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HomeMy WebLinkAboutCC AG PKT 2013-01-28 #K SE AGENDA STAFF REPORT Q Q. .- Q.- DATE: January 28, 2013 TO: Honorable Mayor and City Council THRU: Jill R. Ingram, City Manager FROM: Sean P. Crurriby P.E., Assistant City Manager/Public Works SUBJECT: AUCTION AGREEMENT SUMMARY OF REQUEST: That the City Council adopt Resolution No. 6349 approving an agreement with GovDeals for Auction Services for the City of Seal Beach. BACKGROUND AND ANALYSIS: On June 11, 2013, the City Council adopted a vehicle Fleet Management Plan, pursuant to which staff anticipates that an action to purchase fleet will be brought forward to the City Council in the spring of 2013. When this occurs, the City will need to dispose of its surplus vehicles. The City has previously auctioned off surplus property, most notably vehicles, through traditional auction houses. In contrast, the proposed agreement with GovDeals would allow the City to auction its surplus property online via GovDeals' website. It is anticipated that online auctions will reach a larger pool of bidders and potentially increase the return on the surplus vehicles compared to a traditional auction house. GovDeals is a nationwide auction and liquidity company with over 3,700 public agency clients throughout the country. It opened an office at 16305 Pacific Coast Highway in Seal Beach in December 2012. The rate structure for GovDeals is different than those of a traditional auction house. Previously, the City has paid a percentage of the final auction price to the auction house for the service. With GovDeals, the City would keep the entire auction price and the buyer would pay GovDeals an additional 12.50% as a premium. To assist the City in implementing this online auction system, GovDeals will also provide training, marketing, and support to City staff. GovDeals will also house, insure, store, and show City vehicles on-site at its own cost until they are sold. Agenda Item K The agreement would be for a 3-year term, and the City has the option of extending it for up to 2 additional 2-year terms. ENVIRONMENTAL IMPACT: This agreement does not have an impact within the California Environmental Quality Act (CEQA). LEGAL ANALYSIS: The City Attorney has reviewed and approved as to form. FINANCIAL IMPACT: Funds generated from the auction of a surplus fleet will be deposited into the Fleet Replacement Fund. RECOMMENDATION: It is recommended that the City Council adopt Resolution No. 6349 approving an agreement for Auction Services for the City of Seal Beach. SUBNAIII ED BY: NOTED AND APPROVED: Sean P. Crumby P.E. Jill A. Ingram, City ger Assistant City M�nager/PuZcWorks Attachments: A. Resolution No. 6349 B. Agreement-Auction Services Agreement Page 2 RESOLUTION NUMBER 6349 A RESOLUTION OF THE SEAL BEACH CITY COUNCIL APPROVING A PROFESSIONAL SERVICES AGREEMENT WITH GOVDEALS, INC. FOR AUCTION SERVICES THE SEAL BEACH CITY COUNCIL DOES HEREBY RESOLVE: Section 1. The City Council hereby approves that Auction Services Agreement between the City of Seal Beach and GovDeals, Inc. dated January 28, 2013. Section 2. The City Council hereby authorizes and directs the City Manager to execute the Agreement on behalf of the City. PASSED, APPROVED and ADOPTED by the Seal Beach City Council at a regular meeting held on the 28th day of January., 2013 by the following vote: AYES: Council Members NOES: Council Members ABSENT: Council Members ABSTAIN: Council Members Mayor ATTEST: City Clerk STA`L'E OF CALIFORNIA } COUNTY OF ORANGE } SS CITY OF SEAL BEACH } I, Linda Devine, City Clerk of the City of Seal Beach, do hereby certify that the foregoing resolution is the original copy of Resolution Number 6349 on file in the office of the City Clerk, passed, approved, and adopted by the Seal Beach City Council at a regular meeting held on the 28th day of January ,2013. City Clerk AUCTION SERVICES AGREEMENT Between S EA l 6 o �z �'F R 27 City of Seal Beach 211 - 8th Street Seal Beach, CA 90740 GovDeals, Inc. 5907 Carmichael Place Montgomery, Alabama 36117 (866) 377-1494 "phis Professional Service Agreement ("the Agreement") is made as of January 28, 2013 (the "Effective Date"), by and between GovDeals, Inc. ("Consultant"), a Delaware corporation, and the City of Seal Beach ("City"), a California charter city, (collectively, "the Parties"). S7296-0001\1 522 723 v2,doc RECITALS A. City desires online auction services. B. Consultant represents that it is qualified and able to provide City with such services. NOW THEREFORE, in consideration of the Parties' performance of the promises, covenants, and conditions stated herein, the Parties hereto agree as follows: AGREEMENT 1. Scope of Services 1.1 Consultant shall provide those services ("Services") set forth in the attached Exhibit A, which is hereby incorporated by this reference. To the extent that there is any conflict between Exhibit A and this Agreement, this Agreement shall control. 1.2 Consultant shall perform all Services under this Agreement in accordance with the standard of care generally exercised by like professionals under similar circumstances and in a manner reasonably satisfactory to City. 1.3 In performing this Agreement, Consultant shall comply with all applicable provisions of federal, state, and local law. 1.4 Consultant will not be compensated for any work performed not specified in Exhibit A unless the City authorizes such work in advance and in writing. The City Manager may authorize payment for such work up to a cumulative maximum of $10,000. Payment for additional work in excess of $10,000 requires prior City Council authorization. 2. Term of Agreement This term of this Agreement shall commence as of the Effective Date and shall continue for a term of 3 years unless previously terminated as provided by this Agreement. The City shall have the option to extend this Agreement for up to 2 additional 2-year terms, provided City gives Consultant notice of its decision to exercise its option at least 30 days prior to the end of the then current term. 3. Terms and Conditions City shall provide to Consultant its City Terms and Conditions that Consultant shall post on the GovDeals auction site ("Website") set forth in the attached Exhibit B. At any time during the term of this Agreement, City may modify the City Terms and Conditions. Any substitutions or modifications must be submitted to Consultant in writing before posting assets to the Website. -2- S7296-0001\1 522723v2.do-- 4. Consultant's Compensation Consultant may collect a 12.50% Buyer's Premium as set forth in Financial Settlement Services ("FSS"), included as Exhibit C to this Agreement. 5. Method of Payment Consultant will collect and remit all proceeds on City's behalf as set forth in the FSS in Exhibit C. 6. Termination 6.1 This Agreement may be terminated by City, without cause, or by Consultant based on reasonable cause, upon giving the other party written notice thereof not less than 30 days prior to the date of termination. 6.2 This Agreement may be terminated by City upon 10 days' notice to Consultant if Consultant fails to provide satisfactory evidence of renewal or replacement of comprehensive general liability insurance as required by this Agreement at least 20 days before the expiration date of the previous policy. 7. Party Representatives 7.1 The City Manager is the City's representative for purposes of this Agreement. 7.2 Robert L. DeBardelaben is the Consultant's primary representative for purposes of this Agreement. 8. Notices 8.1 All notices permitted or required under this Agreement shall be deemed made when personally delivered or when mailed 48 hours after deposit in the United States Mail, first class postage prepaid and addressed to the party at the following addresses: To City: City of Seal Beach 211-8th Street Seal Beach, California 90740 Attn: City Manager To Consultant: GovDeals, Inc. 16305 Pacific Coast Highway Seal Beach, California 90740 Attn: Robert L. DeBardelaben 8.2 Actual notice shall be deemed adequate notice on the date actual notice occurred, regardless of the method of service. -3- 9. Independent Contractor 9.1 Consultant is an independent contractor and not an employee of the City. All services provided pursuant to this Agreement shall be performed by Consultant or under its supervision. Consultant will determine the means, methods, and details of performing the services. Any additional personnel performing services under this Agreement on behalf of Consultant shall also not be employees of City and shall at all times be under Consultant's exclusive direction and control. Consultant shall pay all wages, salaries, and other amounts due such personnel in connection with their performance of services under this Agreement and as required by law. Consultant shall be responsible for all reports and obligations respecting such additional personnel, including, but not limited to: social security taxes, income tax withholding, unemployment insurance, disability insurance, and workers' compensation insurance. 9.2 Consultant shall indemnify and hold harmless City and its elected officials, officers, employees, servants, designated volunteers, and agents serving as independent contractors in the role of City officials, from any and all liability, damages, claims, costs and expenses of any nature to the extent arising from Consultant's personnel practices. City shall have the right to offset against the amount of any fees due to Consultant under this Agreement any amount due to City from Consultant as a result of Consultant's failure to promptly pay to City any reimbursement or indemnification arising under this Section. 10. Subcontractors No portion of this Agreement shall be subcontracted without the prior written approval of the City. Consultant is fully responsible to City for the performance of any and all subcontractors. 11. Assignment Consultant shall not assign or transfer any interest in this Agreement whether by assignment or novation, without the prior written consent of City. Any purported assignment without such consent shall be void and without effect. 12. Insurance 12.1 Consultant shall not commence work under this Agreement until it has provided evidence satisfactory to the City that Consultant has secured all insurance required under this Section. Consultant shall furnish City with original certificates of insurance and endorsements effecting coverage required by this Agreement on forms satisfactory to the City. The certificates and endorsements for each insurance policy shall be signed by a person authorized by that insurer to bind coverage on its behalf, and shall be on forms provided by the City if requested. All certificates and endorsements shall be received and approved by the City before work commences. The City reserves the right to require complete, certified copies of all required insurance policies, at any time. -4- 12.2 Consultant shall, at its expense, procure and maintain for the duration of the Agreement, insurance against claims for injuries to persons or damages to property that may arise from or in connection with the performance of this Agreement. Insurance is to be placed with insurers with a current A.M. Best's rating no less than A:VIII, licensed to do business in California, and satisfactory to the City. Coverage shall be at least as broad as the latest version of the following- (1) General Liability: Insurance Services Office Commercial General Liability coverage (occurrence form CG 0001); (2) Automobile Liability: Insurance Services Office Business Auto Coverage form number CA 0001, code 1 (any auto); and, if required by the City, (3) Professional Liability. Consultant shall maintain limits no less than: (1) General Liability: $2,000,000 per occurrence for bodily injury, personal injury and property damage and if Commercial General Liability Insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this Agreement/location or the general aggregate limit shall be twice the required occurrence limit; (2) Automobile Liability: $1,000,000 per accident for bodily injury and property damage; and (3) Professional Liability: $1,000,000 per claim/aggregate. 12.3 The insurance policies shall contain the following provisions, or Consultant shall provide endorsements on forms supplied or approved by the City to state: (1) coverage shall not be suspended, voided, reduced or canceled except after 30 days prior written notice by certified mail, return receipt requested, has been given to the City; (2) any failure to comply with reporting or other provisions of the policies, including breaches of warranties, shall not affect coverage provided to the City, its directors, officials, officers, (3) coverage shall be primary insurance as respects the City, its directors, officials, officers, employees, agents and volunteers, or if excess, shall stand in an unbroken chain of coverage excess of the Consultant's scheduled underlying coverage and that any insurance or self-insurance maintained by the City, its directors, officials, officers, employees, agents and volunteers shall be excess of the Consultant's insurance and shall not be called upon to contribute with it; (4) for general liability insurance, that the City, its directors, officials, officers, employees, agents and volunteers shall be covered as additional insureds with respect to the services or operations performed by or on behalf of the Consultant, including materials, parts or equipment furnished in connection with such work; and (5) for automobile liability, that the City, its directors, officials, officers, employees, agents and volunteers shall be covered as additional insureds with respect to the ownership, operation, maintenance, use, loading or unloading of any auto owned, leased, hired or borrowed by the Consultant or for which the Consultant is responsible. 12.4 All insurance required by this Section shall contain standard separation of insureds provisions and shall not contain any special limitations on the scope of protection afforded to the City, its directors, officials, officers, employees, agents, and volunteers. 12.5 Any deductibles or self-insured retentions shall be declared to and approved by the City. Consultant guarantees that, at the option of the City, either: (1) the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the City, its directors, officials, officers, employees, agents, and volunteers; or -5- (2) the Consultant shall procure a bond guaranteeing payment of losses and related investigation costs, claims and administrative and defense expenses. 13. Indemnification, Hold Harmless, and Duty to Defend Consultant shall defend, indemnify, and hold the City, its officials, officers, employees, volunteers and agents serving as independent contractors in the role of city officials (collectively "Indemnitees") free and harmless from any and all claims, demands, causes of action, costs, expenses, liability, loss, damage or injury, in law or equity, to property or persons, including wrongful death, in any manner arising out of or incident to any acts or omissions of Consultant, its employees, or its agents in connection with the performance of this Agreement, including without limitation the payment of all consequential damages and attorneys' fees and other related costs and expenses, except for such loss or damage arising from the sole negligence or willful misconduct of the City. With respect to any and all such aforesaid suits, actions, or other legal proceedings of every kind that may be brought or instituted against Indemnitees, Consultant shall defend Indemnitees, at Consultant's own cost, expense, and risk, and shall pay and satisfy any judgment, award, or decree that may be rendered against Indemnitees. Consultant shall reimburse City and its directors, officials, officers, employees, agents and/or volunteers, for any and all legal expenses and costs incurred by each of them in connection therewith or in enforcing the indemnity herein provided. Consultant's obligation to indemnify shall not be restricted to insurance proceeds, if any, received by Consultant, the City, its directors, officials, officers, employees, agents or volunteers. All duties of Consultant under this Section shall survive termination of this Agreement. 14. Equal Opportunit Consultant affirmatively represents that it is an equal opportunity employer. Consultant shall not discriminate against any subcontractor, employee, or applicant for employment because of race, religion, color, national origin, handicap, ancestry, sex, sexual orientation, or age, Such non-discrimination includes, but is not limited to, all activities related to initial employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff, or termination. 15. Labor Certification By its signature hereunder, Consultant certifies that it is aware of the provisions of Section 3700 of the California Labor Code that require every employer to be insured against liability for Workers' Compensation or to undertake self-insurance in accordance with the provisions of that Code, and agrees to comply with such provisions before commencing the performance of the Services. 16. Non-Exclusive Engagement This Agreement is not exclusive. City may utilize other approaches, including traditional auctioneer services or sealed bids. It is, however, understood and agreed that City will not utilize other disposal approaches for an asset at the time the asset is -6- listed on the Website or sell by some other means to a prior bidder any item currently or previously listed on the Website for the purpose of avoiding payment of the Consultant fee. City agrees not to manipulate or interfere with the bidding process on the Website. 17. Entire Agreement This Agreement contains the entire agreement of the parties with respect to the subject matter hereof, and supersedes all prior negotiations, understandings, or agreements. "this Agreement may only be modified by a writing signed by both parties. 18. Severabillity The invalidity in whole or in part of any provisions of this Agreement shall not void or affect the validity of the other provisions of this Agreement. 19. Governing- Law This Agreement shall be governed by and construed in accordance with the laws of the State of California. 20. No Third Party Rights No third party shall be deemed to have any rights hereunder against either party as a result of this Agreement. 21. Waiver No waiver of any default shall constitute a waiver of any other default or breach, whether of the same or other covenant or condition. No waiver, benefit, privilege, or service voluntarily given or performed by a party shall give the other party any contractual rights by custom, estoppel, or otherwise. 22. Prohibited Interests; Conflict of Interest 22.1 Consultant covenants that it presently has no interest and shall not acquire any interest, direct or indirect, which may be affected by the Services, or which would conflict in any manner with the performance of the Services. Consultant further covenants that, in performance of this Agreement, no person having any such interest shall be employed by it. Furthermore, Consultant shall avoid the appearance of having any interest, which would conflict in any mariner with the performance of the Services. Consultant shall not accept any employment or representation during the term of this Agreement which is or may likely make Consultant "financially interested" (as provided in California Government Code §§1090 and 87100) in any decision made by City on any matter in connection with which Consultant has been retained. 22.2 Consultant further warrants and maintains that it has not employed or retained any person or entity, other than a bona fide employee working exclusively for Consultant, to solicit or obtain this Agreement. Nor has Consultant paid or agreed to -7- pay any person or entity, other than a bona fide employee working exclusively for Consultant, any fee, commission, gift, percentage, or any other consideration contingent upon the execution of this Agreement. Upon any breach or violation of this warranty, City shall have the right, at its sole and absolute discretion, to terminate this Agreement without further liability, or to deduct from any sums payable to Consultant hereunder the full amount or value of any such fee, commission, percentage or gift. 22.3 Consultant warrants and maintains that it has no knowledge that any officer or employee of City has any interest, whether contractual, noncontractual, financial, proprietary, or otherwise, in this transaction or in the business of Consultant, and that if any such interest comes to the knowledge of Consultant at any time during the term of this Agreement, Consultant shall immediately make a complete, written disclosure of such interest to City, even if such interest would not be deemed a prohibited "conflict of interest" under applicable laws as described in this subsection. 23. Attorneys' Fees If either party commences any legal, administrative, or other action against the other party arising out of or in connection with this Agreement, the prevailing party in such action shall be entitled to have and recover from the losing party all of its attorneys' fees and other costs incurred in connection therewith. 24. Exhibits All exhibits referenced in this Agreement are hereby incorporated into the Agreement as if set forth in full herein. In the event of any material discrepancy between the terms of any exhibit so incorporated and the terms of this Agreement, the terms of this Agreement shall control. 25. Corporate Authority The person executing this Agreement on behalf of Consultant warrants that he or she is duly authorized to execute this Agreement on behalf of said Party and that by his or her execution, the Consultant is formally bound to the provisions of this Agreement. IN WITNESS WHEREOF, the Parties hereto, through their respective authorized representatives have executed this Agreement as of the date and year first above written. -8- CITY OF SEAL BEACH GOVD LS, INC By: By: Jill R. Ingram Robert L. DeBardelaben City Manager President By: Name: 4L) Attest: Its: By: Linda Devine City Clerk Approved as to Form: By: Quinn Barrow City Attorney -9- S7296-000 I 1 I 522723v2.doc Exhibit A Description of services -10- EXHIBIT Description of Services Consultant shall provide the following services: 1.0 Consultant shall maintain and operate an online auction system for the City. Consultant shall provide system access for City to list assets. Consultant will provide the services outlined in this Exhibit for the period agreed toin Section 2.OVf the Agreement. 2.0 Consultant is not a party to the actual sale and has no control over the listed information or ability of the buyer and City tn complete the transaction. 3.0 Consultant Services 3.1 Access to Client Asset Server Consultant shall provide City with Access toa GVvDea|son|ine "Client Asset Server" (CAS),for the purpose of allowing City to load asset to the online auction system, maintain information about the assets, and view and run reports. CAS shall provide City with the following capabilities: Accept descriptive information concerning an asset including unlimited photographs; Allow different auction phases based upon dates and times; and Allow City to set minimum start prices, bid increments, and reserves. 3.2 City Training Consultant shall provide throughout the term of the Agreement training and support services 10 assist City in implementing the GovDeals online auction system,which shall include: Familiarization with the nature and operation mfCAS; Guidance in the posting ofassets; Provide ongoing support; Procedures for taking and posting pictures of assets; and Based on mutual agreement between Consultant and City,training and support services will be provided on-site or via telephone orinternet 3.3 Support Desk Assistance Consultant shall provide Help Desk support available via telephone or email during normal business hours,except announced holidays. 3.4 Marketing Assets tw Potential Buyers -11- Consultant will market City assets posted to the online auction site and promote use of the site to potential buyers,through the same means Consultant currently uses for similarly-situated clients. Consultant and City will continue to work together to form a comprehensive approach to best reach potential buyers through the VVebaite. 3.5 Developing Marketing Strategy with City 3.5.1 Consultant shall work with the City 10 identify assets that can be posted on the VVebsite and may benefit from marketing attention. 3,5,2 Consultant will provide (on a monthly basis) documented proof of all marketing efforts made on behalf of the City. 3.5.3 Consultant shall assist City in determining values and starting prices for all assets the City requests assistance with, including but not limited to, unique and high dollar assets. 3.6 Vehicle Sales City will deliver vehicles to Consultant at 16305 Pacific Coast Highway,Seal Beach, California 90740. Consultant will house, insure,store,and show vehicles on-site at Consultant's cost until sale (scomplete. -1�- Exhibit B Online Sales - Terms and Conditions -13- EXHIBIT B City of Seal Beach, California Online Sales - Terms and Conditions All bidders and other participants of this service ap-ree they have read and fully understand these terms and agree to be bound thereby. Guaranty Waiver. All assets are offered for sale "AS IS, WHERE IS." City of Seal Beach (Seller) makes no warranty, guaranty or representation of any kind, expressed or implied, as to the merchantability or fitness for any purpose of the property offered for sale. The Buyer is not entitled to any payment for loss of profit or any other money damages — special, direct, indirect or consequential. Description Warranty. Seller warrants to the Buyer the property offered for sale will conform to its description. Any claim for misdescription must be made prior to removal of the property. If Seller confirms the property does not conform to the description, Seller will keep the property and refund any money paid. The liability of the Seller shall not exceed the actual purchase price of the property. Please note upon removal of the property, all sales are final. Personal and property risk. Persons attending during exhibition, sale or removal of goods assume all risks of damage of or loss to person and property and specifically release the seller and GovDeals; from liability therefore. Inspection. Most assets offered for sale are used and may contain defects not immediately detectable. Bidders may inspect the property prior to bidding, Bidders must adhere to the inspection dates and times indicated in the asset description. See special instructions on each asset page for inspection details. Consideration of Bid. Seller reserves the right to reject any and all bids and to withdraw from sale any of the assets listed. Buyer's Certificate. Successful bidders will receive a Buyer's Certificate by email from GovDeals. Buyer's Premium. If a Buyer's Premium is shown on the auction page bidder box, then that amount (expressed as a percentage of the final selling price) will be added to the final selling price of all items in addition to any taxes imposed, Payment.Payment in full is due not later than 5 business days from the time and date of the Buyers Certificate. Payment must be made electronically through the GovDcals Website. Acceptable forms of payment PayPal -14- • Wire Transfer • Visa • MasterCard • American Express • Discover PayPaI and Credit Card purchases are limited to below $5,000.00. If the winning bid plus applicable taxes, if any indicated, and the buyer's premium, equals more than$4,999.99, PayPal and Credit Cards may not be used. If Wire Transfer is chosen, a Wire Transfer Transaction Summary page will provide payment and account information. The Wire Transfer must be completed within 5 days. Removal. All assets must be removed within ten (10) business days from the time and date of issuance of the Buyer's Certificate. Purchases will be released only Won receipt of payment as specified. Successful bidders are responsible for loading and removal of any and all property awarded to them from the place where the property is located as indicated on the website and in the Buyer's Certificate. The Buyer will make all arrangements and perform all work necessary, including packing, loading and transportation of the property. Under no circumstances will Seller assume responsibility for packing, loading or shipping. See special instructions on each asset page for removal details. A daily storage fee of$10.00 may be charged for any item not removed within the ten(10)business days allowed and stated on the Buyer's Certificate. Vehicle Titles. Seller will issue a title or certificate upon receipt of payment. Titles may be subject to restrictions as indicated in the asset description on the website. Default. Default shall include (1) failure to observe these terms and conditions; (2) failure to make good and timely payment; or (3) failure to remove all assets within the specified time. Default may result in termination of the contract and suspension from participation in all future sales until the default has been cured. If the Buyer fails in the performance of their obligations, Seller may exercise such rights and may pursue such remedies as are provided by law. Seller reserves the right to reclaim and resell all items not removed by the specified removal date. Acceptance of Terms and Conditions. By submitting a bid, the bidder agrees they have read, fully understand and accept these Terms and Conditions, and agree to pay for and remove the property, by the dates and times specified. These Terms and Conditions are displayed at the to of each page of each asset listed on GovDeals. Special Instructions appearing on the asset page will override certain sections of the terms and conditions.. State/Local Sales and/or Use Tax. Buyers may be subject to payment of State and/or local sales and/or use tax. Buyers are responsible for contacting seller or the appropriate tax office, completing any forms and paying any taxes that may be imposed. Sales to Employees. Employees of the Seller may bid on the property listed for auction, so long as they do NOT bid while on duty. -15- Exhibit c Financial Settlement Services -16- EXHIBIT C Financial Settlement Services (FSS) Consultant shall collect all auction proceeds due to City from the winning bidder. Under no circumstance shall City collect any proceeds directly from the winning bidder and if requested to do so, City shall refer the winning bidder directly to Consultant for payment instructions. Consultant will charge the winning bidder a "Buyer's Premium" of 12.5%, which shall constitute the entirety of Consultant's compensation under the Agreement. City shall not charge the winning bidder any additional "Buyer's Premium". Consultant will collect all proceeds from the winning bidder, including the "Buyer's Premium" through PayPal, credit card, or wire transfer. This is the only means of payment by the bidder. Approved payment from the winning bidder through PayPal, credit card, or wire transfer will be noted in CAS. Consultant shall remit auction proceeds less the Buyer's Premium to the City within 30 days of sale of any asset. City shall not release an asset to a winning bidder until City has received verification from Consultant that payment has been received from the winning bidder. Prior to releasing an item to a winning bidder, City shall ensure the winning bidder or his/her agent has signed a "Bill of Sale" containing the following notation: "Asset is sold as is, where is, and without warranty. Once the asset is removed from the seller's premises there is no refund of monies previously paid". The Bill of Sale must be printed from the City Asset Server (CAS). Any other "Bill of Sale" used by City must be submitted to Consultant for approval. Consultant shall not remit proceeds to City for any assets sold without verification from City that the item has been picked up by the winning bidder. It is City's responsibility to notify Consultant when an item has been picked up, which is accomplished by City accessing CAS and selecting the "Picked Up" option from the "Paid, not picked up" report. City shall notify Consultant of any transaction that was not completed no later than 15 business days after the end date of any auction. The fees for said incomplete transaction shall be credited to City during the next invoice period. In the case of vehicle sales, Consultant shall verify payment and notify City when the vehicle has been picked up from Consultant's premises. Consultant shall remit such sales proceeds to City with Consultant's verification of both payment and that the item has been picked up by the winning bidder, Approved payment from the winning bidder through PayPal, credit card, or wire transfer will be noted in CA, and pick shall be noted by Consultant by accessing CAS and selecting the "Picked Up" option from the "Paid, not picked up" report. -17- Consultant shall remit all proceeds collected, less the "Buyer's Premium," to City on a weekly basis for all assets marked in CAS as "Picked Up". All proceeds will be remitted electronically by Automatic Clearing House (ACH) unless elected on the following page of this exhibit to receive a paper check. Whether proceeds are remitted electronically via ACH or via paper check, a detailed backup will be submitted to City to support the amount remitted. Consultant shall absorb all costs of Charge Backs by PayPal or a credit card company where an item is released to the winning bidder after City receives proper payment notification from Consultant, Consultant or City receives proper pickup notification from City, and the City obtained and retained a signed "Bill of Sale" from the winning bidder. Consultant shall refund proceeds collected to the winning bidder in those rare occasions where the winning bidder pays for an asset but never picks it up and subsequently convinces PayPal or the credit card company to withdraw the amount from Consultant' bank account. It is City's responsibility to request a credit on the asset paid for but not picked up as soon as the allowable pick up time passes. By taking the credit, it insures Consultant shall not charge City a fee and will allow City to resell the asset. If the asset is mistakenly placed in "picked up" status by City or Consultant, and Consultant has remitted payment, City agrees to refund this amount back to Consultant. A Consultant' City Services Representative or a Consultant Help Desk Representative will train City staff on how to effectively use the FSS feature and provide ongoing support as needed. There are no additional costs to City for training and support. Consultant is covered by a Crime Insurance Policy with a limit of $5,000,000, which shall protect City against any loss of funds. Upon 24-hour notice from City, Consultant shall allow City or City's agents or representatives to inspect at Consultant's offices during reasonable business hours all records, invoices, time cards, cost control sheets and other records maintained by Consultant in connection with this Agreement. City's inspection rights shall survive for two years following the termination of the Agreement. -18-