pending litigation, tax claim, proceeding or dispute that may adversely affect the

State’s financial condition so as to impair its ability to perform its obligations under this Lease

Agreement.

vi. Ownership of Equipment Location. The State is the fee owner of the Equipment Location and has good marketable title thereto.

11. INSURANCE

a. Liability Insurance.

i. Public Entity. The State is a “public entity” within the meaning of the CGIA. The State shall maintain at all times during the term of this Lease Agreement such liability insurance, by commercial policy or self-insurance, as is necessary to meet its liabilities under the CGIA.

ii. Self-Insurance. The State, at its own expense and in accordance with §24-30-1501, et seq., C.R.S. , shall provide evidence of a satisfactory self-insurance program in the amounts and in accordance with the CGIA for public liability, self-insurance coverage, only to the extent of the available coverage. Upon Lessor’s request, the State shall provide Lessor with evidence of such self-insurance.

Such coverage shall be for the duration of this Lease Agreement and the amount of coverage shall be in accordance with the requirements of the CGIA and the State’s risk management statutes. Any provisions of this Lease Agreement, whether or not incorporated herein by reference, shall be controlled and limited by these statutes.

b. Property Insurance – Loss or Damage.

i. Replacement Cost. The State shall self-insure or maintain an all risk commercial property policy with replacement cost coverage, at its own expense, covering loss of or damage to the Equipment (but excluding any Modifications not subject to this Lease Agreement with Lessor). If any item of Equipment suffers a Casualty Loss before the date of installation, such Equipment shall not be covered by this Lease

Agreement. If any item of Equipment suffers a Casualty Loss, or is otherwise damaged, on or after the date of installation, the State shall promptly inform Lessor. If the State determines that the item can be repaired economically, the State shall cause the item of Equipment to be placed in good condition and working order and pay the reasonable cost of such repair.

ii. Event of Loss. If the Equipment suffers a Casualty Loss, the State shall provide prompt written notice of such Casualty Loss to Lessor. The State, at its option and to the extent funds have been appropriated for such purpose, shall (a) replace such Equipment with equivalent or newer equipment to be owned by the

Lessor, which shall become subject to this Lease Agreement or (b) pay to Lessor the Purchase Price for the Equipment on the next Rental Payment Date set forth on the Rental Payment Schedule, in which event the Equipment shall no longer be subject to this Lease Agreement and Lessor shall convey title to the

Equipment to the State. The State’s determination regarding the reparability of damaged Equipment and notification to Lessor shall be performed within a commercially reasonable time.

iii. Certificate. If the State elects, in its sole discretion, to maintain an all risk commercial property policy with respect to Equipment, upon Lessor’s request, the State shall provide Lessor with a certificate of insurance evidencing such coverage and naming the Lessor as loss payee.

12. EVENTS OF DEFAULT

a. Events of Default. The occurrence of any of the following shall constitute an Event of Default hereunder.

i. Rental Payments. The State fails to timely pay all or any part of a Rental Payment, other than as a result of an Event of Nonappropriation, and such failure has not been cured within 30 days of the Rental

Payment Date.

ii. Other Payments. The State fails to timely pay any amount, other than a Rental Payment, due and owing under this Lease Agreement, other than as a result of an Event of Nonappropriation, and such failure has not been cured within 30 days of the State’s receipt of notice of such failure from Lessor, in accordance with §14.

iii. Performance. Either Party fails to perform any of its material obligations or violates any of its covenants hereunder, other than the payment of money, in whole or in part or in a timely or satisfactory manner, and such failure is not cured within 30 days of the breaching Party’s receipt of written notice from the aggrieved Party, in accordance with §14, or if a cure cannot be completed within 30 days, such cure has not begun within 30 days and pursued with due diligence.

iv. Misrepresentation. The State makes a material misrepresentation hereunder.

b. Occurrence. Upon the occurrence of an Event of Default, the aggrieved Party shall have the right to exercise any of the remedies set forth in §13 with respect to such Event of Default.

13. REMEDIES

a. The State. Upon the occurrence of an Event of Default with respect to Lessor under this Lease Agreement, the

State shall have all of the remedies available at law or in equity. The State may exercise any or all of the remedies available to it, in its sole discretion, concurrently or consecutively.

b. Lessor. Upon the occurrence of an Event of Default with respect to the State under this Lease Agreement, Lessor shall have all of the remedies listed in this §13(b) in addition to all other remedies set forth in other sections of this Lease Agreement or available at law or in equity. Lessor may exercise any or all of the remedies available to it, in its sole discretion, concurrently or consecutively.

i. Termination. Upon the occurrence of an Event of Default under this Lease Agreement, Lessor may terminate this Lease Agreement. Exercise of this right by Lessor shall not be a breach of its obligations hereunder.

ii. Return of Equipment. Upon the termination of this Lease Agreement under this §13(b), the State shall deliver to Lessor possession of all leased Equipment and such documents as Lessor may request in accordance with §7(j).

14. INDEMNIFICATION

A. Indemnification

i. General Indemnification

Contractor shall indemnify, save, and hold harmless the State, its employees, agents and assignees

(the “Indemnified Parties”), against any and all costs, expenses, claims, damages, liabilities, court awards and other amounts (including attorneys’ fees and related costs) incurred by any of the

Indemnified Parties in relation to any act or omission by Contractor, or its employees, agents, Subcontractors, or assignees in connection with this Contract.

ii. Confidential Information Indemnification

Disclosure or use of State Confidential Information by Contractor in violation of §Error! Reference source not found. may be cause for legal action by third parties against Contractor, the State, or their respective agents. Contractor shall indemnify, save, and hold harmless the Indemnified Parties, against any and all claims, damages, liabilities, losses, costs, expenses (including attorneys’ fees and costs) incurred by the State in relation to any act or omission by Contractor, or its employees, agents, assigns, or Subcontractors in violation of §10.

iii. Intellectual Property Indemnification

Contractor shall indemnify, save, and hold harmless the Indemnified Parties, against any and all costs, expenses, claims, damages, liabilities, and other amounts (including attorneys’ fees and costs) incurred by the Indemnified Parties in relation to any claim that any Work infringes a patent, copyright, trademark, trade secret, or any other intellectual property right.

15. NOTICES - REPRESENTATIVES

Each individual identified below is the principal representative of the designating Party. All notices required to be given hereunder shall be hand delivered with receipt required or sent by certified or registered mail to such Party’s principal representative at the address set forth below. In addition to, but not in lieu of a hard-copy notice, concurrent notice also may be sent by e-mail to the e-mail addresses, if any, set forth below; provided that e-mail notice shall not be effective until hard-copy notice is received by the recipient. Either Party may from time to time designate by written notice substitute addresses or persons to whom such notices shall be sent. Unless otherwise provided herein, all notices shall be effective upon receipt.

a. The State:

b. Lessor:

16. GOVERNMENTAL IMMUNITY

Liability for claims for injuries to persons or property arising from the negligence of the State of Colorado, its departments, institutions, agencies, boards, officials, and employees is controlled and limited by the provisions of the CGIA and the risk management statutes, §24-30-1501, et seq., C.R.S., as may be amended.

17. GENERAL PROVISIONS

a. Assignment.

i. Lessor. Lessor shall not assign, transfer or otherwise dispose of this Lease Agreement or the Equipment, or any interest therein, except with the written consent of the State, which shall not be unreasonably withheld. No assignment, transfer or conveyance permitted by this §17(a)(i) shall be effective until

Lessee shall have received a written notice of assignment that discloses the name, address and tax identification number of each such assignee.

Lessor shall not be relieved of its obligations hereunder as a result of any assignment unless the State expressly consents thereto, in writing through a contract amendment executed by the Colorado State

Controller or designee.

ii. The State. The State shall not assign, transfer or otherwise dispose of this Lease Agreement or the

Equipment, or any interest therein, except with the written consent of Lessor, which shall not be unreasonably withheld.

b. Binding Effect. Except as otherwise provided in §17(a), all provisions herein contained, including the benefits and burdens, shall extend to and be binding upon the Parties’ respective heirs, legal representatives, successors, and assigns.

c. Captions. The captions and headings in this Lease Agreement are for convenience of reference only, and shall not be used to interpret, define, or limit its provisions.

d. Counterparts. This Lease Agreement may be executed in multiple identical original counterparts, all of which shall constitute one agreement.

e. Entire Understanding. This Lease Agreement and the Exhibits hereto represent the complete integration of all understandings between the Parties and all prior representations and understandings, oral or written, are merged herein. Prior or contemporaneous additions, deletions, or other changes hereto shall not have any force or affect whatsoever, unless embodied herein.

f. Jurisdiction and Venue. All suits or actions related to this Lease Agreement shall be filed and proceedings held in the State of Colorado and exclusive venue shall be proper in the City and County of Denver.

g. Modification of Lease Agreement.

i. By the Parties. Except as specifically provided in this Lease Agreement, modifications of this

Lease Agreement shall not be effective unless agreed to in writing by both Parties in an amendment to this Lease Agreement, properly executed and approved in accordance with applicable Colorado State law and

State fiscal rules.

ii. By Operation of Law. This Lease Agreement is subject to such modifications as may be required by changes in Federal or Colorado State law, or their implementing regulations. Any such required modification automatically shall be incorporated into and be part of this Lease Agreement on the effective date of such change, as if fully set forth herein.

h. Order of Precedence. The provisions of this Lease Agreement shall govern the relationship of the State and

Lessor. In the event of conflicts or inconsistencies between this Lease Agreement and its respective exhibits and attachments, including, but not limited to, those provided by Lessor, such conflicts or inconsistencies shall be resolved by reference to the documents in the following order of priority:

i. The Colorado Special Provisions;

ii. The remaining provisions of this Lease Agreement;

iii. Exhibit A – Equipment description.

iv. Exhibit B – Rental Payment Schedule Payments

v. Exhibit C – Certificate of Acceptance

vi. Exhibit D – Maintenance Agreement

vii. Exhibit F - Equipment Warranty

i. Severability. Provided this Lease Agreement can be executed and performance of the obligations of the Parties accomplished within its intent, the provisions hereof are severable and any provision that is declared invalid or becomes inoperable for any reason shall not affect the validity of any other provision hereof, provided that the

Parties can continue to perform their obligations under this Lease Agreement in accordance with its intent.

j. Survival of Certain Terms. Notwithstanding anything herein to the contrary, provisions of this Lease

Agreement requiring continued performance, compliance, or effect after termination hereof, shall survive such termination and shall be enforceable by either Party if the other Party fails to perform or comply as required.

k. Taxes. The State is exempt from all federal excise taxes under IRC Chapter 32 (No. 84-730123K) and from all

State and local government sales and use taxes under §§39-26-101 and 201 et seq., C.R.S. Such exemptions apply when materials are purchased or services are rendered to benefit the State; provided however, that certain political subdivisions (e.g., City of Denver) may require payment of sales or use taxes even though the product or service is provided to the State. The State is prohibited from paying or reimbursing any party for such taxes.

l. Third Party Beneficiaries. Enforcement of this Lease Agreement and all rights and obligations hereunder are reserved solely to the Parties. Any services or benefits which third parties receive as a result of this Lease

Agreement are incidental to this Lease Agreement, and do not create any rights for such third parties.

m. Waiver. Waiver of any breach under a term, provision, or requirement of this Lease Agreement, or any right or remedy hereunder, whether explicitly or by lack of enforcement, shall not be construed or deemed as a waiver of any subsequent breach of such term, provision or requirement, or of any other term, provision, or requirement.

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18. COLORADO SPECIAL PROVISIONS FOR LEASE AGREEMENT

The Special Provisions apply to all State contracts except where noted in italics.

a. CONTROLLER'S APPROVAL. CRS §24-30-202 (1). This Lease Agreement shall not be valid until it has been approved by the Colorado State Controller or designee.

b. FUND AVAILABILITY. CRS §24-30-202(5.5). Financial obligations of the State payable after the current fiscal year are contingent upon funds for that purpose being appropriated, budgeted, and otherwise made available.

c. GOVERNMENTAL IMMUNITY. No term or condition of this Lease Agreement shall be construed or interpreted as a waiver, express or implied, of any of the immunities, rights, benefits, protections, or other provisions, of the Colorado Governmental Immunity Act, CRS §24-10-101 et seq., or the Federal Tort Claims

Act, 28 U.S.C. §§1346(b) and 2671 et seq., as applicable now or hereafter amended.

d. INDEPENDENT CONTRACTOR. Lessor shall perform its duties hereunder as an independent contractor and not as an employee. Neither Lessor nor any agent or employee of Lessor shall be deemed to be an agent or employee of the State. Lessor and its employees and agents are not entitled to unemployment insurance or workers compensation benefits through the State and the State shall not pay for or otherwise provide such coverage for Lessor or any of its agents or employees. Unemployment insurance benefits shall be available to

Lessor and its employees and agents only if such coverage is made available by Lessor or a third party. Lessor shall pay when due all applicable employment taxes and income taxes and local head taxes incurred pursuant to this Lease Agreement. Lessor shall not have authorization, express or implied, to bind the State to any contract, liability or understanding, except as expressly set forth herein. Lessor shall (a) provide and keep in force workers' compensation and unemployment compensation insurance in the amounts required by law, (b) provide proof thereof when requested by the State, and (c) be solely responsible for its acts and those of its employees and agents.

e. COMPLIANCE WITH LAW. Lessor shall strictly comply with all applicable federal and State laws, rules, and regulations in effect or hereafter established, including, without limitation, laws applicable to discrimination and unfair employment practices.

f. CHOICE OF LAW. Colorado law, and rules and regulations issued pursuant thereto, shall be applied in the interpretation, execution, and enforcement of this Lease Agreement. Any provision included or incorporated herein by reference which conflicts with said laws, rules, and regulations shall be null and void. Any provision incorporated herein by reference which purports to negate this or any other Special Provision in whole or in part shall not be valid or enforceable or available in any action at law, whether by way of complaint, defense, or otherwise. Any provision rendered null and void by the operation of this provision shall not invalidate the remainder of this Lease Agreement, to the extent capable of execution.

g. BINDING ARBITRATION PROHIBITED. The State of Colorado does not agree to binding arbitration by any extra-judicial body or person. Any provision to the contrary in this Lease Agreement or incorporated herein by reference shall be null and void.

h. SOFTWARE PIRACY PROHIBITION. Governor's Executive Order D 002 00. State or other public funds payable under this Lease Agreement shall not be used for the acquisition, operation, or maintenance of computer software in violation of federal copyright laws or applicable licensing restrictions. Lessor hereby certifies and warrants that, during the term of this Lease Agreement and any extensions, Lessor has and shall maintain in place appropriate systems and controls to prevent such improper use of public funds. If the State determines that Lessor is in violation of this provision, the State may exercise any remedy available at law or in equity or under this Lease Agreement, including, without limitation, immediate termination of this Lease

Agreement and any remedy consistent with federal copyright laws or applicable licensing restrictions.

i. EMPLOYEE FINANCIAL INTEREST. CRS §§24-18-201 and 24-50-507. The signatories aver that to their knowledge, no employee of the State has any personal or beneficial interest whatsoever in the service or property described in this Lease Agreement. Lessor has no interest and shall not acquire any interest, direct or indirect, that would conflict in any manner or degree with Lessor’s performance and Lessor shall not employ any person having such known interests.

j. VENDOR OFFSET. CRS §§24-30-202 (1) and 24-30-202.4. [Not applicable to intergovernmental agreements] Subject to CRS §24-30-202.4 (3.5), the State Controller may withhold payment under the

State’s vendor offset intercept system for debts owed to State agencies for: (a) unpaid child support debts or child support arrearages; (b) unpaid balances of tax, accrued interest, or other charges specified in CRS

§39-21-101, et seq.; (c) unpaid loans due to the Student Loan Division of the Department of Higher

Education; (d) amounts required to be paid to the Unemployment Compensation Fund; and (e) other unpaid debts owing to the State as a result of final agency determination or judicial action.

k. PUBLIC CONTRACTS FOR SERVICES. CRS §8-17.5-101. [Not applicable to agreements relating to the offer, issuance, or sale of securities, investment advisory services or fund management services, sponsored projects, intergovernmental agreements, or information technology services or products and services] Lessor certifies, warrants, and agrees that it does not knowingly employ or contract with an illegal alien who shall perform work under this Lease Agreement and shall confirm the employment eligibility of all employees who are newly hired for employment in the United States to perform work under this Lease Agreement, through participation in the E-Verify Program or the State program established pursuant to CRS §8-17.5-102(5)(c), Lessor shall not knowingly employ or contract with an illegal alien to perform work under this Lease Agreement or enter into a contract with a subcontractor that fails to certify to Lessor that the subcontractor shall not knowingly employ or contract with an illegal alien to perform work under this Lease Agreement. Lessor (a) shall not use E-Verify Program or State program procedures to undertake pre-employment screening of job applicants while this Lease Agreement is being performed, (b) shall notify the subcontractor and the contracting State agency within three days if

Lessor has actual knowledge that a subcontractor is employing or contracting with an illegal alien for work under this Lease Agreement, (c) shall terminate the subcontract if a subcontractor does not stop employing or contracting with the illegal alien within three days of receiving the notice, and (d) shall comply with reasonable requests made in the course of an investigation, undertaken pursuant to CRS §8-17.5-102(5), by the Colorado Department of Labor and Employment. If Lessor participates in the State program, Lessor shall deliver to the contracting State agency, Institution of Higher Education or political subdivision, a written, notarized affirmation, affirming that Lessor has examined the legal work status of such employee, and shall comply with all of the other requirements of the State program. If Lessor fails to comply with any requirement of this provision or CRS §8-17.5-101 et seq., the contracting State agency, institution of higher education or political subdivision may terminate this Lease Agreement for breach and, if so terminated, Lessor shall be liable for damages.

l. PUBLIC CONTRACTS WITH NATURAL PERSONS. CRS §24-76.5-101. Lessor, if a natural person eighteen (18) years of age or older, hereby swears and affirms under penalty of perjury that he or she

(a) is a citizen or otherwise lawfully present in the United States pursuant to federal law, (b) shall comply with the provisions of CRS §24-76.5-101 et seq., and (c) has produced one form of identification required by

CRS §24- 76.5-103 prior to the effective date of this Lease Agreement.

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SIGNATURE PAGE

Contract Number XXXXXX

THE PARTIES HERETO HAVE EXECUTED THIS LEASE AGREEMENT

By:

LESSOR STATE OF COLORADO

John W. Hickenlooper, Governor

Department of Personnel & Administration

Title:

*Signature

Date:

Title:

2nd Lessor Signature if Needed

LEGAL REVIEW

Cynthia H. Coffman, Attorney General

Signature - Assistant Attorney General

*Signature

ALL CONTRACTS REQUIRE APPROVAL BY THE STATE CONTROLLER

STATE CONTROLLER

Robert Jaros, CPA, MBA, JD

By:___________________________________________

Clark Bolser Nick Server Tanya Olsen Joe Weber

Date:___________________

CRS §24-30-202 requires the State Controller to approve all State contracts. This Lease Agreement is not valid until signed and dated below by the State Controller or delegate. Lessor is not authorized to begin performance until such time. If Lessor begins performing prior thereto, the State of Colorado is not obligated to pay Lessor for such performance or for any goods and/or services provided hereunder.

* Persons signing for Lessor hereby swear and affirm that they are authorized to act on Lessor’s behalf and acknowledge that the State is relying…