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09/03/2020Thursday, September 3, 2020 6:00 PM City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 Main Library - Council Chambers City Council Meeting Agenda September 3, 2020City Council Meeting Agenda To ensure public safety and comply with the Governor's Safer at Home order in response to the COVID-19 virus, the Clearwater City Council will hold a public meeting on Thursday, September 3, 2020 at 6:00 p.m. using communications media technology. Pursuant to Executive Order No. 20-69, issued by the Office of Governor Ron DeSantis on March 20, 2020, municipalities may conduct meetings of their governing boards without having a quorum of its members present physically or at any specific location, and utilizing communications media technology such as telephonic or video conferencing, as provided by Section 120.54(5)(b)2, Florida Statutes. The meeting will be held through the Zoom platform and will be broadcast live on the city's website (https://www.myclearwater.com/government/council-meeting-streaming-videos), o n F a c e b o o k ( w w w . f a c e b o o k . c o m / c i t y o f c l e a r w a t e r ) a n d o n Y o u T u b e (www.youtube.com/myclearwater) as well as the following public access TV channels: Spectrum Channel 638, Frontier Channel 30 and WOW! Channel 15. Citizens wishing to provide comments on an agenda item are encouraged to do so in advance through written comment. The City has established the following four options to ensure public comment for a virtual meeting: 1)eComments via Granicus - eComments is integrated with the published meeting agenda. Individuals may review the agenda item details and indicate their position on the item. You will be prompted to set up a user profile to allow you to comment, which will become part of the official public record. The eComment period is open from the time the agenda is published. Comments received during the meeting will become part of the official record, if posted prior to the closing of public comment. The City Clerk will read received comments into the record. 2)Email – Individuals may submit written comments or videos to ClearwaterCouncil@myclearwater.com. All comments received by 5 p.m. the day before the meeting (September 2) will become part of the official record. The City Clerk will read received comments into the record. 3)Call-in - During the meeting individuals will be able to call in to 562-4646 and be placed on-air to speak to an individual item. 4)Council Chambers - Additionally, like any other council meeting, the public may provide public comment at the Main Library, Council Chambers, 100 N Osceola Avenue. Due to COVID-19, all speakers desiring to appear in person will be subject to all applicable emergency measures in place to prevent the further spread of COVID-19. Speakers who appear in person will be subject to screening for symptoms of COVID-19. Any persons exhibiting any symptoms of COVID-19 will not be permitted to enter council chambers but will be able to participate through the remote options described above. Individuals with disabilities who need reasonable accommodations to effectively participate in this meeting are asked to contact the City Clerk at (727)562-4092 or rosemarie.call@myclearwater.com in advance. 1. Call to Order 2. Invocation 3. Pledge of Allegiance Page 2 City of Clearwater Printed on 9/3/2020 September 3, 2020City Council Meeting Agenda 4. Special recognitions and Presentations (Proclamations, service awards, or other special recognitions. Presentations by governmental agencies or groups providing formal updates to Council will be limited to ten minutes.) 4.1 Library Card Sign Up Month Proclamation - Jennifer Obermaier, Library Director 5. Approval of Minutes 5.1 Approve the minutes of the August 20, 2020 City Council Meeting as submitted in written summation by the City Clerk. 6. Citizens to be heard re items not on the agenda 7. Consent Agenda The Consent Agenda contains normal, routine business items that are very likely to be approved by the City Council by a single motion. These items are not discussed, and may all be approved as recommended on the staff reports. Council questions on these items were answered prior to the meeting. The Mayor will provide an opportunity for a Councilmember or a member of the public to ask that an item be pulled from the Consent Agenda for discussion. Items pulled will receive separate action. All items not removed from the Consent Agenda will be approved by a single motion of the council. 7.1 Approve not-to-exceed increase of $125,000 to Hilltop Securities Inc. (Hilltop) for spring training deal structure consulting services provided by ICON Venue Group, LLC d/b/a CAA ICON (CAA ICON) as subconsultant to Hilltop per Amendment 1 to the agreement dated April 17, 2019 between Hilltop and CAA ICON, approve a not-to-exceed administrative fee increase of $5,000 to Hilltop per the agreement between Hilltop and the City, bringing the total for contract No. 900622 to $188,059.17 and authorize the appropriate officials to execute same. (consent) 7.2 Approve Option 2 the Clearwater Main Library Imagine Clearwater Construction Scheduling. (consent) 7.3 Approve agreement for professional external audit services for five fiscal years ending September 30, 2020 through 2024, with the accounting/auditing firm of Carr, Riggs and Ingram, LLC, for a not-to-exceed amount of $711,700 and authorize the appropriate officials to execute same. (consent) 7.4 Approve Memorandum of Assumption with Resources Investment Advisors, LLC for investment advisory services for the City’s 457 Deferred Compensation Plan and 401(a) Money Purchase Pension Plan and authorize the appropriate officials to execute same. (consent) Page 3 City of Clearwater Printed on 9/3/2020 September 3, 2020City Council Meeting Agenda 7.5 Approve an Extended Warranty Service Agreement and Purchase Order, in the amount of $525,000, with Tecogen, Inc., for the period October 1, 2020 through September 30, 2029, for service maintenance on three Tecochill air conditioning units and authorize the appropriate officials to execute same. (consent) 7.6 Authorize the funding of city medical insurance for the Administrative Services Agreement between the City and Cigna Healthcare under a self-insured funding arrangement for the period January 1, 2021 through December 31, 2021, at a total not-to-exceed $21.5 million, to be funded by city budgeted funds, payroll deductions of employees and retiree premiums. (consent) 7.7 Approve a one-year renewal term for the professional services agreement between the City of Clearwater and Cigna Onsite Health, LLC to provide onsite health clinic services to employees, family members, and retirees who are covered by the City of Clearwater health insurance not to exceed $1.7 million and authorize the appropriate officials to execute same. (consent) 7.8 Approve a proposal by Construction Manager at Risk Keystone Excavators, Inc. of Oldsmar, Florida in the amount of $268,417.05 for site work and improvements at Valencia Park located at 2050 Hercules Avenue and authorize the appropriate officials to execute same. (consent) 7.9 Approve the First Amendment to the Host Venue Agreement between the City and Competitor Group, Inc. (CGI) for the Rock ‘n’ Roll Marathon Series to update the term of the agreement and authorize the appropriate officials to execute same. (consent) 7.10 Ratify and confirm a first amendment to the Joint Project Agreement (JPA) between Pinellas County and the City of Clearwater for the Sunset Point Road at Betty Lane Utility Relocation Project (17-0012-UT) for an increase of $333,108.17, from $402,948 to $736,056.17, and authorize the appropriate officials to execute same. (consent) 7.11 Approve Construction Manager at Risk (CMAR) proposal from Skanska, Inc., of Tampa, FL, for installation of supportive infrastructure for Imagine Clearwater (17-0031-EN) at the Guaranteed Maximum Price (GMP) of $1,184,090 and authorize the appropriate officials to execute same. (consent) 7.12 Award a construction contract to David Nelson Construction Company, of Palm Harbor, Florida, for Invitation to Bid (ITB) 20-0029-EN 2021 Annual Stormwater Repairs in the annual amount of $1,500,000 for an initial one-year term with an option to renew for three additional one-year renewal terms on a unit price basis and authorize the appropriate officials to execute same. (consent) 7.13 Award a construction contract to Shenandoah General Construction Company, of Pompano Beach, Florida, for Invitation to Bid (ITB) 20-0019-EN 2021 Stormwater Pipe Cleaning in the annual amount of $400,000 for an initial one-year term with an option to renew for three additional one-year renewal terms on a unit price basis and authorize the appropriate officials to execute same. (consent) Page 4 City of Clearwater Printed on 9/3/2020 September 3, 2020City Council Meeting Agenda 7.14 Approve the conveyance of a Distribution Easement to Duke Energy Florida, LLC, d/b/a Duke Energy, for the installation, operation and maintenance of electric facilities to support Duke’s new transformers and electrical facility installation for the Imagine Clearwater project. (consent) 7.15 Authorize a Work Order to HDR, Inc. of Tampa, Florida in the amount of $236,324 to assist in updating the City’s Comprehensive Plan per Clearwater Code of Ordinances, 2.564(1)(d) Other Government Contracts, and authorize the appropriate officials to execute same. (consent) 7.16 Authorize a purchase order to CDW Government LLC (CDW-G), of Vernon Hills, IL, in the amount of $156,377.00, pursuant to Clearwater Code of Ordinances Section 2.564(1)(d) Exceptions to Bid - Other Government Entities’ Bids, authorize lease purchase under the City's Master Lease Purchase Agreement or internal financing via an interfund loan from the Capital Improvement Fund, whichever is deemed to be in the City's best interests, and authorize the appropriate officials to execute same. (consent) 7.17 Authorize the award of Invitation to Bid 43-20, Laboratory Services, to Flowers Chemical Laboratories, Inc of Altamonte Springs, FL and Pace Analytical Services, LLC of Oldsmar, FL for an annual not-to-exceed amount of $400,000.00 with the option for two, one-year extensions at the City’s discretion, and authorize the appropriate officials to execute same. (consent) 7.18 Approve the renewal agreement and purchase order to Cayenta, a division of N. Harris Computer Corporation, for support and maintenance related to the Utility Management System, for a total not-to-exceed amount of $774,366.15 for the 5-year term beginning November 1, 2020 through October 31, 2025, per Clearwater Code of Ordinances Section 2.564 (1)(e) Impractical to bid and authorize the appropriate officials to execute same. (consent) 7.19 Approve a Purchase Order increase to Clearwater Towing Service, Inc., of Clearwater, FL, in the amount of $15,000 for a total not to exceed amount of $75,000 for remainder of this term ending September 30, 2020, to accommodate towing services for all city-wide equipment, and authorize the appropriate officials to execute same. (consent) 7.20 Approve an increase to Contract 900048, Hose and Hydraulics, Inc. of Clearwater, FL, in the amount of $100,000 for the remainder of the third year term, bringing the total amount to $325,000, increase the final two terms of the contract expiring August 10, 2022 to $325,000 for the purchase of replacement hydraulic parts, repairs and service for vehicles and equipment used by city departments, in accordance with Clearwater Code of Ordinances Sec. 2.564(1) (d), Other Government Entities Bids, and authorize the appropriate officials to execute same. (consent) Page 5 City of Clearwater Printed on 9/3/2020 September 3, 2020City Council Meeting Agenda 7.21 Appoint Janelle Branch to the Brownfields Advisory Board, as a business owner or representative, with a term to expire September 30, 2024. (consent) 7.22 Increase the amount of the contract with Manson Bolves Donaldson Varn for outside counsel representation in Seminole Boat Docks land ownership issues for a not exceed amount of exceed $25,000, for a new contract total of not to exceed $75,000, approve the amendment to the Legal Services Agreement increasing the contract amount, and authorize the appropriate officials to execute same. (consent) 7.23 Approve a Special Magistrate Services Agreement with Nancy Mag, Esq. and authorize the appropriate officials to execute same. (consent) Public Hearings - Not before 6:00 PM 8. Administrative Public Hearings - Presentation of issues by City staff - Statement of case by applicant or representative (5 min.) - Council questions - Comments in support or opposition (3 min. per speaker or 10 min maximum as spokesperson for others that have waived their time) - Council questions - Final rebuttal by applicant or representative (5 min.) - Council disposition 8.1 Set final millage rate of 5.9550 mills for fiscal year 2020/21 against non-exempt real and personal property within the City of Clearwater and pass Ordinance 9407-20 on first reading. (APH) 8.2 Approve the City of Clearwater Annual Operating Budget for the 2020/21 fiscal year and pass Ordinance 9408-20 on first reading. (APH) 8.3 Approve the fiscal year 2020/21 Annual Capital Improvement Budget, establish a six-year plan for the Capital Improvement Program (CIP) and pass Ordinance 9409-20 on first reading. (APH) 8.4 Approve the recommended Penny for Pinellas project list, as revised for Fiscal Years 2020/21 through 2029/30. (APH) 8.5 Approve State Housing Initiatives Partnership (SHIP) Program Annual Report and Local Housing Incentive Certification for the closeout year 2017-2018 and interim years 2018-2019 and 2019-2020 and allow appropriate officials to execute same. (APH) Page 6 City of Clearwater Printed on 9/3/2020 September 3, 2020City Council Meeting Agenda 9. Second Readings - Public Hearing 9.1 Adopt Ordinance 9383-20 on second reading, amending Chapter 33, Clearwater Code of Ordinances, to prohibit derelict vessels from being left in the city waterways and providing for enforcement. 10. City Manager Reports 10.1 Approve a Gas Utility Easement from Fl-Tarpon Square-QRX, LLC, for the construction, installation, and maintenance of gas utility facilities on real property located at 41256 US Highway 19 North, Tarpon Springs and adopt Resolution 20-43. 10.2 Confirm COVID-19 Emergency Proclamation and adopt Resolution 20-47. 10.3 NFL Alumni Children’s Obstacle Course 11. City Attorney Reports 12. Other Council Action 12.1 Solar Panels on Amphitheater - Councilmember Beckman 12.2 Go Vote banner on old City Hall - Councilmember Beckman 12.3 PSTA Update - Vice Mayor Allbritton 13. Closing comments by Councilmembers (limited to 3 minutes) 14. Closing Comments by Mayor 15. Adjourn Page 7 City of Clearwater Printed on 9/3/2020 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8152 Agenda Date: 9/3/2020 Status: Agenda ReadyVersion: 1 File Type: Special recognitions and Presentations (Proclamations, service awards, or other special recognitions. Presentations by government agencies or groups providing formal updates to Council will be limited to ten minutes.) In Control: Council Work Session Agenda Number: 4.1 SUBJECT/RECOMMENDATION: Library Card Sign Up Month Proclamation - Jennifer Obermaier, Library Director SUMMARY: APPROPRIATION CODE AND AMOUNT: USE OF RESERVE FUNDS: Page 1 City of Clearwater Printed on 9/3/2020 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8026 Agenda Date: 9/3/2020 Status: Agenda ReadyVersion: 1 File Type: MinutesIn Control: City Council Agenda Number: 5.1 SUBJECT/RECOMMENDATION: Approve the minutes of the August 20, 2020 City Council Meeting as submitted in written summation by the City Clerk. SUMMARY: APPROPRIATION CODE AND AMOUNT: USE OF RESERVE FUNDS: Page 1 City of Clearwater Printed on 9/3/2020 City Council Meeting Minutes August 20, 2020 Page 1 City of Clearwater City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 Meeting Minutes Thursday, August 20, 2020 6:00 PM Main Library - Council Chambers City Council Draft City Council Meeting Minutes August 20, 2020 Page 2 City of Clearwater To ensure public safety and comply with the Governor's Safer at Home order in response to the COVID-19 virus, the Clearwater City Council will hold a public meeting on Thursday, August 20, 2020 at 6:00 p.m. using communications media technology. Pursuant to Executive Order No. 20-69, issued by the Office of Governor Ron DeSantis on March 20, 2020, municipalities may conduct meetings of their governing boards without having a quorum of its members present physically or at any specific location, and utilizing communications media technology such as telephonic or video conferencing, as provided by Section 120.54(5)(b)2, Florida Statutes. Roll Call Present: 5 - Mayor Frank Hibbard, Councilmember Hoyt Hamilton, Vice Mayor David Allbritton, Councilmember Mark Bunker and Councilmember Kathleen Beckman Also Present: William B. Horne II – City Manager, Micah Maxwell – Assistant City Manager, Michael Delk – Assistant City Manager, Pamela K. Akin City Attorney, Rosemarie Call – City Clerk, and Nicole Sprague – Deputy City Clerk. To provide continuity for research, items are listed in agenda order although not necessarily discussed in that order. Unapproved 1. Call to Order – Mayor Hibbard The meeting was called to order at 6:00 p.m. via communications media technology. 2. Invocation – Rev. Curtis Paige from Heritage United Methodist Church 3. Pledge of Allegiance 4. Special recognitions and Presentations (Proclamations, service awards, or other special recognitions. Presentations by governmental agencies or groups providing formal updates to Council will be limited to ten minutes.) – Given. 4.1 General Federation of Women's Club Day Proclamation, August 26, 2020 – Susan Luce, Suzanne Pascarella and Heidi Blaine Hadburg – Local Chapter Presidents 5. Approval of Minutes 5.1 Approve the minutes of the August 6, 2020 City Council Meeting Minutes as submitted in written summation by the City Clerk. Draft City Council Meeting Minutes August 20, 2020 Page 3 City of Clearwater Councilmember Hamilton move to approve the minutes of the August 6, 2020 City Council Meeting Minutes as submitted in written summation by the City Clerk. The motion was duly seconded and carried unanimously. 6. Citizens to be heard re items not on the agenda Scott Souza thanked Lina Teixeira for all of her efforts for the small businesses in the area and in Downtown; Ms. Teixeira is the Downtown Clearwater Merchants Association's new Government Liaison. He said the businesses on the 400 and 500 block of Cleveland Street are doing well since the street has been closed to vehicular traffic. The Merchants Association have created a new marketing strategy that emphasizes outdoor dining with live music and beautiful views to the water. The strategy creates a new identify for downtown as The District. Carolyn Bradham thanked the City for extending the Cleveland Street closure through January 14, 2021 and the restaurant voucher program. Lisa Lanza has enjoyed the Cleveland Street closure and restaurant voucher program. Marti Marshall read an excerpt of the Florida Constitution, Article 1 - Sections 3-7. Michael Cortsum expressed concerns with the design renovations at Crest Lake Park and requested consideration to delay Saturday's scheduled opening for four weeks until the new sod takes root. He also suggested moving the trash cans outside of the current location. Bill Jonson expressed concerns with the median landscaping maintenance along Gulf to Bay Boulevard and requested consideration to prioritizing the landscaping. Elizabeth Davis submitted an eComment regarding Imagine Clearwater that was read into the record by the City Clerk (see page 16). 7. Consent Agenda Approved as submitted, less Item 7.9. 7.1 Approve the proposed sculptures and alternate for Sculpture360: Season X for a total Draft City Council Meeting Minutes August 20, 2020 Page 4 City of Clearwater cost of $9,000.00. (consent) 7.2 Authorize staff to enroll in Duke Energy Florida’s Clean Energy Connection Program. (consent) 7.3 Authorize a purchase order to Southeastern Surfaces and Equipment of New Smyrna Beach, Florida in an amount not to exceed $189,750.55, which includes a 10% contingency, to provide and install gymnasium equipment and replace and repair flooring at the Long Center and Countryside Recreation Center gymnasiums, pursuant to Clearwater Code of Ordinances Section 2.564 (1)(d) Cooperative Contracts and authorize the appropriate officials to execute same. (consent) 7.4 Approve a proposal by Construction Manager at Risk Certus Builders of Bristol, Florida, in the amount of $223,812.93 for the renovation and construction of Phase II restroom expansion at Barefoot Beach House located on south beach at 332 S. Gulfview Boulevard and authorize the appropriate officials to execute same. (consent) 7.5 Approve a lease agreement between the InterCultural Advocacy Institute, Inc. and the City of Clearwater for the premises located at 612 Franklin Street, Clearwater, Florida, for a period commencing November 1, 2020 and terminating on October 31, 2023, and authorize the appropriate officials to execute same. (consent) 7.6 Approve a purchase agreement with Inventech Marine Solution, of Bremerton, WA, in the amount of $181,526 for a 27-foot police patrol vessel, engines, and trailer, in accordance with Clearwater Code of Ordinances Section 2.564(1)(d) Other Government Entities Bids; declare surplus and authorize for disposal at auction G3782 and G3783, being replaced in accordance with Clearwater Code of Ordinances Section 2.622; and authorize the appropriate officials to execute same. (consent) 7.7 Approve Engineer of Record (EOR) Work Order to McKim and Creed, Inc., in the amount of $201,910.50 for the Northeast (NE) Water Reclamation Facility (WRF) Motor Control Center-1 (MCC-1) and Distribution Centers 1 and 2 (DC-1 and DC-2) Replacement (17-0028-UT) and authorize the appropriate officials to execute same. (consent) 7.8 Approve Engineer of Record (EOR) Work Order to Hazen and Sawyer, in the amount of $189,024.00, for the Chemical Storage and Handling project (19-0034-UT) and authorize the appropriate officials to execute same. (consent) 7.9 Approve the final plat for Union Place Replat, 1625 Union Street, located east of Highland Avenue and west of Keene Road. (consent) See below. 7.10 Approve the Pinellas County Technical Rescue Team Agreement (extension) with Draft City Council Meeting Minutes August 20, 2020 Page 5 City of Clearwater Pinellas County and the City of Clearwater for one additional one-year term extending until September 30, 2021 and authorize the appropriate officials to execute same. (consent) 7.11 Approve the Federally-Funded Subaward and Grant Agreement for public assistance support for COVID-19 expenditures and authorize the City Manager or designee to enter into, approve, and execute same and any future modifications for COVID-19 expenditures. (consent) 7.12 Authorize the award of Invitation to Bid 38-20 Antiscalant to American Water Chemicals, Inc. of Plant City, FL in an annual not-to-exceed amount of $65,000, with the option for two, one-year extensions at the City’s discretion, and authorize the appropriate officials to execute same. (consent) Councilmember Hamilton moved to approve the Consent Agenda as submitted and authorize the appropriate officials to execute same. The motion was duly seconded and carried unanimously. 7.9 Approve the final plat for Union Place Replat, 1625 Union Street, located east of Highland Avenue and west of Keene Road. (consent) This plat will create 30 single family residential lots, adding 3 lots to the currently plated subdivision. The project site consists of 5.34 acres M.O.L. The Replat was approved through the Development Review Committee on January 2nd, 2020. One individual submitted an eComment questioning the use of the 2005 FEMA flood insurance rate map as a reference document. Engineering Assistant Director Elliot Shoberg said the FEMA maps were last updated in 2005. FEMA is the regulatory authority on the maps. In response to a question, Mr. Shoberg said FEMA has been working on updating the coastal zone maps for approximately five years; FEMA has been working on the maps in question for approximately seven years. Staff is waiting for FEMA to update the maps. Councilmember Hamilton moved to approve the final plat for Union Place Replat, 1625 Union Street, located east of Highland Avenue and west of Keene Road. The motion was duly seconded and carried unanimously. Draft City Council Meeting Minutes August 20, 2020 Page 6 City of Clearwater 8. City Manager Reports 8.1 Accept a Gas Utility Easement from VMR Development, LLC, for the construction, installation, and maintenance of gas utility facilities on real property located at 3139 Little Road, FL and adopt Resolution 20-34. VMR DEVELOPMENT, LLC (Grantor) has granted a non-exclusive five-foot wide natural gas easement, on property located on the southwest corner Little Road and State Road 54, in Pasco County for the installation of a natural gas distribution line. This main line will serve commercial customers in the Village at Mitchell Ranch shopping plaza, located at 3139 Little Road, contained within the following parcels: Parcel ID#: 23-26-16-0010-P10B0-0000, 23-26-16-0010-00000-0110, 23-26-16-0010-00000-0020, 23-26-16-0010-00000-0030, 23-26-16-0010-00000-0040, 23-26-16-0010-00000-0050, 23-26-16-0010-00000-0060, 23-26-16-0010-00000-0070, 23-26-16-0010-00000-0080, 23-26-16-0010-00000-0090 & 23-26-16-0010-P10A0-0000 The easement grant is sufficient for the City to maintain and replace its facilities as necessary in perpetuity, or until such time as the City determines to abandon its use. Councilmember Beckman moved to accept a Gas Utility Easement from VMR Development, LLC, for the construction, installation, and maintenance of gas utility facilities on real property located at 3139 Little Road, FL. The motion was duly seconded and carried unanimously. Resolution 20-34 was presented and read by title only. Councilmember Hamilton moved to adopt Resolution 20-34. The motion was duly seconded and upon roll call, the vote was: Ayes: 5 - Mayor Hibbard, Councilmember Hamilton, Vice Mayor Allbritton, Councilmember Bunker and Councilmember Beckman 8.2 Amend the Clearwater Code of Ordinances, Section 33.055, relating to the regulation of derelict vessels and pass Ordinance 9383-20 on first reading. The police department works in conjunction with local and state agencies to address ‘at risk’ vessels and ‘derelict’ vessels. Per Florida Statute § 327.4107 a vessel is ‘at risk’ if any of the following conditions exist: (a) the vessel is taking on or has taken on water without an effective means to dewater; (b) Spaces on the vessel that are designed to be enclosed are incapable of being sealed off or remain open to the elements for extended periods of time; (c) The vessel has broken loose or is in danger of Draft City Council Meeting Minutes August 20, 2020 Page 7 City of Clearwater breaking loose from its anchor; (d) The vessel is left or stored aground unattended in such a state that would prevent the vessel from getting underway, is listing due to water intrusion, or is sunk or partially sunk; or (e) The vessel does not have an effective means of propulsion for safe navigation within 72 hours after the vessel owner or operator receives telephonic or written notice. Per Florida Statute § 823.11 a vessel is ‘derelict’ if it is left, stored, or abandoned in a wrecked, junked, or substantially dismantled condition. The police department is currently addressing four vessels deemed ‘at risk’ and two vessels that are deemed ‘derelict.’ The changes to Section 33.055 will give the City of Clearwater an additional option for addressing derelict vessels: issuance of a civil citation to be heard by the City’s special magistrate. Compared with prosecution through the county court system, the magistrate route will provide the police department a quicker option to legally declare vessels ‘derelict’ or ‘at risk.’ In response to questions, Police Chief Daniel Slaughter said the proposed ordinance creates a process that can be managed by the Clearwater Police Department in a more efficient and expedient manner. Currently, the Department utilizes Florida Fish and Wildlife Commission officers to implement the county derelict vessel process, which usually takes two to four months. The City may potentially be at risk to incur costs associated with towing derelict vessels, which may not be recoupable. Two individuals submitted emails supporting Item 8.2, that were read into the record by the City Clerk (see page 19-21). Councilmember Hamilton moved to amend the Clearwater Code of Ordinances, Section 33.055, relating to the regulation of derelict vessels. The motion was duly seconded and carried unanimously. Ordinance 9383-20 was presented and read by title only. Councilmember Hamilton moved to pass Ordinance 9383-20 on first reading. The motion was duly seconded and upon roll call, the vote was: Ayes: 5 - Mayor Hibbard, Councilmember Hamilton, Vice Mayor Allbritton, Councilmember Bunker and Councilmember Beckman 8.3 Amend City Council Policies 2-21, 3-2, 3-4, 3-5, 5-7, 5-12, 6-4, and 8-2. Draft City Council Meeting Minutes August 20, 2020 Page 8 City of Clearwater Staff is recommending the following amendments: Special Events Fee (2-21) - staff recommends updating event name and timeline. The Special Events Committee will review applications for use of City beaches, sidewalks, outdoor recreation open space and rights-of-way. Sponsoring organizations will be responsible for the costs of all City services needed in conjunction with the events unless they are City sponsored or co-sponsored events. The City Council may waive all or a portion of fees and related charges for City sponsored or co-sponsored events, including, but not limited to Jazz Holiday, July 4th, Turkey Trot, and Martin Luther King, Jr. CelebrationParade. There shall be an annual review of City sponsored/co-sponsored events during the budget process. An agenda item confirming co-sponsorship and waiver of fees for those to be submitted in the budget will be brought for City Council consideration and acceptance in March by June of each calendar year. All items accepted by the Council are then to be included in the appropriate department’s budget. Only after the item is passed as part of the approved budget is the item considered to be funded. In the event additional monies are requested beyond what is included in the approved budget, City Council approval will be needed before said additional funds are appropriated. Citizen Inquiries- Responses (3-2) - staff recommends adding language to create a process when a member of Council is requested to support a grant application that the City may be considering. A. Generally responses should be in the same form as received, i.e. letter with letter. However, when deemed to be more appropriate a different form may be used. B. Inquiries addressed to a specific Councilmember will be responded to by that Councilmember. C. Inquiries addressed to the whole Council, whether in one letter or duplicate letters to all Councilmembers, will be answered factually by the Mayor using language that indicates that he or she is responding for the Clearwater City Council. When needed, responses will be brought to Council for direction, prior to being sent. Mail will be routed to the appropriate staff to draft a response. Individual Councilmembers are not precluded from responding individually to express their opinion. D. Inquiries received which are not specifically addressed to the Council or its members will be answered by the City Manager or designated staff member. E. Inquiries and responses will be distributed, via e-mail, to all Councilmembers. F. Form letters or emails may be acknowledged but will not require a customized response. G. Requests to support grant applications will be directed to the Council Draft City Council Meeting Minutes August 20, 2020 Page 9 City of Clearwater Assistant who will confirm with staff if a city application is being submitted for the grant application. Departing Councilmembers’ Gifts (3-4) - staff recommends updating language to coincide with current practice: Departing gifts shall be chosen in consultation with the outgoing members. The value of the gifts shall be a maximum of $300 for one full term, $500 for two full terms and $600 for more than two full terms. One full term. Plaque, nameplate, letter, pewter tray with seal, Council pictures. Two full terms. Plaque, nameplate, letter, City watch, Council pictures. Three or more full terms. Plaque, nameplate, ring, collage or album, tray with seal, letter gag gift, caricature. Distribution of Council Correspondence (3-5) - staff recommends updating language with current practice. All correspondence to the Mayor and the Councilmembers arriving at City Hall received pursuant to the law or in connection with the transaction of official business by the City of Clearwater shall be distributed as follows: When needed, e-mails will be forwarded to all Councilmembers by the Council Assistant. Councilmembers will receive the original of hard copy items individually addressed to them, whether anonymous or not. Council e-mails and other correspondence will be available on the City’s website through the electronic document management system. Mail will be delivered to the Council once per week, or as needed daily. Courtney Campbell Causeway (State Road 60) Welcome Signage Program (5-7) - staff recommends adding language clarifying process to replace welcome signs. 4.Installation of a welcome sign will be processed in accordance with the following: A. Requests for a welcome sign shall be submitted in writing to the Parks and Recreation Department by filling out a Courtney Campbell Parkway (State Road 60) Welcome Signage Program Application. The form is available online at www.myclearwater.com <http://www.myclearwater.com>, or by calling the Parks and Recreation Department. B. The award to be recognized by the welcome sign must be of national or international significance. 1. Accomplishment of national or international significance is an achievement or completion of an award granted to an organization or to the City in recognition of being the best in the entire nation or the Draft City Council Meeting Minutes August 20, 2020 Page 10 City of Clearwater best involving two or more countries that promote and enhance the image of Clearwater. 2. Significant Clearwater historical events are defined as events that are unique to Clearwater and add to the overall understanding of the City and its history. C. If approved, a welcome sign may be allowed for a period not to exceed two years. If no other request for signage has been submitted, the current sign may continue for an unspecified time until another application is accepted. D. Requests for a welcome sign may be made by a group or an individual, however written approval to use the event or award to be recognized must be secured from the governing body being represented. In cases where the request is for a group or organization no longer in existence but historically significant to the City, no approval is necessary. Special Event Street Closure Limitation (5-12) - staff recommends updating language with current practice. Street closures for special events shall be limited to two (2) per calendar year requested by any one non-profit or for-profit organization. The City of Clearwater and council approved Co-Sponsored events shall be exempt from this limitation. The City shall comply with any Florida Department of Transportation policies regarding street closures of state roads. Landscaping of City Roads (6-4) - staff recommends adding language that cites recommended resources. When landscaping is a necessary and integral part of a City road or street improvement/construction project the landscape material shall be selected and located based on ease and frequency of required maintenance. All such material shall be drought resistant. Per Clearwater Community Development Code Sec. 3-1202, all such material shall be native, or a non-invasive plant naturalized to Central Florida. Plants recommended in the Guide of Southeast Florida Water Management District, Florida Native Plant Society, FloridaYards.org, University of Florida or other entity as approved by the Community Development Coordinator shall be used. Brick Streets (6-2) - staff is not recommending any changes to the policy; format changes are implemented to keep sections together. Amplification of Sound at City Venues (8-2) - staff recommends deleting paren 3; due to technology changes, the current language was restrictive on how sound should be measured. 2.Amplification of sound including music will not exceed an average of 95 Draft City Council Meeting Minutes August 20, 2020 Page 11 City of Clearwater decibel or dB level measured at the house mix over a period of 30 seconds. 3.Amplification of sound during the event will be measured by a city employee or city contractor by using a sound level meter which is an instrument that includes a microphone, amplifier, RMS detector, integrator or time average, output of display meter and the weighting networks used to measure sound pressure level. 3. 4. The city employee or city contractor will measure the sound levels for every group performing at the event. At the August 17 work session, staff was directed to add the following statements for Council Policy 3-2, Citizen Inquiries- Responses: H. Media interview requests that are not addressed to a specific council member, will be assigned in the following order (per availability): Mayor, Vice Mayor, remaining council members based on seniority. I. Council members scheduling individual meetings with the same citizen/group shall coordinate background information through the city manager prior to the scheduled meeting to ensure council members have consistent information. One individual recalled the 2019 Charter Review Committee recommended incorporating the goal management recommendation into the City Council Policies. It was stated the recommendation will be discussed as part of Council's future philosophy discussions. Councilmember Hamilton moved to amend City Council Policies 2-21, 3-2, 3-4, 3-5, 5-7, 5-12, 6-4, and 8-2. The motion was duly seconded and carried unanimously. 8.4 Confirm COVID-19 Emergency Proclamation and adopt Resolution 20-44. Councilmember Hamilton moved to confirm COVID-19 Emergency Proclamation. The motion was duly seconded and carried unanimously. Resolution 20-44 was presented and read by title only. Councilmember Hamilton moved to adopt Resolution 20-44. The motion was duly seconded and upon roll call, the vote was: Ayes: 5 - Mayor Hibbard, Councilmember Hamilton, Vice Mayor Allbritton, Councilmember Bunker and Councilmember Beckman Draft City Council Meeting Minutes August 20, 2020 Page 12 City of Clearwater 8.5 RFEI/Opportunity Zone Update The City Manager said it was unclear to staff how actions related to implementing Opportunity Zone (OZ) projects should be prioritized. Staff has scheduled a discussion on the matter in September and wants to ensure the discussion is framed around Council's priorities. Assistant City Manager Michael Delk said staff is developing a strategy and recommendations on how to move forward. Staff wants to time the release of the Request for Proposal and to determine if a conservancy will be used. He said the construction phase will be conducive to marketing the bluff properties, allowing staff to develop a vision and message around the bluff properties. He said SKANSKA has identified a 28 to 32-month construction schedule, which should be completed by March 2023. Between now and then, staff will be managing the RFP process and determining if a conservancy will be established, which will include identifying its purpose and membership. He said staff will update the downtown plan within the next several months, anticipating completion by July 2021. Regarding Opportunity Zones, staff’s research indicates that the City will not be able to take advantage of the 10 and 7-year increments. The Program offers additional deferrals or tax advantages in years 10, 7 and 5-timeline for those projects using OZ funds. In December 2021, there will be an opportunity for the City to benefit from the 5-year increment. Staff requests council direction regarding the extent to which OZ is a priority. He said the OZ program is one incentive of several programs to be considered. In response to questions, Mr. Delk said he would like to move the RFP up, potentially during the middle of construction, which will provide an opportunity to take advantage of the OZ program. Staff will find a way to work with partners to ensure individuals know how they can participate in the redevelopment process, which should lead to a good RFP response. He said the OZ program is a good tool to have as it can bring capital into disadvantaged areas, but it should not drive the redevelopment process. Staff will look to Council for direction regarding what items should be included in the RFP and staff will bring back to Council RFP scenarios that are consistent with the City’s plans, programs and objectives for the park and waterfront. 9. City Attorney Reports 9.1 Imagine Clearwater Bond Hearing Validation Draft City Council Meeting Minutes August 20, 2020 Page 13 City of Clearwater The City Attorney said that in November of 2019, Council decided that Imagine Clearwater would be funded by bonds and passed a resolution authorizing the city to move forward with the validation of those bonds. The purpose of the validation hearing is to have the court determine the city’s authority to incur bonded debt for the Imagine Clearwater project and to determine the legality of the proceeding to make sure it is in compliance with the Charter and special act. The validation process will preclude any later challenge to the project on the grounds it doesn’t comply with the Charter or special act. She said participation is limited to taxpayers, property owners and citizens; they can intervene by filing notice or by showing up. Court will not have an in person hearing, it will be done via the Zoom platform and those wishing to participate will go to Council Chambers where the proceedings will be broadcast on the monitors; the public may present evidence that will be scanned and transmitted to the court. One individual submitted an eComment opposing Item 9.1, which was read into the record by the City Clerk (see page 16). One individual submitted an eComment questioning why supporting documents were not included for Item 9.1, which was read into the record by the City Clerk (see page 17). In response to concerns, the City Attorney said the documents referenced in the eComments will be produced after the completion of validation of bonds as outlined in the Ordinance. Council Letterhead The City Attorney suggested Council be provided separate letterhead for individual councilmembers which would indicate the correspondence is not from City Council, but the from the name of the individual councilmember and their seat number. This type of letterhead would be provided digitally and Public Communications has prepared a mock-up of what it would look like. There was council consensus to implement individual councilmember letterhead. 10. Closing comments by Councilmembers (limited to 3 minutes) Vice Mayor Allbritton said he is looking forward to the Council meeting is September. He said he had a meeting with the City Attorney, the City’s lobbyist, Rep. Nick DiCeglie, and Senator Hooper regarding derelict vessels mooring in local waterways and said they discussed initiating a plan for a local bill next session. Draft City Council Meeting Minutes August 20, 2020 Page 14 City of Clearwater Councilmember Hamilton encouraged all to keep their eyes on the weather next week as things could get dicey; prepare for the worst and hope for the best. Councilmember Beckman thanked Council for the discussion regarding environmental ideas at Monday’s Worksession. She thanked citizens for voting in the primary and stressed the importance of registering to vote. The presidential election is on November 3 and there will be important questions on the ballot, including The Landings golf course and minimum wage increases. She said she was wearing white in honor of the 100th anniversary of the women’s suffrage movement. Councilmember Bunker said it is remarkable that there is such a short amount of time to the next election and it is important to vote and have your voice be heard. He said Leah Rimini says hi and she is still considering opening a store here. 11. Closing Comments by Mayor Mayor Hibbard said the tropics are getting active and encouraged all to get prepared now. Duke Energy has returned to their standard billing and credit practices. Crest Lake Dog Park renovations are expected to be completed this week and will reopen with upgraded amenities. The CRA, in partnership with the Public Art and Design Program, are seeking artists for a series of murals on private and public properties in downtown. He congratulated summer campers from Countryside Rec Center for participating in the inaugural summer camp book club; more than 210 books were read. He thanked Council for a good meeting tonight and on Monday and he is looking forward to future meetings. 12. Adjourn The meeting adjourned at 7:39 p.m. Mayor City of Clearwater Attest City Clerk Draft City Council on 2020-08-20 6:00 PM Meeting Time: 08-20-20 18:00 eComments Report Meewios Meeting Agenda Comments Support Oppose Neutral Time Items City Council on 2020-08- 20 6:00 PM 08-20-20 33 4 0 1 2 18:00 Sentiments for All Meetings The following graphs display sentiments for comments that have location data. Only locations of users who have commented will be shown. Overall Sentiment 1. Suppon03%) OpposW,25...,:t Neutra1(50%) No Rosponso,:25°,,o 15 City Council on 2020-08-20 6:00 PM 08-20-20 18:00 6. Citizens to be heard re items not on the agenda 7.9 ID#20-8081 Approve the final plat for Union Place Replat, 1625 Union 1 Street, located east of Highland Avenue and west of Keene Road. consent) 9.1 ID#20-8157 Imagine Clearwater Bond Hearing Validation 0 0 0 0 0 2 0 1 1 Sentiments for All Agenda Items The following graphs display sentiments for comments that have location data. Only locations of users who have commented will be shown. Overall Sentiment Agenda Item: eComments for 6. Citizens to be Overall Sentiment suppo+t,O% opposo,0% Neuttal(0%) No Response; 100./0 Elizabeth Davis Location: Submitted At: 4:27pm 08-19-20 I would like to celebrate the presentation, suggestions, and innovative thinking for Imagine Clearwater, that Councilmember Beckman presented Monday, August 17 at the end of the work session. It was great to know that the many possibilities will be considered and evaluated by all. I would like to add that our promenade sidewalks on our Beachwalk should continue to be our signature. We are a 3 and 4 generation city, with strollers, walkers, wheelchairs and people who love being able to enjoy space. Add our 6 feet of today and please evaluate and consider this kind of green, very wide, porous, draining, walk for our landmark park. Concrete and pavement are hot! It is a win, win! Thank you for listening. 16 Agenda Item: eComments for 7.9 ID#20-8081 Approve the final plat for Union Place Replat, 1625 Union Street, located east of Highland Avenue and west of Keene Road. (consent) Overall Sentiment S,ppo=c4). Oppose:O%i Neutr0100`sj No Response;09wj Lisa Lanza Location: 33763, Clearwater Submitted At: 2:44pm 08- 20-20 Why is the City of Clearwater using the May 2005 FEMA flood insurance rate map as a reference document, on the Union Place Replat, Plat Note, Item 4.0? See uploaded attachment Agenda Item: eComments for 9.1 ID#2E: Overall Sentiment Supporz(0%) Opposa(50,%) Noutrali50%} No Response;0' i Lauren Hallahan Location: Submitted At: 3:11 pm 08-20-20 Lauren Hallahan 1537 Picardy Circle Clearwater, FI 33755 Why has the City Attorney not created Supplemental Resolution to Ordinance No 9357-20, as required by paragraph 7 of Ordinance 9357-20 to provide the following information for Judge Minkoff, as well as for the city manager, city council and city residents? The Supplemental Resolution will provide the following four items: (cut and pasted from the attached Clearwater Ordinance 9357-20) WHEREAS, the Issuer intends on adopting a Supplemental Resolution to provide for the manner of sale and terms of the Series 2020 Bonds, including: 1.) the approval of the Purchase Contract, 17 2.) the designation of the Underwriter and 3.) the distribution of an offering document in connection with the sale of the Series 2020 Bonds by the Underwriter, and 4.) the designation of the Paying Agent and Registrar, after it has completed the validation of the Series 2020 Bonds authorized in Section 8.08 of the Bond Resolution Why is the city not providing all the required information to Judge Minkoff? This is so disturbing to learn that a judge is to make a decision without all of the needed information? How can this be and where is our city attorney Pam Akin? I am very concerned regarding the information above concerning this agenda item. Lisa Lanza Location: 33763, Clearwater Submitted At: 2:25pm 08-20-20 Send by email with included attachments on August 20, 2020 at 2 pm. Dear City Manager, City Clerk, City Attorney, Councilmember Beckman: Why hasn't the city clerk/attorney provided applicable reference documents for Item 9.1: Imagine Clearwater Bond Revenue, along with the city agenda for the August 18, 2020 council meeting? Applicable reference documents would, at a minimum, include the (attached) Lawsuit, Bond Ordinance 9357-20, Final Order- September1,2020 hearing, as well as the Supplemental to the Bond Ordinance 9357-20. Regards, Lisa Lanza 18 Call, Rosemarie From: Pam van der Linde <pamvanderlinde8@gmail.com> Sent: Wednesday, August 19, 2020 2:54 PM To: ClearwaterCouncil Cc: Jacob van der Linde Subject: Derelict vessel in front of my waterfront condo on the Intercoastal of Clearwater Gs ro CAUTION: This email originated from outside of the City of Clearwater. Do not click links or open attachments unless you recognize the sender and know the content is safe. Dear Sirs, I would like to lodge a complaint about a very ugly derelict boat that is parked in front of our beautiful home with waterview. It is simply ugly and ruins our view and is very upsetting to us. Attached is a photo of it from our balcony. It seems that this should be illegal to mar the beautiful water views we all have. I vote for outlawing derelict boats in our waterway. 19 Sincerely, Pamela van der Linde 727 216-5504 2 20 CaII, Rosemarie From: Donna Andrus <donnaandrusl @aol.com> Sent: Wednesday, August 19, 2020 11:10 AM To: ClearwaterCouncil Subject: Public Hearing on Derelict Vessels on Sept 3, 2020 CAUTION: This email originated from outside of the City of Clearwater. Do not click links or open attachments unless you recognize the sender and know the content is safe. Dear Council Members, I want to submit my strong support for an ordinance concerning the long term mooring of vessels in the waterways. There has been a very unsightly small houseboat parked on the Intracoastal Waterway just north of downtown Clearwater, near the Harbor Bluffs condo building at 500 N Osceola Avenue for at least 6 months. Numerous residents have complained and some have called in only to be told there is unfortunately nothing that can be done about it. When I called last year the Marine Police sounded frustrated that they are pretty much powerless to do anything about it and said this is growing problem. When boats park for a short time or even overnight, such as to watch the fireworks on the 4th of July or to hear a concert at Coachman Park, that is totally fine and a pleasant sight. But an old rundown boat should not be allowed to park there indefinitely marring residents' water views. Derelict cars are not allowed to remain on city streets and this is a similar thing. Thank you for your attention to this matter. Best regards, Donna Andrus 727- 643-1171 1 21 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8179 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: City Council Agenda Number: 7.1 SUBJECT/RECOMMENDATION: Approve not-to-exceed increase of $125,000 to Hilltop Securities Inc. (Hilltop) for spring training deal structure consulting services provided by ICON Venue Group, LLC d/b/a CAA ICON (CAA ICON) as subconsultant to Hilltop per Amendment 1 to the agreement dated April 17, 2019 between Hilltop and CAA ICON, approve a not-to-exceed administrative fee increase of $5,000 to Hilltop per the agreement between Hilltop and the City, bringing the total for contract No. 900622 to $188,059.17 and authorize the appropriate officials to execute same. (consent) SUMMARY: In the Spring of 2019, the City requested assistance from the City’s financial advisor, Hilltop Securities (Hilltop), with professional analysis of the proposed Phillies spring training terms. In April 2019, the City contracted with Hilltop for the services of a subconsultant, CAA ICON. Hilltop contracted with CAA ICON on behalf of the City. Payments to Hilltop for CAA ICON consulting fees and related expenses totaled $53,059.17, with another $5,000 in Hilltop administrative and consulting fees under contract #900622. With this increase the total not-to-exceed amount for services under the contract will total $188,059.17 The City has determined that additional CAA ICON consulting services are needed during negotiations of a new spring training lease agreement with the Phillies. CAA ICON has proposed a fee of $25,000 per month for a minimum of 3 months, plus travel expenses, etc. Staff is requesting a not-to-exceed increase of $125,000 to provide a buffer if negotiations exceed the three-month timeframe. Additionally, not-to-exceed increase of $5,000 is requested for Hilltop administrative and consulting fees as needed. APPROPRIATION CODE AND AMOUNT: A third quarter budget amendment will provide a transfer of $130,000 from General Fund reserves to capital improvement project 93618, Misc. Parks and Recreation Contracts, to fund this contract. USE OF RESERVE FUNDS: Funding for this contract will be provided by a third quarter budget amendment allocating General Fund reserves in the amount of $130,000 to capital improvement project 93618, Misc. Parks and Recreation Contracts. Inclusive of this item if approved, a net total of $2,694,294 of General Fund reserves has been appropriated by Council to fund expenditures in the 2019/20 operating budget. The remaining balance in General Fund reserves after the 8.5% reserve is Page 1 City of Clearwater Printed on 9/3/2020 File Number: ID#20-8179 approximately $24.8 million, or 16.3% of the current General Fund operating budget. Page 2 City of Clearwater Printed on 9/3/2020 Effective as of August 13, 2020 VIA EMAIL Matthew J. Sansbury Managing Director Alex Bugallo Managing Director Hilltop Securities Inc. 450 S. Orange Avenue, Suite 460 Orlando, FL 32801 RE: Spring Training Deal Structure Comparison – Amendment #1 Gentlemen: Reference is made to the certain Agreement between Hilltop Securities Inc. (“Hilltop” or “Client”), for the benefit of The City of Clearwater, Florida (“City”), and ICON Venue Group, LLC, d/b/a CAA ICON ("CAA ICON"), dated April 17, 2019 (the "Agreement"). Capitalized terms not otherwise defined herein shall have the meanings for such terms in the Agreement. CAA ICON's Strategic Advisory Group is pleased to present this Letter Amendment to our Agreement. CAA ICON shall provide the Additional Services as outlined in Exhibit A. In consideration for CAA ICON’s performance of these Additional Services, Client shall pay CAA ICON an additional fee of $25,000 per month for a minimum of three months, or $75,000 in total professional fees (“Additional Fees”), plus reimbursement for all reimbursable expenses in accordance with the Letter. The foregoing Additional fee and reimbursable expenses shall be payable in accordance with Section 26 of the Terms and Conditions. At the end of the initial three month period, CAA ICON and Client will meet and confer to determine business arrangements and reach a mutually agreeable approach regarding the extent to which the Services are to be completed. Client acknowledges and agrees that not all the tasks described Exhibit A will be completed in the initial three month period. As provided in the Agreement, any additional consulting services not included in the scope of work described above shall only be performed when agreed to in writing. Hilltop represents and warrants that it has the express authority to retain CAA ICON to perform the scope of Additional Services described below under the terms as outlined herein. In countersigning below, Client acknowledges and agrees that CAA ICON is not an investment bank, broker-dealer, or financial adviser, and is in no way providing services in such a capacity. As such, consistent with Section 5 of the Terms and Conditions, the work-product produced in connection with the Services under this Letter Amendment shall not be used for financing, marketing, or lending purposes. 2 of 3 Except as provided in this Letter Amendment, the Agreement shall remain unchanged and apply fully for the services provided under this Letter Amendment. Your signature below shall signify the Hilltop’s agreement to continue to engage CAA ICON under the terms outlined in this Letter Amendment. Sincerely, ICON VENUE GROUP, LLC d/b/a CAA ICON BY: Daniel S. Barrett TITLE: Executive Vice President Attachment ACKNOWLEDGEMENT OF RECEIPT AND AGREEMENT WITH THE TERMS AND CONDITIONS OF THIS LETTER AMENDMENT (INCLUDING ALL EXHIBITS): HILLTOP SECURITIES, INC. BY: NAME: TITLE: 3 of 3 Exhibit A SCOPE OF ADDITIONAL SERVICES 1) Negotiating assistance and support services a) Review and comment on existing agreements b) Review and comment on proposed stadium and training facility renovation plans c) Estimate financial impact of proposed renovation plans d) Assist in developing overall negotiation strategy e) Meet with team representative(s) and other key stakeholders f) Identify key considerations i) Financial considerations ii) Financing considerations iii) Operating considerations iv) Capital repair considerations v) Timing considerations vi) Political considerations g) Public relations strategy h) Assess key stakeholder goals/objectives and alternatives i) Participate in negotiations j) Consider team alternatives 2) Deal structure advisory a) Consider alternative approaches b) Identify issues and concerns c) Identify desired amenities/rights d) Evaluate financial impacts of key negotiating terms 3) Provide document support services/assist legal team a) Letter of intent/memorandum of understanding b) Definitive agreements Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8180 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: City Manager's Office Agenda Number: 7.2 SUBJECT/RECOMMENDATION: Approve Option 2 the Clearwater Main Library Imagine Clearwater Construction Scheduling. (consent) SUMMARY: At the August 6, 2020 city council meeting, staff was provided direction to move forward with the construction component of the Main Library renovations in conjunction with the Imagine Clearwater Plan. In working with contractor Skanska, staff has developed two construction options: Option 1 - This option will allow for limited use of the library by patrons by bifurcating construction work on the first floor with a temporary wall. The construction timeline for Option 1 is roughly thirteen months. Keeping the library open during renovations the City will incur additional costs due to the protracted construction timeline. Option 2 - This option calls for closing the main library for approximately 9 months to all patrons. This option allows the contractor to complete their construction in almost 1/3 of the time as mentioned in Option 1. Saving additional time and money with a proposed project completion of 9 months instead of 13. Due to the operational and financial impacts of Option 1, staff is recommending that Council pursue Option 2 which would result in a full and complete closure of the main library for 9 months. City Administration and Library staff feel that the library system is well positioned to absorb this impact. To offset patron impact to the library system, staff is planning to temporarily reassign staff from the Main Library to North Greenwood and Beach Library branches to provide increased operational hours while the Main Library is closed due to renovation. At the August 31 work session, there was council consensus to proceed with the shorter timeline. Staff was directed to proceed with Option 2. Page 1 City of Clearwater Printed on 9/3/2020 2021 Council Schedule Intranet (last rev.08-05-20) 2021 CITY COUNCIL MEETING SCHEDULE DRAFT WORK SESSION Time CITY COUNCIL MEETING Time Completed Items & attachments due to Agenda Program Items due to City Clerk Tuesday January 19 9:00 a.m. Thursday January 21 6:00 p.m. January 4 January 11 Monday February 1 9:00 a.m. Thursday February 4 6:00 p.m. January 15 January 25 Tuesday February 16 9:00 a.m. Thursday February 18 6:00 p.m. February 1 February 8 Monday March 1 9:00 a.m. Thursday March 4 6:00 p.m. February 12 February 22 Monday March 15 9:00 a.m. Thursday March 18 6:00 p.m. March 1 March 8 Monday March 29 9:00 a.m. Thursday April 1 6:00 p.m. March 15 March 22 Monday April 12 9:00 a.m. Thursday April 15 6:00 p.m. March 29 April 5 Monday May 3 9:00 a.m. Thursday May 6 6:00 p.m. April 19 April 26 Monday May 17 9:00 a.m. Thursday May 20 6:00 p.m. May 3 May 10 Tuesday June 1 9:00 a.m. Thursday June 3 6:00 p.m. May 17 May 24 Monday June 14 9:00 a.m. Thursday June 17 6:00 p.m. May 28 June 7 Monday July 12 9:00 a.m. Thursday July 15 6:00 p.m. June 28 July 2 Monday August 2 9:00 a.m. Thursday August 5 6:00 p.m. July 19 July 26 Monday August 16 9:00 a.m. Thursday August 19 6:00 p.m. August 2 August 9 Monday August 30 9:00 a.m. Thursday September 2 6:00 p.m. August 16 August 23 Monday September 13 9:00 a.m. Thursday September 16 6:00 p.m. August 30 September 3 Monday October 4 9:00 a.m. Thursday October 7 6:00 p.m. September 20 September 27 Monday October 18 9:00 a.m. Thursday October 21 6:00 p.m. October 4 October 11 Monday November 1 9:00 a.m. Thursday November 4 6:00 p.m. October 18 October 25 Monday November 15 9:00 a.m. Thursday November 18 6:00 p.m. November 1 November 8 Monday November 29 9:00 a.m. Thursday December 2 6:00 p.m. November 15 November 22 Monday December 13 9:00 a.m. Thursday December 16 6:00 p.m. November 29 December 6 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8084 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Finance Agenda Number: 7.3 SUBJECT/RECOMMENDATION: Approve agreement for professional external audit services for five fiscal years ending September 30, 2020 through 2024, with the accounting/auditing firm of Carr, Riggs and Ingram, LLC, for a not-to-exceed amount of $711,700 and authorize the appropriate officials to execute same. (consent) SUMMARY: The City employed the accounting/auditing firm of Cherry Bekaert LLP for external auditing services for the five fiscal years ending September 30, 2015 through 2019. Per City Charter, Article II, Section 2.01(c)(3), the City cannot employ an external audit firm for more than five consecutive years. The City solicited proposals for external auditing services from qualified firms per Request for Proposal 36-20 issued May 1, 2020. Seven firms submitted proposals that were ranked by the City’s Auditor Selection Committee comprised of: Mayor Frank Hibbard; citizen appointee, Herb McLachlan; and citizen appointee, Lisa Burley. The committee completed a preliminary ranking of the proposals and three firms were chosen as finalists for oral presentations and interviews: Carr, Riggs & Ingram, LLC, CliftonLarsonAllen LLP, and MSL, P.A. Per the RFP guidelines, the committee weighed and combined the rankings of proposals, references, and oral interviews to arrive at a composite ranking for each firm. Carr, Riggs & Ingram, LLC emerged as the top ranked firm. The proposed contract includes a fixed fee of $128,000 for the fiscal year 2020 audit, representing a 3.25% decrease from the fiscal year 2019 audit fee of $132,300. Subsequent audit fees are $128,000 for fiscal year 2021, $130,000 per year for fiscal years 2022 and 2023, and $131,000 for fiscal year 2024. A 10% contingency is also included in the funding request to fund expenses related to any significant changes in the scope of the audit due to new governmental accounting and auditing standards/practices, federal grants, or other. APPROPRIATION CODE AND AMOUNT: Budgeted funds for this agreement are available in the Finance, Professional Services expense code: 0109821-530100. Page 1 City of Clearwater Printed on 9/3/2020 Procurement Division 100 S Myrtle Ave Clearwater FL 33756-5520 PO Box 4748, 33758-4748 727-562-4633 Tel v 11.2018 REQUEST FOR PROPOSALS #36-20 PROFESSIONAL AUDITING SERVICES May 1, 2020 NOTICE IS HEREBY GIVEN that sealed proposals will be received by the City of Clearwater (City) until 10:00 AM, Local Time, June 2, 2020 to provide PROFESSIONAL AUDITING SERVICES. Brief Description: The City of Clearwater is seeking proposals from qualified firms of certified public accountants to audit the financial statements of the City of Clearwater, Florida for the fiscal years ending September 30, 2020, 2021, 2022, 2023, and 2024. Proposals must be in accordance with the provisions, specifications and instructions set forth herein and will be received by the Procurement Division until the above noted time, when they will be publicly acknowledged and accepted. Proposal packets, any attachments and addenda are available for download at: https://www.myclearwater.com/business/rfp Please read the entire solicitation package and submit the bid in accordance with the instructions. This document (less this invitation and the instructions) and any required response documents, attachments, and submissions will constitute the bid. General, Process, or Technical Questions concerning this solicitation should be directed, IN WRITING, to the Procurement contact below: This Request for Proposals is issued by: Lori Vogel, CPPB Procurement Manager Lori.vogel@myclearwater.com INSTRUCTIONS Professional Auditing Services 2 RFP #36-20 i.1 VENDOR QUESTIONS: All questions regarding the contents of this solicitation, and solicitation process (including requests for ADA accommodations), shall be directed solely to the contact listed on Page 1. Questions should be submitted in writing via letter, fax or email. Questions received less than ten (10) calendar days prior to the due date and time may be answered at the discretion of the City. i.2 ADDENDA/CLARIFICATIONS: Any changes to the specifications will be in the form of an addendum. Addenda are posted on the City website no less than seven (7) days prior to the Due Date. Vendors are cautioned to check the Purchasing Website for addenda and clarifications prior to submitting their proposal. The City cannot be held responsible if a vendor fails to receive any addenda issued. The City shall not be responsible for any oral changes to these specifications made by any employees or officer of the City. Failure to acknowledge receipt of an addendum may result in disqualification of a proposal. i.3 VENDOR CONFERENCE / SITE VISIT: Yes No Mandatory Attendance: Yes No If so designated above, attendance is mandatory as a condition of submitting a proposal. The conference/site visit provides interested parties an opportunity to discuss the City's needs, inspect the site and ask questions. During any site visit you must fully acquaint yourself with the conditions as they exist and the character of the operations to be conducted under the resulting contract. i.4 DUE DATE & TIME FOR SUBMISSION AND OPENING: Date: June 2, 2020 Time: 10:00 AM (Local Time) The City will open all proposals properly and timely submitted and will record the names and other information specified by law and rule. All proposals become the property of the City and will not be returned except in the case of a late submission. Respondent names, as read at the bid opening, will be posted on the City website. Once a notice of intent to award is posted or 30 days from day of opening elapses, whichever occurs earlier, proposals are available for inspection by contacting the Procurement Division. i.5 PROPOSAL FIRM TIME: 120 Days from Opening Proposal shall remain firm and unaltered after opening for the number of days shown above. The City may accept the proposal, subject to successful contract negotiations, at any time during this time. i.6 PROPOSAL SECURITY: Yes $ 0.00 No If so designated above, a proposal security in the amount specified must be submitted with the proposal. The security may be submitted in any one of the following forms: an executed surety bond issued by a firm licensed and registered to transact such business with the State of Florida; cash; certified check, or cashier's check payable to the City of Clearwater (personal or company checks are not acceptable); certificate of deposit or any other form of deposit issued by a financial institution and acceptable to the City. Such proposal security shall be forfeited to the City of Clearwater should the proposer selected fail to execute a contract when requested. PERFORMANCE SECURITY: Yes $ 0.00 No If required herein, the Contractor, simultaneously with the execution of the Contract, will be required to furnish a performance security. The security may be submitted in one-year increments and in any one of the following forms: an executed surety bond issued by a firm licensed and registered to transact such business with the State of Florida; cash; certified check, cashier's check or money order payable to the City of Clearwater (personal and company checks are not acceptable); certificate of deposit or any other form of deposit issued by a financial institution and acceptable to the City. If the Contractor fails or refuses to fully comply with the terms and conditions of the contract, the City shall have the right to use all or such part of said security as may be necessary to reimburse the City for loss sustained by reason of such breach. The balance of said security, if INSTRUCTIONS Professional Auditing Services 3 RFP #36-20 any, will be returned to Contractor upon the expiration or termination of the contract. i.7 SUBMIT PROPOSALS TO: Proposals should be submitted electronically through our bids website at https://www.myclearwater.com/business/rfp. i.8 LATE PROPOSALS. The proposer assumes responsibility for having the proposal delivered on time at the place specified. All proposals received after the date and time specified shall not be considered and will be returned unopened to the proposer. The proposer assumes the risk of any delay in the mail or in handling of the mail by employees of the City of Clearwater, or any private courier, regardless whether sent by mail or by means of personal delivery. It shall not be sufficient to show that you mailed or commenced delivery before the due date and time. All times are Clearwater, Florida local times. The proposer agrees to accept the time stamp in the City’s Procurement Office as the official time. i.9 LOBBYING. The integrity of the procurement process is critical. Communication regarding this solicitation for purpose of influencing the process or the award, between any person or affiliates seeking an award from this solicitation and the City is strongly discouraged. This does not prohibit public comment at any City Council meeting, study session or Council committee meeting. This shall not apply to vendor-initiated communication with the contact(s) identified in the solicitation or City-initiated communications for the purposes of conducting the procurement including but not limited to pre-bid conferences, clarification of responses, presentations if provided in the solicitation, requests for Best and Final Proposals, contract negotiations, protest/appeal resolution, or surveying non-responsive vendors. i.10 COMMENCEMENT OF WORK. If proposer begins any billable work prior to the City’s final approval and execution of the contract, proposer does so at its own risk. i.11 RESPONSIBILITY TO READ AND UNDERSTAND. Failure to read, examine and understand the solicitation will not excuse any failure to comply with the requirements of the solicitation or any resulting contract, nor shall such failure be a basis for claiming additional compensation. If a vendor suspects an error, omission or discrepancy in this solicitation, the vendor must immediately and in any case not later than seven (7) business days in advance of the due date notify the contact on page one (1). The City is not responsible for and will not pay any costs associated with the preparation and submission of the proposal. Proposers are cautioned to verify their proposals before submission, as amendments to or withdrawal of proposals submitted after time specified for opening of proposals may not be considered. The City will not be responsible for any proposer errors or omissions. i.12 FORM AND CONTENT OF PROPOSALS. Unless otherwise instructed or allowed, proposals shall be submitted on the forms provided. An original and the designated number of copies of each proposal are required. Proposals, including modifications, must be submitted in ink, typed, or printed form and signed by an authorized representative. Please line through and initial rather than erase changes. If the proposal is not properly signed or if any changes are not initialed, it may be considered non-responsive. In the event of a disparity between the unit price and the extended price, the unit price shall prevail unless obviously in error, as determined by the City. The City may require that an electronic copy of the proposal be submitted. The proposal must provide all information requested and must address all points. The City does not encourage exceptions. The City is not required to grant exceptions and depending on the exception, the City may reject the proposal. i.13 SPECIFICATIONS. Technical specifications define the minimum acceptable standard. When the specification calls for “Brand Name or Equal,” the brand name product is acceptable. Other products will be considered upon showing the other product meets stated specifications and is equivalent to the brand product in terms of quality, performance and desired characteristics. Minor differences that do not affect the suitability of the supply or service for the City’s needs may be accepted. Burden of proof that the product meets the minimum standards or is equal to the INSTRUCTIONS Professional Auditing Services 4 RFP #36-20 brand name product is on the proposer. The City reserves the right to reject proposals that the City deems unacceptable. i.14 MODIFICATION / WITHDRAWAL OF PROPOSAL. Written requests to modify or withdraw the proposal received by the City prior to the scheduled opening time will be accepted and will be corrected after opening. No oral requests will be allowed. Requests must be addressed and labeled in the same manner as the proposal and marked as a MODIFICATION or WITHDRAWAL of the proposal. Requests for withdrawal after the bid opening will only be granted upon proof of undue hardship and may result in the forfeiture of any proposal security. Any withdrawal after the bid opening shall be allowed solely at the City’s discretion. i.15 DEBARMENT DISCLOSURE. If the vendor submitting a proposal has been debarred, suspended, or otherwise lawfully precluded from participating in any public procurement activity, including being disapproved as a subcontractor with any federal, state, or local government, or if any such preclusion from participation from any public procurement activity is currently pending, the proposer shall include a letter with its proposal identifying the name and address of the governmental unit, the effective date of this suspension or debarment, the duration of the suspension or debarment, and the relevant circumstances relating to the suspension or debarment. If suspension or debarment is currently pending, a detailed description of all relevant circumstances including the details enumerated above must be provided. A proposal from a proposer who is currently debarred, suspended or otherwise lawfully prohibited from any public procurement activity may be rejected. i.16 RESERVATIONS. The City reserves the right to reject any or all proposals or any part thereof; to rebid the solicitation; to reject non-responsive or non-responsible proposals; to reject unbalanced proposals; to reject proposals where the terms, prices, and/or awards are conditioned upon another event; to reject individual proposals for failure to meet any requirement; to award by item, part or portion of an item, group of items, or total; to make multiple awards; to waive minor irregularities, defects, omissions, technicalities or form errors in any proposal. The City may seek clarification of the proposal from proposer at any time, and failure to respond is cause for rejection. Submission of a proposal confers on proposer no right to an award or to a subsequent contract. The City is responsible to make an award that is in the best interest of the City. All decisions on compliance, evaluation, terms and conditions shall be made solely at the City’s discretion and made to favor the City. No binding contract will exist between the proposer and the City until the City executes a written contract or purchase order. i.17 OFFICIAL SOLICITATION DOCUMENT. Changes to the solicitation document made by a proposer may not be acknowledged or accepted by the City. Award or execution of a contract does not constitute acceptance of a changed term, condition or specification unless specifically acknowledged and agreed to by the City. The copy maintained and published by the City shall be the official solicitation document. i.18 COPYING OF PROPOSALS. Proposer hereby grants the City permission to copy all parts of its proposal, including without limitation any documents and/or materials copyrighted by the proposer. The City’s right to copy shall be for internal use in evaluating the proposal. i.19 CONTRACTOR ETHICS. It is the intention of the City to promote courtesy, fairness, impartiality, integrity, service, professionalism, economy, and government by law in the Procurement process. The responsibility for implementing this policy rests with each individual who participates in the Procurement process, including Respondents and Contractors. To achieve this purpose, it is essential that Respondents and Contractors doing business with the City also observe the ethical standards prescribed herein. It shall be a breach of ethical standards to: a. Exert any effort to influence any City employee or agent to breach the standards of ethical conduct. b. Intentionally invoice any amount greater than provided in Contract or to invoice for Materials or Services not provided. INSTRUCTIONS Professional Auditing Services 5 RFP #36-20 c. Intentionally offer or provide sub-standard Materials or Services or to intentionally not comply with any term, condition, specification or other requirement of a City Contract. i.20 GIFTS. The City will accept no gifts, gratuities or advertising products from proposers or prospective proposers and affiliates. The City may request product samples from vendors for product evaluation. i.21 PROTESTS AND APPEALS. If a Respondent believes there is a mistake, impropriety, or defect in the solicitation, believes the City improperly rejected its proposal, and/or believes the selected proposal is not in the City’s best interests, the Respondent may submit a written protest. All protests and appeals are governed by the City of Clearwater Purchasing Policy and Procedures Section 18 (“Purchasing Policy”). If there exists any discrepancy in this Section i.21 and the Purchasing Policy, the language of the Purchasing Policy controls. Protests based upon alleged mistake, impropriety, or defect in a solicitation that is apparent before the bid opening must be filed with the Procurement Manager no later than five (5) business days before Bid Opening. Protests that only become apparent after the Bid Opening must be filed within the earlier of ten (10) business days of the alleged violation of the applicable purchasing ordinance. The complete protest procedure can be obtained by contacting the Procurement Division. ADDRESS PROTESTS TO: City of Clearwater - Procurement Division 100 So Myrtle Ave, 3rd Fl Clearwater FL 33756-5520 or PO Box 4748 Clearwater FL 33758-4748 INSTRUCTIONS – EVALUATION Professional Auditing Services 6 RFP #36-20 i.22 EVALUATION PROCESS. Proposals will be reviewed by an Auditor Selection Committee established by the City Council pursuant to Chapter 218.391, Florida Statutes. The City staff may or may not initiate discussions with proposers for clarification purposes. Clarification is not an opportunity to change the proposal. Proposers shall not initiate discussions with any City employee or official. i.23 CRITERIA FOR EVALUATION AND AWARD. The City evaluates three (3) categories of information: responsiveness, responsibility, the technical proposal/price. All proposals must meet the following responsiveness and responsibility criteria. a) Responsiveness. The City will determine whether the proposal complies with the instructions for submitting proposals including completeness of proposal which encompasses the inclusion of all required attachments and submissions. The City must reject any proposals that are submitted late. Failure to meet other requirements may result in rejection. b) Responsibility. The City will determine whether the proposer is one with whom it can or should do business. Factors that the City may evaluate to determine "responsibility" include, but are not limited to: excessively high or low priced proposals, past performance, references (including those found outside the proposal), compliance with applicable laws, proposer's record of performance and integrity- e.g. has the proposer been delinquent or unfaithful to any contract with the City, whether the proposer is qualified legally to contract with the City, financial stability and the perceived ability to perform completely as specified. A proposer must at all times have financial resources sufficient, in the opinion of the City, to ensure performance of the contract and must provide proof upon request. City staff may also use Dun & Bradstreet and/or any generally available industry information. The City reserves the right to inspect and review proposer’s facilities, equipment and personnel and those of any identified subcontractors. The City will determine whether any failure to supply information, or the quality of the information, will result in rejection. c) Technical Proposal. The City will determine how well proposals meet its requirements in terms of the response to the specifications and how well the offer addresses the needs of the project. The City will rank offers using a point ranking system (unless otherwise specified) as an aid in conducting the evaluation. d) If less than three (3) responsive proposals are received, at the City’s sole discretion, the proposals may be evaluated using simple comparative analysis instead of any announced method of evaluation, subject to meeting administrative and responsibility requirements. For this RFP, the criteria that will be evaluated and their relative weights are: Evaluation Criteria Points Qualifications, Experience and Project Personnel Expertise (Tab 2) 45 Audit Approach (Tab 3) 30 References (Tab 4) 15 Cost Proposal (Tab 5) 10 i.24 SHORT-LISTING. The City at its sole discretion may create a short-list of the highest scored proposals based on evaluation against the evaluation criteria. Short-listed proposers may be invited to give presentations and/or interviews. Upon conclusion of any presentations/interviews, the City will finalize the ranking of shortlisted firms. i.25 PRESENTATIONS/INTERVIEWS. Presentations and/or interviews may be requested at the City’s discretion. The proposer must provide a formal presentation/interview on-site at a City location upon request. i.26 BEST & FINAL OFFERS. The City may request best & final offers if deemed necessary, and will determine the scope and subject of any best & final request. However, the proposer should not INSTRUCTIONS – EVALUATION Professional Auditing Services 7 RFP #36-20 expect that the City will ask for best & finals and should submit their best offer based on the terms and conditions set forth in this solicitation. i.27 COST JUSTIFICATION. In the event only one response is received, the City may require that the proposer submit a cost proposal in sufficient detail for the City to perform a cost/price analysis to determine if the proposal price is fair and reasonable. i.28 CONTRACT NEGOTIATIONS AND ACCEPTANCE. Proposer must be prepared for the City to accept the proposal as submitted. If proposer fails to sign all documents necessary to successfully execute the final contract within a reasonable time as specified, or negotiations do not result in an acceptable agreement, the City may reject proposal or revoke the award, and may begin negotiations with another proposer. Final contract terms must be approved or signed by the appropriately authorized City official(s). No binding contract will exist between the proposer and the City until the City executes a written contract or purchase order. i.29 NOTICE OF INTENT TO AWARD. Notices of the City’s intent to award a Contract are posted to Purchasing’s website. It is the proposer’s responsibility to check the City of Clearwater’s website at https://www.myclearwater.com/business/rfp to view relevant RFP information and notices. i.30 RFP TIMELINE. Dates are tentative and subject to change. Release RFP: May 1, 2020 Advertise Tampa Bay Times: May 6, 2020 Responses due: June 2, 2020 Review proposals: June 3, 2020-June 15, 2020 Presentations (if requested): Week of June 22, 2020 Award recommendation: June 26, 2020 Council authorization: August 6, 2020 Contract begins: August 2020 TERMS AND CONDITIONS Professional Auditing Services 8 RFP #36-20 S.1 DEFINITIONS. Uses of the following terms are interchangeable as referenced: “vendor, contractor, supplier, proposer, company, parties, persons”, “purchase order, PO, contract, agreement”, “city, Clearwater, agency, requestor, parties”, “bid, proposal, response, quote”. S.2 INDEPENDENT CONTRACTOR. It is expressly understood that the relationship of Contractor to the City will be that of an independent contractor. Contractor and all persons employed by Contractor, either directly or indirectly, are Contractor’s employees, not City employees. Accordingly, Contractor and Contractor’s employees are not entitled to any benefits provided to City employees including, but not limited to, health benefits, enrollment in a retirement system, paid time off or other rights afforded City employees. Contractor employees will not be regarded as City employees or agents for any purpose, including the payment of unemployment or workers’ compensation. If any Contractor employees or subcontractors assert a claim for wages or other employment benefits against the City, Contractor will defend, indemnify and hold harmless the City from all such claims. S.3 SUBCONTRACTING. Contractor may not subcontract work under this Agreement without the express written permission of the City. If Contractor has received authorization to subcontract work, it is agreed that all subcontractors performing work under the Agreement must comply with its provisions. Further, all agreements between Contractor and its subcontractors must provide that the terms and conditions of this Agreement be incorporated therein. S.4 ASSIGNMENT. This Agreement may not be assigned either in whole or in part without first receiving the City’s written consent. Any attempted assignment, either in whole or in part, without such consent will be null and void and in such event the City will have the right at its option to terminate the Agreement. No granting of consent to any assignment will relieve Contractor from any of its obligations and liabilities under the Agreement. S.5 SUCCESSORS AND ASSIGNS, BINDING EFFECT. This Agreement will be binding upon and inure to the benefit of the parties and their respective permitted successors and assigns. S.6 NO THIRD PARTY BENEFICIARIES. This Agreement is intended for the exclusive benefit of the parties. Nothing set forth in this Agreement is intended to create, or will create, any benefits, rights, or responsibilities in any third parties. S.7 NON- EXCLUSIVITY. The City, in its sole discretion, reserves the right to request the materials or services set forth herein from other sources when deemed necessary and appropriate. No exclusive rights are encompassed through this Agreement. S.8 AMENDMENTS. There will be no oral changes to this Agreement. This Agreement can only be modified in a writing signed by both parties. No charge for extra work or material will be allowed unless approved in writing, in advance, by the City and Contractor. S.9 TIME OF THE ESSENCE. Time is of the essence to the performance of the parties’ obligations under this Agreement. S.10 COMPLIANCE WITH APPLICABLE LAWS. a. General. Contractor must procure all permits and licenses, and pay all charges and fees necessary and incidental to the lawful conduct of business. Contractor must stay fully informed of existing and future federal, state, and local laws, ordinances, and regulations that in any manner affect the fulfillment of this Agreement and must comply with the same at its own expense. Contractor bears full responsibility for training, safety, and providing necessary equipment for all Contractor personnel to achieve throughout the term of the Agreement. Upon request, Contractor will demonstrate to the City's satisfaction any programs, procedures, and other activities used to ensure compliance. b. Drug-Free Workplace. Contractor is hereby advised that the City has adopted a policy establishing a drug-free workplace for itself and those doing business with the City to ensure the safety and health of all persons working on City contracts and projects. Contractor will require a drug-free workplace for all Contractor personnel working under this Agreement. Specifically, all Contractor personnel who are working under this Agreement must be notified TERMS AND CONDITIONS Professional Auditing Services 9 RFP #36-20 in writing by Contractor that they are prohibited from the manufacture, distribution, dispensation, possession, or unlawful use of a controlled substance in the workplace. Contractor agrees to prohibit the use of intoxicating substances by all Contractor personnel, and will ensure that Contractor personnel do not use or possess illegal drugs while in the course of performing their duties. c. Federal and State Immigration Laws. Contractor agrees to comply with the Immigration Reform and Control Act of 1986 (IRCA) in performance under this Agreement and to permit the City and its agents to inspect applicable personnel records to verify such compliance as permitted by law. Contractor will ensure and keep appropriate records to demonstrate that all Contractor personnel have a legal right to live and work in the United States. (i) As applicable to Contractor, under this provision, Contractor hereby warrants to the City that Contractor and each of its subcontractors will comply with, and are contractually obligated to comply with, all federal immigration laws and regulations that relate to their employees (hereinafter “Contractor Immigration Warranty”). (ii) A breach of the Contractor Immigration Warranty will constitute as a material breach of this Agreement and will subject Contractor to penalties up to and including termination of this Agreement at the sole discretion of the City. (iii) The City retains the legal right to inspect the papers of all Contractor personnel who provide services under this Agreement to ensure that Contractor or its subcontractors are complying with the Contractor Immigration Warranty. Contractor agrees to assist the City in regard to any such inspections. (iv) The City may, at its sole discretion, conduct random verification of the employment records of Contractor and any subcontractor to ensure compliance with the Contractor Immigration Warranty. Contractor agrees to assist the City in regard to any random verification performed. (v) Neither Contractor nor any subcontractor will be deemed to have materially breached the Contractor Immigration Warranty if Contractor or subcontractor establishes that it has complied with the employment verification provisions prescribed by Sections 274A and 274B of the Federal Immigration and Nationality Act. d. Nondiscrimination. Contractor represents and warrants that it does not discriminate against any employee or applicant for employment or person to whom it provides services because of race, color, religion, sex, national origin, or disability, and represents and warrants that it complies with all applicable federal, state, and local laws and executive orders regarding employment. Contractor and Contractor’s personnel will comply with applicable provisions of Title VII of the U.S. Civil Rights Act of 1964, as amended, Section 504 of the Federal Rehabilitation Act, the Americans with Disabilities Act (42 U.S.C. § 12101 et seq.), and applicable rules in performance under this Agreement. S.11 SALES/USE TAX, OTHER TAXES. a. Contractor is responsible for the payment of all taxes including federal, state, and local taxes related to or arising out of Contractor’s services under this Agreement, including by way of illustration but not limitation, federal and state income tax, Social Security tax, unemployment insurance taxes, and any other taxes or business license fees as required. If any taxing authority should deem Contractor or Contractor employees an employee of the City, or should otherwise claim the City is liable for the payment of taxes that are Contractor’s responsibility under this Agreement, Contractor will indemnify the City for any tax liability, interest, and penalties imposed upon the City. b. The City is exempt from paying state and local sales/use taxes and certain federal excise taxes and will furnish an exemption certificate upon request. TERMS AND CONDITIONS Professional Auditing Services 10 RFP #36-20 S.12 AMOUNTS DUE THE CITY. Contractor must be current and remain current in all obligations due to the City during the performance of services under the Agreement. Payments to Contractor may be offset by any delinquent amounts due the City or fees and charges owed to the City. S.13 OPENNESS OF PROCUREMENT PROCESS. Written competitive proposals, replies, oral presentations, meetings where vendors answer questions, other submissions, correspondence, and all records made thereof, as well as negotiations or meetings where negotiation strategies are discussed, conducted pursuant to this RFP, shall be handled in compliance with Chapters 119 and 286, Florida Statutes. Proposals or replies received by the City pursuant to this RFP are exempt from public disclosure until such time that the City provides notice of an intended decision or until 30 days after opening the proposals, whichever is earlier. If the City rejects all proposals or replies pursuant to this RFP and provides notice of its intent to reissue the RFP, then the rejected proposals or replies remain exempt from public disclosure until such time that the City provides notice of an intended decision concerning the reissued RFP or until the City withdraws the reissued RFP. A proposal or reply shall not be exempt from public disclosure longer than 12 months after the initial City notice rejecting all proposals or replies. Oral presentations, meetings where vendors answer questions, or meetings convened by City staff to discuss negotiation strategies, if any, shall be closed to the public (and other proposers) in compliance with Chapter 286 Florida Statutes. A complete recording shall be made of such closed meeting. The recording of, and any records presented at, the exempt meeting shall be available to the public when the City provides notice of an intended decision or until 30 days after opening proposals or final replies, whichever occurs first. If the City rejects all proposals or replies pursuant to this RFP and provides notice of its intent to reissue the RFP, then the recording and any records presented at the exempt meeting remain exempt from public disclosure until such time that the City provides notice of an intended decision concerning the reissued RFP or until the City withdraws the reissued RFP. A recording and any records presented at an exempt meeting shall not be exempt from public disclosure longer than 12 months after the initial City notice rejecting all proposals or replies. In addition to all other contract requirements as provided by law, the contractor executing this agreement agrees to comply with public records law. IF THE CONTRACTOR HAS QUESTIONS REGARDING THE APPLICATION OF CHAPTER 119, FLORIDA STATUTES, TO THE CONTRACTOR’S DUTY TO PROVIDE PUBLIC RECORDS RELATING TO THIS CONTRACT, CONTACT THE CUSTODIAN OF PUBLIC RECORDS, Rosemarie Call, phone: 727-562-4092 or Rosemarie.Call@myclearwater.com, 600 Cleveland Street, Suite 600, Clearwater, FL 33755. The contractor’s agreement to comply with public records law applies specifically to: a) Keep and maintain public records required by the City of Clearwater (hereinafter “public agency”) to perform the service being provided by the contractor hereunder. b) Upon request from the public agency’s custodian of public records, provide the public agency with a copy of the requested records or allow the records to be inspected or copied within a reasonable time at a cost that does not exceed the cost provided for in Chapter 119, Florida Statutes, as may be amended from time to time, or as otherwise provided by law. c) Ensure that the public records that are exempt or confidential and exempt from public records disclosure requirements are not disclosed except as authorized by law for the duration of the contract term and following completion of the contract if the contractor does not transfer the records to the public agency. TERMS AND CONDITIONS Professional Auditing Services 11 RFP #36-20 d) Upon completion of the contract, transfer, at no cost, to the public agency all public records in possession of the contractor or keep and maintain public records required by the public agency to perform the service. If the contractor transfers all public records to the public agency upon completion of the contract, the contractor shall destroy any duplicate public records that are exempt or confidential and exempt from public records disclosure requirements. If the contractor keeps and maintains public records upon completion of the contract, the contractor shall meet all applicable requirements for retaining public records. All records stored electronically must be provided to the public agency, upon request from the public agency’s custodian of public records, in a format that is compatible with the information technology systems of the public agency. e) A request to inspect or copy public records relating to a public agency’s contract for services must be made directly to the public agency. If the public agency does not possess the requested records, the public agency shall immediately notify the contractor of the request and the contractor must provide the records to the public agency or allow the records to be inspected or copied within a reasonable time. f) The contractor hereby acknowledges and agrees that if the contractor does not comply with the public agency’s request for records, the public agency shall enforce the contract provisions in accordance with the contract. g) A contractor who fails to provide the public records to the public agency within a reasonable time may be subject to penalties under Section 119.10, Florida Statutes. h) If a civil action is filed against a contractor to compel production of public records relating to a public agency’s contract for services, the court shall assess and award against the contractor the reasonable costs of enforcement, including reasonable attorney fees, if: 1. The court determines that the contractor unlawfully refused to comply with the public records request within a reasonable time; and 2. At least eight (8) business days before filing the action, the plaintiff provided written notice of the public records request, including a statement that the contractor has not complied with the request, to the public agency and to the contractor. i) A notice complies with subparagraph (h)2. if it is sent to the public agency’s custodian of public records and to the contractor at the contractor’s address listed on its contract with the public agency or to the contractor’s registered agent. Such notices must be sent by common carrier delivery service or by registered, Global Express Guaranteed, or certified mail, with postage or shipping paid by the sender and with evidence of delivery, which may be in an electronic format. A contractor who complies with a public records request within 8 business days after the notice is sent is not liable for the reasonable costs of enforcement. S.14 AUDITS AND RECORDS. Contractor must preserve the records related to this Agreement for five (5) years after completion of the Agreement. The City or its authorized agent reserves the right to inspect any records related to the performance of work specified herein. In addition, the City may inspect any and all payroll, billing or other relevant records kept by Contractor in relation to the Agreement. Contractor will permit such inspections and audits during normal business hours and upon reasonable notice by the City. The audit of records may occur at Contractor’s place of business or at City offices, as determined by the City. S.15 BACKGROUND CHECK. The City may conduct criminal, driver history, and all other requested background checks of Contractor personnel who would perform services under the Agreement or who will have access to the City’s information, data, or facilities in accordance with the City’s current TERMS AND CONDITIONS Professional Auditing Services 12 RFP #36-20 background check policies. Any officer, employee, or agent that fails the background check must be replaced immediately for any reasonable cause not prohibited by law. S.16 SECURITY CLEARANCE AND REMOVAL OF CONTRACTOR PERSONNEL. The City will have final authority, based on security reasons: (i) to determine when security clearance of Contractor personnel is required; (ii) to determine the nature of the security clearance, up to and including fingerprinting Contractor personnel; and (iii) to determine whether or not any individual or entity may provide services under this Agreement. If the City objects to any Contractor personnel for any reasonable cause not prohibited by law, then Contractor will, upon notice from the City, remove any such individual from performance of services under this Agreement. S.17 DEFAULT. a. A party will be in default if that party: (i) Is or becomes insolvent or is a party to any voluntary bankruptcy or receivership proceeding, makes an assignment for a creditor, or there is any similar action that affects Contractor’s capability to perform under the Agreement; (ii) Is the subject of a petition for involuntary bankruptcy not removed within sixty (60) calendar days; (iii) Conducts business in an unethical manner or in an illegal manner; or (iv) Fails to carry out any term, promise, or condition of the Agreement. b. Contractor will be in default of this Agreement if Contractor is debarred from participating in City procurements and solicitations in accordance with Section 27 of the City’s Purchasing and Procedures Manual. c. Notice and Opportunity to Cure. In the event a party is in default then the other party may, at its option and at any time, provide written notice to the defaulting party of the default. The defaulting party will have thirty (30) days from receipt of the notice to cure the default; the thirty (30) day cure period may be extended by mutual agreement of the parties, but no cure period may exceed ninety (90) days. A default notice will be deemed to be sufficient if it is reasonably calculated to provide notice of the nature and extent of such default. Failure of the non- defaulting party to provide notice of the default does not waive any rights under the Agreement. d. Anticipatory Repudiation. Whenever the City in good faith has reason to question Contractor’s intent or ability to perform, the City may demand that Contractor give a written assurance of its intent and ability to perform. In the event that the demand is made and no written assurance is given within five (5) calendar days, the City may treat this failure as an anticipatory repudiation of the Agreement. S.18 REMEDIES. The remedies set forth in this Agreement are not exclusive. Election of one remedy will not preclude the use of other remedies. In the event of default: a. The non-defaulting party may terminate the Agreement, and the termination will be effective immediately or at such other date as specified by the terminating party. b. The City may purchase the services required under the Agreement from the open market, complete required work itself, or have it completed at the expense of Contractor. If the cost of obtaining substitute services exceeds the contract price, the City may recover the excess cost by: (i) requiring immediate reimbursement to the City; (ii) deduction from an unpaid balance due to Contractor; (iii) collection against the proposal and/or performance security, if any; (iv) collection against liquidated damages (if applicable); or (v) a combination of the aforementioned remedies or other remedies as provided by law. Costs includes any and all, fees, and expenses incurred in obtaining substitute services and expended in obtaining reimbursement, including, but not limited to, administrative expenses, attorneys’ fees, and costs. TERMS AND CONDITIONS Professional Auditing Services 13 RFP #36-20 c. The non-defaulting party will have all other rights granted under this Agreement and all rights at law or in equity that may be available to it. d. Neither party will be liable for incidental, special, or consequential damages. S.19 CONTINUATION DURING DISPUTES. Contractor agrees that during any dispute between the parties, Contractor will continue to perform its obligations until the dispute is settled, instructed to cease performance by the City, enjoined or prohibited by judicial action, or otherwise required or obligated to cease performance by other provisions in this Agreement. S.20 TERMINATION FOR CONVENIENCE. The City reserves the right to terminate this Agreement in part or in whole upon thirty (30) calendar days’ written notice. S.21 CONFLICT OF INTEREST F.S. Section 112. Pursuant to F.S. Section 112, the City may cancel this Agreement after its execution, without penalty or further obligation, if any person significantly involved in initiating, securing, drafting, or creating the Agreement for the City becomes an employee or agent of Contractor. S.22 TERMINATION FOR NON-APPROPRIATION AND MODIFICATION FOR BUDGETARY CONSTRAINT. The City is a governmental agency which relies upon the appropriation of funds by its governing body to satisfy its obligations. If the City reasonably determines that it does not have funds to meet its obligations under this Agreement, the City will have the right to terminate the Agreement without penalty on the last day of the fiscal period for which funds were legally available. In the event of such termination, the City agrees to provide written notice of its intent to terminate thirty (30) calendar days prior to the stated termination date. S.23 PAYMENT TO CONTRACTOR UPON TERMINATION. Upon termination of this Agreement, Contractor will be entitled only to payment for those services performed up to the date of termination, and any authorized expenses already incurred up to such date of termination. The City will make final payment within thirty (30) calendar days after the City has both completed its appraisal of the materials and services provided and received Contractor’s properly prepared final invoice. S.24 NON-WAIVER OF RIGHTS. There will be no waiver of any provision of this agreement unless approved in writing and signed by the waiving party. Failure or delay to exercise any rights or remedies provided herein or by law or in equity, or the acceptance of, or payment for, any services hereunder, will not release the other party of any of the warranties or other obligations of the Agreement and will not be deemed a waiver of any such rights or remedies. S.25 INDEMNIFICATION/LIABILITY. a. To the fullest extent permitted by law, Contractor agrees to defend, indemnify, and hold the City, its officers, agents, and employees, harmless from and against any and all liabilities, demands, claims, suits, losses, damages, causes of action, fines or judgments, including costs, attorneys’, witnesses’, and expert witnesses’ fees, and expenses incident thereto, relating to, arising out of, or resulting from: (i) the services provided by Contractor personnel under this Agreement; (ii) any negligent acts, errors, mistakes or omissions by Contractor or Contractor personnel; and (iii) Contractor or Contractor personnel’s failure to comply with or fulfill the obligations established by this Agreement. b. Contractor will update the City during the course of the litigation to timely notify the City of any issues that may involve the independent negligence of the City that is not covered by this indemnification. c. The City assumes no liability for actions of Contractor and will not indemnify or hold Contractor or any third party harmless for claims based on this Agreement or use of Contractor-provided supplies or services. S.26 WARRANTY. Contractor warrants that the services and materials will conform to the requirements of the Agreement. Additionally, Contractor warrants that all services will be performed in a good, workman-like and professional manner. The City’s acceptance of service or materials provided by Contractor will not relieve Contractor from its obligations under this warranty. If any materials or TERMS AND CONDITIONS Professional Auditing Services 14 RFP #36-20 services are of a substandard or unsatisfactory manner as determined by the City, Contractor, at no additional charge to the City, will provide materials or redo such services until in accordance with this Agreement and to the City’s reasonable satisfaction. Unless otherwise agreed, Contractor warrants that materials will be new, unused, of most current manufacture and not discontinued, will be free of defects in materials and workmanship, will be provided in accordance with manufacturer's standard warranty for at least one (1) year unless otherwise specified, and will perform in accordance with manufacturer's published specifications. S.27 THE CITY’S RIGHT TO RECOVER AGAINST THIRD PARTIES. Contractor will do nothing to prejudice the City’s right to recover against third parties for any loss, destruction, or damage to City property, and will at the City’s request and expense, furnish to the City reasonable assistance and cooperation, including assistance in the prosecution or defense of suit and the execution of instruments of assignment in favor of the City in obtaining recovery. S.28 NO GUARANTEE OF WORK. Contractor acknowledges and agrees that it is not entitled to deliver any specific amount of materials or services or any materials or services at all under this Agreement and acknowledges and agrees that the materials or services will be requested by the City on an as needed basis at the sole discretion of the City. Any document referencing quantities or performance frequencies represent the City's best estimate of current requirements, but will not bind the City to purchase, accept, or pay for materials or services which exceed its actual needs. S.29 OWNERSHIP. All deliverables, services, and information provided by Contractor or the City pursuant to this Agreement (whether electronically or manually generated) including without limitation, reports, test plans, and survey results, graphics, and technical tables, originally prepared in the performance of this Agreement, are the property of the City and will not be used or released by Contractor or any other person except with prior written permission by the City. S.30 USE OF NAME. Contractor will not use the name of the City of Clearwater in any advertising or publicity without obtaining the prior written consent of the City. S.31 PROHIBITED ACTS. Pursuant to Florida Constitution Article II Section 8, a current or former public officer or employee within the last two (2) years shall not represent another organization before the City on any matter for which the officer or employee was directly concerned and personally participated in during their service or employment or over which they had a substantial or material administrative discretion. S.32 FOB DESTINATION FREIGHT PREPAID AND ALLOWED. All deliveries will be FOB destination freight prepaid and allowed unless otherwise agreed. S.33 RISK OF LOSS. Contractor agrees to bear all risks of loss, injury, or destruction of goods or equipment incidental to providing these services and such loss, injury, or destruction will not release Contractor from any obligation hereunder. S.34 SAFEGUARDING CITY PROPERTY. Contractor will be responsible for any damage to City real property or damage or loss of City personal property when such property is the responsibility of or in the custody of Contractor or its employees. S.35 WARRANTY OF RIGHTS. Contractor warrants it has title to, or the right to allow the City to use, the materials and services being provided and that the City may use same without suit, trouble or hindrance from Contractor or third parties. S.36 PROPRIETARY RIGHTS INDEMNIFICATION. Without limiting the foregoing, Contractor will without limitation, at its expense defend the City against all claims asserted by any person that anything provided by Contractor infringes a patent, copyright, trade secret or other intellectual property right and must, without limitation, pay the costs, damages and attorneys' fees awarded against the City in any such action, or pay any settlement of such action or claim. Each party agrees to notify the other promptly of any matters to which this provision may apply and to cooperate with each other in connection with such defense or settlement. If a preliminary or final judgment is obtained against the City’s use or operation of the items provided by Contractor hereunder or any part thereof by reason of any alleged infringement, Contractor will, at its expense and without TERMS AND CONDITIONS Professional Auditing Services 15 RFP #36-20 limitation, either: (a) modify the item so that it becomes non-infringing; (b) procure for the City the right to continue to use the item; (c) substitute for the infringing item other item(s) having at least equivalent capability; or (d) refund to the City an amount equal to the price paid, less reasonable usage, from the time of installation acceptance through cessation of use, which amount will be calculated on a useful life not less than five (5) years, plus any additional costs the City may incur to acquire substitute supplies or services. S.37 CONTRACT ADMINISTRATION. The contract will be administered by the Procurement Division and/or an authorized representative from the using department. All questions regarding the contract will be referred to the Procurement Division for resolution. Supplements may be written to the contract for the addition or deletion of services. S.38 FORCE MAJEURE. Failure by either party to perform its duties and obligations will be excused by unforeseeable circumstances beyond its reasonable control, including acts of nature, acts of the public enemy, riots, fire, explosion, legislation, and governmental regulation. The party whose performance is so affected will within five (5) calendar days of the unforeseeable circumstance notify the other party of all pertinent facts and identify the force majeure event. The party whose performance is so affected must also take all reasonable steps, promptly and diligently, to prevent such causes if it is feasible to do so, or to minimize or eliminate the effect thereof. The delivery or performance date will be extended for a period equal to the time lost by reason of delay, plus such additional time as may be reasonably necessary to overcome the effect of the delay, provided however, under no circumstances will delays caused by a force majeure extend beyond one hundred-twenty (120) calendar days from the scheduled delivery or completion date of a task unless agreed upon by the parties. S.39 COOPERATIVE USE OF CONTRACT. The City has entered into various cooperative purchasing agreements with other Florida government agencies, including the Tampa Bay Area Purchasing Cooperative. Under a Cooperative Purchasing Agreement, any contract may be extended for use by other municipalities, school districts and government agencies with the approval of Contractor. Any such usage by other entities must be in accordance with the statutes, codes, ordinances, charter and/or procurement rules and regulations of the respective government agency. Orders placed by other agencies and payment thereof will be the sole responsibility of that agency. The City is not responsible for any disputes arising out of transactions made by others. S.40 FUEL CHARGES AND PRICE INCREASES. No fuel surcharges will be accepted. No price increases will be accepted without proper request by Contractor and response by the City’s Procurement Division. S.41 NOTICES. All notices to be given pursuant to this Agreement must be delivered to the parties at their respective addresses. Notices may be (i) personally delivered; (ii) sent via certified or registered mail, postage prepaid; (iii) sent via overnight courier; or (iv) sent via facsimile. If provided by personal delivery, receipt will be deemed effective upon delivery. If sent via certified or registered mail, receipt will be deemed effective three (3) calendar days after being deposited in the United States mail. If sent via overnight courier or facsimile, receipt will be deemed effective two (2) calendar days after the sending thereof. S.42 GOVERNING LAW, VENUE. This Agreement is governed by the laws of the State of Florida. The exclusive venue selected for any proceeding or suit in law or equity arising from or incident to this Agreement will be Pinellas County, Florida. S.43 INTEGRATION CLAUSE. This Agreement, including all attachments and exhibits hereto, supersede all prior oral or written agreements, if any, between the parties and constitutes the entire agreement between the parties with respect to the work to be performed. S.44 PROVISIONS REQUIRED BY LAW. Any provision required by law to be in this Agreement is a part of this Agreement as if fully stated in it. S.45 SEVERABILITY. If any provision of this Agreement is declared void or unenforceable, such provision will be severed from this Agreement, which will otherwise remain in full force and effect. The parties will negotiate diligently in good faith for such amendment(s) of this Agreement as may TERMS AND CONDITIONS Professional Auditing Services 16 RFP #36-20 be necessary to achieve the original intent of this Agreement, notwithstanding such invalidity or unenforceability. S.46 SURVIVING PROVISIONS. Notwithstanding any completion, termination, or other expiration of this Agreement, all provisions which, by the terms of reasonable interpretation thereof, set forth rights and obligations that extend beyond completion, termination, or other expiration of this Agreement, will survive and remain in full force and effect. Except as specifically provided in this Agreement, completion, termination, or other expiration of this Agreement will not release any party from any liability or obligation arising prior to the date of termination. DETAILED SPECIFICATIONS Professional Auditing Services 17 RFP #36-20 1. INTRODUCTION. The City of Clearwater (City) is located on the West Coast of Florida in the Tampa Bay region. It is the third largest city in the region with an estimated population of 116,585 residents. The City of Clearwater is also a major tourist destination – Clearwater Beach has been rated #1 U.S. Beach by TripAdvisor, “Florida’s Best Beach Town 2013” by USA Today, and was on the “Top Ten List of Best Beaches from Maine to Hawaii”. The City of Clearwater is home to the Philadelphia Phillies Spring Training and Clearwater Threshers Minor League Baseball, as well as hosting several sports tournaments through the year that attract visitors from across the country. Clearwater is home for Winter the Dolphin and the Clearwater Marine Aquarium. Winter’s story made it all the way to Hollywood in the motion pictures “Dolphin Tale” and “Dolphin Tale 2”, both filmed here in Clearwater. 2. PROJECT GOAL. The City of Clearwater is seeking proposals from qualified firms of certified public accountants to audit the financial statements of the City of Clearwater, Florida for the five (5) fiscal years ending September 30, 2020, 2021, 2022, 2023, and 2024. 3. BACKGROUND/DESCRIPTION OF GOVERNMENT. The City of Clearwater serves an area of approximately twenty-six (26) square miles with a population of approximately 116,585. The City’s fiscal year begins October 1st and ends September 30th. The City of Clearwater provides the following services to its citizens: ➢ Police and fire protection ➢ Construction and maintenance of streets, bridges, sidewalks, storm drainage, public parks, and recreational facilities ➢ City planning, zoning, subdivision and building code regulation and enforcement ➢ Supervised recreation programs ➢ Public libraries ➢ Redevelopment of declining commercial and residential neighborhoods ➢ Refuse and trash collection ➢ Comprehensive recycling program ➢ Natural gas distribution ➢ Water supply and distribution ➢ Storm and wastewater collection, treatment, and disposal ➢ Parking system ➢ Marina, downtown boat slips, and beach fishing pier ➢ Executive airpark More detailed information on the government and its finances can be found in the annual budget and comprehensive annual financial report documents. These documents are available for review at the City’s website: https://www.myclearwater.com/government/city-departments/finance-budget (Finance & Budget Documents & Publications). 4. SCOPE OF SERVICES. The selected firm is expected to perform the following work as tasked by the City: A. SERVICE REQUIREMENTS A.1 Express opinion on the fair presentation of the City’s basic financial statements in conformity with U.S. generally accepted accounting principles no later than February 28th annually. A.2 Express opinion on the fair presentation of City’s individual non-major governmental, non-major enterprise, internal service and fiduciary funds financial statements, including any budgetary comparisons presented as basic financial statements, in conformity with U.S. generally accepted accounting principles, no later than February 28th annually. A.3 Provide an “in-relation-to” opinion on the supporting schedules of federal and state financial assistance, as well as all statements and schedules included within the financial section of the Comprehensive Annual Financial Report (CAFR). A.4 Perform DETAILED SPECIFICATIONS Professional Auditing Services 18 RFP #36-20 certain limited procedures involving required supplementary information as mandated by generally accepted auditing standards. A.5 Provide a report on internal controls over financial reporting and on compliance and other matters based on an audit of financial statements performed in accordance with government auditing standards. A.6 Provide a report on compliance with requirements applicable to each major Federal program and state financial assistance project and on internal control over compliance required by Title 2, U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and Chapter 10.550, Rules of the Auditor General. A.7 Provide a schedule of findings and questioned costs as mandated by Title 2, U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), and the Florida Single Audit Act. A.8 Provide any other reports required by the Uniform Guidance and the Florida Single Audit Act. A.9 Provide a Management Letter as required by Section 10.554(1)(i) of the Rules of the Auditor General of the State of Florida including all required disclosures. A.10 Provide an Independent Accountant’s Report as required by the Florida Auditor General. A.11 Audit the special purpose Schedule of Revenues and Expenditures of Emergency Medical Services and render an opinion as to whether the Schedule presents fairly, in all material respects, the revenues and expenditures related to the Emergency Medical Services (EMS) of the City in accordance with the ALS First Responder Agreement. A.12 Complete the appropriate sections of and sign the Data Collection Form. B. AUDITING STANDARDS The audit shall be performed in accordance with: ➢ Generally Accepted Auditing Standards (GAAS) as set forth by the American Institute of Certified Public Accountants ➢ Government Auditing Standards issued by the Comptroller General of the United States ➢ Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) ➢ Florida Single Audit Act; Section 215.97, Florida Statutes ➢ Chapter 10.550, Rules of the Auditor General ➢ Chapter 11.45, Florida Statutes ➢ State of Florida Department of Banking and Finance Regulations ➢ Audits of State and Local Governmental Units (Revised) – AICPA ➢ Any other applicable federal, state and local laws, regulations, or professional guidance not specifically listed above as well as any additional requirements which may be adopted by these organizations in the future C. ASSISTANCE TO BE PROVIDED TO THE AUDITOR C.1 The City of Clearwater will prepare draft financial statements, notes, and all required supplementary schedules and statistical data, including the Schedule of Expenditures of Federal Awards and State Financial Assistance. C.2 Finance staff and responsible management personnel will be available during the audit to assist the firm in providing additional information, documentation, and explanations. City of Clearwater Electronic Data Processing (EDP) personnel will be available to provide systems documentation and explanations. C.3 The preparation of confirmations shall be the responsibility of the City of Clearwater as directed by the auditor. C.4 The City’s Assistant Finance Director, or designee, will act as coordinator for the audit and will be the primary contact for assistance to be provided to the auditor by the City. DETAILED SPECIFICATIONS Professional Auditing Services 19 RFP #36-20 C.5 The City will provide reasonable workspace, tables, chairs, computer access, telephone access, photocopying facilities, and facsimile services for the on-site audit staff, to be used solely for the audit of the City. C.6 CAFR preparation and printing shall be the responsibility of the City. D. SPECIAL CONSIDERATIONS D.1 The City requires that auditors opine at the fund level across all funds, including non- major funds. D.2 The City has received the Certificate of Achievement for Excellence in Financial Reporting for the past forty consecutive years and will continue to submit its Comprehensive Annual Financial Report (CAFR) to the Government Finance Officers Association for review via its Certificate of Achievement for Excellence in Financial Reporting program. It is expected that the auditor will assist in the review of the report for compliance with the requirements of that program prior to submission. D.3 The City currently anticipates it will prepare one or more official statements in connection with the sale of debt securities which will contain the general purpose financial statements and the auditor’s reports thereon. The auditor shall be required, if requested by the City, to issue a “consent and citation of expertise” as the auditor along with any necessary “comfort letters” at no additional cost to the City. D.4 The City has determined that the U.S. Department of Housing and Urban Development will function as the cognizant agency in accordance with the provisions of Title 2, U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). D.5 The Schedule of Expenditures of Federal and State Awards and the related auditor’s report, as well as the related reports on compliance and internal control, and the management letter are to be issued as part of the CAFR. D.6 The auditor will assist the City in complying with changes in reporting requirements to remain in conformity with Generally Accepted Accounting Principles. D.7 The auditors shall be required to issue an immediate written report of all irregularities and illegal acts or indications of illegal acts of which they become aware to the City Manager, the Auditor Selection Committee and/or the City Council, as appropriate. D.8 The auditor shall submit a signed audit report on the fair presentation of the financial statements in conformity with generally accepted accounting principles no later than February 28th annually, along with the required reports on internal controls and compliance with laws and regulations. D.9 The firm shall provide the City of Clearwater timely written notice of any professional relationships involving the City or component units which the firm enters into during the period of this agreement. D.10 Engagement partners, managers, other supervisory staff and specialists may be changed if those personnel leave the firm, are promoted, or are assigned to another office. These personnel may also be changed for other reasons with the express prior written permission of the City of Clearwater, which retains the right to approve or reject replacements. Other audit personnel may be changed at the discretion of the firm provided that replacements have substantially equivalent or better qualifications and experience. E. WORKING PAPER RETENTION AND ACCESS TO WORKING PAPERS E.1 All working papers and reports must be retained, at the auditor’s expense, for a minimum of five (5) years, unless the firm is notified in writing by the City of the need to extend the retention period; except grant-related working papers will be retained for ten (10) years. E.2 The auditor will be required to make working papers available, upon request, to the following parties or their designees: ➢ City of Clearwater ➢ U.S. Department of Housing and Urban Development ➢ U.S. General Accounting Office (GAO) DETAILED SPECIFICATIONS Professional Auditing Services 20 RFP #36-20 ➢ Parties designated by the federal or state governments or by the City as part of an audit quality review process ➢ Auditors of entities of which the City of Clearwater is a sub-recipient of grant funds ➢ In addition, the firm shall respond to the reasonable inquiries of successor auditors and allow successor auditors to review working papers relating to matters of continuing accounting significance. F. MISCELLANEOUS INFORMATION Pension Plans The City of Clearwater Participates in the following retirement plans: Plan Single Employer Defined Benefit Defined Contribution Clearwater Employees’ X Clearwater Firefighters’ Relief X Firefighters’ Supplemental (Ch.175) X Police Officers’ Supplemental (Ch.185) X Management (401a) X The actuarial services for the Clearwater Employees’ and Clearwater Firefighters’ Relief pension plans are currently provided by Gabriel Roeder Smith & Company and Mouton & Company, respectively. Deferred Compensation Plans The City offers its employees a deferred compensation plan adopted under Internal Revenue Code Section 457. Insurance The City is self-insured within certain parameters for losses arising from claims for property damage, general liability, auto liability and physical damage and workers’ compensation. The City’s current actuary for the self-insurance program is Madison Consulting Group, Inc. The City is also self-insured within certain parameters for employee and retiree health care coverage. A Claim Liability Estimate is provided as of September 30thof each year. The City’s current actuary is Wakely Consulting Group. Component Unit Clearwater Redevelopment Agency (CRA) - a blended component unit, is presented as a non- major special revenue fund in the City’s Comprehensive Annual Financial Report. Separate financial statements are not available for the CRA. 5. MINIMUM QUALIFICATIONS. Firms responding to this RFP must explain their experience with Auditing services in Response Elements, Item 2, Tab 2, Qualifications, Experience and Project Personnel Expertise. With the Qualifications statement, a minimum of three (3) references, preferably from other public entities within the State of Florida, for which similar services have been provided, are required. 6. INSURANCE REQUIREMENTS. The Vendor shall, at its own cost and expense, acquire and maintain (and cause any subcontractors, representatives or agents to acquire and maintain) during the term with the City, sufficient insurance to adequately protect the respective interest of the parties. Coverage shall be obtained with a carrier having an AM Best Rating of A-VII or better. In addition, the City has the right to review the Contractor’s deductible or self-insured retention and to require that it be reduced or eliminated. DETAILED SPECIFICATIONS Professional Auditing Services 21 RFP #36-20 Specifically the Vendor must carry the following minimum types and amounts of insurance on an occurrence basis or in the case of coverage that cannot be obtained on an occurrence basis, then coverage can be obtained on a claims-made basis with a minimum three (3) year tail following the termination or expiration of this Agreement: a. Commercial General Liability Insurance coverage, including but not limited to, premises operations, products/completed operations, products liability, contractual liability, advertising injury, personal injury, death, and property damage in the minimum amount of $1,000,000 (one million dollars) per occurrence and $2,000,000 (two million dollars) general aggregate. b. Commercial Automobile Liability Insurance coverage for any owned, non-owned, hired or borrowed automobile is required in the minimum amount of $1,000,000 (one million dollars) combined single limit. c. Professional Liability/Malpractice/Errors or Omissions Insurance coverage appropriate for the type of business engaged in by the Respondent with minimum limits of $2,000,000 (two million dollars) per occurrence. If a claims made form of coverage is provided, the retroactive date of coverage shall be no later than the inception date of claims made coverage, unless the prior policy was extended indefinitely to cover prior acts. Coverage shall be extended beyond the policy year either by a supplemental extended reporting period (SERP) of as great a duration as available, and with no less coverage and with reinstated aggregate limits, or by requiring that any new policy provide a retroactive date no later than the inception date of claims made coverage. d. Unless waived by the State of Florida and proof of waiver is provided to the City, statutory Workers’ Compensation Insurance coverage in accordance with the laws of the State of Florida, and Employer’s Liability Insurance in the minimum amount of $500,000 (five hundred thousand dollars) each employee each accident, $500,000 (five hundred thousand dollars) each employee by disease, and $500,000 (five hundred thousand dollars) disease policy limit. Coverage should include Voluntary Compensation, Jones Act, and U.S. Longshoremen’s and Harbor Worker’s Act coverage where applicable. Coverage must be applicable to employees, contractors, subcontractors, and volunteers, if any. The above insurance limits may be achieved by a combination of primary and umbrella/excess liability policies. Other Insurance Provisions. a. Prior to the execution of this Agreement, and then annually upon the anniversary date(s) of the insurance policy’s renewal date(s) for as long as this Agreement remains in effect, the Vendor will furnish the City with a Certificate of Insurance(s) (using appropriate ACORD certificate, SIGNED by the Issuer, and with applicable endorsements) evidencing all of the coverage set forth above and naming the City as an “Additional Insured” on the Commercial General Liability Insurance and the Commercial Automobile Liability Insurance. In addition when requested in writing from the City, Vendor will provide the City with certified copies of all applicable policies. The address where such certificates and certified policies shall be sent or delivered is as follows: City of Clearwater Attn: Procurement Division, RFP #36-20 P.O. Box 4748 Clearwater, FL 33758-4748 b. Vendor shall provide thirty (30) days written notice of any cancellation, non-renewal, DETAILED SPECIFICATIONS Professional Auditing Services 22 RFP #36-20 termination, material change or reduction in coverage. c. Vendor’s insurance as outlined above shall be primary and non-contributory coverage for Vendor’s negligence. d. Vendor reserves the right to appoint legal counsel to provide for the Vendor’s defense, for any and all claims that may arise related to Agreement, work performed under this Agreement, or to Vendor’s design, equipment, or service. Vendor agrees that the City shall not be liable to reimburse Vendor for any legal fees or costs as a result of Vendor providing its defense as contemplated herein. The stipulated limits of coverage above shall not be construed as a limitation of any potential liability to the City, and City’s failure to request evidence of this insurance shall not be construed as a waiver of Vendor’s (or any contractors’, subcontractors’, representatives’ or agents’) obligation to provide the insurance coverage specified. MILESTONES Professional Auditing Services 23 RFP #36-20 1. ANTICIPATED BEGINNING AND END DATE OF INITIAL TERM. August 2020 through July 2025. If the commencement of performance is delayed because the City does not execute the contract on the start date, the City may adjust the start date, end date and milestones to reflect the delayed execution. This contract is intended to be for a five (5) year term, with each year of the term subject to annual review and approval by the City. If for any reason the City feels like the firm provided poor performance, not adhering to time schedules, or had excessive fee increases the City will have the right to terminate the contract. 2. EXTENSION. The City reserves the right to extend the term of this contract, provided however, that the City shall give written notice of its intentions to extend this contract no later than thirty (30) days prior to the expiration date of the contract. 3. PRICES. All pricing shall be firm as proposed for the five (5) year term and include all transportation, insurance and warranty costs. The City shall not be invoiced at prices higher than those stated in any contract resulting from this proposal. a. The Contractor certifies that the prices offered are no higher than the lowest price the Contractor charges other buyers for similar quantities under similar conditions. The Contractor further agrees that any reductions in the price of the goods or services covered by this proposal and occurring after award will apply to the undelivered balance. The Contractor shall promptly notify the City of such price reductions. b. No fuel surcharges will be accepted. RESPONSE ELEMENTS Professional Auditing Services 24 RFP #36-20 1. PROPOSAL SUBMISSION – Proposals should be submitted electronically through our bids website at https://www.myclearwater.com/business/rfp. 2. PROPOSAL FORMAT (the following should be included and referenced with index tabs) NOTE: Every response received by the City will be considered a public record pursuant to Chapter 119, Florida Statutes. Any response marked confidential may be deemed non- responsive to this RFP. Table of Contents: Identify contents by tab and page number TAB 1 - Letter of Transmittal and Independence. This section should include the following information: a. The proposer’s understanding of the work to be performed. b. A positive commitment to perform the service within the time period specified. c. An affirmative statement that the firm is independent of the City of Clearwater and any potential component units as defined by generally accepted auditing standards and the U.S. General Accounting Office’s General Auditing Standards. d. List and describe the firm’s (or proposed subcontractors’) professional relationships involving the City of Clearwater or any of its actual or potential component units for the past five (5) years, together with a statement explaining why such relationships do not constitute a conflict of interest relative to performing the audit. TAB 2 – Qualifications, Experience and Project Personnel Expertise. The following information should be included: Firm Qualifications and Experience. a. The proposal should indicate the total number of employees of the firm, the number of employees considered to be governmental audit staff, the location of the office from which the work on this engagement is to be performed, the number and nature of the professional staff to be employed in this engagement on a full-time basis, and the number and nature of the staff to be employed on a part-time basis. b. If the proposal is submitted by a joint venture or consortium, the qualifications of each firm comprising the joint venture or consortium should be separately identified and the firm that is to serve as the principal auditor should be noted, if applicable. c. The firm is also required to submit a copy of the report on its most recent external quality control review, with a statement whether that quality control review included a review of specific governmental engagements. d. The firm shall also provide information on the results of any federal or state desk reviews or field reviews of its audits during the past three (3) years. In addition, the firm shall provide information on the circumstances and status of any disciplinary actions taken or pending against the firm during the past three (3) years with the state regulatory bodies or professional organizations. Partners, Supervisory, and Staff Qualifications and Experience. a. The firm should identify the principal supervisory and management staff, including engagement partners, managers, single audit staff, and other supervisors and specialists, who would be assigned to the engagement and indicate whether each such person is licensed to practice as a certified public accountant in Florida. The firm also should provide information on the governmental auditing experience of each person, including information on relevant continuing professional education for RESPONSE ELEMENTS Professional Auditing Services 25 RFP #36-20 the past three (3) years and membership in professional organizations relevant to the performance of this audit. b. The firm should provide as much information as possible regarding the number, qualifications, experience, and training, including relevant continuing professional education, of the specified staff to be assigned to this engagement. The firm should indicate how the quality of staff over the term of the agreement will be assured. Prior Engagements with Other Governmental Entities. The following information should be included: a. The firm should list separately all engagements within the last five (5) years for other Governmental entities, by type of engagement (i.e. audit, management advisory services, other). b. For each engagement, the firm should indicate the scope of work, date, engagement partners, total hours, the location of the firm’s office from which the engagement was performed, and the name and current telephone number of the principal client contact. Similar Engagements with Other Governmental Entities. The following information should be included: a. For the firm’s office that will be assigned responsibility for the audit, list the five (5) most significant engagements performed in the last five (5) years that are similar to the engagement described in this Request for Proposal. b. Indicate the scope of work, date, engagement partners, total hours, managers, specialists, and the name and telephone number of the principal client contact. TAB 3 – Audit Approach. - The proposal should set forth a general work plan, including an explanation of the audit methodology to be followed. Firms will be required to provide the following information regarding their audit approach: a. Proposed segmentation of the engagement b. Level of staff and percentage of hours to be assigned to each proposed segment of the engagement c. Extent of EDP software use in the engagement d. Approach to be taken to gain and document an understanding of the City of Clearwater’s internal control structure e. Approach to be taken in determining laws and regulations subject to audit test work f. Sample sizes and the extent to which statistical sampling is to be used in the engagement g. Type and extent of analytical procedures to be used in the engagement h. Approach to be taken in drawing audit samples for purposes of tests of compliance Identification of Potential Audit Problems. The proposal should identify and describe any potential audit problems, the firm’s approach to resolving, and any special assistance that will be requested from the City. TAB 4 – References. A minimum of three (3) references, preferably from other public entities within the State of Florida, for whom you have provided similar services. Include the name of entity, RESPONSE ELEMENTS Professional Auditing Services 26 RFP #36-20 contact person’s names, phone numbers, e-mail addresses, mailing addresses, type of service provided, dates these services were provided. TAB 5 – Cost Proposal. The cost portion should contain the following information: a. Pricing information relative to performing the audit engagement as described in this request for proposals. The total all-inclusive maximum price bid is to contain all direct and indirect costs, including all out-of-pocket expenses. b. A total all-inclusive maximum price for each of the 2020, 2021, 2022, 2023, and 2024 engagements, along with the signature of an individual empowered to represent the firm and sign a contract with the City. The fee for the EMS audit as described in Section 4.A.10. of this RFP should be identified separately for each year. c. Progress payments will be made on the basis of hours of work completed during the course of the engagement in accordance with an agreement reached during contracted negotiations. Interim billings shall cover a period of not less than a calendar month. Twenty percent (20%) of the total annual contract will be retained pending delivery and acceptance of the firm’s final reports. TAB 6 - Other Forms. The following forms should be completed and signed: 1. Exceptions/Additional Materials/Addenda form 2. Vendor Information form 3. Vendor Certification of Proposal form 4. Scrutinized Companies form(s) as required 5. Copies of licenses and/or certifications, as required 6. W-9 Form. Include a current W-9 form (http://www.irs.gov/pub/irs-pdf/fw9.pdf) EXCEPTIONS / ADDITIONAL MATERIAL / ADDENDA Professional Auditing Services 27 RFP #36-20 Proposers shall indicate any and all exceptions taken to the provisions or specifications in this solicitation document. Exceptions that surface elsewhere and that do not also appear under this section shall be considered invalid and void and of no contractual significance. Exceptions (mark one): **Special Note – Any material exceptions taken to the City’s Terms and Conditions may render a Proposal non-responsive. No exceptions Exceptions taken (describe--attach additional pages if needed) Additional Materials submitted (mark one): No additional materials have been included with this proposal Additional Materials attached (describe--attach additional pages if needed) Acknowledgement of addenda issued for this solicitation: Prior to submitting a response to this solicitation, it is the vendor’s responsibility to confirm if any addenda have been issued. Addenda Number Initial to acknowledge receipt Vendor Name Date: VENDOR INFORMATION Professional Auditing Services 28 RFP #36-20 Company Legal/Corporate Name: Doing Business As (if different than above): Address: City: State: Zip: - Phone: Fax: E-Mail Address: Website: DUNS # Remit to Address (if different than above): Order from Address (if different from above): Address: Address: City: State: Zip: City: State: Zip: Contact for Questions about this proposal: Name: Fax: Phone: E-Mail Address: Day-to-Day Project Contact (if awarded): Name: Fax: Phone: E-Mail Address: Certified Small Business Certifying Agency: Certified Minority, Woman or Disadvantaged Business Enterprise Certifying Agency: VENDOR CERTIFICATION OF PROPOSAL Professional Auditing Services 29 RFP #36-20 By signing and submitting this Proposal, the Vendor certifies that: a) It is under no legal prohibition to contract with the City of Clearwater. b) It has read, understands, and is in compliance with the specifications, terms and conditions stated herein, as well as its attachments, and any referenced documents. c) It has no known, undisclosed conflicts of interest. d) The prices offered were independently developed without consultation or collusion with any of the other respondents or potential respondents or any other anti-competitive practices. e) No offer of gifts, payments or other consideration were made to any City employee, officer, elected official, or consultant who has or may have had a role in the procurement process for the services and or goods/materials covered by this contract. f) It understands the City of Clearwater may copy all parts of this response, including without limitation any documents and/or materials copyrighted by the respondent, for internal use in evaluating respondent’s offer, or in response to a public records request under Florida’s public records law (F.S. 119) or other applicable law, subpoena, or other judicial process. g) Respondent hereby warrants to the City that the respondent and each of its subcontractors (“Subcontractors”) will comply with, and are contractually obligated to comply with, all Federal Immigration laws and regulations that relate to their employees. h) Respondent certifies that they are not in violation of section 6(j) of the Federal Export Administration Act and not debarred by any Federal or public agency. i) It will provide the materials or services specified in compliance with all Federal, State, and Local Statutes and Rules if awarded by the City. j) It is current in all obligations due to the City. k) It will accept such terms and conditions in a resulting contract if awarded by the City. l) The signatory is an officer or duly authorized agent of the respondent with full power and authority to submit binding offers for the goods or services as specified herein. ACCEPTED AND AGREED TO: Company Name: Signature: Printed Name: Title: Date: SCRUTINIZED COMPANIES FORMS Professional Auditing Services 30 RFP #36-20 SCRUTINIZED COMPANIES AND BUSINESS OPERATIONS WITH CUBA AND SYRIA CERTIFICATION FORM IF YOUR BID/PROPOSAL IS $1,000,000 OR MORE, THIS FORM MUST BE COMPLETED AND SUBMITTED WITH THE BID/PROPOSAL. FAILURE TO SUBMIT THIS FORM AS REQUIRED MAY DEEM YOUR SUBMITTAL NONRESPONSIVE. The affiant, by virtue of the signature below, certifies that: 1. The vendor, company, individual, principal, subsidiary, affiliate, or owner is aware of the requirements of section 287.135, Florida Statutes, regarding companies on the Scrutinized Companies with Activities in Sudan List, the Scrutinized Companies with Activities in the Iran Petroleum Energy Sector List, or engaging in business operations in Cuba and Syria; and 2. The vendor, company, individual, principal, subsidiary, affiliate, or owner is eligible to participate in this solicitation and is not listed on either the Scrutinized Companies with Activities in Sudan List, the Scrutinized Companies with Activities in the Iran Petroleum Sector List, or engaged in business operations in Cuba and Syria; and 3. Business Operations means, for purposes specifically related to Cuba or Syria, engaging in commerce in any form in Cuba or Syria, including, but not limited to, acquiring, developing, maintaining, owning, selling, possessing, leasing or operating equipment, facilities, personnel, products, services, personal property, real property, military equipment, or any other apparatus of business or commerce; and 4. If awarded the Contract (or Agreement), the vendor, company, individual, principal, subsidiary, affiliate, or owner will immediately notify the City of Clearwater in writing, no later than five (5) calendar days after any of its principals are placed on the Scrutinized Companies with Activities in Sudan List, the Scrutinized Companies with Activities in the Iran Petroleum Sector List, or engaged in business operations in Cuba and Syria. __________________________________________ Authorized Signature __________________________________________ Printed Name __________________________________________ Title __________________________________________ Name of Entity/Corporation STATE OF _____________________ COUNTY OF ___________________ The foregoing instrument was acknowledged before me by means of ☐ physical presence or ☐ online notarization on, this _____ day of _________________, 20____, by _____________________________ (name of person whose signature is being notarized) as the ________________________ (title) of ______________________________________(name of corporation/entity), personally known ______, or produced _________________________ (type of identification) as identification, and who did/did not take an oath. __________________________________________ Notary Public __________________________________________ Printed Name My Commission Expires: __________________ NOTARY SEAL ABOVE SCRUTINIZED COMPANIES FORMS Professional Auditing Services 31 RFP #36-20 SCRUTINIZED COMPANIES THAT BOYCOTT ISRAEL LIST CERTIFICATION FORM THIS FORM MUST BE COMPLETED AND SUBMITTED WITH THE BID/PROPOSAL. FAILURE TO SUBMIT THIS FORM AS REQUIRED MAY DEEM YOUR SUBMITTAL NONRESPONSIVE. The affiant, by virtue of the signature below, certifies that: 1. The vendor, company, individual, principal, subsidiary, affiliate, or owner is aware of the requirements of section 287.135, Florida Statutes, regarding companies on the Scrutinized Companies that Boycott Israel List, or engaged in a boycott of Israel; and 2. The vendor, company, individual, principal, subsidiary, affiliate, or owner is eligible to participate in this solicitation and is not listed on the Scrutinized Companies that Boycott Israel List, or engaged in a boycott of Israel; and 3. “Boycott Israel” or “boycott of Israel” means refusing to deal, terminating business activities, or taking other actions to limit commercial relations with Israel, or persons or entities doing business in Israel or in Israeli-controlled territories, in a discriminatory manner. A statement by a company that it is participating in a boycott of Israel, or that it has initiated a boycott in response to a request for a boycott of Israel or in compliance with, or in furtherance of, calls for a boycott of Israel, may be considered as evidence that a company is participating in a boycott of Israel; and 4. If awarded the Contract (or Agreement), the vendor, company, individual, principal, subsidiary, affiliate, or owner will immediately notify the City of Clearwater in writing, no later than five (5) calendar days after any of its principals are placed on the Scrutinized Companies that Boycott Israel List, or engaged in a boycott of Israel. ______________________________________ Authorized Signature ______________________________________ Printed Name ______________________________________ Title ______________________________________ Name of Entity/Corporation STATE OF _____________________ COUNTY OF ___________________ The foregoing instrument was acknowledged before me by means of ☐ physical presence or ☐ online notarization on, this _____ day of _________________, 20____, by _____________________________ (name of person whose signature is being notarized) as the ________________________ (title) of ______________________________________(name of corporation/entity), personally known ______, or produced _________________________ (type of identification) as identification, and who did/did not take an oath. __________________________________________ Notary Public __________________________________________ Printed Name My Commission Expires: __________________ NOTARY SEAL ABOVE MAILING LABEL CUT ALONG THE LINE AND AFFIX TO THE FRONT OF YOUR BID CONTAINER Professional Auditing Services 32 RFP #36-20 --------------------------------------------------------------------------------- For US Mail ------------------------------------------------------------------------------ SEALED PROPOSAL Submitted by: Company Name: Address: City, State, Zip: RFP #36-20, Professional Auditing Services Due Date: June 2, 2020, at 10:00 A.M. City of Clearwater Attn: Procurement Division PO Box 4748 Clearwater FL 33758-4748 --------------------------------------------------------------------------------- For US Mail ------------------------------------------------------------------------------ ---------------------------------------------- For Hand Deliveries, FEDEX, UPS or Other Courier Services ------------------------------------------------ SEALED PROPOSAL Submitted by: Company Name: Address: City, State, Zip: RFP #36-20, Professional Auditing Services Due Date: June 2, 2020, at 10:00 A.M. City of Clearwater Attn: Procurement Division 100 S Myrtle Ave 3rd Fl Clearwater FL 33756-5520 ---------------------------------------------- For Hand Deliveries, FEDEX, UPS or Other Courier Services ------------------------------------------------ Page 1 of 1 Addendum #1 RFP #36-20, Professional Auditing Services May 8, 2020 NOTICE IS HEREBY GIVEN that the following addendum serves to provide clarification and to answer the questions received on RFP #36-20, Professional Auditing Services. Question 1: Are you able to share what the prior year audit fees were or what has been budgeted for the 2020 audit? Answer to Question 1: The prior year audit fees were $132,300. The budget for the completion of the FY20 audit (budget year 2021) has not been completed. Question 2: Do you want insurance certificates of the required coverage included in the proposal? Or does the selected firm simply provide them when they are notified as the winner? Answer to Question 2: Insurance certificates, with the appropriate coverages, will be required upon intent to award. Question 3: On Page 25. “Prior Engagements with other Government Entities”. Will the city accept a listing of all government engagements without the engagement partner, phone number, and principal client contact? Also, under this same category, does the city require a listing of government engagements outside the state of Florida? Answer to Question 3: In reference to TAB 2 – Qualifications, Experience and Project Personnel Expertise, under Prior Engagements with Other Government Entities, page 25; the items listed are requirements of the proposer’s response for all Governmental engagements. End of Questions and Answers End of Addenda Page 1 of 2 Addendum #2 RFP #36-20, Professional Auditing Services May 26, 2020 NOTICE IS HEREBY GIVEN that the following addendum serves to provide clarification and to answer the questions received on RFP #36-20, Professional Auditing Services. Question 1: Is there a cost proposal template that should be completed and submitted with proposal responses? Answer to Question 1: No, there is not a cost proposal template. Your cost portion should contain the information provided under RESPONSE ELEMENTS, TAB 5 – Cost Proposal, pg. 26 in any style the proposer chooses. Question 2: We noted that the opinion date was 3/30 in the most recent audit but the desired date for audit filing in the RFP is for 2/28. What is the reason for the change in timing? Answer to Question 2: The opinion date has been late March for the past several years, however the City always strives to finish earlier. Question 3: What is the expected fieldwork timing? Answer to Question 3: The City anticipates that preliminary field work will be scheduled for late September or early October (this is flexible), and final field work will commence the day after Martin Luther King Jr. Day. Question 4: Item 4 A.11 under “detailed specifications” refers to an opinion being required on the special purpose schedule “Schedule of Revenues and Expenditures of Emergency Medical Services”, could you please provide the prior year opinion/report for this schedule. Answer to Question 4: The prior year report has been provided at the end of this addendum. Question 5: For clarification on service requirement A.2., Expressing an audit opinion on each of the non-major funds is somewhat inconsistent with the intent of GASB Statement 34 which emphasizes that the focus should be on each major fund and the non-major funds in the aggregate. Can we ask for clarification on why the City is making this request and what value the City perceives that it is receiving from having an audit opinion on each individual non-major fund? Also would a more traditional opinion on the aggregate remaining fund information be acceptable instead? Answer to Question 5: The City feels that there is value in receiving an opinion at the non-major fund level and therefore opining on non-major funds in the aggregate would not be acceptable. Page 2 of 2 Question 6: Can we ask approximately how many weeks the incumbent auditor is on sight and what level of staff are present? Answer to Question 6: Auditors are usually scheduled for one (1) week in September or October for preliminary field work and six (6) weeks beginning in mid-January for final field work. We have had between two to four (2-4) auditors onsite at any given time. Having said that, the auditors seem to be working remotely more and more each year. They are not always physically onsite every day so we do not always know how many are working on our audit on any given day. Please Note: The ten (10) day deadline for submitting questions is now closed and no further questions will be responded to. CITY OF CLEARWATER, FLORIDA SCHEDULE OF REVENUES AND EXPENDITURES RELATED TO EMERGENCY MEDICAL SERVICES For the Year Ended September 30, 2019 And Report of Independent Auditor CITY OF CLEARWATER, FLORIDA TABLE OF CONTENTS REPORT OF INDEPENDENT AUDITOR ................................................................................................ 1-2 FINANCIAL STATEMENT Schedule of Revenues and Expenditures Related to Emergency Medical Services .......................................... 3 Notes to the Schedule of Revenues and Expenditures Related to Emergency Medical Services ...................... 4 CITY OF CLEARWATER, FLORIDA ‐ PINELLAS COUNTY – ALS FIRST RESPONDER AGREEMENT ...................................................................................................... 5 Report of Independent Auditor To the Honorable Mayor and Members of City Council City of Clearwater, Florida We have audited the accompanying schedule of revenues and expenditures related to Emergency Medical Services (the “schedule”) of the City of Clearwater, Florida (the “City”) for the year ended September 30, 2019 and related notes to the schedule. Management’s Responsibility for the Financial Information Management is responsible for the preparation and fair presentation of the schedule in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the schedule that is free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on the schedule based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the schedule is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the schedule. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the schedule, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the schedule in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the schedule. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the schedule referred to above presents fairly, in all material respects, the revenues and expenditures related to Emergency Medical Services of the City of Clearwater for the year ended September 30, 2019 in accordance with accounting principles generally accepted in the United States of America. Emphasis of Matter As discussed in Note 1, the schedule presents only the revenues and expenditures related to Emergency Medical Services of the City and does not purport to, and does not present fairly, the financial position of the City as of September 30, 2019, and the changes in its financial position, or, where applicable, its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. 2 Restriction on Use This report is intended solely for the information and use of the Chairman and members of the Emergency Medical Services Authority, the Mayor, City Council, and management of the City, and is not intended to be, and should not be, used by anyone other than these specific parties. Tampa, Florida March 26, 2020 CITY OF CLEARWATER, FLORIDA SCHEDULE OF REVENUES AND EXPENDITURES RELATED TO EMERGENCY MEDICAL SERVICES YEAR ENDED SEPTEMBER 30, 2019 See accompanying notes to the schedule of revenues and expenditures related to Emergency Medical Services. 3 Revenues: Charges for services - Pinellas County (a)6,364,149$ Total Revenues 6,364,149 Expenditures (a): Personal services 6,385,373 Vehicle Expenses 243,774 Miscellaneous 73 Total Expenditures 6,629,220 Excess of expenditures over revenues (b)(265,071)$ (a)Amounts included in general fund of the City. (b)Amount to be repaid to the County. CITY OF CLEARWATER, FLORIDA NOTES TO THE SCHEDULE OF REVENUES AND EXPENDITURES RELATED TO EMERGENCY MEDICAL SERVICES YEAR ENDED SEPTEMBER 30, 2019 4 Note 1—Reporting entity The City of Clearwater, Florida (the “City”) is a political subdivision of the State of Florida. The schedule of revenues and expenditures related to Emergency Medical Services (the “schedule”) only contains the revenues and expenditures related to Emergency Medical Services which are included in the City’s general fund and is not intended to present the revenues and expenditures of the City for the year ended September 30, 2019 in accordance with accounting principles generally accepted in the United States of America. The expenditures are based on allowable costs in accordance with the ALS First Responder Agreement and Pinellas County EMS Authority’s Resolution 14-65. Note 2—Basis of accounting The schedule is presented using the modified accrual basis of accounting. Under the modified accrual basis, revenues are recognized if they are measurable and available for use during the year, and expenditures are generally recognized in the period liabilities are incurred. CITY OF CLEARWATER, FLORIDA PINELLAS COUNTY ALS FIRST RESPONDER AGREEMENT EMS FINANCIAL INFORMATION ATTESTATION FORM FOR FY 18‐19 5 Instructions: In accordance with the 2017 Emergency Medical Services ALS First Responder Agreement, monies derived from the Emergency Medical Services Mill must be used solely for Emergency Medical Services ("EMS"). A designated Emergency Medical Services Fund is used solely for EMS revenue and expenditures. The following form is provided for consistent expenditure reporting and shall be submitted within ten (10) business days of the City’s receipt of Annual External Audit. To be completed by the City: City or Fire District City of Clearwater, Florida Name of Person Completing Form Jay Ravins, Finance Director Phone Number and Email Address (727)562-4538 jay.ravins@myclearwater.com 1.EMS Funding Received by City $ 6,364,149 Audit Page: 3 2.EMS Expenditure Incurred by City $ 6,629,220 Audit Page: 3 3.Difference (If excess, amount due to Pinellas County) $ (265,071) Audit Page:3 PLEASE INCLUDE A COPY OF THE ANNUAL AUDIT AND SUPPORTING DOCUMENTATION AS NEEDED. We have audited the schedule of revenue and expenditures related to the Emergency Medical Services (“EMS”) of the City of Clearwater, Florida for the year ended each September 30. The expenditures identified in line 2 above, are related to the prior Fiscal Year EMS Authority Approved Budget for EMS Authorized positions and units in accordance with the 2017 Emergency Medical Services ALS First Responder Agreement. We have reviewed payroll expenditures, salary and benefit expenditures, relief staffing expenditures incurred to maintain continuous staffing of Authorized positions, and expenditures for supervision, fuel, maintenance and repairs, and other allowable costs. March 26, 2020 External Auditor Signature Date End of Questions and Answers End of Addenda CITY OF CLEARWATER RFP #36-20 June 2nd, 2020 Carr, Riggs & Ingram 600 Cleveland St. Suite 1000 Clearwater, FL 33755 727.446.0504 CRIcpa.com David Alvarez Partner dalvarez@cricpa.com Table of Contents Tab 1 Letter of Transmittal and Independence 3 Understanding and Meeting Your Needs 5 Additional Services at No Charge 6 Tab 2 Firm Profile 8 Government Credentials 9 Firm Qualifications and Experience 10 Government Statistics 12 Single Audit Experience 13 Federal and State Desk Reviews 14 Peer Review 15 Engagement Team Bios 17 Continuing Professional Education 27 Commitment to Staffing 28 Engagements with other Government Entities 29 Similar engagements with other Government Entities 30 Tab 3 Audit Approach 32 Segmentation 32 EDP Software 33 Approach to Understanding Internal Controls 33 Approach to Determining Laws & Regulations 34 Approach to Single Audit 34 Sample Sizes and Statistical Sampling 35 Type and Extent of Analytical Procedures 35 Approach in Drawing Samples for Compliance 35 Identification of Potential Audit Problems 35 Tab 4 References 37 Tab 5 Cost 39 Tab 6 Required Forms 41 Insurance Certificates 46 W9 48 Appendix A-CRI Government Clients Firm-Wide 49 CRIcpa.com CARR, RIGGS & INGRAM TAB 1 2 CRIcpa.com CARR, RIGGS & INGRAM LETTER OF TRANSMITTAL AND INDEPENDENCE Dear City of Clearwater Auditor Selection Committee: The Clearwater practice of CRI is privileged to propose on audit services for the City of Clearwater. Dating back to our days as Harper Van Scoik & Co. formed in 1963, we have called Clearwater home for 57 years! Since merging in with CRI in 2008, we've continued to provide "Big Firm Resources" with "Small Firm Services" to the citizens of Clearwater. We have carefully reviewed the RFP, and identied the City's needs and our solutions on the following page. All terms and conditions of the RFP are understood and acknowledged. We are committed to completing the work and providing the required reports on time. We conrm that Carr, Riggs, & Ingram (LLC) (CRI) is independent of the City of Clearwater as dened by Generally Accepted Auditing Standards and by standards of the U.S. Government Accountability Oce's (GOA) Government Auditing Standards. Additionally, we arm we are indpendent of the City of Clearwater component units as dened by the same standards. Our Clearwater partner in charge, David Sietsma, has served with City Manager Bill Horne on the Pinellas Community Foundation's Board of Govenors. Mr. Horne serves on this board in a personal capacity, not as a representative of the City. This relationship does not constitute a conict of interest relative to performing the audit. Outlined below are several major points which we believe demonstrate we are the most qualied group of professionals with the desire and ability to serve the City of Clearwater as its independent Certied Public Accountants. The advantages to you are: CRI has a superior team of professionals with extensive governmental and single audit experience to commit to this engagement. Our Clearwater oce is currently the auditor for 10 governmental entities, the internal auditor for Pasco County, Pinellas County Schools and performs at least 8 Federal and State Single Audits each year. CRI currently provides services to over 200 governments in Florida including 22 counties and over 46 municipalities. CRI’s partners are active members of the team throughout the audit process. They will be “in the eld” working and supervising other members of the team. In addition, the City of Clearwater's nancial statements will be reviewed by two partners. A partner will also present the nancial statements to the Commission and will oer to meet one on one with any Commission Member to discuss the audit plan or report. CRI has a signicant presence in Florida, with 21 local oces staed by over 300 professionals. Your audit will be staed by the Clearwater oce of Carr, Riggs & Ingram, LLC. CRI will be a valuable resource to the City of Clearwater. We are always just a phone call away and can be at the City at a moment’s notice. Our team members work with your sta throughout the year to address any accounting issues or concerns that arise. Consistent communication and prompt response to the governmental entities that we serve results in more accurate nancial statements and a more ecient audit. CRI will bring a fresh approach to the City of Clearwater's audit. Due to the breadth of resources in CRI with governmental audit experience, we are able to oer the City a fresh approach to its audit. CRI’s audit practice is heavily oriented to the public sector. Over 40% of our audit clients throughout the Southeast are audited under Government Audit Standards issued by the Government Accountability Oce (Yellow Book). No other rm in Florida can match the government experience of CRI. CRI has additional service oerings that makes it unique. Because of the size of CRI, we are able to oer the City of Clearwater additional services, such as IT risk assessments and audits of construction contractor compliance. 3 CRIcpa.com CARR, RIGGS & INGRAM David Alvarez is authorized to make representations for the rm. He can be reached at the address and telephone number shown below or at dalvarez@cricpa.com. CRI’s Federal ID number is 72-1396621. We believe that CRI is the best qualied rm to audit the City of Clearwater due to our extensive experience and depth of knowledge in auditing municipalities in Florida. Additionally, our prior experience with auditing local governments will allow us to be more ecient and eective. We welcome the opportunity to demonstrate to you the same teamwork, expertise and responsiveness that have made us one of the fastest growing public accounting rms in the United States. We appreciate your consideration, and we encourage you to contact us with any questions as you review our proposal. This proposal is a rm and irrevocable oer for one hundred twenty (120) days (as extended in the event of a protest). The City of Clearwater will be one of the most important clients of CRI. We assure you that you will receive the highest level of service. Sincerely, David Alvarez Engagement Partner 600 Cleveland St. Suite 1000 Clearwater, FL 33755 4 CRIcpa.com CARR, RIGGS & INGRAM UNDERSTANDING & MEETING YOUR NEEDS From the RFP, we understood your team to express the following needs, requests, and/or issues. We’ve detailed our proposed solutions below and are happy to discuss other related projects as they arise and upon request. NEEDS & ISSUES SOLUTIONS & SERVICES Technical Express opinion on the fair presentation of the City's nancial statements, which also includes all non-major funds of the City. CRI has selected an expert team experienced in auditing Florida cities to perform your audit. The team will utilize specialized audit tools created by CRI, tailored to the needs that Florida cities require. Technical Provide an "in-relation-to" opinion on required supplementary information and perform limited procedures on other supplementary information included in the CAFR. Perform procedures on required supplementary information and other information included in the CAFR using our highly trained governmental sta. Technical Provide report on internal controls over nancial reporting and on compliance and other matters in accordance with Government Auditing Standards. Utilizing our detailed planning approach with our experienced team, prepare an audit approach that eectively and eciently audits the required elements in a government auditing engagement. Technical Perform single audit in accordance with Uniform Guidance and Chapter 10.550, Rules of the Auditor General, and provide all reports and as required by Federal and Florida State single audit requirements. Complete and submit the certied Data Collection Form to the Federal Audit Clearinghouse. Perform single audit eciently with our highly trained single audit team which will be overseen by specialist partners with the AICPA Advanced Single Audit Certications. Ensure that all lings required in a single audit are made by the auditor during a single audit engagement. Technical Provide all reports required by the Florida General including the management letter and investment compliance attestation report. Perform specialized compliance procedures required in Florida governments using our highly trained sta to issue all reports required for the Florida Auditor General. Technical Audit the special purpose Schedule of Revenues and Expenditures of Emergency Medical Services and render opinion if the schedule is presented fairly. Utilize our highly trained sta in auditing Pinellas County entities to render this opinion that is specic to Pinellas County EMS providers. Relational The City expects and deserves continuous communication throughout the year in order to avoid surprise ndings at the end of the audit each year. Communicate regularly with management throughout the year to ensure City is prepared with new standards or has through any signicant transactions. In addition, we use standard status meetings with management in order to hold everyone accountable in order to meet all deadlines, internal and external. 5 CRIcpa.com CARR, RIGGS & INGRAM ADDITIONAL SERVICES ADDITIONAL SERVICES PROVIDED AT NO EXTRA CHARGE CRI and its professionals are highly skilled at providing an extensive range of services to a variety of government clients. Clearwater will be a top-priority client of the rm, we would like to oer additional services to the City for no additional cost. If selected as your new auditor, CRI would also perform the following value-added services for no charge: System penetration testing and independent IT security analysis to provide you with insights related to possible system vulnerabilities and the extent to which the City’s data is secure from malicious activity. 8 Hours of Professional CPE Training which will be customized for the City of Clearwater based on your preferences and access to applicable classes from our library of training webinars available for your review. 6 CRIcpa.com CARR, RIGGS & INGRAM TAB 2 7 CRIcpa.com CARR, RIGGS & INGRAM FIRM PROFILE 8 CRIcpa.com CARR, RIGGS & INGRAM GOVERNMENT CREDENTIALS 9 CRIcpa.com CARR, RIGGS & INGRAM FIRM QUALIFICATIONS AND EXPERIENCE FIRM PROFILE AND STAFF BREAKDOWN Established in 1997, Carr, Riggs & Ingram, LLC (CRI) is a top 25 regional certied public accounting and consulting rm with roots going back to 1972. CRI has over 1,900 professionals and 65 oces throughout Florida, Alabama, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, Tennessee, Texas and New Mexico. CRI provides a wide variety of high-quality, cost-eective accounting, assurance, tax and consulting services to individuals, businesses (both publicly and privately held), governmental entities, and non-prot organizations throughout the United States. CRI delivers a depth of resources that ensures our understanding of your challenges and innovative solutions for overcoming them. Our governmental team’s combined experience is derived from providing audit and accounting outsourcing services to a client base that includes: 450+ governmental entity clients across the South totaling approximately $22 billion in total revenues, and Municipality clients of up to $1.2 billion in total revenues We parlay this vast experience and derived best practices into proven solutions that benet you. We are proud members in good standing of the following organizations: The American Institute of Certied Public Accountants (AICPA) The Governmental Audit Quality Center of the AICPA AICPA Private Companies Practice Section Employee Benet Plan Audit Quality Center of the AICPA The Center for Audit Quality of the AICPA The Public Company Accounting Oversight Board The Florida Institute of Certied Public Accountants (FICPA) Florida Government Finance Ocers Association (FGFOA) Members of the above voluntary organizations are select CPA rms recognized in the profession to be of the highest caliber. As a result, we are subject to stricter quality control standards than rms that choose not to take this voluntary step to improve the quality of their practices. Our team members are regular presenters at state and local chapter FICPA and FGFOA events. We are also active members in The Space Coast League of Cities and support the League with their accounting services. 10 CRIcpa.com CARR, RIGGS & INGRAM FIRM QUALIFICATIONS AND EXPERIENCE The City of Clearwater's audit will be staed with team members from the Clearwater oce. We have proposed a team consisting of 10 team members from the Clearwater oce. The Clearwater oce currently has 15 audit team members on sta, including 2 partners. Specialists and consulting partners may be utilized from other oces of CRI should the need arise during the audit process. CRI is a full service rm providing high quality audit, accounting, tax and consulting services. All sta in this engagement will be employed on a full-time basis. Other audit team members are available and whose services will be utilized as deemed necessary based on the audit plan. All resumes and applicable certications are included in this proposal. Provided below is a sta breakdown of the composition of the Audit teams for CRI's Government practice. JOINT VENTURE OR CONSORTIUM We maintain the qualied sta and experience to complete the City's requirements in a timely matter. This engagement will not be a joint venture or consortium. 11 CRIcpa.com CARR, RIGGS & INGRAM FIRM QUALIFICATIONS AND EXPERIENCE GOVERNMENT EXPERIENCE CRI has specialized in serving the government industry for many years; our proposed team delivers a depth of resources that ensure we understand your challenges and key factors associated with your audit. We will utilize our innovative solutions and tailored government tools and experience to design highly ecient and eective audit strategy. CRI’s government audit professionals have extensive experience on nancial statement audit engagements conducted under Governmental Auditing Standards and implemented the full range of GASB statements on a variety of entity types. Our government team’s 1,100+ years of combined experience is derived from the following: 500+ current governmental entity audit and consulting clients; 200+ Florida governmental entity audit and consulting clients served; 20+ Florida counties audited, plus consulting services provided to multiple other Florida cities; CRI has over 25 governments that have over $1 billion of revenue/assets Nearly 50 CRI clients obtained the GFOA’s CAFR certicate of excellence; Performance of single audits for approximately 30% of all governmental clients, with federal funds totaling more than $2.8 billion and state funds totaling more than $375 million (where single audit is required) We have created government-specic tools which facilitate ecient and eective audit procedures in various areas including: federal/state single audits, FRS pension testing, and compliance testing; We host regular in-person and online government CPE training sessions; We have a detailed understanding of the key matters and nuances associated with the operations of Florida cities and Florida specic compliance requirements; and We participate on committees for standard setting bodies, giving us advanced notication and allowing us to help shape the upcoming standards; we share our insights with our clients. GASB EXPERIENCE CRI has a dedicated industry line to serve our state and local government clients, which is spearheaded by some of the partners who will be assigned to this engagement. This includes Ray Roberts, who oversees the industry line to ensure proper implementation of GASB standards and works with other partners across the rm to ensure best practices and implementation are brought directly to our clients nationwide. In addition, Engagement Partner David Alvarez works directly with Ray and the entire government industry line to conduct relevant research, complete industry line documents, and provide training internally to our team members and externally across the region. Members of CRI’s governmental team also serve on various committees working directly with GASB and providing input in order to assist with implementation understanding. These committee appointments allow us to stay abreast of new accounting standards issued by GASB and the AICPA, which gives our clients ample time to assess the impact of the new standards before the required implementation dates. CRI’s government audit professionals have extensive experience on nancial statement audit engagements conducted under Governmental Auditing Standards, implementing the full range of GASB statements on a variety of entity types. Recently, we have assisted with the early implementation of GASB 84 for several entities, and are prepared to assist in implementation of GASB 84, 87 and 91, three new pronouncements coming into place during the coming years. 12 CRIcpa.com CARR, RIGGS & INGRAM FIRM QUALIFICATIONS AND EXPERIENCE FEDERAL AND STATE SINGLE AUDIT EXPERIENCE Our governmental team performs annual Single Audits of Federal and State Funds for more than 150 separate entities totaling over $2.8 billion in federal awards and $375 million in annual state awards (in the states that require a state single audit). Our local single audit practice is overseen by Lorri Kidder who is assigned to your audit as a Single Audit Partner. Lorri works on multiple single audits every year including numerous single audits where she serves as the Engagement Quality Control Reviewer. She's also earned the AICPA's Advanced Single Audit Certication. Proprietary tools, including Florida state single audit risk assessment templates, were developed in collaboration with David Alvarez (your Engagement Partner), Lorri Kidder and Rob Lemmon and were updated for the changes in the rules which became eective last year. Single audits are an important part of what we do as a rm and a major area of specialization. We are proud of our 10 professionals who have earned the AICPA’s Advanced Single Audit Certication, and are excited about the additional professionals that have earned the Intermediate Certication and are now studying for the advanced certicate. CRI received the Single Audit Resource Center (SARC) Award for Excellence in knowledge, value, and overall client satisfaction. This award recognizes audit rms who provide an outstanding service to their clients. The award is based on feedback received from over 25,000 nonprot and government entities about the knowledge of their auditors, the value of the services rendered, and overall satisfaction with their 2018 scal year end audit. Our government experts are highly involved in the government accounting and auditing industry. Below is a summary of some of the outstanding accomplishments achieved by CRI and its professionals: Chairman and current member of the AICPA Auditing Standards Board Member of the AICPA Government Audit Quality Center Chairperson of the AICPA Government Technical Issues Committee Member of the AICPA’s Governmental Accounting and Auditing Committee, involved in developing the State and Local Governments Audit and Accounting guide Member of team that answers questions for the AICPA Center for Plain English for Government Member of GAO Advisory Board on Government Audit Standards Recipient of the Single Audit Resource Center (SARC) award for excellence 10 AICPA certied advanced single audit specialists Subcontractor for AICPA to inspect Single Audit engagements performed by other CPA rms as part of the AICPA Enhanced Peer Review Process Chairman of Oversight Task Force of the AICPA Peer Review Board Active members of the GFOA and FGFOA Experts conducting CAFR reviews for GFOA’s certicate of excellence program Contributing authors to the FICPA’s “Compliance Auditing in Florida” practice team Member of the FICPA’s State and Local Government Committee Member of the FICPA’s Government Standards Review Committee Member of the FGFOA’s Technical Resources Committee Regular speakers at educational programs on government accounting and auditing Expert authors of various technical articles which we proactively share with our clients 13 CRIcpa.com CARR, RIGGS & INGRAM 2019 PEER REVIEW REPORT CRI is enrolled in the AICPA Peer Review Program, through which our external reviews are conducted by another independent public accounting rm. We have our accounting and auditing practice triennially reviewed as a member in this program. The most recent review of our rm was performed in 2019 by Brown Edwards. The quality control reviews did include a review of specic local government engagements. A copy of our most recent report is presented on the following page. Additionally, we are registered with the PCAOB, who performs an external review inspection once every three years. FEDERAL & STATE DESK REVIEWS CRI meets all specic requirements, rules and regulations imposed by state and federal law. CRI has not been the subject of any disciplinary actions, nor are we aware of any actions pending, involving any regulatory bodies or professional organizations in the last 3 years. The Firm’s governmental audit work is subject to normal, recurring peer and state regulatory reviews. No adverse ndings have resulted from those reviews. We received a Pass result, the highest possible result, in our most recent peer review and a copy has been included below. 14 CRIcpa.com CARR, RIGGS & INGRAM 15 CRIcpa.com CARR, RIGGS & INGRAM 16 CRIcpa.com CARR, RIGGS & INGRAM YOUR SOLUTIONS TEAM David Alvarez, CPA Engagment Partner dalvarez@CRIcpa.com 727.324.1232 813.846.3949 (mobile) Representative Clients City of Largo, FL City of Treasure Island City of Gulfport, FL Pasco County, FL Sarasota County, FL Manatee County, FL Sumter County, F Lee County Mosquito Control District Lee County Hyacinth Control District District School Board of Pasco County District School Board of Pinellas County Florida State Fair Authority Past Clients Pinellas County Hernando County City of Tampa, FL Experience David has been in public accounting for 15 years. His rst 5 we were with KPMG before joining CRI for the last 10. David has experience working with some of the most complex government, non-prot, and public traded companies in the Bay Area. David is an instructor for CRI's rm wide CPE week and serves on the Quality Control Committee for our government/non-prot industry line. He's conducted numerous speaking engagements for the FGFOA, FICPA and universities throughout Florida. David is a member of the FICPA committees for State and Local Governments, and Policies and Auditing Standards. David sits on the Florida Holocaust Museum board of directors and is also a member of Leadership Tampa Bay class of 2020. Education, Licenses & Certications Masters of Accountancy, University of South Florida BS, Accounting, Florida State University Certied Public Accountant Certied Valuation Analyst Chartered Global Management Accountant Professional Aliations American Institute of Certied Public Accountants (AICPA) Florida Institute of Certied Public Accountants (FICPA) Government Finance Ocers Association (GFOA) Florida Government Finance Ocers Association (FGFOA) 17 CRIcpa.com CARR, RIGGS & INGRAM Rob Lemmon, ACA Quality Control Review Partner rlemmon@CRIcpa.com 352.548.3645 Representative Clients City of Jacksonville, FL Pasco County, FL Sumter County, FL Clay County, FL Dixie County, FL Gilchrist County, FL St. John’s County, FL Flagler County, FL Alachua County, FL Nassau County, FL City of Gainesville, FL City of Wildwood, FL Howey in the Hills, FL Town of Callahan, FL Town of Cross City, FL Town of Inglis, FL JEA Gainesville Regional Utilities Cedar Key Water & Sewer District Big Bend Water Authority University of California, Irvine Experience Rob has worked as an auditor for 12 years. Before joining CRI, he spent 7 years working with PwC gaining experience in various sectors performing annual audits and quarterly reviews for publicly listed entities, private companies, non-prot entities and governmental entities. Rob worked for PwC at their London, Bermuda and Los Angeles oces. He is procient in US and UK GAAP as well as IFRS. Rob has conducted a large volume of Single Audits for governmental and non-prot entities and has been selected by CRI to serve as a Single Audit Specialist and Engagement Quality Control Reviewer for the rm. He has also performed and overseen testing of internal controls, under section 404 of the Sarbanes-Oxley Act, and audits for publicly listed clients. Since joining CRI, Rob has expanded his specialty for Governmental auditing and Single Audit compliance testing and has led a number of large City and County audits. He has also conducted training sessions of Governmental Accounting Standard updates and audit quality initiatives and has presented at FGFOA Chapter meetings. He also serves as an expert CAFR reviewer for the GFOA’s Certicate of Achievement for Excellence in Financial Reporting Program. Education BA, Business Accounting and Finance, University of Newcastle on Tyne, England CPA examinations - passed Professional Aliations Institute of Chartered Accountants in England and Wales Florida Institute of Certied Public Accountants 18 CRIcpa.com CARR, RIGGS & INGRAM Lorri Kidder, CPA Single Audit Partner lkidder@CRIcpa.com 727.324.1241 Representative Clients Manatee County- Single Audit Only Pinellas County School Board – Single Audit Only Pasco County School Board – Single Audit Only City of Largo – Single Audit Only City of Gulfport - Single Audit Only School Board of Manatee County – Internal Audit Only Personal Enrichment through Mental Health Services –Single Audit Operation PAR, Inc. – Single Audit Only Experience Lorri is known to her clients as a genuine people person and is well- respected for providing proactive accounting strategies that maximize protability. She also helps young accountants to further their professional development by serving as a mentor. She also performs various types of not-for-prot audits. Her expertise includes child welfare organizations, healthcare-related, foundations, member-based organizations, and religious organizations as well as Federal and State Single Audits. She has earned her Advanced Single Audit Certicate and the Not-for-prot 2 Certicate from the AICPA. She is a member of the rm’s fraud, forensic, and valuations accounting services team and provides client education dedicated to preventing fraud and creating internal controls within their organizations. Education, Licenses & Certications University of Missouri, Kansas City - Bachelor's Certied Public Accountant (CPA) Certied Fraud Examiner (CFE) Chartered Global Management Accountant (CGMA) Professional Aliations American Institute of Certied Public Accountants (AICPA) Florida Institute of Certied Public Accountants (FICPA) Association of Certied Fraud Examiners 19 CRIcpa.com CARR, RIGGS & INGRAM David Mills, CPA IT Audit Partner dmills@CRIcpa.com 334.437.8332 Representative Clients City of Port Orange City of Troy, Alabama City of Largo, Florida City of Tallahassee City of Huntsville Utilities, Alabama Alachua County, Florida City of Gainesville Clay County, Florida Pinellas County School District St. Johns County, Florida Holmes County, Florida Walton County, Florida Leon County Schools, Florida St. Johns River Water Management District Flagler County, Florida Jeerson Parrish Schools, Louisiana Tangiapihoa Parrish Schools, Louisiana Experience David has more than 20 years of IT experience. His specialties include IT compliance/audit, IT security, risk analysis, disaster recovery, network design, installation, and implementation. David’s accomplishments include IT assessments/audits for Sarbanes compliance; Health Insurance Portability and Accountability Act; Gramm Leach Bliley; Federal Financial Institutions Examinations Council; SOC 1, 2 & 3; and the Bank Secrecy Act. David served as an IT liaison for many education and government agencies. David has designed, congured, and installed complete IT systems for large and medium size local and state government, education, nancial, legal, medical, and manufacturing entities. David has served on the faculty of Troy University as an Adjunct Professor, a speaker and instructor for groups and associations such as the AICPA IT Executive Committee and Florida Tax Collectors Association. Education, Licenses & Certications Bachelors, Physics, TROY University Masters, TROY University Certied Information Systems Auditor Professional Aliations American Institute of Certied Public Accountants (AICPA) Florida Society of Certied Public Accountants Certied in the Governance of Enterprise IT Certied Information Systems Auditor Information Systems Audit and Control Association Institute of Internal Auditors 20 CRIcpa.com CARR, RIGGS & INGRAM Heather Mosier, CPA Single Audit Senior Manager hmosier@CRIcpa.com 561.427.0300 Representative Clients Pasco County Board of County Commissioners- Single Audit Pinellas County Schools City of Largo Bridges of America- Single Audit Morton Plant Mease Foundation, Inc. The ARC of Tampa Bay, Inc. The ARC of Tampa Bay Foundation, Inc. Operation PAR, Inc. AMI Kids, Inc. Insurance Oce of America Operation PAR, Inc. Cardno USA Experience With more than 13 years of experience in public accounting, Heather has signicant experience performing single audits and serving not- for-prot clients. Her experience with not-for-prots includes foundations and associations, as well as entities engaged in social welfare. Heather is responsible for managing the engagement team in the eld, working with the clients and developing solutions. In addition, Heather is a certied fraud examiner and brings a complete understanding of prevention and detection controls to her clients. Heather is a member of Rotary of Winter Garden and Junior League of Orlando. She also is a graduate of Leadership Pasco and Leadership Tampa Bay. Education, Licenses & Certications BS, Accounting, University of South Florida Certied Public Accountant Certied Fraud Examiner Professional Aliations American Institute of Certied Public Accountants (AICPA) Florida Institute of Certied Public Accountants (FICPA) Association of Certied Fraud Examiners (ACFE) 21 CRIcpa.com CARR, RIGGS & INGRAM John Brielmaier, CPA Audit Manager jbrielmaier@CRIcpa.com 727.324.1247 Representative Clients District School Board of Pinellas County District School Board of Pasco County Pasco County, FL City of Largo, Florida Lee County Mosquito Control District Lee County Hyacinth Control District AMIkids, Inc. Carlton Manor, Inc. Operation PAR, Inc. Clearwater Marine Aquarium Sun Print Management City of Cape Coral – Special Project for Internal Audit Department Experience John is entering his 8th year in public accounting, all with Carr, Riggs, & Ingram. He is a rising star on our team focusing primarily on government and large non-prot engagements. John has extensive experience and training in yellow book, GASB, and single audit. As an audit manager, John is responsible for preparing the preliminary audit plan, being on-site to oversee all testing, and supervising all senior and sta level accountants. He also is involved in testing of the highest risk/most complex areas of the audit. John is also on the Board of Directors of Creative Pinellas, Inc as well as the Tampa Bay Community Development Corporation. Education, Licenses & Certications BS, Accounting, University of South Florida Certied Public Accountant (CPA) - Florida Certied Information Technology Professional (CITP) Certied Information Systems Auditor (CISA) Professional Aliations American Institute of Certied Public Accountants (AICPA) Florida Institute of Certied Public Accountants (FICPA) Information Systems Audit and Control Association (ISACA) 22 CRIcpa.com CARR, RIGGS & INGRAM Trisha Alcala Supervising Senior talcala@CRIcpa.com 727.324.1236 Representative Clients District School Board of Pinellas County District School Board of Pasco County Pasco County Property Appraiser Pasco County Sheri's Oce Pasco County Supervisor of Elections Florida State Fair Authority City of Treasure Island, Florida City of Gulfport, Florida City of Largo, Florida Experience Trisha is in her 6th year of public accounting, all with CRI. Trisha has been involved with several types of audit engagements for clients in industries including governmental entities, not-for-prot and for- prot clients and healthcare. As a senior level accountant, Trisha is responsible for fullling components of the engagement required for completion. She is currently working towards obtaining the CPA license. Education, Licenses & Certications BS, Accounting, University of Tampa MBA, MS Accounting, University of Tampa Actively sitting for CPA Exam 23 CRIcpa.com CARR, RIGGS & INGRAM Amanda Elliott Single Audit Senior aelliot@CRIcpa.com 727.324.1248 Representative Clients City of Largo City of Gulfport The Arc of Tampa Bay Pinellas County School Board-Single Audit Pasco County School Board-Single Audit Pasco County, Florida Experience Amanda is approaching her 5th year of public accounting, all with CRI. She has worked predominantly with government and non-prot clients in her career and brings great hands on experience with federal and state single audits. As an audit senior, Amanda is responsible for fulfulling requirements of the single audit engagement and will work closely with Heather and Lori. Amanda is actively sitting for the CPA exam. Education, Licenses & Certications BS, Accounting, University of South Florida Master of Accountancy, University of South Florida Professional Aliations Florida Institute of Certied Public Accountants (FICPA) 24 CRIcpa.com CARR, RIGGS & INGRAM Kristen Akel, CPA Sta Accountant kakel@CRIcpa.com 727.324.1240 Representative Clients Pasco County BOCC Pasco County Sheri's Department Pasco County Property Appraiser Pasco County Supervisor of Elections District School Board of Pasco County District School Board of Pinellas County City of Largo, Florida City of Gulfport, Florida City of Treasure Island, Florida Experience Kristen is approaching 3 years with CRI. She started as an intern and was hired to the audit team after obtaining her Master's degree. Kristen has been working on government engagements in a sta accountant capacity and brings outstanding knowledge of federal and state programs. Education, Licenses & Certications Masters, Accounting, North Carolina State University BS, Accounting, Saint Leo University Certied Public Accountant Professional Aliations American Institute of Certied Public Accountants (AICPA) Florida Institute of Certied Public Accountants (FICPA) 25 CRIcpa.com CARR, RIGGS & INGRAM Megan Trieber Sta Accountant mtrieber@CRIcpa.com 727.324.1240 Representative Clients Pasco County FL BOCC Pasco County Property Appraiser Pasco County Tax Collector Pasco County Sheri's Oce Experience Megan came to CRI with an impressive resume having received her Bachelor's and Master's degrees in Accounting from USF. She was an intern with CRI for 4 months and also interned at the Port of Tampa Bay as well. She's been crafting her audit skills working in a mix of government and non-prot entities. Education, Licenses & Certications Masters, Accounting, University of South Florida BS, Accounting, University of South Florida Passed all 4 parts of the CPA exam Professional Aliations Florida Institute of Certied Public Accountants (FICPA) 26 CRIcpa.com CARR, RIGGS & INGRAM CONTINUING PROFESSIONAL EDUCATION CRI understands that comprehensive training is integral to help shape employee success and the quality of a professional services rm is determined by its people and the rm’s investment in them. Therefore, we have a comprehensive plan to provide quality training to our team and ensure high quality services are routinely provided to you, and each of CRI’s professional sta’s CPE records are reviewed annually to ensure that they are in compliance with 61H1-33.0035 Florida Administrative Code, regarding Continuing Professional Education (CPE). Our CPE plan includes: Technical Training at CRI’s CPE Week: Firm-wide event enabling collaboration and networking along with over 100 in-house training sessions, including government auditing, single audits, and managing audit engagements; Specialty Training: Industry specic training, includes government and single audit classes; IT Audit Schools: We are investing in the future of audit with three progressive levels taught by AICPA leaders; CRI’s Leadership Academy: Over 10 sessions related to teamwork, delegation, and business writing 27 CRIcpa.com CARR, RIGGS & INGRAM CONTINUING PROFESSIONAL EDUCATION The table below provides a summary of the CPE hours earned during the last three years by each member of the engagement team. Full class listings will be provided upon request. TEAM MEMBER PROFESSIONAL HOURS GOVERNMENT HOURS David Alvarez 186 107.2 Rob Lemmon 118.5 108 Lorri Kidder 198.5 168 David Mills 117 35 Heather Mosier 122.5 90 John Brielmaier 117.5 77 Trisha Alcala 185 86.5 Amanda Elliott 101.5 49 Kristen Akel 130 35 Megan Treiber 11 5 COMMITMENT TO STAFFING We recognize the importance of maintaining team continuity not only at the partner and manager level but all the way to the sta level. We will commit to maintaining the same team throughout all years of the contract to the greatest extent possible (i.e., the team listed in this proposal will also be the team working on the audit in the second and third years of the engagement) and the overall team size will not change from year-to-year. Maintaining continuity benets both us and our clients with increased eciency over time in performing the audit. Continuity enables us to focus on substantive issues rather than start-up concerns, and it fosters a strong working relationship between our team and your personnel. Continuity of stang is a priority in sta assignment decisions, and we will work hard to achieve a high degree of sta stability from year to year on the engagement. As a top-priority client, the City can expect CRI to provide consistent audit teams each year. 28 CRIcpa.com CARR, RIGGS & INGRAM ENGAGEMENTS WITH OTHER GOVERNMENT ENTITIES See Appendix A - We have not provided detail contact information of every client on our list. We value the privacy of our client's information. Our policy is to ask clients in advance of providing their information to obtain their permission. Should you wish to contact any client listed please let us know and we will be happy to obtain their permission for you to contact them. 29 CRIcpa.com CARR, RIGGS & INGRAM SIMILAR ENGAGEMENTS WITH OTHER GOVERNMENT ENTITIES In the table below, you will see 5 additional government engagements performed by the Clearwater oce of CRI in the last 5 years. Additional references are in Tab 4. ENGAGEMENT ENGAGEMENT PARTNER AUDIT MANAGER TOTAL HOURS SCOPE OF WORK Contact Name and Phone Number Pasco County, FL 2017 to present David Alvarez John Brielmaier 3,775 Audit Single Audit CAFR Review PAFR Review Manny Long 352.521.4581 Pinellas County School Board 2010 to present David Alvarez John Brielmaier 1,400 Audit Single Audit Construction Contract AUPs Investment Controls AUPs CAFR Review Kevin Smith 727.588.6172 Pasco County School Board 2017 to present David Alvarez John Brielmaier 1,200 Audit Single Audit Construction Contract AUPs CAFR Review Dominick Cristofaro 813.794.2086 Largo, FL 2012 to present David Alvarez John Brielmaier 800 Audit Single Audit CAFR Review Data Analytics - P-card Process Kim Adams 727.587.6747 Gulfport, FL 2010 to present David Alvarez N/A 500 Audit Single Audit CAFR Review Cheryl Hannan 727.893.1014 30 CRIcpa.com CARR, RIGGS & INGRAM TAB 3 31 CRIcpa.com CARR, RIGGS & INGRAM AUDIT APPROACH FOR THE CITY OF CLEARWATER SEGMENTATION We segment our audits into four (4) segments: client acceptance and pre-planning, risk assessment and audit strategy, audit execution, and report and monitor. STAFF AND HOURS ASSIGNED TO EACH SEGMENT Sta Level Client Acceptance & Pre-Planning Risk Assessment & Audit Strategy Audit Execution Report & Monitor Total Partners 0.4%3.5%6.4%2.1%12.4% Managers 0.2%4.4%14.9%1.8%21.2% Supervisory Sta0%7.1%27.3%1.1%35.4% Sta0%6.2%24.8%0.0%31.0% Total 0.5%21.2%73.3%5.0%100% 32 CRIcpa.com CARR, RIGGS & INGRAM EXTENT OF EDP SOFTWARE CRI uses both IDEA and Active Data, which are highly powerful data analytic tools, in our audit engagements. All seniors have been trained on Active Data which allows them to perform very robust data analytic processes and analysis. We also use specialized IDEA trained experts for highly complicated analysis that any engagement team can request assistance from an expert at any time. As clients are now able to generate very large populations of data we use Computer Assisted Auditing Techniques (CAATs) increasingly in all engagements. There are many areas in City engagements that are very eective in using CAATs to allow us to test complete populations eectively, while increasing eectiveness by being able to focus on items of highest risk. We typically use CAATs to test journal entries throughout the year, a step that is required by auditing standards in all audits, as well as to test enterprise fund billing processes. APPROACH TO UNDERSTANDING INTERNAL CONTROLS In our approach around internal controls we will begin with documentation that is already in place for Clearwater, for example process narratives/policy manuals. We will review documentation in place and site with process owners to gain an understanding of the process and the key risks throughout the various processes and control environments throughout the City. Where signicant risks in processes are identied we will determine if controls are in place to mitigate risks to nancial reporting. For example, in the cash disbursement process a key risk is paying an invoice that has not been approved by a department or purchaser. The key control would be the review and approval process of invoices. Through this process we also identify controls that are eective for us to test and rely upon in order to reduce the amount sampling and analytical procedures we perform. We would expect to test controls in the following areas, in order to conduct a more eective and ecient audit: cash disbursements, cash receipts, revenue billing, and payroll. The second component of internal controls that gain an understanding are information technology general controls (ITGC). These controls will considered carefully during our evaluation of internal control over nancial reporting. The controls that mitigate these risks are important because of their pervasive eect on the reliability, integrity, and availability of processing relevant data. IT risks & controls will be evaluated and tested from the top down as follows: 1. IT General Controls (ITGCs) typically impact multiple applications in the technology environment and prevent certain events from impacting the integrity of processing data. Computer operations, physical and logical security, program changes, systems development, and business continuity are examples of processes where general IT controls reside. These IT controls are pervasive because they can have an impact on the City’s achievement of nancial reporting objectives germane to many of its processes. 2. Application controls are more specic to individual processes. These controls include policies and procedures designed and implemented in the applications and data. They also include so called programmed controls within the applications that perform specic control related activities, such as computerized edit checks of input data, numerical sequence checks, validation of key elds, and exception reporting and related follow-up on exceptions. In our process of reviewing the many internal control processes in place throughout the City we use our extensive experience in Florida governments and fresh perspective to provide the City some best practices and observations that would be extremely useful in generating ideas for eciencies in processes and policies. 33 CRIcpa.com CARR, RIGGS & INGRAM APPROACH TO DETERMINING LAWS & REGULATIONS SUBJECT TO TEST WORK Due to our extensive government auditing experience we are very familiar with the Rules of the Florida Auditor General, the requirements imposed by Florida Statutes and regulations, and our reporting obligations. To facilitate compliance testing on our City audits we review the statutes each year and create testing tools which our teams use to help them determine which sections of the Statutes are in-scope for compliance testing based on which are direct and material to the City. Where possible, we will incorporate our statutory compliance testing into our nancial statement substantive testing to gain eciencies but where this is not possible we will perform a stand-alone compliance test. A separate signicant portion of our audit in relation to laws and regulations is the single audit component of the overeall audit engagement. Our single audit approach is as follows: CRI's approach to Single Audits has proven to be highly ecient and eective and this has led to CRI earning the Single Audit Resource Center (SARC) Award for Excellence in knowledge, value, and overall client satisfaction. The steps in the single audit are very similar to those in the nancial statement audit in that they focus on risk assessment, followed by the testing of transactions and controls, and are concluded with communication of the results and nancial reporting. Below we have summarized the specic steps taken in our single audit approach: Obtain the Schedule of Expenditures of Federal Awards (SEFA) and the Schedule of Expenditures of State Financial Assistance (SESA) (if applicable), Check the SEFA and SESA for accuracy and reconcile them to the underlying nancial records, Following the Federal and State requirements we utilize our highly-ecient, internally-generated tools to assist us in determining and documenting which grants are to be tested, For each grant being tested, we perform a risk assessment to determine which compliance requirements are direct and material and in-scope for testing, We perform inquiries with management and observation of processes to establish the controls over compliance which are in place over each direct and material compliance requirement, For a sample of items we perform ecient, dual-purpose testing to gain comfort over both the operating eectiveness of controls and compliance with the direct and material requirements, Results of the testing procedures are reviewed and any possible ndings are investigated to determine the most appropriate way to report them, and Once all procedures are complete, the single audit reports are issued. 34 CRIcpa.com CARR, RIGGS & INGRAM SAMPLE SIZES AND THE EXTENT TO WHICH STATISTICAL SAMPLING IS USED In our approach, we base our testing o the risk of an account balance, as described above. Based on the risk we will determine our testing approach which would including sampling balances to test individual transactions and also use analytical procedures. We try and maximize the use of analytical procedures as we can then identify unusual trends and focus sampling in areas with greatest risk. Included in our engagement team, David Alvarez, is the rm-wide sampling expert and has been teaching sampling courses at our internal CPE Week for approximately ve years. Throughout the year engagement teams from other oces reach out to David with sampling related questions and diculties. CRI has the ability to use both statistical and non-statistical sampling methodologies. The selection of the two techniques depends on the format in which populations are provided. When populations are provided in an Excel or delimited le we can use statistical sampling methodologies. We primarily use Active Data to select items through this method of monetary unit sampling. For all other populations we use a non-statistical sampling approach that is based on the AICPA's Sampling Guide. In both instances our sample sizes rst focus on individually signicant items and then the remaining sample is based on risk in the population and materiality for the related opinion unit. Once we select items, testing is performed over each selected item. TYPE AND EXTENT OF ANALYTICAL PROCEDURES Analytical review procedures will be used in planning the nature, timing and extent of most audit procedures performed by CRI. Examples of analytical procedures used include comparisons to prior year balances and amounts from the City's nancial reports as well as comparisons to current year budgets using the City budget documents. Likewise, they will be used on an overall basis to test the results of the procedures we perform. Throughout the audit, we will use analytical procedures such as historical trend comparisons, and prior year actual to current-year actual comparisons on selected, related groups of accounts from the City's nancial reports and budget documents. We also prepare predictive analytics as our primary substantive tests of accounts. These predictive analytics would be performed over payroll and enterprise fund revenues. We use data analytic tools discussed above to allow to perform these highly eective procedures. These are invaluable audit procedures that assist us in streamlining our audit work while “zeroing” in on issues for management’s consideration. Thus, this approach provides advantages for both the City as well as the auditors. APPROACH IN DRAWING SAMPLES FOR TESTING COMPLIANCE During our audits we perform tests of compliance in relation to Florida Statutes and in accordance with Uniform Guidance and Chapter 10.550, Rules of the Auditor General. Our sample sizes are driven based on the level of assurance needed from the test, meaning the signicance of the compliance requirement, as well as the size of the population. The population is the number of times there is a transaction or requirement for each compliance component. IDENTIFICATION OF POTENTIAL AUDIT PROBLEMS CRI's government industry line is the largest segment of business for the rm. It's extremely rare we encounter a problem/issue we wouldn't be able to address. We do not foresee any anticipated audit problems for the City of Clearwater. Given our experience and sta level, we have seen many approaches at dierent locations to similar issues that would impact the City and are exible in our approach that emphasizes how things work best for our clients and not how things only create eciency on our side. Should the City have any problem with our approach or conclusion, you are welcome to contact our corporate oversight function for a fresh perspective. All related contact information would be provided to management. We also have not identied any special assistance that will be requested from the City in performing this engagement. 35 CRIcpa.com CARR, RIGGS & INGRAM TAB 4 36 CRIcpa.com CARR, RIGGS & INGRAM REFERENCES FOR THE CITY OF CLEARWATER CRI delivers a depth of resources that ensures our understanding of your challenges and innovative solutions for overcoming them. Our team’s combined experience is derived from providing audit, tax, consulting, and accounting outsourcing services. We parlay this vast experience and derived best practices into proven solutions that benet you. Below we share specic, relevant client references; we encourage you to consult with them. RELATIONSHIP TIMELINE SERVICE DESCRIPTION POINTS TO CONSIDER Hours City of Largo 201 Highland Ave. N Largo, FL 33770 Kimball Adams-Finance Director 727.587.6747 kadams@largo.com 2012 to Present Financial Audit Single Audit EMS Certication Data Analytics Services Examination of procedures in accordance with Pinellas County Regulations Responsiveness to client needs 800 City of Jacksonville 117 W Duval St Jacksonville, FL 32202 Kyle Billy Council Auditor's Oce 904.255.5488 kbilly@coj.net 2015 to Present Financial Audit Federal and State Single Audit CAFR review CRA Audit Venue Audit GFOA deadline met Court cost reporting Landll escrow Audit Debt refunding transactions Signicant enterprise fund activity 2,500 City of Daytona Beach 301 S. Ridgewood Ave Daytona Beach, FL 32114 Patricia Bliss-CFO 386-671-8060 blissp@codb.us 2014 to Present Financial Audit Federal and State Single Audit Client service experience Responsiveness to client needs 1,000 City of Melbourne 900 E. Strawbridge Ave Melbourne, FL 32901 Je Towne, Finance Director 321-608-7010 je.towne@mlb.org 1978 to Present Financial Audit Federal and State Single Audit Client service experience Responsiveness to client needs Long-term relationships 850 Pasco County, FL 38053 Live Oak Ave Ste 205 Dade City, FL 33523 Manny Long-Finance Director 352.521.4581 mlong@pascoclerk.com 2017 to Present Financial Audit Single Audit CAFR and PAFR Review Numerous Attestation Reports Drastically improved audit timeliness from prior auditor Debt refunding transactions Signicant enterprise fund activity 3,775 37 CRIcpa.com CARR, RIGGS & INGRAM TAB 5 38 CRIcpa.com CARR, RIGGS & INGRAM COST PROPOSAL We value creating mutually rewarding, long-term relationships with our clients. Our goal is to provide high quality, responsive service that yields returns far greater than your investment in our professional fees. Please nd below our proposal of fees to provide the requested services for the upcoming scal years. Our fees below are stated as "not-to-exceed" fees, so any overruns would be absorbed by CRI, but if we come in under budget we will pass these savings back to the City/Tax Payers. SERVICE CRI FEES 2020 CRI FEES 2021 CRI FEES 2022 CRI FEES 2023 CRI FEES 2024 Perform external audit services in accordance with auditing standards generally accepted in the United States of America (GAAS) $119,000 $119,000 $120,500 $120,500 $121,500 Perform Federal and State Single Audit 7,500 7,500 8,000 8,000 8,000 Auditing the special purpose Schedule of Revenue for Emergency Medical Services (EMS) 1,500 1,500 1,500 1,500 1,500 Total $128,000 $128,000 $130,000 $130,000 $131,000 If City of Clearwater requests additional services outside of this proposal, professional fee hourly rates are as follows, but may be negotiated depending on the project request: CLASSIFICATION HOURLY RATE Partner $275 Manager $150 Senior $90 Sta$55 IT Specialist $250 Fraud Specialist $250 Our professional fees are based on the key assumptions that City of Clearwater will: Ensure that the predecessor’s work papers will be made available for timely review. Make available documents and work papers for review at City of Clearwater's headquarters location, although we may choose to review at alternate locations. Prepare certain schedules and analyses and provide supporting documents as requested. Assist us in obtaining an understanding of the accounting systems of City of Clearwater. Not experience a signicant change in business operations or nancial reporting standards. 39 CRIcpa.com CARR, RIGGS & INGRAM TAB 6 40 CRIcpa.com CARR, RIGGS & INGRAM REQUIRED FORMS EXCEPTIONS/ADDITIONAL MATERIALS/ADDENDA FORM 41 CRIcpa.com CARR, RIGGS & INGRAM VENDOR INFORMATION FORM 42 CRIcpa.com CARR, RIGGS & INGRAM VENDOR CERTIFICATION OF PROPOSAL FORM 43 CRIcpa.com CARR, RIGGS & INGRAM SCRUTINIZED COMPANIES FORM 44 CRIcpa.com CARR, RIGGS & INGRAM 45 CRIcpa.com CARR, RIGGS & INGRAM CERTIFICATE OF INSURANCE 46 CRIcpa.com CARR, RIGGS & INGRAM 47 CRIcpa.com CARR, RIGGS & INGRAM W9 FORM 48 CRIcpa.com CARR, RIGGS & INGRAM APPENDIX A-CRI GOVERNMENT CLIENTS FIRM-WIDE 49 50 51 52 53 54 55 56 57 58 59 60 1 AGREEMENT THIS AGREEMENT, made and entered into this ___ day of August, 2020 by and between the CITY OF CLEARWATER, FLORIDA, a municipal corporation of the State of Florida, located at 600 Cleveland Street, Suite 600, Clearwater, Florida 33755, hereinafter referred to as "City”, and Carr, Riggs & Ingram, LLC, a firm of Certified Public Accountants, located at 600 Cleveland Street, Suite 1000, Clearwater, Florida, 33755, hereinafter referred to as "Contractor”; WITNESSETH WHEREAS, the City is required by Article II, Section 2.01(c)(3) of the City Charter to provide for an annual audit of its financial accounts; and WHEREAS, the City participates in various Federal, State and County Assistance programs which require independent financial and compliance audits in accordance with rules established by the U.S. Department of Housing and Urban Development, Florida Auditor General, and other agencies; and WHEREAS, the Contractor is in the business of public accounting, is fully qualified to meet the requirements of applicable City, State and Federal law, and desires to perform the necessary services: NOW, THEREFORE, the parties agree as follows: 1. Recitals. The foregoing recitals are true and correct and are incorporated in and form a part of this Agreement. 2. The “Auditor Services Documents” form the Auditor Services Agreement. The Auditor Services Documents consist of this Agreement between the City and the Contractor (hereinafter “Agreement”) and its attached Exhibits: City of Clearwater Request for Proposal for Professional Auditing Services, (“RFP 2 36-20”)issued May 1, 2020 (Exhibit “A”); Proposal to provide Professional Auditing Services to the City of Clearwater, Florida (“Proposal”) submitted June 2, 2020 (Exhibit “B”); Engagement Letters from Contractor to City confirming understanding of the services to be provided under the Agreement (“Engagement Letters”) (Exhibits “C” and “D”). The Auditor Services Documents shall not be construed to create a contractual relationship of any kind with any third party, including any third-party service provider used by the Contractor in the fulfillment of its obligations under the Agreement. In the event of a conflict between terms of the Auditor Service Documents, the documents shall have the following order of precedence: The Agreement, Exhibit A, Exhibit B, Exhibit C and D. 3. This agreement relates specifically to the City's fiscal years ending September 30, 2020 thru 2024. This agreement may be terminated by the City on the basis of unsatisfactory performance, as determined by the City in its sole discretion, with written notice at least six months prior to the September 30 fiscal year-end, or by the contractor for reasons specified in the Engagement Letter which is hereby incorporated by reference and made a part hereof. City Charter Section 2.01(c)(3) currently prohibits any single audit firm from being employed for more than five consecutive years. The fees for subsequent years are fixed per this agreement and not expected to deviate from the amounts stated herein except for unanticipated significant changes in the scope of auditing services required by the City. 4. The Contractor shall review the City's comprehensive annual financial report for compliance with GAAP and the applicable requirements of the Certificate of Achievement for Excellence in Financial Reporting program of the Government Finance 3 Officers Association and assist the City in complying with new or existing requirements. The Contractor shall, subject to the terms and conditions of the engagement letter, render a report on the fair presentation of the City's basic financial statements and all individual non-major fund financial statements, in conformity with generally accepted accounting principles, for the fiscal years ending September 30, 2020 thru 2024. The Contractor shall, subject to the terms and conditions of the engagement letter, render a report on the fair presentation of the City's combining and individual fund financial statements and schedules in conformity with generally accepted accounting principles. The Contractor is not required to audit the supplementary information contained in the comprehensive annual financial report, however, the Contractor shall provide an "in-relation-to" report on the supplementary information based on the audit procedures applied during the audit of the basic financial statements and the combining and individual fund financial statements and schedules. The Contractor is not required to audit the introductory or statistical sections of the report. The Contractor shall also perform the required financial and compliance audits associated with Federal, State, and County Assistance programs in accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements of Federal Awards (Uniform Guidance); the provisions of the Florida Single Audit Act (Section 215.97 Florida Statutes); and rules of other agencies. 5. In performing the services described in #2 above, the Contractor shall comply with the following:  Generally Accepted Auditing Standards (GAAS) as set forth by the American Institute of Certified Public Accountants 4  Government Auditing Standards issued by the Comptroller General of the United States  Florida Single Audit Act; Section 215.97 Florida Statutes  Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance)  Chapter 11.45 Florida Statutes  Chapter 10.550, Rules of the Auditor General  State of Florida Department of Banking and Finance Regulations  Audits of State and Local Governmental Units (Revised)- AICPA   Any other applicable federal, state, and local laws, regulations or professional guidance not specifically listed above as well as any additional requirements which may be adopted by these organizations in the future As a part of the audit, the Contractor will consider the City's internal control structure, as required by generally accepted auditing standards and Government Auditing Standards. 6. Following completion of the audit, the Contractor shall, subject to the terms and conditions of the engagement letter, render the following reports:  Express an opinion or issue a report as appropriate on the fair presentation of the City’s basic financial statements in conformity with U.S. generally accepted accounting principles no later than February 28th annually.  Express an opinion or issue a report as appropriate on the fair presentation of City’s individual non-major governmental, non-major enterprise, internal service and fiduciary funds financial statements, including any budgetary comparisons presented as basic financial statements, in conformity with U.S. generally accepted 5 accounting principles, no later than February 28th annually.  Provide an “in-relation-to” opinion or report as appropriate on the supporting schedules of federal and state financial assistance, as well as all statements and schedules included within the financial section of the CAFR.  Perform certain limited procedures involving required supplementary information as mandated by generally accepted auditing standards.  Provide a report on internal controls over financial reporting and on compliance and other matters based on an audit of financial statements performed in accordance with government auditing standards.  Provide a report on compliance with requirements applicable to each major Federal program and state project and on internal control over compliance required by Title 2, U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principals and Audit Requirements for Federal Awards (Uniform Guidance).  Provide a schedule of findings and questioned costs as mandated by Title 2, U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principals and Audit Requirements for Federal Awards (Uniform Guidance), and the Florida Single Audit Act.  Provide any other reports required by the Uniform Guidance and the Florida Single Audit Act.  Provide a Management Letter as required by Section 10.554(1)(i) of the Rules of the Auditor General of the State of Florida including all required disclosures.  Provide an Independent Accountant’s Report as required by the Florida Auditor General.  Audit the special purpose Schedule of Revenues and Expenditures of Emergency Medical Services and express an opinion or issue a report as appropriate as to whether the Schedule presents fairly, in all material respects, the revenues and expenditures related to the Emergency Medical Services (EMS) of the City in accordance with the ALS First Responder Agreement. 6  Complete the appropriate section of and sign the Data Collection Form. 7. The Contractor, at the end of the audit at no additional cost to the City, will provide a report on the liftable portion of the financial statements that would be suitable to include with the financial statements included in a debt issuance. When this report is used, the City will include in their offering statement the following: “Carr, Riggs & Ingram, LLC our independent auditor, has not been engaged to perform and has not performed, since the date of its report included herein, any procedures on the financial statements addressed in that report. Carr, Riggs & Ingram, LLC also has not performed any procedures relating to this official statement.” 8. The Contractor shall retain all working papers for a minimum of five (5) years, unless notified in writing by the City of the need to extend the retention period. The Contractor shall make working papers available, upon request, to the following parties or their designees:  City of Clearwater  U.S. Department of Housing and Urban Development  U.S. General Accounting Office (GAO)  Parties designated by the federal or state governments or by the City of Clearwater as part of an audit quality review process  Auditors of entities of which the City of Clearwater is subrecipient of grant funds In addition, the Contractor shall, provided all fees have been paid, respond to the reasonable inquiries of successor auditors and allow successor auditors to review working papers relating to matters of continuing accounting significance. 7 9. The Contractor shall assist the City in scheduling the Comprehensive Annual Financial Report to be completed and issued no later than March 15th, succeeding each fiscal year. Contractor/City meetings will be held at least once per month until completion of this contract. Weekly status meetings shall be held while the Contractor is working at the City. The Contractor shall complete performance under this contract by March 31st succeeding each fiscal year. 10. The Contractor shall bill the City and the City shall pay the Contractor for the performance of the services under this contract on the basis of the Contractor's normal and customary charges for such services, plus ordinary out-of-pocket expenses customarily stated separately by the Contractor in his general practice. The total amount of this contract, including out-of- pocket expenses, shall not exceed: Fiscal 2020 $128,000 Fiscal 2021 $128,000 Fiscal 2022 $130,000 Fiscal 2023 $130,000 Fiscal 2024 $131,000 The City may, by amendment of this agreement, increase this maximum fee and/or extend the completion date upon the Contractor's showing evidence of conditions which require substantially more time than would generally be required to perform the prescribed services. Progress payments will be made periodically for work completed to date based on invoices submitted by the Contractor. The sum of such progress payments shall not exceed ninety percent (80%) of the maximum specified above. The final payment will be made within thirty (30) days of receipt of the final audit reports. 8 Miscellaneous Provisions 11. Budget Allocations. The obligations of the parties are subject to appropriate budgeted funds being available in each budget year to achieve the purposes of this Agreement. In the event that sufficient budgeted funds are not available in a subsequent fiscal year, this Agreement shall terminate on the last day of the fiscal year for which sufficient budgeted funds are available without penalty to either of the parties. 12. Record Retention. Documents related to this agreement may be construed as public record and shall be retained and provided as required by law, regulation or professional standard. 13. Compliance with the Law. Both Parties shall comply with all federal, state, county, and local laws, regulations, and ordinances at all times. 14. Discrimination Prohibited. The Parties shall, during the performance of this agreement, comply with all applicable provisions of federal, state and local laws and regulations pertaining to prohibited discrimination. 9 15. Assignment. This agreement is not assignable. 16. Severability. Should any section or part of any section of this Agreement be rendered void, invalid, or unenforceable by any court of law, for any reason, such a determination shall not render void, invalid, or unenforceable of any other section or any part of any section of this Agreement. 17. Amendments. This Agreement constitutes the entire Agreement between the Parties, and no change will be valid unless made by supplemental written agreement executed by both Parties. 18. Notices. All notices, requests, demands, or other communications required by law, or this Agreement shall be in writing and shall be deemed to have been served as of the delivery date appearing upon the return receipt if sent by certified mail, postage prepaid with return receipt requested, to: Jay Ravins, Finance Director City of Clearwater 100 South Myrtle Avenue Clearwater, FL 33756 David Alvarez, Partner Carr, Riggs & Ingram, LLC 600 Cleveland Street, Suite 1000 Clearwater, FL 33756 10 19. Non-Waiver. No act of omission or commission of either Party, including without limitation, any failure to exercise any right, remedy, or recourse, shall be deemed to be a waiver, release, or modification of the same. Such a waiver, release, or modification is to be effected only through a written modification to this Agreement. 20. Authority. Each Party to this Agreement represents and warrants to the other Party that (i) it is duly organized, qualified and existing entities under the laws of the State of Florida, and (ii) all appropriate authority exists so as to duly authorize the persons executing this Agreement to so execute the same and fully bind the Party on whose behalf they are executing. This Agreement is subject to approval by the Parties. 21. Governing Law. This Agreement shall be construed and enforced in accordance with Florida Law. 11 IN WITNESS WHEREOF, the parties hereto have caused this agreement to be executed the day and year first above written: Countersigned: CITY OF CLEARWATER, FLORIDA ___________________________ By: __________________________ Frank V. Hibbard William B. Horne II Mayor City Manager Approved as to form: Attest: ___________________________ ________________________________ Pamela K. Akin Rosemarie Call City Attorney City Clerk Carr, Riggs & Ingram LLC By: ____________________________ David Alvarez Engagement Partner Carr, Riggs & Ingram, LLC 600 Cleveland Street Suite 1000 Clearwater, FL 33755 727.446.0504 727.461.7384 (fax) CRIcpa.com September 3, 2020 The Honorable Mayor and City Council Members, City of Clearwater, Florida: We are pleased to confirm our understanding of the services we are to provide City of Clearwater for the year ended September 30, 2020. We will audit the financial statements of the governmental activities, the business‐ type activities, each major fund, and the aggregate remaining fund information, including the related notes to the financial statements, which collectively comprise the basic financial statements, of City of Clearwater as of and for the year ended September 30, 2020. We will also audit the financial statements of each of the City’s nonmajor governmental funds, nonmajor enterprise funds, internal service funds and fiduciary funds presented as supplemental information in the accompanying combining and individual fund financial statements as of and for the year ended September 30, 2020. Accounting standards generally accepted in the United States of America provide for certain required supplementary information (RSI), such as management’s discussion and analysis (MD&A), to supplement City of Clearwater’s basic financial statements. Such information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. As part of our engagement, we will apply certain limited procedures to City of Clearwater’s RSI in accordance with auditing standards generally accepted in the United States of America. These limited procedures will consist of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We will not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. The following RSI is required by U.S. generally accepted accounting principles and will be subjected to certain limited procedures, but will not be audited: 1)Management’s Discussion and Analysis. 2)Required Supplemental Information – Pension Trust Funds a)Employees' Pension Plan – Schedule of Changes in Net Pension Liability and Related Ratios b)Firefighters' Relief and Pension Plan – Schedule of Changes in Net Pension Liability and Related Ratios c)Employees' Pension Plan – Schedule of Contributions d)Firefighters' Relief and Pension Plan – Schedule of Contributions e)Employees' Pension Plan – Schedule of Investment Returns f)Firefighters' Relief and Pension Plan – Schedule of Investment Returns 3)Required Supplemental Information – Other Postemployment Benefits We have also been engaged to report on supplementary information other than RSI that accompanies City of Clearwater’s financial statements. We will subject the following supplementary information to the auditing Page 2 of 10 procedures applied in our audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America, and we will provide an opinion on it in relation to the financial statements as a whole, in a report combined with our auditor’s report on the financial statements: 1)Schedule of Expenditures of Federal Awards and State Financial Assistance Projects 2)Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual (GAAP Basis) – Community Redevelopment Agency Special Revenue Fund The following other information accompanying the financial statements will not be subjected to the auditing procedures applied in our audit of the financial statements, and our auditor’s report will not provide an opinion or any assurance on that other information (except as described above for nonmajor funds, internal service funds and fiduciary funds). 1)Introductory section 2)Statistical section 3)Other information section Audit Objectives The objective of our audit is the expression of opinions as to whether your financial statements are fairly presented, in all material respects, in conformity with U.S. generally accepted accounting principles and to report on the fairness of the supplementary information referred to in the second paragraph when considered in relation to the financial statements as a whole. The objective also includes reporting on— Internal control over financial reporting and compliance with provisions of laws, regulations, contracts, and award agreements, noncompliance with which could have a material effect on the financial statements in accordance with Government Auditing Standards. Internal control over compliance related to major programs and an opinion (or disclaimer of opinion) on compliance with federal statutes, regulations, and the terms and conditions of federal awards that could have a direct and material effect on each major program in accordance with the Single Audit Act Amendments of 1996 and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and Chapter 10.550, Rules of the Auditor General. The Government Auditing Standards report on internal control over financial reporting and on compliance and other matters will include a paragraph that states that (1) the purpose of the report is solely to describe the scope of testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance, and (2) the report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. The Uniform Guidance and Chapter 10.550, Rules of the Auditor General report on internal control over compliance will include a paragraph that states that the purpose of the report on internal control over compliance is solely to describe the scope of testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance and Chapter 10.550, Rules of the Auditor General. Both reports will state that the report is not suitable for any other purpose. Page 3 of 10 Our audit will be conducted in accordance with auditing standards generally accepted in the United States of America; the standards for financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; the Single Audit Act Amendments of 1996; and the provisions of the Uniform Guidance and Chapter 10.550, Rules of the Auditor General, and will include tests of accounting records, a determination of major program(s) and project(s) in accordance with the Uniform Guidance and Chapter 10.550, Rules of the Auditor General, and other procedures we consider necessary to enable us to express such opinions. We will issue written reports upon completion of our Single Audit. Our reports will be addressed to Mayor and City Council Members of City of Clearwater. We cannot provide assurance that unmodified opinions will be expressed. Circumstances may arise in which it is necessary for us to modify our opinions or add emphasis‐of‐ matter or other‐matter paragraphs. If our opinions are other than unmodified, we will discuss the reasons with you in advance. If, for any reason, we are unable to complete the audit or are unable to form or have not formed opinions, we may decline to express opinions or issue reports, or we may withdraw from this engagement. Audit Procedures—General An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements; therefore, our audit will involve judgment about the number of transactions to be examined and the areas to be tested. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We will plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether from (1) errors, (2) fraudulent financial reporting, (3) misappropriation of assets, or (4) violations of laws or governmental regulations that are attributable to the government or to acts by management or employees acting on behalf of the government. Because the determination of waste and abuse is subjective, Government Auditing Standards do not expect auditors to perform specific procedures to detect waste or abuse in financial audits nor do they expect auditors to provide reasonable assurance of detecting waste or abuse. Because of the inherent limitations of an audit, combined with the inherent limitations of internal control, and because we will not perform a detailed examination of all transactions, an unavoidable risk exists that some material misstatements or noncompliance may exist and not be detected by us, even though the audit is properly planned and performed in accordance with U.S. generally accepted auditing standards and Government Auditing Standards. In addition, an audit is not designed to detect immaterial misstatements or violations of laws or governmental regulations that do not have a direct and material effect on the financial statements or on major programs. However, we will inform the appropriate level of management of any material errors, any fraudulent financial reporting, or misappropriation of assets that come to our attention. We will also inform the appropriate level of management of any violations of laws or governmental regulations that come to our attention, unless clearly inconsequential. We will include such matters in the reports required for a Single Audit. Our responsibility as auditors is limited to the period covered by our audit and does not extend to any later periods for which we are not engaged as auditors. Our procedures will include tests of documentary evidence supporting the transactions recorded in the accounts, and may include tests of the physical existence of inventories, and direct confirmation of receivables and certain other assets and liabilities by correspondence with selected individuals, funding sources, creditors, and financial institutions. We will request written representations from your attorneys as part of the engagement, and they may bill you for responding to this inquiry. At the conclusion of our audit, we will require certain written representations from you about your responsibilities for the financial statements; schedule of expenditures of federal awards; federal award programs; compliance with laws, regulations, contracts, and grant agreements; and other responsibilities required by generally accepted auditing standards. Page 4 of 10 Audit Procedures—Internal Control Our audit will include obtaining an understanding of the government and its environment, including internal control, sufficient to assess the risks of material misstatement of the financial statements and to design the nature, timing, and extent of further audit procedures. Tests of controls may be performed to test the effectiveness of certain controls that we consider relevant to preventing and detecting errors and fraud that are material to the financial statements and to preventing and detecting misstatements resulting from illegal acts and other noncompliance matters that have a direct and material effect on the financial statements. Our tests, if performed, will be less in scope than would be necessary to render an opinion on internal control and, accordingly, no opinion will be expressed in our report on internal control issued pursuant to Government Auditing Standards. As required by the Uniform Guidance and Chapter 10.550, Rules of the Auditor General, we will perform tests of controls over compliance to evaluate the effectiveness of the design and operation of controls that we consider relevant to preventing or detecting material noncompliance with compliance requirements applicable to each major federal award program. However, our tests will be less in scope than would be necessary to render an opinion on those controls and, accordingly, no opinion will be expressed in our report on internal control issued pursuant to the Uniform Guidance and Chapter 10.550, Rules of the Auditor General. An audit is not designed to provide assurance on internal control or to identify significant deficiencies or material weaknesses. Accordingly, we will express no such opinion. However, during the audit, we will communicate to management and those charged with governance internal control related matters that are required to be communicated under AICPA professional standards, Government Auditing Standards, and the Uniform Guidance and Chapter 10.550, Rules of the Auditor General. Audit Procedures—Compliance As part of obtaining reasonable assurance about whether the financial statements are free of material misstatement, we will perform tests of City of Clearwater’s compliance with provisions of applicable laws, regulations, contracts, and agreements, including grant agreements. However, the objective of those procedures will not be to provide an opinion on overall compliance and we will not express such an opinion in our report on compliance issued pursuant to Government Auditing Standards. The Uniform Guidance and Chapter 10.550, Rules of the Auditor General requires that we also plan and perform the audit to obtain reasonable assurance about whether the auditee has complied with federal and state statutes, regulations, and the terms and conditions of federal awards applicable to major programs and state financial assistance applicable to major projects. Our procedures will consist of tests of transactions and other applicable procedures described in the OMB Compliance Supplement for the types of compliance requirements that could have a direct and material effect on each of City of Clearwater’s major programs and projects. For federal programs and state projects that are included in the Compliance Supplement, our compliance and internal control procedures will relate to the compliance requirements that the Compliance Supplement identifies as being subject to audit. The purpose of these procedures will be to express an opinion on City of Clearwater’s compliance with requirements applicable to each of its major programs and projects in our report on compliance issued pursuant to the Uniform Guidance and Chapter 10.550, Rules of the Auditor General. Page 5 of 10 Other Services We will also assist in preparing the data collection form and any other nonaudit services you request of the City of Clearwater in conformity with U.S. generally accepted accounting principles and the Uniform Guidance and Chapter 10.550, Rules of the Auditor General based on information provided by you. These nonaudit services do not constitute an audit under Government Auditing Standards and such services will not be conducted in accordance with Government Auditing Standards. We will perform the services in accordance with applicable professional standards. The other services are limited to preparing the data collection form and any other nonaudit services you request. We, in our sole professional judgment, reserve the right to refuse to perform any procedure or take any action that could be construed as assuming management responsibilities. Management Responsibilities Management is responsible for (1) designing, implementing, establishing, and maintaining effective internal controls relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error, including internal controls over federal awards, and for evaluating and monitoring ongoing activities to help ensure that appropriate goals and objectives are met; (2) following laws and regulations; (3) ensuring that there is reasonable assurance that government programs are administered in compliance with compliance requirements; and (4) ensuring that management and financial information is reliable and properly reported. Management is also responsible for implementing systems designed to achieve compliance with applicable laws, regulations, contracts, and grant agreements. You are also responsible for the selection and application of accounting principles; for the preparation and fair presentation of the financial statements, schedule of expenditures of federal awards, and all accompanying information in conformity with U.S. generally accepted accounting principles; and for compliance with applicable laws and regulations (including federal statutes) and the provisions of contracts and grant agreements (including award agreements). Your responsibilities also include identifying significant contractor relationships in which the contractor has responsibility for program compliance and for the accuracy and completeness of that information. Management is also responsible for making all financial records and related information available to us and for the accuracy and completeness of that information. You are also responsible for providing us with (1) access to all information of which you are aware that is relevant to the preparation and fair presentation of the financial statements, including identification of all related parties and all related‐party relationships and transactions, (2) access to personnel, accounts, books, records, supporting documentation, and other information as needed to perform an audit under the Uniform Guidance and Chapter 10.550, Rules of the Auditor General, (3) additional information that we may request for the purpose of the audit, and (4) unrestricted access to persons within the government from whom we determine it necessary to obtain audit evidence. Your responsibilities include adjusting the financial statements to correct material misstatements and confirming to us in the management representation letter that the effects of any uncorrected misstatements aggregated by us during the current engagement and pertaining to the latest period presented are immaterial, both individually and in the aggregate, to the financial statements of each opinion unit as a whole. Page 6 of 10 You are responsible for the design and implementation of programs and controls to prevent and detect fraud, and for informing us about all known or suspected fraud affecting the government involving (1) management, (2) employees who have significant roles in internal control, and (3) others where the fraud could have a material effect on the financial statements. Your responsibilities include informing us of your knowledge of any allegations of fraud or suspected fraud affecting the government received in communications from employees, former employees, grantors, regulators, or others. In addition, you are responsible for identifying and ensuring that the government complies with applicable laws, regulations, contracts, agreements, and grants. Management is also responsible for taking timely and appropriate steps to remedy fraud and noncompliance with provisions of laws, regulations, contracts, and grant agreements that we report. Additionally, as required by the Uniform Guidance and Chapter 10.550, Rules of the Auditor General, it is management’s responsibility to evaluate and monitor noncompliance with federal and state statutes, regulations, and the terms and conditions of federal awards and state financial assistance; take prompt action when instances of noncompliance are identified including noncompliance identified in audit findings; promptly follow up and take corrective action on reported audit findings; and prepare a summary schedule of prior audit findings and a separate corrective action plan. The summary schedule of prior audit findings should be available for our review on September 30, 2020. You are responsible for identifying all federal awards and state financial assistance received and understanding and complying with the compliance requirements and for the preparation of the schedule of expenditures of federal awards and state financial assistance (including notes and noncash assistance received) in conformity with the Uniform Guidance and Chapter 10.550, Rules of the Auditor General. You agree to include our report on the schedule of expenditures of federal awards and state financial assistance in any document that contains and indicates that we have reported on the schedule of expenditures of federal awards. You also agree to include the audited financial statements with any presentation of the schedule of expenditures of federal awards that includes our report thereon or make the audited financial statements readily available to intended users of the schedule of expenditures of federal awards and state financial assistance no later than the date the schedule of expenditures of federal awards and state financial assistance is issued with our report thereon. Your responsibilities include acknowledging to us in the written representation letter that (1) you are responsible for presentation of the schedule of expenditures of federal awards and state financial assistance in accordance with the Uniform Guidance and Chapter 10.550, Rules of the Auditor General; (2) you believe the schedule of expenditures of federal awards and state financial assistance, including its form and content, is stated fairly in accordance with the Uniform Guidance and Chapter 10.550, Rules of the Auditor General; (3) the methods of measurement or presentation have not changed from those used in the prior period (or, if they have changed, the reasons for such changes); and (4) you have disclosed to us any significant assumptions or interpretations underlying the measurement or presentation of the schedule of expenditures of federal awards and state financial assistance. You are also responsible for the preparation of the other supplementary information, which we have been engaged to report on, in conformity with U.S. generally accepted accounting principles. You agree to include our report on the supplementary information in any document that contains, and indicates that we have reported on, the supplementary information. You also agree to include the audited financial statements with any presentation of the supplementary information that includes our report thereon or make the audited financial statements readily available to users of the supplementary information no later than the date the supplementary information is issued with our report thereon. Your responsibilities include acknowledging to us in the written representation letter that (1) you are responsible for presentation of the supplementary information in accordance with GAAP; (2) you believe the supplementary information, including its form and content, is fairly presented in accordance with GAAP; (3) the methods of measurement or presentation have not changed from those used in the prior period (or, if they have changed, the reasons for such changes); and (4) you have disclosed to us any significant assumptions or interpretations underlying the measurement or presentation of the supplementary information. Page 7 of 10 Management is responsible for establishing and maintaining a process for tracking the status of audit findings and recommendations. Management is also responsible for identifying and providing report copies of previous financial audits, attestation engagements, performance audits, or other studies related to the objectives discussed in the Audit Objectives section of this letter. This responsibility includes relaying to us corrective actions taken to address significant findings and recommendations resulting from those audits, attestation engagements, performance audits, or studies. You are also responsible for providing management’s views on our current findings, conclusions, and recommendations, as well as your planned corrective actions, for the report, and for the timing and format for providing that information. You agree to assume all management responsibilities relating to the data collection form preparation services and any other nonaudit services we provide. You will be required to acknowledge in the management representation letter our assistance with preparation of the data collection form and have accepted responsibility for them. Further, you agree to oversee the nonaudit services by designating an individual, preferably from senior management, with suitable skill, knowledge, or experience; evaluate the adequacy and results of those services; and accept responsibility for them. Dispute Resolution In the event of a dispute between the parties which arises out of or relates to this contract or engagement letter, the breach thereof or the services provided or to be provided hereunder, if the dispute cannot be settled through negotiation, the parties agree that before initiating arbitration, litigation or other dispute resolution procedure, they will first try, in good faith, to resolve the dispute through non‐binding mediation. All parties agree that an alternative form of dispute resolution shall not be undertaken by either party until the expiration of fifteen (15) calendar days following notice being provided to the other party indicating that the dispute cannot be settled through mediation. The mediation will be administered by the American Arbitration Association under its Dispute Resolution Rules for Professional Accounting and Related Services Disputes. The costs of any mediation proceedings shall be shared equally by all parties. Electronic Data Communication and Storage and Use of Third Party Service Provider In the interest of facilitating our services to your company, we may send data over the Internet, securely store electronic data via computer software applications hosted remotely on the Internet, or allow access to data through third‐party vendors’ secured portals or clouds. Electronic data that is confidential to your company may be transmitted or stored using these methods. We may use third‐party service providers to store or transmit this data, such as, but not limited to, providers of tax return preparation software. In using these data communication and storage methods, our firm employs measures designed to maintain data security. We use reasonable efforts to keep such communications and data access secure in accordance with our obligations under applicable laws and professional standards. We also require our third‐party vendors to do the same. You recognize and accept that we have no control over, and shall not be responsible for, the unauthorized interception or breach of any communications or data once it has been sent or has been subject to unauthorized access, notwithstanding all reasonable security measures employed by us or our third‐party vendors. You consent to our use of these electronic devices and applications and submission of confidential client information to third‐ party service providers during this engagement. Page 8 of 10 To enhance our services to you, we will use a combination of remote access, secure file transfer, virtual private network or other collaborative, virtual workspace or other online tools or environments. Access through any combination of these tools allows for on‐demand and/or real‐time collaboration across geographic boundaries and time zones and allows CRI and you to share data, engagement information, knowledge, and deliverables in a protected environment. In order to use certain of these tools and in addition to execution of this acknowledgement and engagement letter, you may be required to execute a separate client acknowledgement or agreement and agree to be bound by the terms, conditions and limitations of such agreement. You agree that CRI has no responsibility for the activities of its third‐party vendors supplying these tools and agree to indemnify and hold CRI harmless with respect to any and all claims arising from or related to the operation of these tools. While we may back up your files to facilitate our services, you are solely responsible for the backup of your files and records; therefore, we recommend that you also maintain your own backup files of these records. In the event you suffer a loss of any files or records due to accident, inadvertent mistake, or Act of God, copies of which you have provided to us pursuant to this agreement, we shall not be responsible or obligated to provide you a copy of any such file or record which we may retain in our possession. Engagement Administration, Fees, and Other We may from time to time and depending on the circumstances, use third‐party service providers in serving your account. We may share confidential information about you with these service providers, but remain committed to maintaining the confidentiality and security of your information. Accordingly, we maintain internal policies, procedures, and safeguards to protect the confidentiality of your personal information. In addition, we will secure confidentiality agreements with all service providers to maintain the confidentiality of your information and we will take reasonable precautions to determine that they have appropriate procedures in place to prevent the unauthorized release of your confidential information to others. In the event that we are unable to secure an appropriate confidentiality agreement, you will be asked to provide your consent prior to the sharing of your confidential information with the third‐party service provider. Furthermore, we will remain responsible for the work provided by any such third‐party service providers. We understand that your employees will prepare all cash, accounts receivable, or other confirmations we request and will locate any documents selected by us for testing. At the conclusion of the engagement, we will complete the appropriate sections of the Data Collection Form that summarizes our audit findings. It is management’s responsibility to electronically submit the reporting package (including financial statements, schedule of expenditures of federal awards, summary schedule of prior audit findings, auditor’s reports, and corrective action plan) along with the Data Collection Form to the federal audit clearinghouse. We will coordinate with you the electronic submission and certification. The Data Collection Form and the reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s reports or nine months after the end of the audit period. We will provide copies of our reports to Mayor and City Council Members; however, management is responsible for distribution of the reports and the financial statements. Unless restricted by law or regulation, or containing privileged and confidential information, copies of our reports are to be made available for public inspection. Page 9 of 10 The audit documentation for this engagement is the property of Carr, Riggs & Ingram, LLC and constitutes confidential information. However, subject to applicable laws and regulations, audit documentation and appropriate individuals will be made available upon request and in a timely manner to its designee, a federal agency providing direct or indirect funding, or the U.S. Government Accountability Office for purposes of a quality review of the audit, to resolve audit findings, or to carry out oversight responsibilities. We will notify you of any such request. If requested, access to such audit documentation will be provided under the supervision of Carr, Riggs & Ingram, LLC personnel. Furthermore, upon request, we may provide copies of selected audit documentation to the aforementioned parties. These parties may intend, or decide, to distribute the copies or information contained therein to others, including other governmental agencies. The audit documentation for this engagement will be retained for a minimum of five years after the report release date or for any additional period requested. If we are aware that a federal awarding agency, pass‐through entity, or auditee is contesting an audit finding, we will contact the party(ies) contesting the audit finding for guidance prior to destroying the audit documentation. We expect to begin our audit on approximately October 1, 2020 and to issue our reports no later than March 31, 2021. David Alvarez is the engagement partner and is responsible for supervising the engagement and signing the reports or authorizing another individual to sign them. Our fees for these services will be a total all‐inclusive maximum price for the engagement as defined in the scope of work listed in the RFP for the year ended September 30, 2020. We will not bill for any out‐of‐pocket expenses. SERVICE 2020 Perform external audit services in accordance with auditing standards generally accepted in the United States of America (GAAS). $119,000 Perform Federal and State Single Audit 7,500 Auditing the special purpose Schedule of Revenue for Emergency Medical Services (EMS) 1,500 Total $128,000 Our professional fees are based on the key assumptions that City of Clearwater will:  Ensure that the predecessor’s work papers will be made available for timely review.  Make available documents and work papers for review at City of Clearwater's headquarters location, although we may choose to review at alternate locations.  Prepare certain schedules and analyses and provide supporting documents as requested.  Assist us in obtaining an understanding of the accounting systems of City of Clearwater.  Not experience a significant change in business operations or financial reporting standards. Our invoices for these fees will be rendered each month as work progresses and are payable on presentation. In accordance with our firm policies, work may be suspended if your account becomes 30 days or more overdue and may not be resumed until your account is paid in full. If we elect to terminate our services for nonpayment, our engagement will be deemed to have been completed upon written notification of termination, even if we have not completed our report. You will be obligated to compensate us for all time expended through the date of termination. The above fee is based on anticipated cooperation from your personnel and the assumption that unexpected circumstances will not be encountered during the audit. If significant additional time is necessary, we will discuss it with you and arrive at a new fee estimate before we incur the additional costs. Page 10 of 10 We appreciate the opportunity to be of service to City of Clearwater and believe this letter accurately summarizes the significant terms of our engagement. If you have any questions, please let us know. If you agree with the terms of our engagement as described in this letter, please sign the enclosed copy and return it to us. Very truly yours, Carr, Riggs, & Ingram, LLC RESPONSE: This letter correctly sets forth the understanding of City of Clearwater. Management signature: Title: Date: Governance signature: Title: Date: Carr, Riggs & Ingram, LLC 600 Cleveland Street Suite 1000 Clearwater, FL 33755 727.446.0504 727.461.7384 (fax) CRIcpa.com September 3, 2020 The Honorable Mayor and City Council Members, City of Clearwater We are pleased to confirm our understanding of the services we are to provide for the City of Clearwater. We will examine the City of Clearwater, Florida’s compliance with Florida Statute, 218.415 Local Government Investment Policies for the year ending September 30, 2020. The objectives of our examination are to express an opinion as to whether the City of Clearwater complied in all material respects, with Florida Statute, 218.415 Local Government Investment Policies. Our examination will be conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants. Accordingly, it will include examining, on a test basis, your records and other procedures to obtain evidence necessary to enable us to express our opinion. We will issue a written report upon completion of our examination. Our report will be addressed to Mayor and Councilmembers of the City of Clearwater. We cannot provide assurance that an unmodified opinion will be expressed. Circumstances may arise in which it is necessary for us to modify our opinion. If our opinion is other than unmodified, we will discuss the reasons with you in advance. If, for any reason, we are unable to complete the examination or are unable to form or have not formed an opinion, we may decline to express an opinion or may withdraw from this engagement. Because of the inherent limitations of an examination engagement, together with the inherent limitations of internal control, an unavoidable risk exists that some material misstatements may not be detected, even though the examination is properly planned and performed in accordance with the attestation standards. You understand that the report is intended solely for the information and use of the Mayor, Councilmembers, management, and the State of Florida Auditor General, and is not intended to be and should not be used by anyone other than those specified parties. We will plan and perform the examination to obtain reasonable assurance about whether the City of Clearwater complied, in all material respects, with Florida Statute 218.415. Our engagement will not include a detailed inspection of every transaction and cannot be relied on to disclose all material errors, or known and suspected fraud or noncompliance with laws or regulations, or internal control deficiencies that may exist. However, we will inform you of any known and suspected fraud and noncompliance with laws or regulations, internal control deficiencies identified during the engagement, and uncorrected misstatements that come to our attention unless clearly trivial. We understand that you will provide us with the information required for our examination and that you are responsible for the accuracy and completeness of that information. We may advise you about appropriate criteria, but the responsibility for the subject matter remains with you. Page 2 of 3 You are responsible for the presentation of whether the City of Clearwater is in compliance with the specified requirements of Florida Statute 218.415; and for selecting the criteria and determining that such criteria are appropriate for your purposes. You are responsible for, and agree to provide us with, a written assertion about whether you are in compliance with Florida Statute 218.415. Failure to provide such an assertion will result in our withdrawal from the engagement. You are also responsible for providing us with (1) access to all information of which you are aware that is relevant to the measurement, evaluation, or disclosure of the subject matter; (2) additional information that we may request for the purpose of the examination; and (3) unrestricted access to persons within the entity from whom we determine it necessary to obtain evidence. At the conclusion of the engagement, you agree to provide us with certain written representations in the form of a representation letter. We may from time to time, and depending on the circumstances, use third‐party service providers in serving your account. We may share confidential information about you with these service providers, but we remain committed to maintaining the confidentiality and security of your information. Accordingly, we maintain internal policies, procedures, and safeguards to protect the confidentiality of your personal information. In addition, we will secure confidentiality agreements with all service providers to maintain the confidentiality of your information, and we will take reasonable precautions to determine that they have appropriate procedures in place to prevent the unauthorized release of your confidential information to others. In the event that we are unable to secure an appropriate confidentiality agreement, you will be asked to provide your consent prior to the sharing of your confidential information with the third‐party service provider. Furthermore, we will remain responsible for the work provided by any such third‐party service providers. David Alvarez is the engagement partner and is responsible for supervising the engagement and signing the report or authorizing another individual to sign it. Our fees are included in the price of the financial statement audit. The fee estimate is based on anticipated cooperation from your personnel and the assumption that unexpected circumstances will not be encountered during the examination. If significant additional time is necessary, we will discuss it with you and arrive at a new fee estimate before we incur the additional costs. Our invoices for these fees will be rendered each month as work progresses and are payable on presentation. If we elect to terminate our services for nonpayment, our engagement will be deemed to have been completed upon written notification of termination, even if we have not completed our report. You will be obligated to compensate us for all time expended and to reimburse us for all out‐of‐pocket expenditures through the date of termination. We appreciate the opportunity to be of service to you and believe this letter accurately summarizes the significant terms of our engagement. If you have any questions, please let us know. If you agree with the terms of our engagement as described in this letter, please sign the enclosed copy and return it to us. Very truly yours, Carr, Riggs, & Ingram, LLC RESPONSE: This letter correctly sets forth the understanding of City of Clearwater. Page 3 of 3 Management signature: Title: Date: Governance signature: Title: Date: Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8113 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Finance Agenda Number: 7.4 SUBJECT/RECOMMENDATION: Approve Memorandum of Assumption with Resources Investment Advisors, LLC for investment advisory services for the City’s 457 Deferred Compensation Plan and 401(a) Money Purchase Pension Plan and authorize the appropriate officials to execute same. (consent) SUMMARY: In November 2017, Council approved a five-year agreement with Independent Financial Partners c/o Montgomery Retirement Plan Advisors, Inc., for investment advisor/consultant services for the City’s 457 Deferred Compensation Plan and 401(a) Money Purchase Pension Plan, for the five-year period January 1, 2018 through December 31, 2022. Effective July 1, 2020, Montgomery Retirement Plan Advisors, headquartered in Tampa, was acquired by Resources Investment Advisors, LLC (RIA). Per the proposed Memorandum of Assumption, RIA is assuming all terms and conditions of the previously executed agreement with Independent Financial Partners. Additionally, the key personnel that advised the City have been retained and will continue to provide the service. Montgomery Retirement Plan Advisors has provided these advisory services to the City’s plans since 2012. Staff is very happy with the quality of services provided and recommends approval of the Memorandum of Assumption for the remainder of the agreement term. APPROPRIATION CODE AND AMOUNT: N/A Page 1 City of Clearwater Printed on 9/3/2020 MEMORANDUM OF ASSUMPTION This Memorandum of Assumption (“this Memorandum”) is entered between City of Clearwater (“Client”), on the one hand, and Resources Investment Advisors, LLC (“RIA”), and Ronald A. Letaw, W. Michael Montgomery and James Battmer, investment adviser representatives of RIA (“Adviser Representatives”), as of this 1st day of July, 2020 (“Effective Date”). Recitals WHEREAS Adviser Representatives desire to provide certain investment advisory and/or consulting services (“the Services”) to Client pursuant to the following agreement(s) with Independent Financial Partners (“IFP”): Retirement Plan Advisory and Consulting Agreement (“IFP Agreement”); and WHEREAS Adviser Representatives are registered as investment adviser representatives of RIA and wish to provide the Services promised under the IFP Agreement through their registration with RIA; and WHEREAS RIA is willing to assume responsibility for the Adviser Representatives’ provision of the Services to Client pursuant to the terms and conditions contained in the IFP Agreement; and WHEREAS Client is willing to accept RIA’s assumption of responsibility for the Adviser Representatives’ provision of the Services to RIA under the same terms and conditions contained in the IFP Agreement; NOW, WHEREFORE, the parties hereby agree as follows: Agreement 1. Continuing Provision of the Services by Adviser Representatives. Adviser Representatives hereby agree to provide the Services pursuant to the same terms and conditions as contained in the IFP Agreement. 2. Assumption of Responsibility by RIA. As of the Effective Date, RIA hereby agrees to assume all duties assigned to IFP under the IFP Agreement, including without limitation, the assumption of responsibility for Adviser Representatives’ provision of the Services. RIA also offers, on its own behalf, all of the same representations made to Client by IFP, including without limitation, the representation regarding its fiduciary status, and will provide client with its ADV brochure following the Effective Date. 3. Acceptance of Transfer by Client. Client hereby agrees to accept RIA’s assumption of responsibility and the representations made to it under this Memorandum and agrees the terms and conditions outlined in the IFP Agreement, as modified by this Memorandum, shall govern the relationship between the parties as of the Effective Date. DocuSign Envelope ID: 450D7A4E-E3C5-419D-9FF4-3A05E36A4D58 By their signatures, below, the parties hereby signify their agreement to this Memorandum. Ronald A. Letaw W. Michael Montgomery and James Battmer (“Adviser Representatives”) Resources Investment Advisors, LLC Countersigned: CITY OF CLEARWATER, FLORIDA _______________________________________ _______________________________________ Frank Hibbard William B. Horne, II Mayor City Manager Date: __________________________________ Approved as to form: Attest: _______________________________________ _______________________________________ Owen Kohler Rosemarie Call Assistant City Attorney City Clerk DocuSign Envelope ID: 450D7A4E-E3C5-419D-9FF4-3A05E36A4D58 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT Legal Name of Plan: MONTGOMERY RETIREMENT PLAN ADVISORS CityofClearwater 401(a) Money Purchase PensionPlan, ICMA 467 Government Planand Trust, Nationwide 457 GovernmentPlan and Trust Name of Employer/Plan Sponsor: City of Clearwater This Retirement Plan Advisory and Consulting Agreement and Appendices A, B and C, which are attached and incorporated by reference (collectively, the "Agreement"), is effective on the date noted on the signature page below (the "Effective Date"), If accepted by the Advisor and is made by and between (I) the Employer/Plan Sponsor (the "Sponsor") of the retirement plan named above (the "Plan") and (iI) IFP Advisors, Inc. ("Advisor"). Advisor does business as Independent Financial Partners ("IFP") and as Montgomery Plan Advisors. Advisor is a corporation with its principal office in Tampa Florida, and is federally registered with the U.S. Securities and Exchange Commission ("SEC") as an investment adviser under the Investment Advisers Act of 1940 (the Advisers Act"). Advisor acts through its independent contractor investment advisor representative(s) identified on the signature page below (the "Investment Advisor Representative" or "IAR"). 1. SERVICES Advisor, through the Investment Adviser Representative, agrees to provide to the Pian the services selected by Sponsor by marking the box before each service in Appendix B ("Services").The Services that may be selected in Appendix B are identified In Appendix B as either Advisory Services or ConsultingServices. Failure to mark a box is an express indication that Advisor will not perform that Service. Advisory Services If Sponsor selects any service that is identified In Appendix B as an Advisory Service, Advisor and IAR will each act as a fiduciary, in good faith and with the degree of diligence, care and skill that a prudent person rendering similar services would exercise under similar circumstances. When providing any Advisory Services, Advisor will solely be making recommendations to Sponsor and Sponsor retains full discretionary authority or control over assets of the Plan. Sponsor is not required to implement any recommendations made by Advisor or to otherwise conduct business through Investment Adviser Representative. Any recommendations are based upon Advisor's professional judgment and the results are not guaranteed. 1.2. Consulting Services Advisor agrees to perform any ConsultingService solely in a capacity that would not be considered fiduciary. 1.3. Limitations on Services Sponsor understands and agrees that in providing any Service selected in Appendix B, Advisor: a) Will not, unless expressly stated in writing: (i) serve as a Plan custodian, third party administrator or recordkeeper; or (ii) assume the duties of a trustee ofthe Plan or administrator. b) Will have no authority or responsibility to vote proxies for securities held by the Plan or take any other action relating to shareholder rights regarding those securities, including delivering the prospectus for those securities. Sponsor reserves to Itself all authority to vote proxies. c) Will have no authority or discretion to: (i) Interpret the Plan documents (except as reasonably required to provide the services explicitly selected in Appendix B of this Agreement); (11) handle benefit claims under the Plan; (Ili) determine eligibility or participation under the Plan; or (iv) take any other action regarding the management or administration of the Plan. Specifically, and without limitation, Advisor, directly or acting through the Advisor, has no authority, discretion, or responsibility to: determine eligibility to participate in the Plan, calculate benefits, prepare or distribute any notices to participants or beneficiaries, perform recordkeeping or actuarial services, determine amount or timing of contributions to the Plan or distributions or withdrawals from the Plan, or select or certify any Investment advice computer model or any other service not expressly stated in Appendix B. Rev. 0517 Non -ERISA Retirement Plan Advisory and ConsultingAgreement 1 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT d) Will not, and cannot, provide legal or tax advice to Sponsor and/or the Plan (or any Plan participant or beneficiary), and Sponsor agrees to seek the advice of Its own legal and/or tax advisor, as to all matters concerning the Plan, including, without limitation, the operations and administration of the Plan and how the Plan may comply with applicable law, including the Internal Revenue Code of 1986, as amended (the "Code"). e) Will not have any responsibilities or potential liabilities for (i) investments offered by the Plan that are not recommended to the Plan by Advisor (e.g., employer securities or self-directed brokerage accounts), (ii) Plan assets that have been excluded from the Services, as designated in Appendix A, or (iii) special investment instructions made by Sponsor, as specified in Appendix A. f) Will not be responsible or liable for recommendations or services rendered by third -party service providers ("other provider") or the other provider's compliance with applicable laws, including, without limitation, the Code. 2. FEES 2.1. Amount and Payment In consideration for the Services provided, Sponsor will pay, or will cause the Pian to pay, to Advisor the Fee(s) described in Appendix C ("Fees"). Sponsor acknowledges that the Plan may Incur other fees and expenses, including but not limited to Investment -related expenses Imposed by other service providers and mutual fund managers not affiliated with Advisor. Those other fees and expenses charged by the Plan's custodian, trustee, third -party administrator, and/or recordkeeper are in addition to the Fees. The only compensation received by Advisor for Services are the Fees, and no increase in the Fees will be effective without prior written Notice as defined In Section 10.5 of this Agreement. Despite this, and not necessarily related to the Services, various vendors, product providers, distributors and others may provide non-cash compensation by paying some expenses related to training and education, travel expenses, and attaining professional designations. Advisor and/or IAR might recelve cash and non-cash compensation to subsidize its/their own training programs. Certain vendors may invite Advisor and/or IAR to participate in conferences, on-line training or provide publications that may further Advisor and/or IAR and employees' skills and knowledge. Some may occasionally provide Advisor and/or IAR gifts, meals and entertainment of reasonable value consistent with industry rules and regulations. (A more detailed description of the types and potential cash and non-cash compensation provided can be found in Advisor's Form ADV Part 2A and Advisor's Part 2B.) 2.2. Authorization to Remit Fees and Information Sponsor agrees to instruct the Plan's recordkeeper or custodian (or other custodian of the Plan's assets) (collectively, Recordkeeper") regarding its obligation to calculate the Fees according to Appendix C. Notwithstanding the Plan's obligation to pay Fees, Sponsor may elect within its sole discretion to pay any or all Fees to Advisor instead of the Plan paying the Fees, provided that any Fees remaining unpaid after thirty (30) days from the date of invoice will be due and payable immediately by the Plan. If Sponsor elects to direct the Recordkeeper to pay the Fees to Advisor from Plan assets pursuant to Appendix C, Sponsor will authorize the Recordkeeper to remit the Fees within thirty (30) days, directly to Advisor. Advisor and the IAR are not liable to the Plan, Plan participants or beneficiaries, or any other fiduciary of the Plan or anyone else for errors made by others in the calculation or payments of Fees. Any miscalculation known to Advisor that results in overpayment by Sponsor, will be refunded promptly. Sponsor authorizes all third -party service providers to provide Advisor with copies of reports or information related to the Services and agrees to provide this authorization in a separate writing, if requested. If a Solicitor is named in Appendix A, Sponsor understands and agrees that Advisor will pay a portion ofthe Fees to the Solicitor in accordance with an agreement between the Solicitor and Advisor. These arrangements are described in Advisor's Form ADV Part 2A and in a separate solicitor's disclosure document. Solicitor is required to provide both of those documents to the Sponsor, and Sponsor acknowledges that It has received them. The separate solicitor's disclosure document contains information about the services the Solicitor may perform, which may include one or more of the Consulting, as well as the amounts Advisor will pay to the Solicitor. These arrangements will not change the Fees that Sponsor pays to Advisor under this Agreement and the Fees rate will be the Rev. 0517 Non -ERISA Retirement Plan Advisory and Consulting Agreement 2 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT same as for similarly situated sponsors who are not referred to Advisor by a Solicitor. 3. CUSTODY OF ASSETS AND OTHER SERVICES The only Services Advisor will provide to the Plan are described in this Agreement. Custody of all Plan assets will be maintained with a third -party custodian selected by Sponsor, and Plan recordkeeping will be provided by a third -party recordkeeper selected by Sponsor. Advisor will have no custody of any Plan assets. Sponsor will be solely responsible for paying all Fees or charges of the Recordkeeper. Advisor will not have any liability for custodian and/or custodial arrangements or the acts, conduct, or omissions of the custodian. Sponsor authorizes the Recordkeeper to provide Advisor with copies of all periodic statements and other reports that the Recordkeeper sends to Sponsor. Advisor is not responsible for placing trades or entering orders for securities transactions with Plan assets or executing any trades or orders. Advisor does not request or accept the discretionary authority to determine the broker-dealer to be used for Plan accounts. In accepting the Sponsor's direction to use a particular broker-dealer, Advisor will not have the authority to negotiate commissions among the various broker-dealers, and best execution may not be achieved, resulting in higher transaction costs for the Plan. 4. NON -EXCLUSIVITY Sponsor understands that Advisor may perform services for other clients and may also give advice and take action in performing its duties for those other clients (including those who may have similar retirement plan arrangements as Sponsor) that may differ from advice given, or in the timing and nature of action taken, with respect to Sponsor. Advisor has no obligation to advise Sponsor in the same manner as it may advise any of its other clients. 5. VALUATION Advisor may rely, without independent verification, upon valuation of assets as provided by Sponsor or the Recordkeeper of the Plan's assets. In all events, Sponsor acknowledges that anyvaluation will not be any guarantee of the market value of any asset in the Plan. 6. REPRESENTATIONS OF SPONSOR Sponsor represents that: 6.1. This Agreement is binding on the Sponsor, authorized by the Plan and does not violate any prior obligation or agreement. 6.2. Sponsor is solely responsible for the Plan's compliance (both in form and operation) with all applicable federal and state laws, rules and regulations, including, but not limited to, the Code. 6.3. Sponsor will comply with all applicable federal and state privacy and information security laws governing the use, disclosure and safeguarding of nonpublic personal information. 6.4. Advisor is not responsible for monitoring whether any class action lawsuits have been filed pertaining to investment recommendations, investment purchases, or investment sales; nor for determining whether the Plan is eligible to participate; norwhether It is in the best interests of the Plan to participate in a class action. 6.5. Sponsor is solely responsible for determining whether or not to enter into any arrangement(s) in connection with the Plan (including this Agreement) that are deemed by Sponsor to be necessary for the management and operation of the Plan andfor determining whether or not any arrangement is reasonable and appropriate with respect to compensation paid for and conflicts of interest(s) arising in connection with the services and/or products provided. 6.6. Sponsor authorizes Advisor to initially deliver Advisor's Form ADV Part 2A, Form ADV Part 2B, and Advisor's Privacy Policy (collectively, the "Disclosure Documents") to Sponsor at the time of, or prior to, entering into this Agreement. Initial delivery of Advisor's Disclosure Documents will be made by one or more of the following methods: personal delivery, USPS or other recognized delivery service, or through the use of electronic means including electronic mall and/or posting to a website. Sponsor authorizes subsequent delivery of any documents to be made through the use of electronic means. Neither Advisor nor IAR is responsible for determining whether the use of any electronic communication complies with the applicable requirements of the Code. Advisor is not Rev. 0517 Non -ERISA Retirement Plan Advisory andConsulting Agreement 3 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT responsible for prospectus delivery. 6.7. Before this Agreement was entered into, Advisor and/or any Solicitor provided to Sponsor information regarding services, compensation, fiduciary obligations and potential and/or actual conflicts of interest, and Sponsor acknowledges that It received that Information sufficiently in advance of entering into this Agreement to make an informed decision to engage Advisor. The Information is included in this Agreement and its Appendices, in Advisor's Form ADV Part 2A ("ADV"), IAR's Form ADV Part 2B ("Brochure Supplement"), and Advisor's Privacy Policy. 6.8. Any individual signing this Agreement and any appendices on behalf of the Sponsor represents that he/she: (I) is Independent of and unrelated to Advisor and/or IAR or any of their affiliates; (11) is a fiduciary of the Pian or other authorized delegate of Sponsor regarding the control or management of the assets of the Plan; (111) has the power and authority to appoint registered investment advisers and consultants under the terms of the Plan and to enter into contractual arrangements with third parties to assist in the discharge of these and related duties and (iv) Is authorized to sign on behalf of the Sponsor and no other signatures are required. 6.9. Sponsor will promptly provide Advisor any amendments to the Plan's governing documents that Advisor may request and are reasonably expected to alter or affect the performance ofServices under this Agreement, in accordance with Section 10.5. 6.10. Sponsor has reviewed and considered the contents of the Agreement and has determined the Services to be: (i) in the best interests of the Plan and its participants; (ii) necessary for the operation of the Plan; and (iii) reasonable and appropriate based upon the compensation to be paid for the Services. 6.11. Advisor may provide other services to plan participants when the services are independently sought by participants, including recommendations about the advisability of taking retirement Plan distributions or how to invest the proceeds of a distribution. These other services will be performed separately from Services to the Plan, are not part of this Agreement, and will be defined in a separate agreement with the Plan participant individually. 6.12. If Fees are to be paid out of Plan assets, the documents governing the Plan permit payment of the Fees out of Plan assets. No Fees paid from Plan assets are for expenses relating to settlor functions, such as for decisions relating to the formation, design and termination of the Plan, unless otherwise authorized by law. 6.13. Sponsor acknowledges that investments fluctuate In value and the value of Investments when sold may be more or less than when purchased, and that past investment performance does not guarantee any level of future investment performance. 6.14. Sponsor will cooperate fully with Advisor in providing the Services. Sponsor will authorize the Recordkeeper to provide Advisor information or data about the Plan, Its participants and assets, and participant information that Advisor reasonably requests. 6.15. Advisor may engage third parties as subcontractors to assist Advisor in performing any Consulting Service and may engage sub -advisors to assist it in providing any Advisory Service. 7. REPRESENTATIONS OF ADVISOR Advisor represents that: 7.1. Advisor is registered as an investment adviser under the Advisers Act, and will maintain Its registration. 7.2. Advisor has the power and authority to enter into and perform this Agreement, and will obtain and/or maintain any authorizations, permits, certifications, licenses, filings, registrations, approvals or consents, which must be obtained by it from any third party, Including any governmental authority, in connection with this Agreement. 7.3. Advisor will receive the Fees shown in Appendix C only, and does not receive any compensation from any third party in connection with the Services. Rev. 0517 Non -ERISARetirement Man Advisory andConsulting Agreement 4 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT 7.4. Advisor agrees to comply with all applicable federal and state privacy and information security laws governing the use, disclosure and safeguarding of nonpublic personal information. 8. INDEMNITY; DATA DISCLOSURE 8.1. Indemnification a) RESERVED b) RESERVED c) Notwithstanding anything contained herein to the contrary, any indemnification provision shall not be construed as a waiver ofany Immunity to which Sponsor is entitled or the extent of any limitation of liability pursuant to § 768.28, Florida Statutes. Furthermore, this provision is not intended to norshall be interpreted as limiting or in any way affecting any defense Sponsor may have under § 768.28, Florida Statutes or as consent to be sued by third parties. 8.2. Data Disclosure Advisor will use reasonable efforts to ensure that the data, analysis, and other Information it provides in connection with the Services are correct. Although gathered from sources believed to be reliable, Sponsor acknowledges that Advisor cannot guarantee the accuracy of the information received by Sponsor or third parties used to provide the Services. The completeness and timeliness of all data and information used to provide the Services is dependent upon the sources of that data and information, which are outside of Advisor's control. 8.3. Information from Sponsor The Services provided by Advisor are based in part on information provided by Sponsor, Sponsor's representatives, and Sponsor's other service providers. Sponsor acknowledges that Advisor is entitled to rely upon all information necessary to carry out the duties under this Agreement that is provided by Sponsor's representatives or Sponsor's other service providers, without independent verification by Advisor. Sponsor represents that all information provided to Advisor will be true, correct, timely and complete in all material respects. Sponsor agrees to promptly notify Advisor in writing of any material change in information it provides and to promptly provide any additional information as may be reasonably requested by Advisor. Sponsor will promptly notify Advisor of any errors in accuracy or completeness in any ofthe data, analyses, opinions, or other information it provided to Advisor in connection with the Services. Advisor will not be responsible for any payment or contribution to the costs, fees, taxes, or penalties that the Sponsor, Plan participants or beneficiaries, or other Plan fiduciary Incur as a result of any errors in valuation or payment. 8.4. Authority to Receive Information from Third Parties Advisor is authorized by Sponsor to obtain all information from service providers, investment managers, the Recordkeeper, the Plan's trustee and Plan's administrator as it may reasonably require. Sponsor authorizes the Plan's custodian, product vendor, trustee or any third party responsible for any aspect of Plan operation to promptly release the information to Advisor immediately upon request by Advisor. Advisor will not be under any obligation to verify any information obtained from the Plan or its agents and may rely upon the Information in performing Services. Advisor may obtain information from a wide variety of publicly available sources and do not claim to have sources of inside or private information. 9. TERMINATION This Agreement terminates on January 1, 2023. Any party may terminate this Agreement without charge or penalty upon thirty (30) days prior written Notice to the other party. Advisor will be entitled to a pro -rata amount of compensation earned prior to the date oftermination; alternatively, Plan will be entitled to a pro -rata refund of any unearned compensation subsequent to the date of termination paid in advance to Advisor pursuant to this Agreement. Any termination will not, however, affect the liabilities or obligations of the parties arising from transactions initiated prior to the termination, and the liabilities and obligations (together with the provisions of Sections 8, 10.8 and 11) will survive any expiration or termination of this Agreement. Upon termination, Advisor will have no further obligation under this Agreement to act or advise Sponsor with respect to Services except as agreed to by the parties at the time of termination. Rev. 0517 Non -ERISA Retirement PianPdvlsory and Consulting Agreement 5 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT 10. GENERAL PROVISIONS 10.1. Assignability This Agreement Is not assignable by either party without the prior written consent of the other party. Sponsor will be deemed to provide written consent to any proposed assignment if the procedures of Section 10.3, known as "negative consent" procedures, are followed. Both parties acknowledge and agree that transactions that do not result In a change of actual control or management will not be deemed an assignment. 10.2. Effect This Agreement will be binding upon and will inure to the benefit of the parties and their respective heirs, successors, survivors, administrators and permitted assigns. 10.3. Modification This Agreement may be modified, including without limitation the Services to be provided by Advisor, or the Fees charged by Advisor: (1) by written agreement between Advisor and Sponsor; or (1i) in accordance with the following procedure: Advisor may propose to change the Fees charged, to change the Services provided, to assign the Agreement or otherwise modify this Agreement by giving Sponsor at least sixty (60) days advance Notice of the proposed change. The Notice will be given in the manner described in Section 10.5 below. The Notice will: (I) explain the proposed modification of the Fees, Services, assignment or other provisions; (11) fully disclose any resulting changes in the Fees to be charged as a result of any proposed change in the Services or other changes to this Agreement; (iii) identify the effective date of the change; (iv) explain Sponsor's right to reject in writing the change or terminate this Agreement; and (v) state that pursuant to the provisions of this Agreement, if Sponsor fails to object to the proposed change(s) before the date on which the change(s) become effective Sponsor will be deemed to have consented to the proposed change(s). If Sponsor rejects any change to this Agreement proposed by Advisor, Advisor will not be authorized to make the proposed change. In that event, Sponsor will have an additional sixty (60) days from the proposed effective date (or such additional time beyond sixty (60) days as may be agreed to by Advisor) to retain a service provider in place of Advisor. If at the end of the additional sixty (60) day period (or such additional time period as agreed by Advisor), the parties have not reached agreement, this Agreement will automatically terminate. Notwithstanding the above, Sponsor may update information contained in Appendix A at any time in any reasonable manner. 10.4. Severability Should any of the provisions of this Agreement be rendered invalid by a court or governmental agency of competent jurisdiction, it is agreed that this will not affect the enforceability of the other provisions of this Agreement, which will remain in full force and effect. 10.5. Notices Notice means any notice required or permitted under this Agreement which Is In writing and (I) delivered personally; (11) mailed by registered or certified mail, return receipt requested and postage prepaid; (iii) sent via a nationally recognized overnight courier service; or (iv) sent via facsimile. Rev. 0517 To Advisor: Independent Financial Partners, Attn: Plan Advisors Division, 3030 N. Rocky Point Dr. W., Suite 700, Tampa, FL. 33607, Fax #: 813-282-4654. To Sponsor c/o plan fiduciary or other authorized signatory: To the address (or Fax number, or Email address as applicable) in Appendix A — Employer Profile, or the last address Advisor has in its records following written Notice from Sponsor. All Notices will be deemed to have been given or made when delivered by hand or courier, or when sent by facsimile or email, orif mailed, on the third business day after being so mailed. Non -ERISA Retirement Plan Advisory and Consulting Agreement 6 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT 10.6. Headings All headings are for ease of reference only and in no way will be understood as interpreting, decreasing or enlarging the provisions of this Agreement. 10.7. Entire Understanding IFP is to perform the work as defined in Request for Proposals (RFP 18-17), in accordance with the terms and conditions specified therein, together with any addendums and other specifications, which are hereby incorporated by reference and made a part of this Agreement. In the event of a conflict between this Agreement and the incorporated RFP 18-17 documents, these Agreement terms shall prevail. This Agreement is the entire understanding between the parties and supersedes all prior oral or written statements dealing with this subject. 10.8. Applicable Law; Forum This Agreement is governed by, and interpreted in accordance with the laws of the State of Florida without reference to conflict of law principles, unless preempted by federal law. The parties agree that any arbitration under Section 11 below must be conducted in (or when applicable, legal suit, action or proceeding arising out of or relating to this Agreement must be instituted and resolved in a State or Federal court in) Tampa, Florida and each party irrevocably submits to the jurisdiction and venue in that city (and if applicable, that court). 10.9. Waiver or Limitation Nothing in this Agreement will in any way constitute a waiver or limitation of any rights which the Sponsor or the Plan or any other party may have under applicable federal or state securities laws. 11. DISPUTE RESOLUTION All disputes, actions or controversies between Sponsor and Advisor which may arise out of or relate to any of the Services provided under this Agreement, orthe construction, performance or breach ofthis or any other agreement between Advisor and Sponsor, whether entered into prior to, on or subsequent to the date hereof, will be resolved by negotiation of the parties acting in good faith. lithe parties are unable to resolve their differences through negotiation, the parties will engage in non-binding mediation, using the services of an impartial, neutral mediator selected by mutual agreement of the parties. Mediation is voluntary once commenced, and either party may withdraw from the mediation process at its sole discretion at any time. The fees of the mediator will be shared equally by the parties. Rev. 0517 Non -ERISA Retirement Plan Advisory and Consulting Agreement 7 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT Legal Name ofPlan: cayorClearwater401(a)Ab eyPurchase PensionPlan,xxrA457GovernmentPhutandThad,n e457 GovernmentPlan endMoat Nameof Employer/PlanSponsor: City of Clearwater FP Advisors, Inc., byits InvestmentAdvisor Representative(s) 1.1,2 Responsible Plan Fidudary(s) THISAGREEMENTCONTAINS ABINDING AGREEMENTTOARBITRATE INSECTION 11, pager and ILSponsor understandsthatthe agreementtoetbkratedoes not constitute a waiverof hborher tightt, seek* judidalforumwhere such weaver wouldbavoid underfedemlorapplicabtestate stumbles laws. Signature ` Date Signature W. Michael t ontgo Print Name Print Name Date E-mail Address 2. 2. Signature Date Signature Date Print Name PrintName E-mailAddress 3. 3, Signature Date Signature Print Name Split Rep ID forMultiple Representatives: Accepted byIFP Advisors, Inc. 10/30/2017 Signature Date ComplianceAnalyst Title Print Name Date Title Small Address E Date ofTMsAgreement 1/112018 Agreement EZI New 0 Update Conversion Rev. 0517 Non-BUSA Retirement PianAdusoryand consultingAgreement a Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT Countersigned: CIQ.oIC n Ci t V45 George N. Cretekos Mayor Approv-d as to form: Matt ew Smith Assistant City Corney CITY OF CLEARWATER, FLORIDA BY: LO XL4A. William B. Horne II City Manager Attest: Rosemarie Call City Clerk C14 -U Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT APPENDIX A — PLAN INFORMATION Employer Profile Employer/Plan Sponsor Name: City of Clearwater Phone Number: 727) 562-4876 Street Address: 100 South Myrtle Avenue City, State, Zip Clearwater, FL 33756 Mailing Address (ifDifferent): Cash Balance Plan City, State, Zip 403(b) Employer d/b/a (if any): Other 401(a) Money Purchase Plan Employer ID: bazzeld@nationwide.com Legal Type of Organization: City Government Industry: Government Plan Profile Legal Plan Name: CityofClearwater 401(a) Maney Purdiase Pension Plan, ICMA457 Government Planand Trust. Natiomvide 467 Government Manand Trot Plan Tax ID (If differentfrom Employer ID): Participant or Trustee Directed Plan Participant Directed 0 Trustee Directed 0 Both (explain): Plan Status Is this a new Plan? Yes No Other Plan. Providers (not parties to this Agreement) Plan Type ICMA-RC Profit Sharing Plan Defined Benefit Pian 457(b) 401(k) Plan Cash Balance Plan 403(b) Other 401(a) Money Purchase Plan Email Address: bazzeld@nationwide.com Provider/Recordkeeper 3 Name: Participant or Trustee Directed Plan Participant Directed 0 Trustee Directed 0 Both (explain): Plan Status Is this a new Plan? Yes No Other Plan. Providers (not parties to this Agreement) Provider/Recordkeeper 1 Name: ICMA-RC Contact Name: Arthur Flattich Account/Contract #: 300629 / 109729 Emall Address: AFlattich@icmarc.com Provider/Recordkeeper 2 Name: Nationwide Retirement Plans Contact Name: David A. Bazzel, ChFC, CRC Account/Contract #: 0035678 Email Address: bazzeld@nationwide.com Provider/Recordkeeper 3 Name: Contact Name: Account/Contract #: Email Address: Provider/Recordkeeper 4 Name: Contact Name: Account/Contract #: Emall Address: TPA Name1: Contact Name: Account/Contract #2: Email Address: Custodian Name: Contact Name: Account/Contract #z: Email Address: Participant Services Provider=: Contact Name: Account/Contract #1: Email Address: Rev.0517 Non -ERISARetirement PlanAdvisory and Consulting Agreement A-1 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT Total Assets in Plan Estimated Total Plan Assets In U.S.$: 71,400,000 Projected Annual Plan Cash Flow APPENDIX A— PIAN INFORMATION (Cont'd) Estimated Annual Average Contribution from Pian Participants: OtherFiduciaries (not parties to this Agreement) Estimated Annual Average Contributions from Employer: 410,000 3(16) Capacity 3(21) Capacity 3(38) Capacity Contact Name: N/A N/A N/A Company Name: Email Address: Phone Number: Total Assets in Plan Estimated Total Plan Assets In U.S.$: 71,400,000 Projected Annual Plan Cash Flow Estimated Annual Average Contribution from Pian Participants: 2,484,000 Estimated Annual Average Contributions from Employer: 410,000 Estimated Annual Average Distributions to Plan Participants: Company Employee Demographies; Estimated Number of Participants with Account Balances: 1,185 Plan Assets Excluded from the Servicesin thisAgreement (ifany) Rev. 0517 Non -ERISA Retirement Plan Advisory and Consulting Agreement A-2 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT Investment Policy Statement ("IPS") 1. Does the Plan currently have an approved IPS? Provide a diversified menu of Investment options for plan participants covering a range of Investment objectives appropriate for individual retirement needs. Ifyes, attach the IPS and no further information is needed. i7 Yes Liquidity Objective of Plan No See question 2 below. 2. (Answer this question only ifyou answered "No" to question 1 above) Will the Sponsor update and/or implement an IPS as part ofthis Agreement? Yes Submit IPS when adopted bySponsor. No Complete Plan Objectives below: Diversification Objective of Plan Used only ifIPS will notbe completed) Provide a diversified menu of Investment options for plan participants covering a range of Investment objectives appropriate for individual retirement needs. Please list any specific Diversification Objectives: Liquidity Objective of Plan Provide a diverslfled menu of Investment options for plan participants who may have different liquidity needs. Please list any specific Liquidity Objectives: Time. Horizon Objectiveof Pian Provide a diversified menu ofinvestment options for plan participants who may have different Investment time horizons. Please list any specific Time Horizon Objectives: Risk Tolerance Objective ofPlan Provide a diversified menu of investment options for plan participants who may have different Investment risktolerances. Please list any specific Risk Tolerance Objectives: OtherSpecial Investment Instructions (ifany) Rev. 0517 Non -ERISA Retirement Plan Advlsory and Consulting Agreement A-3 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT APPENDIX B — SCHEDULE OF RETIREMENT PLAN SERVICES Check Only those Services INVESTMENT ADVISER REPRESENTATIVE will Perform) ERISA FIDUCIARY SERVICES 01 1.) RECOMMEND. ESTABLISHING AND REVISING THE PLAN'S INVESTMENT POLICY STATEMENT ("IPS") Advisor will review with the Plan Fiduciary the investment obJectives, risk tolerance and goals of the Plan. If the Plan does not have an IPS, the Advisor will recommend investment polices to assist the PlanFiduciary to establish an appropriate IPS. If the Plan has an existing IPS, Advisor will review it for consistency with the Plan's obJectives. If the IPS does not represent the obJectives of the Plan, Advisor will recommendto the Plan Fiduciary revisions that will establish Investment policies that are congruent with the Plan's obJectives. 2.) RECOMMEND AND MONITOR THE INVESTMENTS: Based on the Plan's IPS or other guidelines established by the Plan, Advisor will review the investment options available to the Plan and will make recommendations to assist the Plan Fiduciary to select the Investment options to be offered to Plan participants, or to be held by the Plan, in the case ofa trustee -directed Plan. Once the Plan Fiduciary selects the investment options, Advisor will, on a periodic basis and/or upon reasonable request, provide reports, information and recommendations to assist the Plan Fiduciary to monitor the investment options. If the IPS criteria require an Investment option to be removed, Advisor will provide information, analysis and recommendations to the Plan Fiduciary to help evaluate replacing investment option with alternative(s). 3.) RECOMMEND AND MONITOR QUALIFIED DEFAULT INVESTMENTALTERNATIVE(S) ("QDIAs"): Based on the Plan's IPS or other guidelines established by the Plan, Advisor will review the investment options available to the Plan and will make recommendations to assist the Plan Fiduciary to select the Plan's Qualified Designated Investment Alternatives QDIAs) for Plan participants that fall to direct the Investment of their accounts. Once the Plan Fiduciary selects the QDIAs, Advisor will provide reports, information and recommendations, on a periodic or upon reasonably requested basis, to assist the Plan Fiduciary to monitor the investments options. Ifthe IPS criteria require an Investment option to be removed, Advisor will provide information and analysis to assist the Plan Fiduciary to evaluate replacing a QDIA. 4.) RECOMMEND CREATING AND MAINTAINING ASSETALLOCATION PORTFOLIOS ("MODEL PORTFOLIOS"): Based on the Plan's IPS or other investment guidelines established by the Plan, the Advisor will review the investment options available to the Plan and will make recommendations to assist the Plan Fiduciary to create and maintain Model Portfolios. Model Portfolios provide a process to allocate an account among the investment options to meet various risk profiles and investment objectives. Once the Plan Fiduciary approves the Model Portfolios, the Advisor will provide reports Information and recommendations, on a periodic basis, designed to assist the Plan Fiduciary to monitorthe Plan's Investment options. If the IPS criteria require an investment option to be removed, the Advisor will provide information and analysis to assist the Plan Fiduciary to evaluate replacing Investment(s) options with alternative(s) to be included in the Model Portfolios. Upon reasonable request, Advisor will make recommendations to the Plan Fiduciary to rebalance the Model Portfolios to maintain their desired allocations. 5.) RECOMMEND AND MONITOR INVESTMENT MANAGERS: Based on the Plan's IPS or other guidelines established by the Plan, Advisor will review the potential Investment managers available to the Plan and will make recommendations to assist the Plan Fiduciary to select one or more investment managers. Once the Plan Fiduciary approves the Investment manager, Advisor will provide, on a periodic basis, reports, information and recommendations to assist the Plan Fiduciary to monitor the Plan's investment managers. If the IPS criteria require an investment manager to be removed, Advisor will provide Information and analysis to assist the Plan Fiduciary to evaluate replacing investment manager(s). 6.) PARTICIPANT INVESTMENT ADVICE: Advisor will, periodically and upon reasonable request, collect (directly from a participant and/or from Sponsor or Its designee) information necessary to complete a Profile which will Include client information, including the participant's individual investment obJectives, risk tolerance and time horizon. Based upon each participant's Profile, Advisor will make recommendation for investing the participant's individual Plan account among one or more of the Plan's chosen investments and/or Models. Rev, 0517 Non -ERISA Retirement Plan Advisory and Consulting Agreement A-4 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT APPENDIX B — SCHEDULE OF RETIREMENT PLAN SERVICES Check Only Those Services INVESTMENT ADVISOR REPRESENTATIVE will Perform) NON-FiDUCIARYSERVICES 1. Plan Governance and Committee Education: 1 A. Review Plan demographics, goals and objectives, and current Plan features to assist Sponsor In matching the Plan with Plan participants' needs and regulatory changes. These Services do not include settlor functions, such as plan design, unless related Fees are .paid directlybySponsor as specified in Appendix C, Item 4 B. Provide investment education to the committee, which may include, without providing any personalized investment recommendations or advice, information about the Plan; general financial, Investment, and retirement information; asset allocationmodels; and interactive Investment materials C. Explain the retirement Plan's committee structure and members' fiduciary responsibilities 1 D. Review participant education and communication strategy, Including ERISA 404(c) requirements E. Provide guidance for developing and maintaining audit ready fiduciary file(s) 19 F. Attend periodic meetings with Plan committee (upon request by Pian Sponsor), upto per year 1 G. Explain Plan's investments and provide objective performance information compared to benchmarks established in the Plan's Investment Policy Statement or other criteria established by Sponsor 2. Assist Sponsorwith Selecting and Reviewing Other Service Providers (not partiesto this Agreement): 0 A. Help Sponsor evaluate 4D8(b)(2). disclosures as compared to services and fees from other Plan service providers B. Periodically benchmark fees and services to help sponsor assess whether they are reasonable 1 C. HelpSponsor prepare, distribute and evaluate provider Requests for Proposals ("RFPs") and/or Requests, for Information ("RFIs") to other service providers Provided only upon future request by Plan Sponsor, and foran additional fee negotiated atthe time CI D. Help Sponsor transition accounts and/orconvert Plan to new service provider 1 E. AssistSponsor by acting as a liaison to other service providers to the Pian, butonlyunderInstruction from the Sponsor 3. Employee/Participant investment Education and Communication: A. Conduct group enrollment meetings, atleast peryear B. Provide investment education to participants, which may Include, without providing any personalized Investment recommendations or advice, Information about the Plan; general €inancial, investment, and retirement information; asset allocation models; and interactive investment materials C. Provide education about plan fees and expenses D. Help participants assess their readiness to retire E. Provide participants with periodic market updates, or periodic newsletter on request . 4. Other Services (may be added only upon consultation with home office): Rev. 0517 Non -ERISA Retirement Plan Advisory and Consulting Agreement A-5 Non -ERISA RETIREMENT PLAN ADVISORY AND CONSULTING AGREEMENT APPENDIX C - FEE SCHEDULE 1. Advisory Feesare to bePaid to: Independent Financial Partners (IFP) FB0 W Michael Mnntgnmey 3030 N. Rocky Point Dr. W., Ste. 700 Tampa, FL 33607 2. Fee Schedule (Must choose one or more) Source of Payment PaId from Assets' Paid. by Soonsor1 Annual Asset -Based Fee. Fees (or commission) based on percentage points ("bps"), 100 bps =1% of assets). of Plan assets of basis Annual Flat Fee. $ 36,5001 0 Fee Per Unit. $- per (named unitto which unit fee Is applied) First Year Transition Expense Fee of $ or bps (one time). One-time Project Fee of $ , forSpecific Project, Provide details in Section 4 below) Annual Fee, as percentage ofplan assets, per schedule below: Tiered • Breakpoint 1 Value ofPlan Assets (range) Fee 0.0 to $ bps to $ bps to $ bps to $ bps to $ bps to $ Ug bps 1, Authorization to pay: Sponsor authorizes the Platform Provider/ Recordkeeper to deduct Fees from Plan assets and pay the Advisor. 2. If Paid by Sponsor, Fees will be billed to the Sponsor and due upon receipt. 3. Paymentfrequency, liming, and Method (MustChooseOtte Option for Each) Frequency: Timing: Method: Monthly In Arrears Based on the Based on the In Arrears. 19 Quarterly Annually Other: Platform Provider/Recordkeeper. period If In Advance or at the end of the previous period If 1 In Advance value of Plan assets In the method determined by value of Plan assets at the beginning of the current noted above. 0 Flat Fee, as Additional Payment /Project Details (Ifany): 5. Expenses: ponsor will payAdvisorthe following expenses (include detall,such as travel' expenses of IAB): No additional fees or expense reimbursement Rev. 0517 Non -ERISA Retirement Plan Advisory and Consulting Agreement A-6 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8136 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Gas System Agenda Number: 7.5 SUBJECT/RECOMMENDATION: Approve an Extended Warranty Service Agreement and Purchase Order, in the amount of $525,000, with Tecogen, Inc., for the period October 1, 2020 through September 30, 2029, for service maintenance on three Tecochill air conditioning units and authorize the appropriate officials to execute same. (consent) SUMMARY: This Agreement will provide warranty services on three natural gas fired air-conditioning units (50 tons each) that serve Clearwater Gas System’s (CGS) new Administrative and Operations Building located at 777 Maple St in Clearwater. Each unit runs on natural gas to provide cooling needs for the main building. The following items are included in the Service Agreement: ·All material and/or labor required to repair a scheduled or unscheduled service event (for all three units) at no additional expense to CGS ·Preventive maintenance performed by factory trained technicians ·All parts replaced with Original Equipment Manufacturer (OEM) parts ·Real-time internet monitoring for fast repair response ·Annual condenser cleaning The first-year annual maintenance was approved by the Purchasing Manager in the amount of $46,200 (period 10/1/19 - 9/30/20). However, after discussing with City Building & Maintenance, it was determined all three units should have a service warranty for the first 10 years of the equipment lifecycle. Therefore, we are asking for approval to start the new term, effective October 1, 2020 and run through September 30, 2029 which is the end of the 10-year cycle. The estimated cost of this agreement is approximately $570,000, which includes the cost of the first-year term. The total cost also includes an escalation factor for all subsequent years (i.e., year 2 - 10) which equals the preceding year Consumer Price Index (CPI) plus 2%. The escalation factor for years 2022 - 2029 is estimated at 5% per year. APPROPRIATION CODE AND AMOUNT: Funds are included in the proposed budget for fiscal year FY20/21 in cost code 4232078-530300, contractual services. Future year funding will be requested as part of the annual budget process. Page 1 City of Clearwater Printed on 9/3/2020 File Number: ID#20-8136 USE OF RESERVE FUNDS: N/A Page 2 City of Clearwater Printed on 9/3/2020 Tecogen, Inc. Tecochill Extended Warranty Service Agreement Agreement Customer Address: Clearwater Gas 777 Maple St Clearwater, FL 33755 Site Address: Gas Administrative & Operations Building “A” 777 Maple Street Clearwater, FL 33755 Tecogen Service Agreement This Service Agreement consists of the pages beginning with the title page entitled "Agreement," the consecutively numbered pages immediately following such title page, and includes and ends with the Tecogen Preventative Maintenance Schedule (collectively, the "Service Agreement" or "Agreement"). Tecogen agrees to inspect and maintain the Covered Equipment hereof according to the terms of this Service Agreement, including the "Terms and Conditions," and "Scope of Services" sections hereof. Tecogen agrees to give preferential service to Customer over non-contract customers. Tecogen Equipment Description Tecogen manufactured equipment covered under this agreement includes: Tecogen Module(s). 3 Model #(s): RT-50 Serial #(s): TBD Estimated Annual Run Hours: 6,000 Start Date: 10/1/2020 Estimated Full Load Hours: 3,000 End Date: 9/30/2029 Service Coverage Chiller Service Complete □Engine Service Complete □Exclude Engine Overhauls Other Covered Equipment □Chiller Service Schedule Service Only □Engine Service Complete Ser v ice Annual Condenser Cleaning □on Call Service 24/7 □on Call Service 24/ 5 □Annual Dump HX Cleaning □Emissions Engine Other equipment covered under this agreement includes: Equipment Equipment Tag I Manufacturer I Model # Serial # Coverage None Service Fee The maintenance service charge for the first 12-month period of the Maintenance Agreement shall be an amount equal to a flat rate of $47,262.60 payable in monthly installments of $3,938.55 per month. Auto Renew If un-checked, contract shall not automatically renew following the expiration of the agreement. Duration of Agreement: Nine (9) Years Effective Date: Start-Up The Driving Force in Cooling Tecogen Inc. • 45 First Avenue, Waltham, MA 02451• 781-466-6400 • 781-466-6466 (fax) • www.tecogen.com 7 Special Terms 1.This contract’s price was agreed upon prior to construction of the chilled water plant. The seller has reviewed the construction documents dated and confirms service clearances are acceptable. If deviations from the drawing are made which impact service access this price is subject to change or contract be voided. 2.At the end of the first year of operation, the Buyer and the Seller shall review the operating history of the past year to ensure the estimated run time and loading of the chiller are consistent with the anticipated operating schedule. If anticipated operating schedule has changed the price is subject to change or the contract will be voided. Maintain Your Savings™ The Maintenance Agreement on the above equipment is further governed by the Term and Conditions of Maintenance for Tecogen Cogeneration Systems which forms an internal part of this agreement. This Agreement is subject to Customer’s acceptance of the attached Tecogen Terms and Conditions. Tecogen Joseph E. Gehret Printed Name Signature Director of Field Operations Title Date CITY OF CLEARWATER, FLORIDA By: __________________________ William B. Horne II City Manager Attest: ________________________________ Rosemarie Call Countersigned: __________________________ Frank V. Hibbard Mayor Approved as to form: __________________________ _ Laura Mahony Assistant City Attorney City Clerk The Driving Force in Cooling Tecogen Inc. • 45 First Avenue, Waltham, MA 02451 • 781-466-6400 • 781-466-6466 (fax) • www.tecogen.com Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8085 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Human Resources Agenda Number: 7.6 SUBJECT/RECOMMENDATION: Authorize the funding of city medical insurance for the Administrative Services Agreement between the City and Cigna Healthcare under a self-insured funding arrangement for the period January 1, 2021 through December 31, 2021, at a total not-to-exceed $21.5 million, to be funded by city budgeted funds, payroll deductions of employees and retiree premiums. (consent) SUMMARY: Historically, the City’s health care costs have escalated due to increased inflation in health care costs (8% to 10% annually) which is reflected in the City’s claims experience.  This resulted in increased costs annually for the City, the employees, family members, and retirees who participated in the city plan.  The City implemented a multi-faceted effort to control costs which included opening the Employee Health Center and adding enhanced wellness and educational offerings. As a result, the City has seen cost increases trending downward, which can be attributed to savings from the use of the Employee Health Center and the greater focus on wellness by the City and employees. These savings resulted in health plan design changes that lowered the office visit co-pays, hospital admission fee, and prescription drug co-pays in prior years. As a result of the positive claims experience for 2019 and 2020 plan year, renewal projections indicate no increase is needed for the 2021 plan year. As of June 2020, plan spend is below budgeted expenses by 23%. However, it should be noted that part of this savings is due to reduced care being received due to COVID-19. It is expected that some of these expenses will occur later in the year. The City’s Benefits Committee voted to renew with a 0% increase continuing the negotiated contribution scenarios for dependent coverage, being 75%of Employee +1 coverage and 68% of Employee +Family coverage. Included in the premiums for the 2021 plan year is the continuation of the Motivate Me incentive through CIGNA. Under this program employees can receive incentives (up to $200 per year) when participating in various preventative healthcare activities such as general health screenings at the Employee Health Center, and more advanced screenings such as colonoscopies and mammograms, and chronic health condition coaching. These rewards are directly tied to cost drivers on the City’s medical plan and are an essential part of controlling increases over the long term. All incentive costs are included in the medical plan funding. To date 18% of employees have earned some incentive. Total payouts are approximately $30,000. The City’s fiscal 2021 budget is $19,098,250 which includes $17,398,250 million across all operations for health plan costs and $1,700,000 budgeted for the Employee Health Center. Page 1 City of Clearwater Printed on 9/3/2020 File Number: ID#20-8085 APPROPRIATION CODE AND AMOUNT: Funds are available in cost codes 5907590-530300 (contractual services) and 5907590-545602 (major medical claims) to fund the City’s portion; and revenues from payroll deductions and retiree premiums will provide remaining funds necessary to fund this contract. Page 2 City of Clearwater Printed on 9/3/2020 1 HEALTH CARE2021 2CITY OF CLEARWATER | Medical Plan Background $746 $782 $861 $822 $785 $0 $200 $400 $600 $800 $1,000 2016 2017 2018 2019 2020 (YTD) Average Claims Per Employee Per Month SELF INSURED WITH CIGNA City pays administration fee to Cigna and pays medical and pharmacy claims as they occur COST TREND 1.8% average increase the past 5 years NATIONAL AVERAGES Have exceeded 6% per year, with Florida 2% -3% higher 3CITY OF CLEARWATER | Self-Funded Renewal •Renewal projection calls for a 0%increase •No change to the employee and employer contributions •City pays 100% of Single, 75% EE+1, and 68% Family $17,398,250 $3,342,112 Renewal Cost Summary City Contributions Employee Contributions 4CITY OF CLEARWATER | Self-Funded Renewal •2021 FY Budget: $19,098,250 •City Contributions $17,398,250 •EHC $ 1,700,000 $19,098,250 5CITY OF CLEARWATER | Cost Drivers 62 catastrophic claims accounted for 45% of medical claims costs. 85% of catastrophic claims have a chronic condition such as: -Hypertension (high blood pressure) -Diabetes -Hyperlipidemia (high cholesterol) -Obesity $8,546,948, 51% $8,138,108, 49% 2019 Medical Plan Spend Non-Catastrophic Spend Catastrophic Spend 62 Members (Claims >$50k) 2,525 Members 6CITY OF CLEARWATER | Cost Drivers Cancer is the highest catastrophic cost driver, followed by diabetes, heart disease and stroke Diabetes has the highest overall pharmaceutical spend For 2020, 35% of members have an identified chronic health condition and drive 76% of plan spend 7CITY OF CLEARWATER | Motivate Me Motivate Me is a Cigna program that incentivizes healthy medical and lifestyle choices Program includes wellness screenings, preventative care visits, and health coaching targeting cost drivers on the medical plan Available to all employees covered under the medical plan Program is offered and administered by Cigna, and included in plan funding Employees can earn up to $200/year 8CITY OF CLEARWATER | Motivate Me Summary $50,175 in rewards earned through July 23rd 29% have completed eligibility requirements 63% of participants have earned $100 or more 7 78 25 124 23 479 215 0 500 Skin Cancer Screening Prostate Screening Mammogram Health Assesment Colon Cancer Screening Biometric Screening Annual Physical TOP ACTIVITIES 9CITY OF CLEARWATER | Employee Health Center 10CITY OF CLEARWATER | Employee Health Center 74% of employees engaged with clinic in 2019, up from 66% in 2018. 98% Satisfaction Rate 74% Employee Penetration 45% Target $1.6:1 Average Return on Investment $2.2mil+ in gross savings in 2019 11CITY OF CLEARWATER | Renewal Recommendations •Renew with Cigna •Continue “Open Access Plus” network •Maintain current plan design (copays/deductibles/coinsurance) •Maintain employee contributions •Continue Motivate Me wellness incentive to encourage preventative screenings & EHC HEALTH CARE2021 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8105 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Human Resources Agenda Number: 7.7 SUBJECT/RECOMMENDATION: Approve a one-year renewal term for the professional services agreement between the City of Clearwater and Cigna Onsite Health, LLC to provide onsite health clinic services to employees, family members, and retirees who are covered by the City of Clearwater health insurance not to exceed $1.7 million and authorize the appropriate officials to execute same. (consent) SUMMARY: Cigna Onsite Health will continue to operate the Employee Health Center and provide onsite medical and prescription drug services to include primary care, health risk assessments, acute and urgent care, immunizations, examinations and screenings, pharmaceutical dispensing, disease management, and primary care management, pre-employment physical and COVID-19 testing. The Employee Health Center also provides Telemed visits both telephonically and virtually. The Employee Health Center also promotes wellness management by assisting patients gain incentive dollars through screenings and claim management. The one-year renewal term will begin on October 1, 2020 and end on September 30, 2021. APPROPRIATION CODE AND AMOUNT: 1.7M has been budgeted in the Employee Health Center budget (5909835) to fund fiscal year 2020-2021. Page 1 City of Clearwater Printed on 9/3/2020 1 FOURTH AMENDMENT TO PROFESSIONAL SERVICES AGREEMENT This is the Fourth Amendment (“Fourth Amendment”) to the Professional Services Agreement (“Agreement”) between City of Clearwater (“Client”) with offices located at 100 South Myrtle Avenue, Clearwater, Florida 33756 and Cigna Onsite Health, LLC (“Cigna”) with offices located 26500 North Norterra Drive, Phoenix, Arizona 85085 effective October 1, 2015, whereby Cigna agreed to provide for a Cigna Onsite Health Clinic (“Clinic”) providing low acuity, urgent and episodic care and ancillary services for the benefit of Client employees and others (as defined in the Agreement). This Fourth Amendment is effective October 1, 2020 (“Fourth Amendment Effective Date”). Client and Cigna are sometimes referred to herein individually as a “Party" and collectively as the “Parties.” WHEREAS, the Client and Cigna previously entered into the Agreement, effective October 1, 2015, and as amended by the First Amendment, effective January 1, 2018, and as amended by the Second Amendment, effective September 19, 2018, and as amended by the Third Amendment, effective October 1, 2019. WHEREAS, pursuant to Section 28 of the Agreement, the Parties wish to amend the Agreement in accordance with the terms stated herein. NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which is hereby acknowledged, as of the Fourth Amendment Effective Date, the Agreement is hereby amended as follows: 1. For purposes of this Fourth Amendment, capitalized terms used herein shall be as defined in the Agreement, as amended, or in any of the Schedules or Appendices attached thereto, unless otherwise specified. 2. Pursuant to Section 3, the Parties agree to a Renewal Term of twelve (12) months from 10/1/2020 through 9/30/2021. 3. The Operating Budget (Appendix 1) attached to Schedule B – Fees of the Agreement is hereby deleted in its entirety and replaced with the Operating Budget (Appendix 1) attached to this Fourth Amendment for the Renewal Term of 10/1/2020 through 9/30/2021. 4. The recitals and representations are true and accurate and are incorporated herein by reference. [THIS SECTION INTENTIONALLY LEFT BLANK] 2 5. Except as modified by this Fourth Amendment, all other terms and provisions of the Agreement, as amended, and all Schedules and Appendices attached thereto, shall continue in full force and effect. IN WITNESS THEREOF, the Parties hereto have caused this Fourth Amendment to be executed and signed by their respective officers duly authorized to do so. CIGNA ONSITE HEALTH, LLC Signature: Print Name: Jeffrey T. Perry, DBA, PhD Title: Chief Operating Officer, VP Date: Countersigned: CITY OF CLEARWATER, FLORIDA ___________________________ ________________________________ Frank Hibbard William B. Horne II Mayor City Manager Approved as to form: Attest: ___________________________ ________________________________ Owen Kohler Rosemarie Call Assistant City Attorney City Clerk August 11, 2020 3 Appendix 1 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8029 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Parks & Recreation Agenda Number: 7.8 SUBJECT/RECOMMENDATION: Approve a proposal by Construction Manager at Risk Keystone Excavators, Inc. of Oldsmar, Florida in the amount of $268,417.05 for site work and improvements at Valencia Park located at 2050 Hercules Avenue and authorize the appropriate officials to execute same. (consent) SUMMARY: On August 4, 2016, Council approved the use of Construction Manager at Risk Services (CMR) for Continuing Contracts with Biltmore Construction Co., Inc. of Belleair, FL; Cathey Construction and Development, LLC of Mexico Beach, FL; Certus Builders, Inc. of Tampa, FL; J. Kokolakis Contracting, Inc. of Tarpons Springs, FL; J.O. Delotto & Sons, Inc. of Tampa, FL; Keystone Excavators, Inc. of Oldsmar, FL; Khors Construction, Inc. of Thonotosassa, FL; and Wharton-Smith, Inc. of Sanford, FL for a period of four years. These firms were selected in accordance with Florida Statutes 255.103 and 287.055 under Request for Qualifications #24-16 based upon construction experience, financial capability, availability of qualified staff, local knowledge, and involvement in the community. The Construction Manager at Risk Contract with Keystone Excavators was set to expire on August 4, 2020. Per Clearwater Ordinance Section 2.561(8) and Article 12 (Section III, General Conditions), the City Manager approved an amendment extending the Contract until October 1, 2020. This Proposal furthers extend the Contract until completion and acceptance of this Project and upon final payment. Valencia Park is one of the many smaller neighborhood parks that are interspersed throughout the city to meet neighborhood recreational needs. Included in this park is a full-size basketball court, two tennis courts, pre-school playground, small parking lot , and a lighted walking path. Over the years the various components of the park have been maintained by the Parks Division and include resurfacing of the tennis, basketball and parking lot as well as replacing playground equipment, landscaping, and fencing. The tennis courts are now over 40 years old and in need of total replacement. This contract will include the demolition and removal of the existing tennis courts, construction of new courts, irrigation, landscaping and site work needed for a new playground, and installation of sidewalks. This is a 60-day contract and will be completed by December 2020. The park will be closed Page 1 City of Clearwater Printed on 9/3/2020 File Number: ID#20-8029 during construction. APPROPRIATION CODE AND AMOUNT: Funds are available capital improvement projects 315-93636, Tennis Court Resurfacing and Replacement ($229,290.05); and 315-93637, Playground Purchase and Replacement ($39,127.00) to fund this contract. Page 2 City of Clearwater Printed on 9/3/2020 Construction Manager at Risk Contract This CONTRACT made and entered into this ail; 91.249/6, by and between the City of Clearwater, Florida, a municipal corporation, herein designated as the "City" or "Owner", and Kc m is Csedr w ed..s . of theCS' .f Oiambot, County Pinellas and State of Florida, hereinafter designated as the "Construction Manager". The contracting entities shall collectively be known as the "Parties." WITNESSETH: WHEREAS, the Clearwater City Council has approved using the Construction Manager at Risk approach on appropriate projects as determined by the City's Engineering Department; and WHEREAS, the City desires that the Construction Manager perform the management of the necessary construction, design, and preconstruction services (collectively referred to as the Services) on an as- needed basis subject to the terms and conditions set forth in this agreement and any agreement incorporated into this agreement by reference. NOW, THEREFORE, IT IS AGREED BY THE PARTIES: ARTICLE 1: SCOPE OF WORK AND CONTRACT DOCUMENTS 1.1 The Construction Manager and its successors, assigns, executors or administrators, in consideration of the sums of money, as herein after set forth to be paid by the City to the Construction Manager, shall and will at its own cost and expense perform all labor, furnish all materials, tools and equipment for all individual projects assigned as a result of this contract. 1.2 For each individual project assigned, in accordance with such proposal and technical supplemental specifications and such other special provisions and drawings, if any, which will be submitted by the City, together with any advertisement, instructions to bidders, general conditions, proposal and bond, which may be hereto attached, and any drawings, if any, which may be herein referred to, are hereby made a part of this contract, and all of said work to be performed and completed by the contractor and its successors and assigns shall be fully completed in a good and workmanlike manner to the satisfaction of the City. 1.3 Unless otherwise specified in this contract, all work shall be completed in accordance with Section III and Section IV of the City of Clearwater Contract Specifications (the Specifications). For the purposes of this contract, the term Contractor in Section III shall include the Construction Manager. The Specifications, as may be supplemented and changed, along with this Contract constitute the Contract Documents." In the event there is any conflict between this Contract and the Specifications, this Contract shall take precedence except that the GMP PROPOSAL dated in the amount of $ is expressly incorporated and made part of this Agreement. Further, the GMP Proposal shall be determinative and control in the event of any conflict, discrepancy, absence of information and / or term or condition to the contrary. Page 1 of 12 ARTICLE 2: CONSTRUCTION MANAGER'S DUTIES AND STATUS 2.1 The Construction Manager recognizes the relationship of trust and confidence established between it and the City by this Agreement, and agrees with the City to furnish its best skill and judgment and the overall supervision of its executives; to fumish efficient business administration and superintendence; and to use every effort to keep upon the project site at all times an adequate supply of workforce and materials to secure its execution and completion in the most expeditious and economical manner. 2.2 The Construction Manager represents that it has made a thorough examination of the premises and is thoroughly familiar with the conditions under which it is to work. 2.3 The Construction Manager agrees to perform and complete the Services in accordance with laws, rules, and regulations of all govemmental authorities and departments thereof. 2.4 The Construction Manager agrees to cooperate with the City, Architect- Engineer, or any other Design Professional in all respects, including, but not limited to, providing necessary preconstruction services, such as evaluation of methods, availability and costs of the various components of the Services while under design consideration; supervising the Services and the progress thereof; the coordination of the Services and suggesting changes in the Services; and supplying information as to costs and availability of materials and methods of construction in order, amongst other things, to reduce costs wherever the same may be practicably consistent with the quality of the Services presented in the Contract Documents. 2.5 The Construction Manager agrees to the following: a) In connection with the performance of work under this Contract, the Construction Manager agrees not to discriminate against any employee or applicant for employment because of race, sex, religion, color, or national origin. The aforesaid provision shall include, but not be limited to, the following employment upgrading demotion or transfer recruitment or recruitment advertising lay -off or termination rates of pay or other forms of compensation; and selection for training, including apprenticeship b) The Construction Manager agrees to post hereafter in conspicuous places, available for employees or applicants for employment, notices to be provided by the contracting officer setting forth the provisions of the non - discrimination clause. c) The Construction Manager further agrees to insert the foregoing provisions in all contracts hereunder, including contracts or agreements with labor unions and /or worker's representatives, except sub - contractors for standard commercial supplies or raw materials. ARTICLE 3: SCOPE OF THE SERVICES 3.1 The services that the Construction Manager shall provide include, but are not limited to those described in the following sections. 3.2 Reporting - Written reports shall be provided with the monthly pay requests as follows: Page 2 of 12 a) Monthly Executive Summary which provides an overview of current issues and pending decisions, future developments and expected achievements, and any problems or delays, including code violations found by any permitting agency. b) A Monthly Construction Progress Report that includes a cost narrative, a scheduling narrative and that summarizes the work of the various subcontractors. This report shall include information from the weekly job site meetings as applicable such as: general conditions long lead supplies current deliveries safety and labor relations programs permits construction problems and recommendations; and plans for the succeeding month 3.3 Scheduling a) Upon award of this Contract, the Construction Manager shall submit a master project schedule covering the planning and design approvals, construction and Owner occupancy of the Project. This schedule will serve as the framework for the subsequent development of all detailed schedules. The master project schedule shall be produced and updated monthly throughout the project. b) Within thirty (30) days after the date of the Owner's issuance of a Notice to Proceed, the Construction Manager shall prepare and submit to the Owner two copies of a Critical Path Method (CPM) construction schedule graphically depicting the activities contemplated to occur as a necessary incident to performance of the work required to complete the project, showing the sequence in which the Construction Manager proposes for each such activity to occur and duration (dates of commencement and completion, respectively) of each activity. c) Following development and submittal of the construction schedule the Construction Manager shall, at the end of each calendar month during the project, or at such earlier intervals as circumstances may require, update and /or revise the construction schedule to show the actual progress of the work performed and the occurrences of all events which have affected the progress of performance of work already performed or will affect the progress of the performance of the work yet to be performed in contrast with the planned progress of performance of such work, as depicted on the original construction schedule and all updates and/or revisions thereto as reflected in the updated and/or revised construction schedule last submitted prior to submittal of each such monthly update and revision. Each such update and/or revision to the construction schedule shall be submitted to the Owner in duplicate. d) The Construction Manager shall provide current scheduling information and provide direction and coordination regarding milestones, beginning and finishing dates, responsibilities for performance and the relationships of the Construction Manager's work to the work of his subcontractors and suppliers to enable them to perform their respective tasks so that the development of construction progresses in a smooth and efficient manner in conformance with the overall project schedule. The schedule shall include all phases of the construction work, material supplies, long lease procurement, approval of shop drawings, change orders in progress, schedules for change orders, and performance testing requirements. The Construction Manager shall advise the Owner, its representatives and the Architect- Engineer of their required participation in any meeting or inspection giving each at least one week notice unless such notice Is made Impossible by conditions beyond his control. The Page 3of12 Construction Manager shall hold job -site meetings at least once each month with the Construction Team and at least once each week with the subcontractors and the Architect - Engineer's Field Representative, or more frequently as required by work progress, to review progress, discuss problems and their solutions and coordinate future work with all subcontractors. e) Twice per month corresponding as closely as possible with progress review meetings, a two week' look ahead report shall be prepared and submitted to Owner and Architect / Engineer. 3.4 Design Review and Recommendations a) The Construction Manager shall familiarize himself thoroughly with the evolving architectural, civil, mechanical, plumbing, electrical and structural plans and specifications and shall follow the development of design through Contract Documents. The Construction Manager shall make recommendations with respect to the selection of systems and materials, and cost reducing altematives including assistance to the Architect- Engineer and Owner in evaluating alternative comparisons versus long term cost effect. The evaluation shall speak to the benefits of the speed of erection and early completion of the project. The Construction Manager shall fumish pertinent information as to the availability of materials and labor that will be required. The Construction Manager shall submit to the Owner and Architect-Engineer such comments as may be appropriate conceming construction, feasibility, and practicality. The Construction Manager shall bring to the Owner and the Architect-Engineer's attention any apparent defects in the design, drawing and specifications, or other documents. The Construction Manager shall prepare an estimate of the construction cost at appropriate milestones during the design and shall evaluate such estimate with the project budget. The Construction Manager shall recommend cost saving altematives, as appropriate, at each design milestone. At each design milestone the Owner, Architect Engineer and Construction Manager shall conduct a value engineering review. b) After receiving the Construction Documents for each phase of the project, the Construction Manager shall perform a specific review thereof. Promptly after completion of the review, the Construction Manager shall submit to the Owner, with a duplicate to the Architect - Engineer, a written report covering suggestions or recommendations previously submitted, additional suggestions or recommendations as the Construction Manager may deem appropriate, and all actions taken by the Architect - Engineer with respect to same, any comments he may deem to be appropriate with respect to separating the work into separate contracts and/or alternative materials. c) At completion of the Construction Manager's review of the plans and specifications, except only as to specific matters as may be identified by appropriate comments pursuant to this section, the Construction Manager shall warrant, without assuming any architectural or engineering responsibility, that the plans and specifications are consistent, practical, feasible and constructible. The Construction Manager shall warrant that the work described in the plans and specifications for the various bidding packages is constructible within the scheduled construction time. d) The Construction Manager shall review the design for the purpose of identifying long lead procurement items (i.e. machinery, equipment, materials and supplies). When each item is identified, the Construction Manager shall notify the subcontractors, the Owner, and the Architect- Engineer of the required procurement and schedule. Such information shall be included in the bid documents and made a part of all affected sub - contracts. As soon as the Architect- Engineer has completed drawings and technical specifications and the Construction Manager has obtained permitting approval, the Construction Manager shall Page4of12 prepare invitations for bids. The Construction Manager shall keep informed of the progress of the respective subcontractors or suppliers, manufacturing or fabricating such items and advise Project Director, Owner and Architect- Engineer of any problems or prospective delay in delivery. 3.5 Staffing - Key personnel assigned to City projects by the Construction Manager shall not be removed from the project until alternate personnel acceptable to the City are approved in writing by the City. 3.6 Soliciting Bids a) Without assuming responsibilities of the Architect- Engineer, and unless waived in writing by the Owner, the Construction Manager shall prepare invitations for bids, or requests for proposal when applicable, for all procurements of long lead items, materials and services, and for Subcontractor contracts. Such invitations for bids shall be prepared in accordance with the following guidelines: i) Contracts totaling $1,000 but not exceeding $10,000 may be entered into by the Construction Manager with the firm which is qualified and submits the lowest verbal quotation. The Construction Manager shall obtain a minimum of two (2) verbal quotations. These quotations shall be entered on a bid tabulation sheet and a copy of such tabulation sent to the Owner, Architect- Engineer and to each firm. The successful quotation shall be confirmed by written contract or purchase order to the low bid firm defining the scope and quality of work to be provided. ii) Contracts totaling $10,000 but not exceeding $200,000 may be entered into by the Construction Manager with the firm who is qualified and submits the lowest responsive proposal. The Construction Manager shall request at least three (3) firms to submit sealed written proposals based on written drawings and /or specifications. The written proposals shall all be opened publicly at the location, date and time named by the Construction Manager in his request for proposal. A tabulation of the results shall be furnished to the Owner, Architect- Engineer and to each firm. iii) Contracts totaling $200,000 but not exceeding $500,000 may be entered into by the Construction Manager with the firm who is pre - qualified and submits the lowest responsive proposal. The Construction Manager shall advertise these projects at least once with the last advertisement appearing at least 21 calendar days prior to the established bid opening date. These proposals shall be based on approved plans and specifications. Bids shall be received and opened publicly at the location, date and time established in the bid advertisement. iv) Contracts totaling $500,000 or greater shall be treated the same as described under iii above except that the advertisement shall be run for at least 30 days prior to the established bid opening and at least 5 days prior to any scheduled pre -bid conference. v) Individual purchases of materials or rentals or leases of equipment of up to $999.99 each may be made without bids or quotes when reasonably necessary to expedite work on the project; however, the Construction Manager shall not divide or separate a procurement in order to avoid the requirements set forth above. vi) Site utilities may be acquired at market rates from the entity(ies) providing such in the franchise area. Page 5of12 b) For each separate construction contract exceeding $35,000, the Construction Manager shall, unless waived by Owner, conduct a pre -bid conference with prospective bidders, the Architect - Engineer and the Owner. In the event questions are raised which require an interpretation of the bidding documents or otherwise indicate a need for clarification or correction of the invitation, the Construction Manager shall transmit these to the Architect - Engineer and upon receiving clarification or correction in writing shall prepare an addendum to the bidding document, and issue same to all of the prospective bidders. 3.7 Quality Control - The Construction Manager shall develop and maintain a program, acceptable to the Owner and Architect- Engineer that assures quality control of the construction. The Construction Manager shall supervise the work of all subcontractors providing instruction to each when their work does not conform to the requirements of the plans and specifications and shall continue to assert influence and control over each subcontractor to ensure that corrections are made in a timely manner so as to not affect the efficient progress of the work. Should disagreement occur between the Construction Manager, the Owner or the Architect- Engineer over acceptability of work and conformance with the requirements of the specifications and plans, the Owner shall be the final judge of performance and acceptability. 3.8 Subcontractor Interfacing - The Construction Manager shall be the single point of interface with all subcontractors for any work done under this Contract. The Construction Manager shall negotiate all change orders, field orders and request for proposals, with all affected subcontractors and shall review the costs of those proposals and advise the Owner and Architect- engineer of their validity and reasonableness, acting in the Owner's best interest prior to requesting approval of each change order from the Owner. Before any work is begun on any change order, a written authorization from the Owner must be issued. When health and safety are threatened, however, the Construction Manager shall act immediately to remove such threat to health and safety. The Construction Manager shall also carefully review all shop drawings and then forward the same to the Architect - Engineer for review and actions. The Architect- Engineer will transmit them back to the Construction Manager who will then issue the shop drawings to the affected subcontractor for fabrication or revision. The Construction Manager shall maintain a record to promote expeditious handling. The Construction Manager shall request the Architect- Engineer to make interpretations of the drawings or specifications requested of him by the subcontractors and shall maintain a record to promote timely response. The Construction Manager shall advise the Owner and Architect-Engineer when timely response is not occurring on any of the above. The Construction Manager shall collect, review and submit to the Owner, all project closeout documentation including operation, maintenance and training manuals. ARTICLE 4: MAXIMUM PROJECT COST AND FEES FOR SERVICES 4.1 Guaranteed Maximum Price for Construction a) When the Construction Documents are sufficiently complete to establish the scope of work for the project or any portion thereof, the Construction Manager will establish and submit in writing to the Owner for his approval a Guaranteed Maximum Price (GMP) guaranteeing the maximum price to the Owner, for the construction cost of the project or designated part thereof. Such Guaranteed Maximum Price will be subject to modification for changes in the project as provided in article 4.1(e) below. Actual price paid for the work by the Owner, however, shall be the actual cost of all work subcontracts, supply contracts, direct Tabor costs, direct supervision costs and direct job costs, plus the Construction Manager's fees or the GMP, whichever is less when the work is complete. Invoicing shall occur monthly for completed work with 5% retainage withheld until final completion and acceptance of all work covered in the contract documents in accordance to the City's General Conditions. Page 6of12 b) At the time of submission of a Guaranteed Maximum Price, the Construction Manager will verifythetimescheduleforactivitiesandworkwhichwereadoptedandusedtodeterminethe Construction Manager's cost of work. In addition to the cost of work, a GMP will indude an agreed upon sum as the construction contingency which is included for the purpose of defraying the expenses due to unforeseen circumstances relating to construction. The Construction Manager will be required to fumish documentation evidencing expenditures charged to the contingency prior to the release of funds by the Owner. If bids are received below the applicable line items in the GMP, the surplus will be added to the contingency. c) If bids are received above the applicable line item in the GMP, the deficiency will be taken from the contingency; however, such occurrence shall not be cause to increase the GMP. d) If bids are not received for a portion of the work at or below the applicable line item amount in the GMP, the Construction Manager reserves the right to perform that portion of the work as acknowledged by the Owner or negotiate for its performance for the specified line item lump sumamountorless. e) The increase or decrease in the Guaranteed Maximum Price resulting from a change in theProjectshallbedeterminedinoneormoreofthefollowingways: i. By mutual acceptance of a lump sum properly itemized and supported by sufficient substantiating data to permit evaluation by the Architect Engineer and owner; ii. By unit prices stated in the Agreement or subsequently agreed upon; iii. If none of the methods is agreed upon, the Construction Manager, provided it has received a signed written order by the Owner, shall promptly proceed with the work involved. The cost of such work shall then be determined on the basis of the reasonable expenditures and savings of those performing the work attributed to the change. In the event a Change Order is issued under these conditions, however, the Architect-Engineer will establish an estimated cost of the work and the Construction Manager shall not perform any work whose cost exceeds that estimate without prior written approval by the Owner. In such case, the Construction Manager shall keep and present, in such form as the Owner may prescribe, an itemized accounting together with appropriate supporting data of the increase in the Cost of the Project. The amount of decrease in the Guaranteed Maximum Price to be allowed by the Construction Manager to the Owner for any deletion or change which results in a net decrease in cost will be the amount of the actual net decrease; iv. The Architect- Engineer will have authority to order minor changes in the Project not involving an adjustment in the Guaranteed Maximum Price or an extension of the Construction Completion Date and not inconsistent with the intent of the Drawings and Specifications. Such changes shall be effected by written order. Documentation of changes shall be determined by the Architect- Engineer.. Changes shall be approved by the Architect-Engineer 4.2 Construction Manager's Fee - In consideration of the performance of the contract, the Owner agrees to pay the Construction Manager as compensation for his services, fees as set forth below : Page 7 of 12 Preconstruction Phase Fee - shall be based on design costs if applicable, constructability review, value engineering and fee determination of Guaranteed Maximum Price. The fee for this phase in the amount of $ TBD shall be paid at the negotiated price upon receipt of the Guaranteed Maximum Price. a) Construction Phase Fee - Prior to commencement of the Construction Phase, the Owner will direct the Construction Manager in writing to proceed into the Construction Phase. The Construction Manager's compensation for work or service performed during the Construction Phase shall be a fee of TBD . The Construction Phase Fee shall be invoiced and paid in TBD months. Payments will be remitted monthly at the cost of TBD each and one final monthly payment of TBD The first monthly payment shall become due thirty days following the issuance of the first Construction Authorization and the final monthly payment shall be paid only when construction of the project is completed and occupancy of the project accepted by the Owner. If construction is authorized only for a part of the project, the fee paid shall be proportionate to the amount of work authorized by the Owner. ARTICLE 5: TERMINATION AND TIME OF THE ESSENCE 5.1 If the Construction Manager is adjudged bankrupt or makes a general assignment for the benefit of creditors, or if a receiver is appointed on account of its insolvency, or if refuses or fails, except in cases for which an extension of time is provided, to supply enough properly skilled workmen or proper materials for the Services, or otherwise be guilty of a substantial violation of any provision of this Agreement as determined by the certificate of the Architect, the Owner may, without prejudice and reserving any other right or remedy the Owner may have, after giving the Construction Manager seven (7) days' written notice, terminate the employment of the Construction Manager and take possession of the premises and all materials, tools, and appliances thereon and finish the Project in whatever manner the Owner may deem expedient. 5.2 It is mutually agreed between the parties hereby that time is of the essence of this contract, and in the event that the Substantial Completion Date is not achieved within the time stipulated herein, it is then further agreed that the City may deduct from such sums or compensation as may be due to the Construction Manager, the sum of $1,000.00 per day for each day that the work to be performed by the Construction Manager remains incomplete beyond the time limit specified herein, which sum of I 1,000.011 per day shall only and solely represent damages which the City has sustained by reason of the failure of the Construction Manager to complete the work within the time stipulated, it being further agreed that the sum is not to be construed as a penalty but is only to be construed as liquidated damages for failure of the Construction Manager to complete and perform all work within the time period as specified in this contract. ARTICLE 6: INDEMNIFICATION 6.1The Construction Manager and his or its successors and assigns does hereby agree to assume the defense of any legal action which may be brought against the City as a result of the Construction Manager's activities arising out of this contract and furthermore, in consideration of the terms, stipulations and conditions as contained herein, agrees to hold the city free and harmless from any and all claims for damages, costs of suits, judgments or decrees resulting from any claims made under this contract against the city or the contractor or the contractor's sub - contractors, agents, servants or employees resulting from activities by the aforementioned contractor, sub - contractor, agent servants or employees. Page 8of12 6.2 Nothing contained herein shall be construed as a waiver of any immunity from or limitation of liability the City (Owner) may be entitled to under the doctrine of sovereign immunity or section 768.28, Florida Statutes. ARTICLE 7: TITLE TO THE PROJECT 7.1 The title of all work, completed portions of the Project and in the course of construction, and of all materials on account of which payment has been made shall be in the Owner. ARTICLE 8: ASSIGNMENT 8.1 This Agreement shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and assigns, except that this Agreement may not be assigned by either party without the prior written consent of the other party. Any assignment made without such prior written consent shall not vest rights in the assignee. ARTICLE 9: ADDITIONAL PROVISIONS 9.1 This Agreement shall be govemed by and construed in accordance with the laws of the State of Florida, and the venue for any dispute under this Agreement shall be an appropriate court of competent jurisdiction in Pinellas County, Florida. 9.2 Any notice required to be given by the terms and provisions of this Agreement or by any law or govemmental regulation, either by the Owner or Construction Manager, shall be in writing unless otherwise required by such law or regulation and shall be deemed to have been served and given when deposited in either Registered or Certified Mail in United States Branch Post Office, addressed to the party hereto to whom directed, at the address specified in the Specifications,. 9.3 The language in this Agreement shall be construed according to its customary meaning within the Florida building industry. Whenever used, the singular shall include the plural, the plural the singular, and the use of any gender shall be applicable to all genders. 9.4 If any provision of the Contract Documents is invalid or unenforceable as against any person or party, the remainder of the Contract Documents and the applicability of such provision to other persons or parties shall not be affected thereby. 9.5 Nothing contained in this Agreement shall be construed to mean that the Construction Manager and Owner are joint venturers or partners. 9.6 In addition to all other contract requirements as provided by law, the contractor executing this agree- ment agrees to comply with public records law. IF THE CONTRACTOR HAS QUESTIONS REGARDING THE APPLICATION OF CHAPTER 119, FLORIDA STATUTES, THE CONTRACTORS DUTY TO PROVIDE PUBLIC RECORDS RELATING TO THIS CONTRACT. CONTACT THE CUTODIAN OF PUBLIC RECORDS AT 727 - 562 -4092, Rosemarie .CaWmyclearwater.com, 112 S. Osceola Ave., Clearwater, FL 33756 Page 9of12 The contractor's agreement to comply with public records law applies specifically to: a) Keep and maintain public records required by the City of Clearwater hereinafter "public agency ") to perform the service being provided by the contractor hereunder. b) Upon request from the public agency's custodian of public records, provide the public agency with a copy of the requested records or allow the records to be inspected or copied within a reasonable time at a cost that does not exceed the cost provided for in Chapter 119, Florida Statutes, as may be amended from time to time, or as otherwise provided by law. c) Ensure that the public records that are exempt or confidential and exempt from public records disclosure requirements are not disclosed except as authorized by law for the duration of the contract term and following completion of the contract if the contractor does not transfer the records to the public agency. d) Upon completion of the contract , transfer, at no cost, to the public agency all public records in possession of the contractor or keep and maintain public records required by the public agency to perform the service. If the contractor transfers all public records to the public agency upon completion of the contract, the contractor shall destroy any duplicate public records that are exempt or confidential and exempt from public records disclosure requirements. If the contractor keeps and maintains public records upon completion of the contract, the contractor shall meet all applicable requirements for retaining public records. All records stored electronically must be provided to the public agency, upon request from the public agency's custodian of public records, in a format that is compatible with the information technology systems of the public agency. e) A request to inspect or copy public records relating to a public agency's contract for services must be made directly to the public agency. If the public agency does not possess the requested records, the public agency shall immediately notify the contractor of the request and the contractor must provide the records to the public agency or allow the records to be inspected or copied within a reasonable time. f) The contractor hereby acknowledges and agrees that if the contractor does not comply with the public agency's request for records, the public agency shall enforce the contract provisions in accordance with the contract. Page 10 of 12 g) A contractor who fails to provide the public records to the public agency within a reasonable time may be subject to penalties under Section 119.10, Florida Statutes. h) If a civil action is filed against a contractor to compel production of public records relating to a public agency's contract for services, the court shall assess and award against the contractor the reasonable costs of enforcement, including reasonable attorney fees, if: 1. The court determines that the contractor unlawfully refused to comply with the public records request within a reasonable time; and 2. At least 8 business days before filing the action, the plaintiff provided written notice of the public records request, including a statement that the contractor has not complied with the request, to the public agency and to the contractor. i) A notice complies with subparagraph (h)2. if it is sent to the public agency's custodian of public records and to the contractor at the contractor's address listed on its contract with the public agency or to the contractor's registered agent. Such notices must be sent by common carrier delivery service or by registered, Global Express Guaranteed, or certified mail, with postage or shipping paid by the sender and with evidence of delivery, which may be in an electronic format. j) A contractor who complies with a public records request within 8 business days after the notice is sent is not liable for the reasonable costs of enforcement. Page 11 of 12 IN WITNESS WHEREOF, the parties to the agreement have hereunto set their hands and seals and have executed this Agreement, in duplicate, the day and year first above written. CITY OF CLEARWATER IN PINELLAS COUNTY, FLORIDA By: William B. Home 11 City Manager Countersigned: BY: Sto yACe AttO George Cretekos, Mayor - Councilmember Contractor must indicate whether Corporation, Partnership, company or Individual) The person signing shaN, in his own handwriting sign the Principal's name, his own name and his title; where the person is signing for a Corporation he must, by Affidavit, show his authority to bind the Corporation). Attest: Rosemarie Call, City Clerk Approv as t fo Smith, istant City Attorney 1'dreviver 60,14 S,,T 1G Contrdctor) SCRUTINIZED COMPANIES AND BUSINESS OPERATIONS WITH CUBA AND SYRIA CERTIFICATION FORM THIS FORM MUSTBE COMPLETEDAND SUBMITTED WITH PROPOSAL FOR PROJECTS THATMAY EXCEED $1,000,000. FAILURE TO SUBMIT THIS FORMASREQUIRED, MAYDEEM YOUR SUBMITTAL NONRESPONSIVE The affiant, by virtue of the signature below, certifies that: 1. The vendor, company, individual, principal, subsidiary, affiliate, or owner is aware of the requirements ofsection 287.135, Florida Statutes, regarding companies on the Scrutinized Companies with Activities in Sudan List, the Scrutinized Companies with Activities in the Iran Petroleum Energy Sector List, or engaging in business operations inCubaandSyria; and 2. The vendor, company, individual, principal, subsidiary, affiliate, or owner is eligible to participate in this solicitation and is not listed on either the Scrutinized Companies with Activities in Sudan List, the Scrutinized Companies with Activities in the Iran Petroleum Sector List, or engaged in business operations in Cuba and Syria; and 3. Business Operations means, for purposes specifically related to Cuba or Syria, engaging in commerce in any forminCubaorSyria, including, but not limited to, acquiring, developing, maintaining, owning, selling, possessing, leasing or operating equipment, facilities, personnel, products, services, personal property, real property, military equipment, or anyotherapparatusofbusinessorcommerce; and 4. If awarded the Contract (or Agreement), the vendor, company, individual, principal, subsidiary, affiliate, or ownerimmediatelynotifytheCityofClearwaterinwriting, no later than five (5) calendar days after any of its principals are Eitaced on the Scrutinized Companies with Activities in Sudan List, the Scrutinized Companies with Activities in the Iran Retrgt Sect List, or engages in business operations in Cuba and Syria. Authorized:Stgnature f o T C. Fo_t,VW,gl rPrr-innttegi,Name 1 •CcrtS /j?d.4/r Title Atsmie 6eiCerfi/ArotS, ire. Nanfe of Entity/Corporation STATE OF Fcc,040,4 COUNTY OF The foregoing instrument was acknowledged before me on this 110 day of ,urge_ , 20 IL , byunbar . C.. Focnc..sc 4. (name of person whose signature is being notarized) as the0,re..s deny (title) of 1<eals.lausle. Exegt,,Ad (name of corporation /entity),, rallyknowntomeasdescribedherein , or produced a (type of identification) as identification, and who did/did not take an oath. Notary Public - J Printed Name My Commission Expires: NOTARY SEAL ABOVE TRUTH -IN- NEGOTIATION CERTIFICATE In compliance with the Consultants' Competitive Negotiation Act, Section 287.055, Florida Statutes, and The Truth in Negotiations Act (TINA), Gotelry- 57WE'Xd41 fir i hereby certifies that wage rates, fringe rates and other factual unit costs supporting the compensationRISC5xoces ,fit for the a, r„ru.thd GDtiahc. services of (l7 ed_toogimareiG to be provided under this Agreement, conceming /P'Q AV- are accurate, complete and current as of the time of contracting. The hereby undersigned representative submits this certification that they: 0.... e :an: ' authorized representative of the proposer who may legally bind the proposer attest to'' the accuracy of the information: STATE OF Fie.tav4 COUNTY OF /a/Ave-A.4_44 Authorized Signature K tumr- c • F:eiiC.tl6ttr4GT" R Printed Name Title if/9672,0%4r exoav r7a3s,. ., Name of Entity/Corporation The foregoing instrument was acknowledged before me on this U'" day ofAulhe. , 20 t t . , by 44c.er -i. C . FOrn wo.,\ name of person whose signature is being notarized) as the t restde„ - title) of \{e..vslichne. _YCAtinAdres. Tr,e _ (name of corporation/entity), onallr known to me as described herein , or produced a type of identification) as identification, and who did / did not take an oath. Wen Notary Public Printed Name My Commission Expires: NOTARY SEAL ABOVE 0 AMENDMENT NO. 1 TO CONSTRUCTION MANAGER AT RISK SERVICES CONTINUING CONTRACT, DATED JUNE 15, 2016, BETWEEN KEYSTONE EXCAVATORS, INC. ( "Contractor") AND THE CITY OF CLEARWATER ( "City ") The City of Clearwater's RFQ #24 -16 Construction Management at Risk Services for Continuing Contracts will be for a four (4) year period. This contract will be from Aug 4, 2016 — Aug. 4, 2020 and will be for projects up to $2,000,000. Keystone Excavators, Inc. By: 4vrfrAii4/31/41/24( Name: M'6 Zr e. Title: Tgee;TS /a+6•vT- Date: 4.-y /31 20/6 AMENDMENT NO.2 CONSTRUCTION MANAGER AT RISK CONTRACT KEYSTONE EXCAVATORS INC. This AMENDMENT NO. 2 is made and entered into by and between the City of Clearwater, Florida CITY) and KEYSTONE EXCAVATORS INC., (CONSTRUCTION MANAGER) on this 76 day of 2020. WHEREAS, the CITY AND CONSTRUCTION MANAGER previously entered into a contract on June 28, 2016, hereinafter referred to as the Contract, to provide for construction, design, and preconstruction services on an as -needed basis; and WHEREAS, the Contract is set to expire on August 4, 2020; and WHEREAS, per Clearwater Ordinance Section 2.561(8) and Article 12 (Section III, General Conditions), the CITY has the option to extend the Contract for 59 days; WHEREAS, the Parties desire to extend the Contract duration. NOW THEREFORE, in consideration of the mutual terms, covenants, conditions contained herein, the Parties agree as follows: 1. The term ofthe Contract shall be extended and will now expire on October 1, 2020. 2. Except as expressly modified by this Amendment, all other terms, and provisions of the Contract shall remain in full force and effect. 3. The foregoing recitals are incorporated herein and form a part of the Contract. IN WITNESS WHEREOF, the Parties have executed this Contract as of the date set forth above. KEYST NE EXCAVATORS INC. By: Name: Title: Date: CITY OF CLEARWATER, FLORIDA William B. Home, II City Manager Approved as to form: Bowen Kohler Assistant City Attorney Attest: Rosemarie Call City Clerk Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8100 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Parks & Recreation Agenda Number: 7.9 SUBJECT/RECOMMENDATION: Approve the First Amendment to the Host Venue Agreement between the City and Competitor Group, Inc. (CGI) for the Rock ‘n’ Roll Marathon Series to update the term of the agreement and authorize the appropriate officials to execute same. (consent) SUMMARY: On February 6, 2020, Council approved a Host Venue Agreement with CGI, the operator of the Rock ‘n’ Roll Marathon Series, to bring this signature running event to Clearwater. The agreement provided for the race dates to begin in October 2020 and extend through October 2024. Due to issues caused by the COVID-19 pandemic and the more defined schedule for the Imagine Clearwater project, CGI is requesting that the race dates be modified to begin in October 2022 and extend through October 2026. This will allow the City to provide a signature running event showcasing the newly opened Imagine Clearwater location. In addition, it will provide CGI as well as the City the opportunity to attract the most runners to not only participate in the race but to get to know the many amenities that Clearwater has to offer. All other terms of the agreement remain unchanged and in full force and effect. APPROPRIATION CODE AND AMOUNT: N/A USE OF RESERVE FUNDS: N/A Page 1 City of Clearwater Printed on 9/3/2020 FIRST AMENDMENT to HOST VENUE AGREEMENT ROCK ‘N’ ROLL® CLEARWATER (2022-2026) This FIRST AMENDMENT TO HOST VENUE AGREEMENT (this “First Amendment”) is effective as of August ____, 2020 (the “First Amendment Date”) by and between COMPETITOR GROUP, INC., a Delaware corporation (“CGI”), and CITY OF CLEARWATER, a city formed under the laws of Florida (“Host” or “City”). CGI and Host/City are sometimes referred to herein individually as “Party” and collectively as “Parties.” RECITALS A.This First Amendment amends that certain HOST VENUE AGREEMENT, dated February 11, 2020, between CGI and Host (the “Agreement”). Capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Agreement. B.The Parties desire to amend the Agreement in order to update the Term of the Agreement. The Parties agree as follows: AMENDMENTS TO THE AGREEMENT 1.Section 1(a) of the Agreement is hereby deleted in its entirety and replaced with the following: Ownership. CGI shall prepare and conduct an Event (as defined below) in and around the Venue during the years 2022, 2023, 2024, 2025, and 2026 (each, a “Race Year”). CGI is and will be the owner of each Event and nothing herein constitutes a license by CGI to Host or to any third party to establish or operate any Event or Race (as defined below). 2.Section 1(d) of the Agreement is hereby deleted in its entirety and replaced with the following: Race Dates. The Races each year of the Term will occur on the following applicable dates (each, a “Race Date”): (i)2022: TBD – October, 2022 (ii)2023: TBD – October, 2023 (iii)2024: TBD – October, 2024 (iv)2025: TBD – October, 2025 (v)2026: TBD – October, 2026 DocuSign Envelope ID: 7DF5A59C-B14F-45D7-A037-F5BE8F594758 15 FIRST AMENDMENT TO HOST VENUE AGREEMENT- Page 2 of 3 Page 2 of 3 3. Section 2 of the Agreement is hereby deleted in its entirety and replaced with the following: Term of Agreement. This Agreement is effective beginning on the Effective Date, and will continue in effect until the date that is thirty (30) days after the 2026 Event, unless this Agreement is sooner terminated in accordance with the terms of this Agreement (the “Term”). OTHER PROVISIONS 4. No Other Changes. Except as expressly provided in this First Amendment, the Agreement is not otherwise amended, modified, or affected by this First Amendment, and all other terms of the Agreement remain unchanged and in full force and effect. 5. Miscellaneous. The Agreement, as amended by this First Amendment, constitutes the entire agreement and understanding of the Parties with respect to its subject matter and supersedes all prior or contemporaneous agreements, arrangements, and understandings, written or oral, between or among the Parties, except as may be specifically provided herein. No modifications, amendments, cancellations, renewals, or extensions of or to this First Amendment or the Agreement will be binding upon the Parties unless modified, amended, cancelled, renewed, or extended in a writing and signed by both Parties. This First Amendment will be binding upon, and enure to the benefit of, the Parties and their respective successors and assigns. Subject to the immediately preceding sentence, no third party will have any rights or remedies under the Agreement or this First Amendment. This First Amendment may be executed in counterparts, each of which will be deemed an original binding document and all of which will constitute one and the same instrument. An electronic (e.g., PDF) or facsimile copy of the executed this First Amendment or counterpart hereof will be deemed, and will have the same legal force and effect as, an original document. [ Signature Page Directly Follows This Page ] DocuSign Envelope ID: 7DF5A59C-B14F-45D7-A037-F5BE8F594758 FIRST AMENDMENT TO HOST VENUE AGREEMENT- Page 3 of 3 Page 3 of 3 This First Amendment has been executed and delivered by each Party’s duly authorized representative as of the First Amendment Date. CGI: COMPETITOR GROUP, INC. By: ____________________________ Name: Andrew Messick Title: Chief Executive Officer Host: CITY OF CLEARWATER, FLORIDA ______________________________ ______________________________ Frank Hibbard William B. Horne, II Mayor City Manager Approved as to form: Attest: ________________________________ ________________________________ Owen Kohler Rosemarie Call Assistant City Attorney City Clerk DocuSign Envelope ID: 7DF5A59C-B14F-45D7-A037-F5BE8F594758 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-7727 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Engineering Department Agenda Number: 7.10 SUBJECT/RECOMMENDATION: Ratify and confirm a first amendment to the Joint Project Agreement (JPA) between Pinellas County and the City of Clearwater for the Sunset Point Road at Betty Lane Utility Relocation Project (17-0012-UT) for an increase of $333,108.17, from $402,948 to $736,056.17, and authorize the appropriate officials to execute same. (consent) SUMMARY: November 2, 2017, City Council approved a JPA between Pinellas County and City of Clearwater for Utility Relocations in the amount of $402,948. The utility relocations were to accommodate conflicts between a City 16-in. potable water main and Pinellas County improvements to its stormwater system along Sunset Point Road from Douglas Avenue to Kings Highway. Construction began in early 2019 and is anticipated to be complete by the end of 2020. During construction, unforeseen conflicts between the City water main and the County’s proposed stormwater improvements were identified. In addition, some sections of the water main were found to have insufficient cover and required relocation and/or concrete encasement. This first amendment increases the construction budget in the amount of $333,108.17 to fund the unforeseen work, bringing the total construction budget to $736,056.17. APPROPRIATION CODE AND AMOUNT: 3277327-563800-96634 $333,108.17 Funding is available in Utility Renewal and Replacement project 96634, Sanitary Utility Relocation Accommodation. Page 1 City of Clearwater Printed on 9/3/2020 1 FIRST AMENDMENT BETWEEN THE CITY OF CLEARWATER AND PINELLAS COUNTY FOR THE JOINT PROJECT AGREEMENT: SUNSET POINT ROAD AT BETTY LANE INTERSECTION IMPROVEMENTS THIS FIRST AMENDMENT is made and entered into on this ________ day of ________, 2020, by and between PINELLAS COUNTY, a public corporation of the State of Florida whose address is 315 Court Street, Clearwater, FL 33756, hereinafter referred to as the "COUNTY," and the City of Clearwater, a municipal corporation of the State of Florida, whose address is 100 South Myrtle Avenue, Clearwater, Florida, 33756, hereinafter referred to as the "CITY", collectively “Parties”. WITNESSETH: WHEREAS, the COUNTY will be constructing a capital improvement program plan referred to as Sunset Point Road at Betty Lane Intersection Improvements “Project”; and WHEREAS, the COUNTY and the CITY previously entered into an agreement on December 12, 2017, hereinafter referred to as the Agreement, to provide funding for the CITY’s Utility Work to be completed by the COUNTY’s contractor as part of construction of the Project; and WHEREAS, Section 11 of the Agreement provides that the Agreement may be amended where agreed to in writing by the Parties; and WHEREAS, both the COUNTY and the CITY desire to amend the Agreement. NOW THEREFORE, in consideration of the mutual terms, covenants and conditions contained herein, the Parties agree as follows: 1. Section 1. Utility Work is hereby amended in its entirety as follows: The City’s Utility Work within the limits of the Project is more specifically described as the replacement, relocation or adjustment of approximately 1034 500 linear feet of sixteen inch (16”) water main, and approximately 377 500 linear feet of eight inch (8”) water main, and 22 linear feet of six inch (6”) water main that are in conflict with the proposed intersection construction improvements as part of County PID No. 001018A, located on Sunset Point Road at Betty Lane. Additional Utility Work within the limits of the Project is more specifically described as the replacement, relocation or adjustment of approximately 64 linear feet of sixteen inch (16”) water main that is in conflict with the proposed stormwater box culvert in Spring Branch Creek as part of County PID No. 001018A, located on Sunset Point Road at Betty Lane. 2 2. Section 2.2. Funding is hereby amended in its entirety as follows: The City hereby certifies that funding for the preliminary estimated Utility Work cost (Exhibit A) of Three Hundred Eighty-Three Thousand Seven Hundred Sixty and 00/100 Dollars ($383,760.00), plus 5% for County construction/contract administration/compaction and backfill testing costs of Nineteen Thousand One Hundred Eighty-Eight and 00/100 Dollars ($19,188.00), for a total cost of Four Hundred Two Thousand Nine Hundred Forty-Eight and 00/100 Dollars ($402,948.00), has been appropriated and is available for deposit into an interest bearing escrow account for the purpose of payments by the County to the contractor on the City’s behalf. The deposit will be due to the County no later than thirty (30) days from the date of notification of the County’s intent to award the construction contract. If the option item of the contractor’s bid selected by the County for performance of the Utility Work exceeds the amount of the preliminary estimated Utility Work, then subject to and in accordance with the limitations and conditions established by Subparagraph 2.1 hereof regarding the City’s option to remove the Utility Work, the City will deposit an amount with the County which equals the total option item plus 5% of that amount for County construction/contract administration/compaction and backfill testing. Interest will accrue on the deposit balance and be used toward the cost of the Utility Work. In the event the final, actual cost of the Utility Work is less than the amount the City deposited, including all interest earned, but excluding the 5% for County construction/contract administration/compaction and backfill testing of the actual construction costs, the County will reimburse the City any excess escrow account funds. Should contract modifications occur that increase the cost of the Utility Work, or the estimated quantities of items provided by the City in Exhibit A are exceeded, the City will be notified by the County accordingly. The City will pay the County within thirty (30) calendar days of notification by the County to ensure that cash on deposit with the County is sufficient to fully fund the cost of the Utility Work. The County shall notify the City as soon as it becomes apparent the actual costs will overrun the award amount, and the City shall pay for the cost overruns (plus 5% administrative fee) within thirty (30) calendar days of notification by the County. However, failure of the County to so notify the City shall not relieve the City from its obligation to pay for the full cost of the Utility Work. The City hereby certifies that additional funding for plan revisions and construction cost overruns of Three Hundred Seventeen Thousand Two Hundred Forty-Five and 88/100 Dollars ($317,245.88), plus 5% for County construction/contract administration/compaction and backfill testing costs of Fifteen Thousand Eight Hundred Sixty Two and 29/100 Dollars ($15,862.29), for a total cost of Three Hundred Thirty Three Thousand One Hundred Eight and 17/100 Dollars ($333,108.17), has been appropriated and is available for deposit into an interest bearing escrow account for the purpose of payments by the County to the contractor on the City’s behalf. The deposit will be due to the County no later than thirty (30) days from the date of this fully executed First Amendment. All deposits due to the County referenced in Section 2.2 above shall be mailed to: Finance Division Accounts Receivable 3 Pinellas County Board of County Commissioners P. O. Box 2438 Clearwater, FL 33757 3. Except as changed or modified by this FIRST AMENDMENT, all provisions and conditions of the Agreement shall remain in full force and effect. IN WITNESS WHEREOF, the Parties have caused these presents to be duly executed, as of the day and year first above-mentioned. PINELLAS COUNTY, FLORIDA BY: ___________________________________ Barry A. Burton, County Administrator APPROVED AS TO FORM: BY: ___________________________________ Assistant County Attorney CITY OF CLEARWATER ___________________________ ________________________________ Frank Hibbard William B. Horne II Mayor City Manager Approved as to form: Attest: ___________________________ ________________________________ Owen Kohler Rosemarie Call Assistant City Attorney City Clerk JOINT PROJECT AGREEMENT UTILITY INSTALLATION BY ROADWAY CONTRACTOR PROJECT NAME: Sunset Point Road at Betty Lane Intersection Improvements PROJECT LIMITS: Sunset Point Road at Betty Lane PROJECT NO.: 001018A THIS JOINT PROJECT AGREEMENT (Agreement) made and entered into on the ( ~Tff day ofj}.fctr/1~20fi, by and between Pinellas County, a political subdivision of the State of Florida, hereinafter called the "County", and the City of Clearwater, Florida, a municipal corporation of the State of Florida, hereinafter called the "City" ( collectively, Parties). WITNESSETH, That: WHEREAS, the County intends to construct roadway and/or drainage improvements to Sunset Point Road at Betty Lane Intersection (County Project No. 001018A or Project), which will call for the adjustment, relocation and/or installation of the City's utility facilities along, over and/or under the Project (Utility Work); and WHEREAS, the County's plans for the Project have been reviewed by the City and the City has had the opportunity for input into said plans; and WHEREAS, the County and the City have determined that it would be to the best interest of the general public and to the economic advantage of both Parties to enter into this Joint Project Agreement for the Utility Work to be accomplished by the County's contractor as part of the construction of the Project; and WHEREAS, the City has expressed its desire to assume all reasonable and necessary costs to be incurred for this Utility Work and has requested to County to include in said Project certain plans and specifications to meet the City's needs. NOW, THEREFORE, in consideration of the sum of One Dollar ($1.00) each to the other in hand paid, the receipt whereof is hereby acknowledged, and in further consideration of the mutual covenants hereinafter contained, it is agreed by the Parties as follows: 1. Utility Work The City's Utility Work within the limits of the Project is more specifically described as the replacement, relocation or adjustment of approximately 500 linear feet of sixteen inch (16") water main, and approximately 500 linear feet of eight inch (8") and six inch (6") water main that are in conflict with the proposed intersection construction improvements as part of County PID No. 00 IO l 8A, located on Sunset Point Road at Betty Lane. Page I 2. Funding 2.1 The County will be responsible for the bidding and award of the construction contract for the Project and will include the Utility Work as a separate option item in its bidding document. After the County receives, opens, and evaluates the bids, the County will notify the City, in writing, of the County's intent to award the contract. This notification will include the amount for the Utility Work option. The City will have fifteen (15) days from receipt of the County's notification to request, in writing, that the County delete this option, and to notify the County of the City's intent to perform the Utility Work with the City's own forces or its own contractor. In order not to delay the construction of the Project, the City must show that it is ready and able to perform all Utility Work prior to requesting that the County delete the Utility Work option from the contract award. The City does not have the right to delay or affect, in any way, the award of the contract. In the event the City, in performing the Utility Work causes a compensable delay to the County's construction of this Joint Project, the City will pay all claims and costs incurred due to its delay. 2.2 The City hereby certifies that funding for the preliminary estimated Utility Work cost (Exhibit A) of Three Hundred Eighty-Three Thousand Seven Hundred Sixty and 00/100 Dollars ($383,760), plus 5% for County construction/contract administration/compaction and backfill testing costs of Nineteen Thousand One Hundred Eighty-Eight and 00/100 Dollars ($19,188), for a total cost of Four Hundred Two Thousand Nine Hundred Forty-Eight and 00/100 Dollars ($402,948), has been appropriated and is available for deposit into an interest bearing escrow account for the purpose of payments by the County to the contractor on the City's behalf. The deposit will be due to the County no later than thirty (30) days from the date of notification of the County's intent to award the construction contract. If the option item of the contractor's bid selected by the County for performance of the Utility Work exceeds the amount of the preliminary estimated Utility Work, then subject to and in accordance with the limitations and conditions established by Subparagraph 2.1 hereof regarding the City's option to remove the Utility Work, the City will deposit an amount with the County which equals the total option item plus 5% of that amount for County construction/contract administration/compaction and backfill testing. Interest will accrue on the deposit balance and be used toward the cost of the Utility Work. In the event the final, actual cost of the Utility Work is less than the amount the City deposited, including all interest earned, but excluding the 5% for County construction/contract administration/compaction and backfill testing of the actual construction costs, the County will reimburse the City any excess escrow account funds. Should contract modifications occur that increase the cost of the Utility Work, or the estimated quantities of items provided by the City in Exhibit A are exceeded, the City will be notified by the County accordingly. The City will pay the County within thirty (30) calendar days of notification by the County to ensure that cash on deposit with the County is sufficient to fully fund the cost of the Utility Work. The County shall notify the City as soon as it becomes apparent the actual costs will overrun the award amount, and the City shall pay for the cost overruns (plus 5% administrative fee) within thirty (30) calendar days of notification by the County. However, failure of the County to so notify the City shall not relieve the City from its obligation to pay for the full cost of the Utility Work. Page 2 All deposits due to the County referenced in Section 2.2 above shall be mailed to: Finance Division Accounts Receivable Pinellas County Board of County Commissioners P. 0. Box 2438 Clearwater, FL 33757 2.3 The County will require the successful contractor to comply with the following conditions. The City shall be responsible for the costs attributed to said compliance with these conditions as part of the Utility Work: (A) Indemnify, hold harmless, pay on behalf of and defend the County and its agents and employees and the City and its agents and employees from and against all claims, damages, losses and expenses, including, but not limited to, attorney's fees, arising out of or resulting from the performance of the Project or the Utility Work; (B) Provide a dual obligee bond in the full amount of the Project, naming the City and the County as obligees; and (C) Provide insurance coverage with the County and the City named as additional insured entities and certificate holders with limits of $1,000,000 per occurrence and $2,000,000 in the aggregate for commercial general liability, statutory worker's compensation with employer's liability limit of $500,000, auto liability with a limit of $1,000,000 per accident and a commercial excess policy with a limit of $1,000,000. Coverage shall be primary and non- contributory and include waivers of subrogation in favor of the County and the City. County shall include insurance requirements and terms in bid document. 3. Joint Project Activities 3.1 The City will prepare, at its expense, the design of plans and specifications for all the City's necessary Utility Work and reimbursable Utility Work described above and will furnish to the County no later than October 19, 2017, complete and reproducible plans on standard size sheets (11" x 17" and 24" x 36"), together with a complete set of specifications covering all construction requirements for the Utility Work. These plans and specifications will be complete in every detail and will include a "Summary of Quantities" sheet and/or "Bill of Materials" identifying the items of work, with a final estimate of cost (Engineer's Estimate), required to accomplish the Utility Work said estimate to be satisfactory to the County. The plans and specifications will be signed and sealed by a Registered Professional Engineer in the State of Florida. 3.2 The City will coordinate the development of the Utility Work plans with the County's plans for the Project. The County, upon request by the City, will furnish all available roadway information required by the City for the coordination and development of the Utility Work plans, and the County will cooperate with the City to this end. Page 3 3.3 The City will obtain all necessary Florida Department of Transportation or other jurisdiction permits required for construction of the Utility Work. A copy of all permits required for said Utility Work will be provided to the County no later than November 30, 2017. 3.4 The County will issue a "Right-of-Way Utilization Permit" upon execution of the Agreement by both Parties. This permit will not be subject to any required fees. 3.5 All surveys for construction of the Utility Work will be furnished by the successful contractor, in accordance with the plans and specifications provided by the City. 3.6 The coordination of the City's Utility Work with that of the roadway contractor and other utilities and/or their contractors will be the responsibility of the County. The City will cooperate fully and immediately to resolve any delays in the construction of the project occurring as the result of the City's Utility Work. 3.7 All of the Utility Work done pursuant to this Agreement shall be done in substantial accordance with the plans and specifications of the City, which plans, and specifications are, by reference hereto, made a part hereof. All information required for field changes, change orders or supplemental agreements pertaining to the City's Utility Work will be promptly furnished to the County. 3.8 During construction of the City's Utility Work, the City will provide the necessary construction and engineering inspection for the City's Utility Work to determine if the Utility Work is in substantial compliance with the plans and specifications, and provide all required testing associated with the City's Utility Work, excluding backfill and compaction testing in accordance with Pinellas County Minimum Testing Frequency Requirements, and provide results to the County for same. The contractor shall contact the City's Engineering Inspection Division at 727-562-4591 within 24 hours prior to commencement of any City Utility Work to schedule the appropriate inspection and pressure testing. The City's inspector will immediately notify the County inspector of any objections to the Utility Work. 3.9 The City will participate in the design, utility coordination, pre-construction and other meetings as necessary for Project coordination. 3.10 All adjustment, relocations, repairs, maintenance, and incidental work ("Incidentals") required to be performed to the City's existing utilities for the Joint Project, not included in the Utility Work, will be the sole responsibility of the City. All such work is to be coordinated with the construction of this Joint Project and in a manner that will not cause delay to the County's Project contractor. 3.11 The City's comments and suggestions are invited and will be considered by the County; however, all services and work under the construction contract will be performed to the satisfaction of the County's Director of Public Works, who will decide all questions, difficulties and disputes of whatever nature which may arise under or by reason of such contract for Utility Work, the prosecution and fulfillment of the services thereunder, and the character, quality, Page4 amount and value thereof; and who's decision upon all claims, questions and disputes thereunder are final and conclusive upon the Parties hereto. 3.12 Upon completion of the entire Project, which will be determined jointly by the County and the City, the City will own, control, maintain and be responsible for all City utility facilities in accordance with the terms of the Right-of-Way Utilization Permit. The City will maintain and keep in repair, or cause to be maintained and kept in repair, all of such constructed utilities facilities. 3.13 The County will forward any accounting records, if requested, to the following City representative: Lan-Anh Nguyen City of Clearwater 100 S. Myrtle A venue Clearwater, FL 33756 3.14 Upon final payment to the contractor, the County intends to have its final and complete accounting of all costs incurred in connection with the work performed hereunder within three hundred sixty (360) days. All project costs records and accounts shall be subject to audit by a representative of the Company for a period of three (3) years after final close out of the Project. 3.15 Upon completion of the entire Project, the Contractor will supply "as built" ("Record") standard size sheet (11" x 17" or 24" x 36") Utility Work plans to the County, who in tum will within one hundred eighty (180) days, furnish the City with one (1) set. 3.16 Upon completion of the entire Project, the County will insure that any warranty, including materials, equipment, workmanship and closeout documents, by the contractor constructing and/or installing facilities related to the Utility Work in accordance with this Agreement, is assigned to the City. 4. Project Managers The primary contact for each of the Parties is: 4.1 The Project Manager for City of Clearwater shall be Lan-Anh Nguyen or their designee ("City's Project Manager"), whose telephone number is 727.562.4581 and whose post office address is 100 S. Myrtle Avenue, Clearwater, FL 33756. 4.2 The Project Manager for Pinellas County shall be Tim Clark or their designee ("County's Project Manager"), whose telephone number is 727.454.4408 and whose post office address is 14 S. Fort Harrison Avenue, Clearwater, FL 33756. 4.3 Each Party may designate a replacement Project Manager by giving written notice of such designation to the other party in accordance with this Agreement. Page 5 5. Records, Reports, and Inspection The County shall maintain financial records, accounting and purchasing information, and books and records for the Project. These books, records, and information shall comply with general accounting procedures. All documents related to the Project are public records and shall be retained and provided as required by law. 6. Compliance with Federal, State, County, and Local Laws Both Parties shall comply with all federal, state, county, and local laws, regulations, and ordinances at all times. 7. Responsibilities of the Parties The County and the City shall be fully responsible for their own acts of negligence and their respective agents' acts of negligence, when such agents are acting within the scope of their employment; and shall be liable for any damages resulting from said negligence to the extent permitted by Section 768.28, Florida Statutes. Nothing herein is intended to serve as a waiver of sovereign immunity by either the County or the City. Nothing herein shall be construed as consent by the County or City to be sued by third Parties in any matter arising out of this Agreement. 8. Discrimination The County and the City shall, during the performance of this Agreement, comply with all applicable provisions of federal, state and local laws and regulations pertaining to prohibited discrimination. 9. Assignment This Agreement may not be assigned. 10. Severability Should any section or part of any section of this Agreement be rendered void, invalid, or unenforceable by any court of law, for any reason, such a determination shall not render void, invalid, or unenforceable any other section or any part of any section of this Agreement. 11. Entire Agreement This Agreement constitutes the entire agreement between the Parties, and no change will be valid unless made by supplemental written agreement executed by both Parties. 12. Notification Page6 All notices, requests, demands, or other communications required by law, or this Agreement shall be in writing and shall be deemed to have been served as of the delivery date appearing upon the return receipt if sent by certified mail, postage prepaid with return receipt requested, if hand delivered, or upon the actual date of delivery to the Project Manager, whose address is set forth in Section 4 above. 13. Waiver No act of omission or commission of either Party, including without limitation, any failure to exercise any right, remedy, or recourse, shall be deemed to be a waiver, release, or modification of the same. Such a waiver, release, or modification is to be effected only through a written modification to this Agreement. 14. Due Authority Each Party to this Agreement represents and warrants to the other Party that (i) it is duly organized, qualified and existing entities under the laws of the State of Florida, and (ii) all appropriate authority exists so as to duly authorize the persons executing this Agreement to so execute the same and fully bind the party on whose behalf they are executing. 15. Headings The paragraph headings are inserted herein for convenience and reference only, and in no way define, limit, or otherwise describe the scope or intent of any provisions hereof. 16. Approval This Agreement is subject to approval by the City and the County. 17. Fiscal Funding The obligations of the Parties are subject to appropriate budgeted funds being available in each budget year to achieve the purposes of this Agreement. In the event that sufficient budgeted funds are not available in a subsequent fiscal year, this Agreement shall terminate on the last day of the fiscal year for which sufficient budgeted funds are available without penalty to either of the Parties. 18. Term The term of this Agreement shall commence upon execution of this Agreement by the Parties and shall terminate after completion and acceptance of the Utility Work and upon final payment in accordance with the provisions of Paragraph 3.14 of this Agreement. If the County fails to issue a Notice to Proceed to a contractor for the Project within three hundred sixty-five (365) days from the date of full execution of this Agreement by the Parties, this Agreement shall be deemed terminated and any payments made by the City to the County shall be refunded in full by the County within thirty (30) days. Page7 IN WITNESS WHEREOF the Parties hereto have caused this Agreement to be executed by their duly authorized representatives on the day and date first above written CITY OF CLEARWATER, FLORIDA, A municipal corporation and political subdivision of the State of Florida By: -({~ftt'\C"l \lPJJ ~~~~~~~~~~~~~ George N. Cretekos Mayor By: w~~.~-n ATTEST: William B. Home II City Manager Byk:~~ Rosemarie Call I y Clerk Assistant City Attorney OFFICIAL CITY SEAL PINELLAS COUNTY, FLORIDA by and through its Board of County Commissioners ATTEST: Ken Burke, Court APPROVED AS TO FORM OFFICE OF COUNTY AlTOANEV -~~k Page 8 . . , . ; ) MACOMBER AVE MACOMBER AVE CHENANGO AVE CHENANGO AVE COLES RD COLES RD PINELAND DR PINELAND DR SYLVAN DR SYLVAN DR DOUGLAS AVE DOUGLAS AVE N BETTY LN N BETTY LN KINGS HWYKINGS HWYSUNSET POINT RDSUNSET POINT RD LOCATION MAP CRM DN NA NA 08/21/2020Map Gen By:Reviewed By: S-T-R:Grid #: Date:Prepared by:Engineering DepartmentGeographic Technology Division100 S. Myrtle Ave, Clearwater, FL 33756Ph: (727)562-4750, Fax: (727)526-4755www.MyClearwater.com 17-0012-UTSunset Point at Betty Lane Utility Relocation JPA ² N.T.S.Scale: Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8095 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Engineering Department Agenda Number: 7.11 SUBJECT/RECOMMENDATION: Approve Construction Manager at Risk (CMAR) proposal from Skanska, Inc., of Tampa, FL, for installation of supportive infrastructure for Imagine Clearwater (17-0031-EN) at the Guaranteed Maximum Price (GMP) of $1,184,090 and authorize the appropriate officials to execute same. (consent) SUMMARY: December 19, 2019, City Council approved RFQ #52-19 selecting Skanska as CMAR to provide construction services for Imagine Clearwater and approved a proposal for Pre-Construction services in the amount of $425,000 to include design review and construction cost estimating. Existing Duke Energy utility facilities within Coachman Park must be modified to accommodate the new buildings and amenities planned within the Imagine Clearwater park design. Construction documents for the supportive infrastructure portion of the project are complete and Skanska has provided a GMP to construct this infrastructure in Coachman Park and adjacent City-owned lots located at 301 Drew Street, Clearwater. Construction for this work is scheduled to begin early September and will be completed in January of 2021. Use of the park space for certain programmed special events will be retained until late November 2020. APPROPRIATION CODE AND AMOUNT: ENGF180013-CONS-CNSTRC $1,184,090 Funds are available in capital improvement project ENGF180013, Imagine Clearwater, to fund the proposal. Page 1 City of Clearwater Printed on 9/3/2020 DREW ST PIERCE ST CLEVELAND ST N OSCEOLA AVE MEMORI ALCSWYS OSCEOLA AVE LAURA ST LOCATION MAP ²Prepared by:Engineering DepartmentGeographic Technology Division100 S. Myrtle Ave, Clearwater, FL 33756Ph: (727)562-4750, Fax: (727)526-4755www.MyClearwater.com JB CC N.T.S.286B 16-29s-15e11/27/2019Map Gen By:Reviewed By:S-T-R:Grid #:Date:Scale: Imagine Clearwater Boundary Document Path: C:\Users\james.benwell\City of Clearwater\Engineering Geographic Technology - Location Maps\ImagineClearwaterBoundary.mxd Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8103 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Engineering Department Agenda Number: 7.12 SUBJECT/RECOMMENDATION: Award a construction contract to David Nelson Construction Company, of Palm Harbor, Florida, for Invitation to Bid (ITB) 20-0029-EN 2021 Annual Stormwater Repairs in the annual amount of $1,500,000 for an initial one-year term with an option to renew for three additional one-year renewal terms on a unit price basis and authorize the appropriate officials to execute same. (consent) SUMMARY: Engineering issued ITB 20-0029-EN which closed on August 5, 2020. David Nelson Construction was the lowest most responsible bidder for this project. The intent on this project is to establish an annual contract for as -needed stormwater infrastructure improvements and repairs services. Projects covered by this contract will be of size and scale not feasible for city forces to complete. Projects included in this contract will typically include repair and replacement of existing stormwater pipe networks, erosion mitigation with the use of gabions or appropriate slope stability procedures, the addition of new stormwater infrastructure to help alleviate localized flooding, and emergency repairs. This is a unit price contract not to exceed $1,500,000 annually with an estimated start date of October 1, 2020. The City reserves the option to extend the contract on a yearly basis up to three additional one-year renewal terms. APPROPRIATION CODE AND AMOUNT: ENST180001-CONS-CNSTRC $1,500,000 Funds are available in Capital Improvement Project ENST180001, Storm System Improvements, to fund the contract and will be included in FY2022 through FY2024 Capital Improvement Programs for future renewals in the amount of $1,500,000 per year. Page 1 City of Clearwater Printed on 9/3/2020 2021 Stormwater Repairs 20-0029-EN BID OPENING - August 5, 2020 AWARD - September 3, 2020 Item #BID ITEMS UNIT QTY UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT1.0 MOBILIZATION AND SITE PREPARATION 1.1 MOBILIZATION EA 10 13,500.00$ 135,000.00$ 16,900.00$ 169,000.00$ 24,000.00$ 240,000.00$ 13,200.00$ 132,000.00$ 15,525.00$ 155,250.00$ 1.2 MAINTENANCE OF TRAFFIC EA 10 14,000.00$ 140,000.00$ 4,700.00$ 47,000.00$ 5,000.00$ 50,000.00$ 2,180.00$ 21,800.00$ 4,300.00$ 43,000.00$ 1.3 EROSION AND SEDIMENT CONTROL EA 10 1,736.00$ 17,360.00$ 2,100.00$ 21,000.00$ 2,500.00$ 25,000.00$ 1,270.00$ 12,700.00$ 870.00$ 8,700.00$ 2.0 EARTHWORK 2.1 UNSUITABLE MATERIAL REMOVAL & REPLACE CY 700 30.80$ 21,560.00$ 38.00$ 26,600.00$ 40.00$ 28,000.00$ 103.00$ 72,100.00$ 12.00$ 8,400.00$ 2.2 SWALE GRADING LF 200 25.20$ 5,040.00$ 30.00$ 6,000.00$ 25.00$ 5,000.00$ 34.00$ 6,800.00$ 70.00$ 14,000.00$ 2.3 PLUGGING & ABANDON IN-PLACE AND GROUT PIPE CY 100 270.00$ 27,000.00$ 310.00$ 31,000.00$ 840.00$ 84,000.00$ 253.00$ 25,300.00$ 180.00$ 18,000.00$ 2.4 EROSION PROTECTION- RIP RAP TN 100 196.00$ 19,600.00$ 120.00$ 12,000.00$ 325.00$ 32,500.00$ 655.00$ 65,500.00$ 63.00$ 6,300.00$ 2.5 GABION BASKETS CY 200 413.00$ 82,600.00$ 420.00$ 84,000.00$ 300.00$ 60,000.00$ 382.00$ 76,400.00$ 470.00$ 94,000.00$ 2.6 IMPORT FILL CY 100 24.50$ 2,450.00$ 23.00$ 2,300.00$ 62.00$ 6,200.00$ 44.00$ 4,400.00$ 22.00$ 2,200.00$ 3.0 DRAINAGE PIPE DEPTH ≤ 6’ 3.1 15" REINFORCED CONCRETE PIPE (RCP)LF 400 72.00$ 28,800.00$ 51.00$ 20,400.00$ 175.00$ 70,000.00$ 256.00$ 102,400.00$ 98.30$ 39,320.00$ 3.2 18" REINFORCED CONCRETE PIPE (RCP)LF 100 80.00$ 8,000.00$ 61.00$ 6,100.00$ 193.00$ 19,300.00$ 305.00$ 30,500.00$ 105.00$ 10,500.00$ 3.3 24" REINFORCED CONCRETE PIPE (RCP)LF 100 90.00$ 9,000.00$ 74.00$ 7,400.00$ 211.00$ 21,100.00$ 290.00$ 29,000.00$ 117.00$ 11,700.00$ 3.4 30" REINFORCED CONCRETE PIPE (RCP)LF 100 105.00$ 10,500.00$ 92.00$ 9,200.00$ 220.00$ 22,000.00$ 320.00$ 32,000.00$ 131.00$ 13,100.00$ 3.5 36" REINFORCED CONCRETE PIPE (RCP)LF 100 115.00$ 11,500.00$ 97.00$ 9,700.00$ 270.00$ 27,000.00$ 355.00$ 35,500.00$ 152.00$ 15,200.00$ 3.6 42" REINFORCED CONCRETE PIPE (RCP)LF 100 130.00$ 13,000.00$ 115.00$ 11,500.00$ 330.00$ 33,000.00$ 388.00$ 38,800.00$ 170.00$ 17,000.00$ 3.7 48" REINFORCED CONCRETE PIPE (RCP)LF 100 140.00$ 14,000.00$ 125.00$ 12,500.00$ 370.00$ 37,000.00$ 440.00$ 44,000.00$ 191.00$ 19,100.00$ 3.8 CITY STANDARD CURB INLET (S.D. A-9)EA 2 5,750.00$ 11,500.00$ 5,500.00$ 11,000.00$ 10,000.00$ 20,000.00$ 10,180.00$ 20,360.00$ 9,215.00$ 18,430.00$ 3.9 FDOT TYPE J-7T M.H. (5X5)EA 2 4,950.00$ 9,900.00$ 3,600.00$ 7,200.00$ 6,300.00$ 12,600.00$ 5,666.00$ 11,332.00$ 6,445.00$ 12,890.00$ 3.1 FDOT TYPE J-7T M.H. (6X6)EA 2 5,300.00$ 10,600.00$ 4,400.00$ 8,800.00$ 7,700.00$ 15,400.00$ 7,510.00$ 15,020.00$ 6,875.00$ 13,750.00$ 3.1 FDOT TYPE J-7T M.H. (6X7)EA 2 6,000.00$ 12,000.00$ 5,500.00$ 11,000.00$ 8,500.00$ 17,000.00$ 8,340.00$ 16,680.00$ 7,380.00$ 14,760.00$ 3.1 FDOT TYPE "F" D.B.I.EA 2 4,000.00$ 8,000.00$ 3,200.00$ 6,400.00$ 6,950.00$ 13,900.00$ 5,550.00$ 11,100.00$ 6,000.00$ 12,000.00$ 3.1 FDOT TYPE "C" D.B.I.EA 2 3,500.00$ 7,000.00$ 2,800.00$ 5,600.00$ 4,800.00$ 9,600.00$ 4,840.00$ 9,680.00$ 4,795.00$ 9,590.00$ PIPE DEPTH > 6’ ≤ 10’ 3.1 15" REINFORCED CONCRETE PIPE (RCP)LF 100 84.00$ 8,400.00$ 58.00$ 5,800.00$ 225.00$ 22,500.00$ 295.00$ 29,500.00$ 106.00$ 10,600.00$ 3.2 18" REINFORCED CONCRETE PIPE (RCP)LF 100 95.00$ 9,500.00$ 65.00$ 6,500.00$ 235.00$ 23,500.00$ 350.00$ 35,000.00$ 113.00$ 11,300.00$ 3.2 24" REINFORCED CONCRETE PIPE (RCP)LF 100 105.00$ 10,500.00$ 80.00$ 8,000.00$ 250.00$ 25,000.00$ 340.00$ 34,000.00$ 125.00$ 12,500.00$ 3.2 30" REINFORCED CONCRETE PIPE (RCP)LF 75 140.00$ 10,500.00$ 106.00$ 7,950.00$ 285.00$ 21,375.00$ 370.00$ 27,750.00$ 140.00$ 10,500.00$ 3.2 36" REINFORCED CONCRETE PIPE (RCP)LF 75 165.00$ 12,375.00$ 130.00$ 9,750.00$ 315.00$ 23,625.00$ 405.00$ 30,375.00$ 158.00$ 11,850.00$ 3.2 42" REINFORCED CONCRETE PIPE (RCP)LF 75 195.00$ 14,625.00$ 140.00$ 10,500.00$ 370.00$ 27,750.00$ 440.00$ 33,000.00$ 175.00$ 13,125.00$ 3.2 48" REINFORCED CONCRETE PIPE (RCP)LF 75 205.00$ 15,375.00$ 160.00$ 12,000.00$ 400.00$ 30,000.00$ 490.00$ 36,750.00$ 197.00$ 14,775.00$ 3.2 CITY STANDARD CURB INLET (S.D. A-9)EA 2 6,300.00$ 12,600.00$ 6,000.00$ 12,000.00$ 11,000.00$ 22,000.00$ 9,890.00$ 19,780.00$ 10,890.00$ 21,780.00$ 3.2 FDOT TYPE J-7T M.H. (5X5)EA 2 5,825.00$ 11,650.00$ 5,500.00$ 11,000.00$ 9,200.00$ 18,400.00$ 9,020.00$ 18,040.00$ 8,120.00$ 16,240.00$ 3.2 FDOT TYPE J-7T M.H. (6X6)EA 2 6,675.00$ 13,350.00$ 6,400.00$ 12,800.00$ 11,000.00$ 22,000.00$ 10,355.00$ 20,710.00$ 9,150.00$ 18,300.00$ 3.2 FDOT TYPE J-7T M.H. (6X7)EA 2 7,675.00$ 15,350.00$ 7,500.00$ 15,000.00$ 11,500.00$ 23,000.00$ 11,000.00$ 22,000.00$ 9,580.00$ 19,160.00$ 3.3 FDOT TYPE "F" D.B.I.EA 2 6,125.00$ 12,250.00$ 4,200.00$ 8,400.00$ 7,625.00$ 15,250.00$ 6,800.00$ 13,600.00$ 6,485.00$ 12,970.00$ 3.3 FDOT TYPE "C" D.B.I.EA 2 4,125.00$ 8,250.00$ 3,400.00$ 6,800.00$ 6,500.00$ 13,000.00$ 6,065.00$ 12,130.00$ 5,940.00$ 11,880.00$ 3.3 UNDERDRAIN REMOVAL AND REPLACEMENT (6" AND 8")LF 300 42.00$ 12,600.00$ 45.00$ 13,500.00$ 90.00$ 27,000.00$ 76.00$ 22,800.00$ 58.50$ 17,550.00$ 4.0 PAVING AND MARKING Steve's Excavating & Paving, Inc 1741 North Keene Rd Clearwater, FL 33755 David Nelson Construction 3489 Atlernate 19 Palm Harbor, FL 34683 Rowland Inc. 6855 102nd Ave. N. Pinellas Park, FL 33782 PCS Civil 6920 Asphalt Ave., Tampa, FL 33614 Keystone Excavators 371 Scarlet Blvd. Oldsmar, FL 34677 2021 Stormwater Repairs 20-0029-EN BID OPENING - August 5, 2020 AWARD - September 3, 2020 Item #BID ITEMS UNIT QTY UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT Steve's Excavating & Paving, Inc 1741 North Keene Rd Clearwater, FL 33755 David Nelson Construction 3489 Atlernate 19 Palm Harbor, FL 34683 Rowland Inc. 6855 102nd Ave. N. Pinellas Park, FL 33782 PCS Civil 6920 Asphalt Ave., Tampa, FL 33614 Keystone Excavators 371 Scarlet Blvd. Oldsmar, FL 34677 4.1 8" ROADWAY BASE (LBR 100)SY 3500 29.40$ 102,900.00$ 19.00$ 66,500.00$ 26.00$ 91,000.00$ 40.60$ 142,100.00$ 23.60$ 82,600.00$ 4.2 12" STABILIZED SUBGRADE (LBR 40)SY 3000 14.00$ 42,000.00$ 12.50$ 37,500.00$ 35.00$ 105,000.00$ 23.00$ 69,000.00$ 15.00$ 45,000.00$ 4.3 STRAIGHT CURB LF 200 29.40$ 5,880.00$ 24.00$ 4,800.00$ 110.00$ 22,000.00$ 78.00$ 15,600.00$ 31.00$ 6,200.00$ 4.4 HEADER CURB LF 200 25.20$ 5,040.00$ 28.00$ 5,600.00$ 110.00$ 22,000.00$ 78.00$ 15,600.00$ 31.00$ 6,200.00$ 4.5 CITY MODIFIED CURB LF 1000 30.80$ 30,800.00$ 28.00$ 28,000.00$ 105.00$ 105,000.00$ 78.00$ 78,000.00$ 31.00$ 31,000.00$ 4.6 CITY TYPE I CURB LF 1000 30.80$ 30,800.00$ 28.00$ 28,000.00$ 108.00$ 108,000.00$ 78.00$ 78,000.00$ 31.00$ 31,000.00$ 4.7 VALLEY GUTTER CURB LF 1000 43.40$ 43,400.00$ 28.00$ 28,000.00$ 110.00$ 110,000.00$ 78.00$ 78,000.00$ 33.00$ 33,000.00$ 4.8 R&R 4" CONCRETE SIDEWALK SF 1500 9.00$ 13,500.00$ 8.00$ 12,000.00$ 20.00$ 30,000.00$ 7.00$ 10,500.00$ 6.75$ 10,125.00$ 4.9 R&R CONCRETE DRIVEWAY RESTORATION SF 2500 10.00$ 25,000.00$ 12.00$ 30,000.00$ 30.00$ 75,000.00$ 16.40$ 41,000.00$ 8.00$ 20,000.00$ 4.1 PEDESTRIAN RAMPS W/ DETECTABLE WARNING EA 5 1,350.00$ 6,750.00$ 2,100.00$ 10,500.00$ 300.00$ 1,500.00$ 3,430.00$ 17,150.00$ 3,500.00$ 17,500.00$ MILLING / PAVING 4.1 MILLING (UP TO 2")SY 4500 6.30$ 28,350.00$ 12.00$ 54,000.00$ 29.00$ 130,500.00$ 70.90$ 319,050.00$ 18.00$ 81,000.00$ 4.1 MILLING (2" - 4")SY 2500 8.50$ 21,250.00$ 16.00$ 40,000.00$ 29.00$ 72,500.00$ 74.80$ 187,000.00$ 20.75$ 51,875.00$ 4.1 SUPERPAVE ASPHALT CONCRETE, TYPE SP 12.5 TN 100 185.00$ 18,500.00$ 190.00$ 19,000.00$ 245.00$ 24,500.00$ 593.00$ 59,300.00$ 325.00$ 32,500.00$ 4.1 SUPERPAVE ASPHALT CONCRETE, TYPE SP 9.5 TN 400 185.00$ 74,000.00$ 250.00$ 100,000.00$ 205.00$ 82,000.00$ 561.00$ 224,400.00$ 330.00$ 132,000.00$ 5.0 LANDSCAPING AND RESTORATION 5.1 TREE REMOVAL (0” – 12” DIAMETER)EA 20 1,250.00$ 25,000.00$ 800.00$ 16,000.00$ 500.00$ 10,000.00$ 780.00$ 15,600.00$ 595.00$ 11,900.00$ 5.2 TREE REMOVAL (13” – 24” DIAMETER)EA 15 2,200.00$ 33,000.00$ 2,000.00$ 30,000.00$ 1,000.00$ 15,000.00$ 2,026.00$ 30,390.00$ 2,185.00$ 32,775.00$ 5.3 TREE REMOVAL (25” – 48” DIAMETER)EA 4 6,000.00$ 24,000.00$ 3,300.00$ 13,200.00$ 4,000.00$ 16,000.00$ 4,990.00$ 19,960.00$ 3,250.00$ 13,000.00$ 5.4 TREE REMOVAL (GREATER than 42” DIA.)EA 1 7,500.00$ 7,500.00$ 4,500.00$ 4,500.00$ 4,000.00$ 4,000.00$ 6,235.00$ 6,235.00$ 6,550.00$ 6,550.00$ 5.5 TREE BARRICADE LF 1000 4.20$ 4,200.00$ 6.00$ 6,000.00$ 5.00$ 5,000.00$ 9.00$ 9,000.00$ 10.00$ 10,000.00$ 5.6 SOD RESTORATION (IN KIND)SF 40000 0.98$ 39,200.00$ 0.80$ 32,000.00$ 0.75$ 30,000.00$ 1.00$ 40,000.00$ 1.95$ 78,000.00$ 5.7 ROOT PRUNING LF 1000 9.00$ 9,000.00$ 8.00$ 8,000.00$ 10.00$ 10,000.00$ 12.50$ 12,500.00$ 8.00$ 8,000.00$ SUBTOTAL 1,361,805.00$ 1,239,300.00$ 2,232,000.00$ 2,637,192.00$ 1,499,945.00$ 6.0 STORMWATER CONTINGENCY LS 1 75,000.00$ 75,000.00$ 75,000.00$ 75,000.00$ 75,000.00$ 75,000.00$ 75,000.00$ 75,000.00$ 75,000.00$ 75,000.00$ 7.0 SANITARY CONFLICT CONTINGENCY LS 1 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 8.0 WATERMAIN CONFLICT CONTINGENCY LS 1 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ 20,000.00$ BIDDER'S GRAND TOTAL 1,476,805.00$ 1,354,300.00$ 2,347,000.00$ 2,752,192.00$ 1,614,945.00$ SECTION V Page i Updated: 5/4/2020 SECTION V CONTRACT DOCUMENTS Table of Contents PUBLIC CONSTRUCTION BOND ......................................................................................................... 1 CONTRACT ................................................................................................................................................ 4 CONSENT OF SURETY TO FINAL PAYMENT .................................................................................. 8 PROPOSAL/BID BOND ............................................................................................................................ 9 AFFIDAVIT .............................................................................................................................................. 10 NON-COLLUSION AFFIDAVIT ........................................................................................................... 11 PROPOSAL ............................................................................................................................................... 12 CITY OF CLEARWATER ADDENDUM SHEET ............................................................................... 14 BIDDER’S PROPOSAL ........................................................................................................................... 15 SCRUTINIZED COMPANIES AND BUSINESS OPERATIONS WITH CUBA AND SYRIA CERTIFICATION FORM ....................................................................................................................... 18 SCRUTINIZED COMPANIES THAT BOYCOTT ISRAEL LIST CERTIFICATION FORM...... 19 SECTION V – Contract Documents SECTION V Page 1 of 19 Updated: 5/4/2020 Bond No.: ________________ PUBLIC CONSTRUCTION BOND (1) This bond is given to comply with § 255.05, Florida Statutes, and any action instituted by a claimant under this bond for payment must be in accordance with the notice and time limitation provisions in subsections (2) and (10). Pursuant to § 255.05(1)(b), Florida Statutes, “Before commencing the work or before recommencing the work after a default or abandonment, the contractor shall provide to the public entity a certified copy of the recorded bond. Notwithstanding the terms of the contract or any other law governing prompt payment for construction services, the public entity may not make a payment to the contractor until the contractor has complied with this paragraph.” CONTRACTOR SURETY OWNER David Nelson Construction Company 3489 Alternate 19 Palm Harbor, FL 34683 727-784-7624 [name] [principal business address] [phone number] City of Clearwater Engineering 100 S. Myrtle Avenue Clearwater, FL 33756 (727) 562-4750 PROJECT NAME: 2021 STORMWATER REPAIRS PROJECT NO.: 20-0029-EN PROJECT DESCRIPTION: This is an annual contract for on-call services for Stormwater infrastructure improvements and repairs. The successful contractor will be required to enter a contract with the City of Clearwater and provide all labor, equipment, and materials for Stormwater infrastructure improvements and repairs. BY THIS BOND, We David Nelson Construction Company, as Contractor, and __________________________________________________, a corporation, as Surety, are bound to the City of Clearwater, Florida, herein called Owner, in the sum of $1,500,000.00, for payment of which we bind ourselves, our heirs, personal representatives, successors, and assigns, jointly and severally. THE CONDITION OF THIS BOND is that if Contractor: 1. Performs the contract dated _________________, between Contractor and Owner for construction of 2021 Stormwater Repairs, the contract documents being made a part of this bond by reference (which include the Advertisement for Bids, Proposal, Contract, Surety Bond, Instructions to Bidders, General Conditions, Plans, Technical Specifications and Appendix, and such alterations as may be made in said Plans and Specifications as therein provided for), at the times and in the manner prescribed in the contract; and SECTION V – Contract Documents SECTION V Page 2 of 19 Updated: 5/4/2020 2. Promptly makes payments to all claimants, as defined in Section 255.05(1), Florida Statutes, supplying Contractor with labor, materials, or supplies, used directly or indirectly by Contractor in the prosecution of the work provided for in the contract; and SECTION V – Contract Documents SECTION V Page 3 of 19 Updated: 5/4/2020 Bond No.:________________ PUBLIC CONSTRUCTION BOND (2) 3. Pays Owner all losses, damages, expenses, costs, and attorney’s fees, including appellate proceedings, that Owner sustains because of a default by Contractor under the contract; and 4. To the limits of § 725.06(2), Florida Statutes, shall indemnify and hold harmless Owner, their officers and employees, from liabilities, damages, losses and costs, including, but not limited to, reasonable attorney’s fees, to the extent caused by the negligence, recklessness, or intentional wrongful misconduct of Contractor and persons employed or utilized by Contractor in the performance of the construction contract; and 5. Performs the guarantee of all work and materials furnished under the contract for the time specified in the contract, then this bond is void; otherwise it remains in full force. 6. Any action instituted by a claimant under this bond for payment must be in accordance with the notice and time limitation provisions in Section 255.05(2), Florida Statutes. 7. Any changes in or under the contract documents and compliance or noncompliance with any formalities connected with the contract or the changes does not affect Surety’s obligation under this bond, and Surety does hereby waive notice of any such change, extension of time, alteration or addition to the terms of the contract or to the work or to the specifications. IN TESTIMONY WHEREOF, witness the hands and seals of the parties hereto this __________ day of ________________, 20___. (If sole Ownership or Partnership, two (2) Witnesses required). (If Corporation, Secretary only will attest and affix seal). David Nelson Construction Co. By: ____________________________ Title: ____________________________ Print Name: ____________________________ WITNESS: WITNESS: _______________________________________ _______________________________________ Corporate Secretary or Witness Print Name: ____________________________ Print Name: _____________________________ (affix corporate seal) _______________________________________ (Corporate Surety) By: _________________________________ ATTORNEY-IN-FACT Print Name: ___________________________ (affix corporate seal) (Power of Attorney must be attached) SECTION V – Contract Documents SECTION V Page 4 of 19 Updated: 5/4/2020 CONTRACT (1) This CONTRACT made and entered into this ___ day of ____________, 20___ by and between the City of Clearwater, Florida, a municipal corporation, hereinafter designated as the "City", and David Nelson Construction Company, of the City of _Palm Harbor County of Pinellas and State of Florida, hereinafter designated as the "Contractor". [Or, if out of state:] This CONTRACT made and entered into this ___ day of ____________, 20___ by and between the City of Clearwater, Florida, a municipal corporation, hereinafter designated as the "City", and _____________________________________, a/an _____________(State) Corporation authorized to do business in the State of Florida, of the City of ____________________ County of __________________________ and State of ____________, hereinafter designated as the "Contractor". WITNESSETH: That the parties to this contract each in consideration of the undertakings, promises and agreements on the part of the other herein contained, do hereby undertake, promise and agree as follows: The Contractor, and his or its successors, assigns, executors or administrators, in consideration of the sums of money as herein after set forth to be paid by the City and to the Contractor, shall and will at their own cost and expense perform all labor, furnish all materials, tools and equipment for the following: PROJECT NAME: 2021 STORMWATER REPAIRS PROJECT NO.: 20-0029-EN in the amount of $1,500,000.00 In accordance with such proposal and technical supplemental specifications and such other special provisions and drawings, if any, which will be submitted by the City, together with any advertisement, instructions to bidders, general conditions, technical specifications, proposal and bond, which may be hereto attached, and any drawings if any, which may be herein referred to, are hereby made a part of this contract, and all of said work to be performed and completed by the contractor and its successors and assigns shall be fully completed in a good and workmanlike manner to the satisfaction of the City. If the Contractor should fail to comply with any of the terms, conditions, provisions or stipulations as contained herein within the time specified for completion of the work to be performed by the Contractor, then the City, may at its option, avail itself of any or all remedies provided on its behalf and shall have the right to proceed to complete such work as Contractor is obligated to perform in accordance with the provisions as contained herein. SECTION V – Contract Documents SECTION V Page 5 of 19 Updated: 5/4/2020 CONTRACT (2) THE CONTRACTOR AND HIS OR ITS SUCCESSORS AND ASSIGNS DOES HEREBY AGREE TO ASSUME THE DEFENSE OF ANY LEGAL ACTION WHICH MAY BE BROUGHT AGAINST THE CITY AS A RESULT OF THE CONTRACTOR'S ACTIVITIES ARISING OUT OF THIS CONTRACT AND FURTHERMORE, IN CONSIDERATION OF THE TERMS, STIPULATIONS AND CONDITIONS AS CONTAINED HEREIN, AGREES TO HOLD THE CITY FREE AND HARMLESS FROM ANY AND ALL CLAIMS FOR DAMAGES, COSTS OF SUITS, JUDGMENTS OR DECREES RESULTING FROM ANY CLAIMS MADE UNDER THIS CONTRACT AGAINST THE CITY OR THE CONTRACTOR OR THE CONTRACTOR'S SUB CONTRACTORS, AGENTS, SERVANTS OR EMPLOYEES RESULTING FROM ACTIVITIES BY THE AFOREMENTIONED CONTRACTOR, SUB CONTRACTOR, AGENT SERVANTS OR EMPLOYEES, TO THE LIMITS OF § 725.06(2). In addition to the foregoing provisions, the Contractor agrees to conform to the following requirements: In connection with the performance of work under this contract, the Contractor agrees not to discriminate against any employee or applicant for employment because of race, sex, religion, color, or national origin. The aforesaid provision shall include, but not be limited to, the following: employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; lay off or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Contractor agrees to post hereafter in conspicuous places, available for employees or applicants for employment, notices to be provided by the contracting officer setting forth the provisions of the non-discrimination clause. The Contractor further agrees to insert the foregoing provisions in all contracts hereunder, including contracts or agreements with labor unions and/or worker's representatives, except sub-contractors for standard commercial supplies or raw materials. It is mutually agreed between the parties hereto that time is of the essence of this contract, and in the event that the work to be performed by the Contractor is not completed within the time stipulated herein, it is then further agreed that the City may deduct from such sums or compensation as may be due to the Contractor the sum of $1,000.00 per day for each day that the work to be performed by the Contractor remains incomplete beyond the time limit specified herein, which sum of $1,000.00 per day shall only and solely represent damages which the City has sustained by reason of the failure of the Contractor to complete the work within the time stipulated, it being further agreed that this sum is not to be construed as a penalty but is only to be construed as liquidated damages for failure of the Contractor to complete and perform all work within the time period as specified in this contract. It is further mutually agreed between the City and the Contractor that if, any time after the execution of this contract and the public construction bond which is attached hereto for the faithful performance of the terms and conditions as contained herein by the Contractor, that the City shall at any time deem the surety or sureties upon such public construction bond to be unsatisfactory or if, for any reason, the said bond ceases to be adequate in amount to cover the performance of the work the Contractor shall, at his or its own expense, within ten (10) days after receipt of written notice from the City to do so, furnish an additional bond or bonds in such term and amounts and with such surety or sureties as shall be satisfactory to the City. If such an event occurs, no further payment shall be made to the Contractor under the terms and provisions of this contract until such new or additional security bond guaranteeing the faithful performance of the work under the terms hereof shall be completed and furnished to the City in a form satisfactory to it. SECTION V – Contract Documents SECTION V Page 6 of 19 Updated: 5/4/2020 CONTRACT (3) In addition to all other contract requirements as provided by law, the contractor executing this agreement agrees to comply with public records law. IF THE CONTRACTOR HAS QUESTIONS REGARDING THE APPLICATION OF CHAPTER 119, FLORIDA STATUTES, THE CONTRACTORS DUTY TO PROVIDE PUBLIC RECORDS RELATING TO THIS CONTRACT. CONTACT THE CUSTODIAN OF PUBLIC RECORDS AT 727-562-4092, Rosemarie.Call@myclearwater.com, 600 Cleveland St. Clearwater, FL 33756 The contractor’s agreement to comply with public records law applies specifically to: a) Keep and maintain public records required by the City of Clearwater (hereinafter “public agency”) to perform the service being provided by the contractor hereunder. b) Upon request from the public agency’s custodian of public records, provide the public agency with a copy of the requested records or allow the records to be inspected or copied within a reasonable time at a cost that does not exceed the cost provided for in Chapter 119, Florida Statutes, as may be amended from time to time, or as otherwise provided by law. c) Ensure that the public records that are exempt or confidential and exempt from public records disclosure requirements are not disclosed except as authorized by law for the duration of the contract term and following completion of the contract if the contractor does not transfer the records to the public agency. d) Upon completion of the contract, transfer, at no cost, to the public agency all public records in possession of the contractor or keep and maintain public records required by the public agency to perform the service. If the contractor transfers all public records to the public agency upon completion of the contract, the contractor shall destroy any duplicate public records that are exempt or confidential and exempt from public records disclosure requirements. If the contractor keeps and maintains public records upon completion of the contract, the contractor shall meet all applicable requirements for retaining public records. All records stored electronically must be provided to the public agency, upon request from the public agency’s custodian of public records, in a format that is compatible with the information technology systems of the public agency. e) A request to inspect or copy public records relating to a public agency’s contract for services must be made directly to the public agency. If the public agency does not possess the requested records, the public agency shall immediately notify the contractor of the request and the contractor must provide the records to the public agency or allow the records to be inspected or copied within a reasonable time. f) The contractor hereby acknowledges and agrees that if the contractor does not comply with the public agency’s request for records, the public agency shall enforce the contract provisions in accordance with the contract. g) A contractor who fails to provide the public records to the public agency within a reasonable time may be subject to penalties under Section 119.10, Florida Statutes. h) If a civil action is filed against a contractor to compel production of public records relating to a public agency’s contract for services, the court shall assess and award against the contractor the reasonable costs of enforcement, including reasonable attorney fees, if: 1. The court determines that the contractor unlawfully refused to comply with the public records request within a reasonable time; and SECTION V – Contract Documents SECTION V Page 7 of 19 Updated: 5/4/2020 CONTRACT (4) 2. At least 8 business days before filing the action, the plaintiff provided written notice of the public records request, including a statement that the contractor has not complied with the request, to the public agency and to the contractor. i) A notice complies with subparagraph (h)2. if it is sent to the public agency’s custodian of public records and to the contractor at the contractor’s address listed on its contract with the public agency or to the contractor’s registered agent. Such notices must be sent by common carrier delivery service or by registered, Global Express Guaranteed, or certified mail, with postage or shipping paid by the sender and with evidence of delivery, which may be in an electronic format. j) A contractor who complies with a public records request within 8 business days after the notice is sent is not liable for the reasonable costs of enforcement. IN WITNESS WHEREOF, the parties to the agreement have hereunto set their hands and seals and have executed this Agreement, the day and year first above written. CITY OF CLEARWATER IN PINELLAS COUNTY, FLORIDA By: __________________________________ (SEAL) William B. Horne, II City Manager Attest: Countersigned: __________________________________________ Rosemarie Call City Clerk By: __________________________________ Approved as to form: Frank Hibbard Mayor __________________________________________ Owen Kohler Assistant City Attorney Contractor must indicate whether: ______ Corporation, ______ Partnership, ______ Company, or ______ Individual __________________________________________ (Contractor) By: _________________________ (SEAL) Print Name: ________________________________ Title: _____________________________________ The person signing shall, in his own handwriting, sign the Principal's name, his own name, and his title; where the person is signing for a Corporation, he must, by Affidavit, show his authority to bind the Corporation – provide Affidavit. SECTION V – Contract Documents SECTION V Page 8 of 19 Updated: 5/4/2020 CONSENT OF SURETY TO FINAL PAYMENT TO OWNER: City of Clearwater PROJECT NAME: 2021 STORMWATER REPAIRS Engineering PROJECT NO.: 20-0029-EN 100 S. Myrtle Ave. CONTRACT DATE: [__________] Clearwater, FL 33756 BOND NO.: [__________], recorded in O.R. Book [____], Page [____], of the Public Records of Pinellas County, Florida. CONTRACTOR: [___ _] Pursuant to § 255.05(11), Florida Statutes, and in accordance with the provisions of the Contract between the Owner and the Contractor as indicated above, the: [insert name of Surety] [address] [address] ,SURETY, on bond of David Nelson Construction Company 3483 Alternate 19 Palm Harbor, FL 34683 ,CONTRACTOR, hereby approves of the final payment to the Contractor, and agrees that final payment to the Contractor shall not relieve Surety of any of its obligations to City of Clearwater Engineering 100 S. Myrtle Ave. Clearwater, FL 33756 ,OWNER, as set forth in said Surety’s bond. IN WITNESS WHEREOF, the Surety has hereunto set its hand this ___ day of ___________, ______ __________________________________________ (Surety) __________________________________________ (Signature of authorized representative) __________________________________________ (Printed name and title) Attest: (Seal): Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8104 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Engineering Department Agenda Number: 7.13 SUBJECT/RECOMMENDATION: Award a construction contract to Shenandoah General Construction Company, of Pompano Beach, Florida, for Invitation to Bid (ITB) 20-0019-EN 2021 Stormwater Pipe Cleaning in the annual amount of $400,000 for an initial one-year term with an option to renew for three additional one-year renewal terms on a unit price basis and authorize the appropriate officials to execute same. (consent) SUMMARY: Engineering issued ITB 20-0019-EN which closed on July 28, 2020. Shenandoah General Construction Company was the lowest most responsible bidder for this project. The intent on this project is to establish an annual contract for the cleaning and video inspection of stormwater infrastructure at various locations throughout the City of Clearwater. Stormwater infrastructure experiences decreased capacity when sand, tree roots, barnacles, and many other types of debris collect in the conveyance system. This contract will involve removal of debris to improve the function and integrity of the Stormwater infrastructure. The City of Clearwater Engineering Department will direct the contractor to high priority pipe systems as established by review of inspection reports and maintenance records. This is a unit price contract not to exceed a total of $400,000 annually with an estimated start date of October 1, 2020. The City reserves the option to extend the contract on an annual basis up to three additional one-year renewal terms. APPROPRIATION CODE AND AMOUNT: ENST180001-CONS-CNSTRC $400,000 Funds are available in Capital Improvement Project ENST180001, Storm System Improvements, to fund the contract and will be included in FY2022 through FY2024 Capital Improvement Program for future renewals in the amount of $400,000 per year. Page 1 City of Clearwater Printed on 9/3/2020 BID ITEMS UNIT QTY UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT UNIT PRICE AMOUNT General 1 Project Sign LS 1 1,500.00$ 1,500.00$ 0.01$ 0.01$ -$ 1,500.00$ 1,500.00$ 3,500.00$ 3,500.00$ 2,500.00$ 2,500.00$ 250.00$ 250.00$ 1,500.00$ 1,500.00$ 2 Easement Set-up EA 10 1,000.00$ 10,000.00$ 1,000.00$ 10,000.00$ -$ 600.00$ 6,000.00$ 500.00$ 5,000.00$ 100.00$ 1,000.00$ 1,000.00$ 10,000.00$ 2,400.00$ 24,000.00$ 3 Root Cutting LF 500 17.00$ 8,500.00$ 10.00$ 5,000.00$ -$ 5.00$ 2,500.00$ 12.00$ 6,000.00$ 20.00$ 10,000.00$ 5.00$ 2,500.00$ 10.00$ 5,000.00$ 4 Cleaning Video Recording LF 20000 4.00$ 80,000.00$ 1.00$ 20,000.00$ -$ 5.00$ 100,000.00$ 10.00$ 200,000.00$ 0.25$ 5,000.00$ 1.50$ 30,000.00$ 4.10$ 82,000.00$ 5 Headwall/Upstream Structure Restoration (Grout/Seal)CY 5 2,000.00$ 10,000.00$ 750.00$ 3,750.00$ -$ 1,000.00$ 5,000.00$ 1,500.00$ 7,500.00$ 3,000.00$ 15,000.00$ 300.00$ 1,500.00$ 1,800.00$ 9,000.00$ 6 Outfall Concrete Restoration CY 50 750.00$ 37,500.00$ 300.00$ 15,000.00$ -$ 750.00$ 37,500.00$ 500.00$ 25,000.00$ 1,000.00$ 50,000.00$ 100.00$ 5,000.00$ 275.00$ 13,750.00$ 7 Clean and Paint Tideflex Valve EA 20 500.00$ 10,000.00$ 500.00$ 10,000.00$ -$ 525.00$ 10,500.00$ 1,200.00$ 24,000.00$ 750.00$ 15,000.00$ 500.00$ 10,000.00$ 350.00$ 7,000.00$ Light Cleaning (0-9% accumulated debris vs. pipe volume) 8 ≤12" Diameter Pipe LF 500 3.00$ 1,500.00$ 5.00$ 2,500.00$ -$ 6.00$ 3,000.00$ 4.00$ 2,000.00$ 5.25$ 2,625.00$ 8.00$ 4,000.00$ 6.50$ 3,250.00$ 9 15" Diameter Pipe LF 1000 4.00$ 4,000.00$ 7.00$ 7,000.00$ -$ 8.00$ 8,000.00$ 4.00$ 4,000.00$ 5.50$ 5,500.00$ 10.00$ 10,000.00$ 7.50$ 7,500.00$ 10 18" Diameter Pipe LF 1000 5.00$ 5,000.00$ 9.00$ 9,000.00$ -$ 9.00$ 9,000.00$ 4.00$ 4,000.00$ 6.75$ 6,750.00$ 12.00$ 12,000.00$ 8.65$ 8,650.00$ 11 24" Diameter Pipe LF 1000 6.00$ 6,000.00$ 11.00$ 11,000.00$ -$ 10.00$ 10,000.00$ 5.00$ 5,000.00$ 7.75$ 7,750.00$ 15.00$ 15,000.00$ 9.95$ 9,950.00$ 12 30" Diameter Pipe LF 1000 7.00$ 7,000.00$ 13.00$ 13,000.00$ -$ 11.00$ 11,000.00$ 5.00$ 5,000.00$ 8.25$ 8,250.00$ 18.00$ 18,000.00$ 11.50$ 11,500.00$ 13 36" Diameter Pipe LF 1000 8.00$ 8,000.00$ 15.00$ 15,000.00$ -$ 11.50$ 11,500.00$ 5.00$ 5,000.00$ 8.75$ 8,750.00$ 20.00$ 20,000.00$ 14.00$ 14,000.00$ 14 42" Diameter Pipe LF 1000 9.00$ 9,000.00$ 17.00$ 17,000.00$ -$ 12.00$ 12,000.00$ 6.00$ 6,000.00$ 9.75$ 9,750.00$ 25.00$ 25,000.00$ 15.75$ 15,750.00$ 15 48" Diameter Pipe LF 1000 10.00$ 10,000.00$ 19.00$ 19,000.00$ -$ 13.00$ 13,000.00$ 6.00$ 6,000.00$ 10.75$ 10,750.00$ 30.00$ 30,000.00$ 18.50$ 18,500.00$ 16 54" Diameter Pipe LF 1000 11.00$ 11,000.00$ 21.00$ 21,000.00$ -$ 20.00$ 20,000.00$ 6.00$ 6,000.00$ 11.75$ 11,750.00$ 35.00$ 35,000.00$ 22.50$ 22,500.00$ 17 60" Diameter Pipe LF 1000 12.00$ 12,000.00$ 25.00$ 25,000.00$ -$ 23.00$ 23,000.00$ 6.00$ 6,000.00$ 14.75$ 14,750.00$ 40.00$ 40,000.00$ 27.00$ 27,000.00$ Medium Cleaning (10-29% accumulated debris vs. pipe volume) 18 ≤12" Diameter Pipe LF 250 5.00$ 1,250.00$ 7.00$ 1,750.00$ -$ 7.00$ 1,750.00$ 6.00$ 1,500.00$ 6.50$ 1,625.00$ 10.00$ 2,500.00$ 8.50$ 2,125.00$ 19 15" Diameter Pipe LF 500 6.00$ 3,000.00$ 9.00$ 4,500.00$ -$ 9.00$ 4,500.00$ 6.00$ 3,000.00$ 6.50$ 3,250.00$ 12.00$ 6,000.00$ 12.00$ 6,000.00$ 20 18" Diameter Pipe LF 500 7.00$ 3,500.00$ 11.00$ 5,500.00$ -$ 10.00$ 5,000.00$ 6.00$ 3,000.00$ 7.00$ 3,500.00$ 15.00$ 7,500.00$ 13.00$ 6,500.00$ 21 24" Diameter Pipe LF 500 8.00$ 4,000.00$ 13.00$ 6,500.00$ -$ 11.00$ 5,500.00$ 8.00$ 4,000.00$ 8.00$ 4,000.00$ 20.00$ 10,000.00$ 13.85$ 6,925.00$ 22 30" Diameter Pipe LF 500 9.00$ 4,500.00$ 15.00$ 7,500.00$ -$ 12.00$ 6,000.00$ 8.00$ 4,000.00$ 9.00$ 4,500.00$ 25.00$ 12,500.00$ 14.25$ 7,125.00$ 23 36" Diameter Pipe LF 500 10.00$ 5,000.00$ 17.00$ 8,500.00$ -$ 12.50$ 6,250.00$ 8.00$ 4,000.00$ 10.75$ 5,375.00$ 30.00$ 15,000.00$ 15.50$ 7,750.00$ 24 42" Diameter Pipe LF 500 11.00$ 5,500.00$ 19.00$ 9,500.00$ -$ 13.00$ 6,500.00$ 8.00$ 4,000.00$ 15.25$ 7,625.00$ 35.00$ 17,500.00$ 18.50$ 9,250.00$ 25 48" Diameter Pipe LF 500 12.00$ 6,000.00$ 21.00$ 10,500.00$ -$ 15.50$ 7,750.00$ 10.00$ 5,000.00$ 16.75$ 8,375.00$ 40.00$ 20,000.00$ 21.00$ 10,500.00$ 26 54" Diameter Pipe LF 500 14.00$ 7,000.00$ 23.00$ 11,500.00$ -$ 23.00$ 11,500.00$ 10.00$ 5,000.00$ 17.75$ 8,875.00$ 45.00$ 22,500.00$ 27.50$ 13,750.00$ 27 60" Diameter Pipe LF 500 16.00$ 8,000.00$ 27.00$ 13,500.00$ -$ 28.00$ 14,000.00$ 10.00$ 5,000.00$ 18.75$ 9,375.00$ 50.00$ 25,000.00$ 37.00$ 18,500.00$ Heavy Cleaning (30% and greater accumulated debris vs. pipe volume) 28 ≤12" Diameter Pipe LF 200 10.00$ 2,000.00$ 10.00$ 2,000.00$ -$ 9.50$ 1,900.00$ 8.00$ 1,600.00$ 8.00$ 1,600.00$ 15.00$ 3,000.00$ 10.00$ 2,000.00$ 29 15" Diameter Pipe LF 500 12.00$ 6,000.00$ 12.00$ 6,000.00$ -$ 10.50$ 5,250.00$ 8.00$ 4,000.00$ 10.00$ 5,000.00$ 20.00$ 10,000.00$ 12.75$ 6,375.00$ 30 18" Diameter Pipe LF 500 14.00$ 7,000.00$ 13.00$ 6,500.00$ -$ 11.50$ 5,750.00$ 10.00$ 5,000.00$ 15.00$ 7,500.00$ 25.00$ 12,500.00$ 13.95$ 6,975.00$ 31 24" Diameter Pipe LF 750 16.00$ 12,000.00$ 15.00$ 11,250.00$ -$ 13.00$ 9,750.00$ 10.00$ 7,500.00$ 17.00$ 12,750.00$ 30.00$ 22,500.00$ 18.35$ 13,762.50$ 32 30" Diameter Pipe LF 500 17.00$ 8,500.00$ 17.00$ 8,500.00$ -$ 15.00$ 7,500.00$ 12.00$ 6,000.00$ 20.00$ 10,000.00$ 35.00$ 17,500.00$ 19.00$ 9,500.00$ 33 36" Diameter Pipe LF 750 19.00$ 14,250.00$ 19.00$ 14,250.00$ -$ 18.00$ 13,500.00$ 12.00$ 9,000.00$ 25.50$ 19,125.00$ 40.00$ 30,000.00$ 23.75$ 17,812.50$ 34 42" Diameter Pipe LF 500 22.00$ 11,000.00$ 21.00$ 10,500.00$ -$ 19.50$ 9,750.00$ 12.00$ 6,000.00$ 26.50$ 13,250.00$ 45.00$ 22,500.00$ 26.75$ 13,375.00$ 35 48" Diameter Pipe LF 750 25.00$ 18,750.00$ 25.00$ 18,750.00$ -$ 21.00$ 15,750.00$ 16.00$ 12,000.00$ 27.50$ 20,625.00$ 50.00$ 37,500.00$ 26.75$ 20,062.50$ 36 54" Diameter Pipe LF 500 27.00$ 13,500.00$ 27.00$ 13,500.00$ -$ 26.00$ 13,000.00$ 16.00$ 8,000.00$ 28.50$ 14,250.00$ 60.00$ 30,000.00$ 31.50$ 15,750.00$ 37 60" Diameter Pipe LF 500 30.00$ 15,000.00$ 30.00$ 15,000.00$ -$ 30.00$ 15,000.00$ 16.00$ 8,000.00$ 30.50$ 15,250.00$ 70.00$ 35,000.00$ 38.50$ 19,250.00$ SUBTOTAL 386,750.00$ 388,750.01$ -$ 449,400.00$ 425,600.00$ 360,975.00$ 627,250.00$ 494,137.50$ 38 10% CONTINGENCY 38,675.00$ 38,875.00$ -$ 44,940.00$ 42,560.00$ 36,097.50$ 62,725.00$ 49,413.75$ TOTAL CONTRACT 425,425.00$ 427,625.01$ -$ 494,340.00$ 468,160.00$ 397,072.50$ 689,975.00$ 543,551.25$ corrected calculations EnviroWaste Services Group Inc. 8001 Old Cutler Rd # 554 Miami, FL 33157 Hinterland Group, Inc. 2051 W. Blue Heron Blvd. Riviera Beach, FL 33404 Flotech Environmental, LLC 5245 NW 36 Street, Ste 230 Miami, FL 33166 NON-RESPONSIVE Shenandoah General Construction CO. 1888 NW 22nd Street, Pompano Beach, FL 33069 National Water Main Cleaning Co. 1806 Newark Turnpike Kearny, NJ 07302 Vortex Services 5910 Hartford St. Tampa, FL 33619 Cloud 9 Services, Inc DBA Fender Marine Co. 1201 W. Jackson St. Orlando, FL 32805 Granite Inliner 2531 Jewett Lane Sanford, Fl 32771 2021 Stormwater Pipe Cleaning 20-0019-EN BID OPENING - Tuesday July 28, 2020 AWARD - Thursday September 3, 2020 SECTION V Page i Updated: 5/4/2020 SECTION V CONTRACT DOCUMENTS Table of Contents PUBLIC CONSTRUCTION BOND .......................................................................................................... 1 CONTRACT ................................................................................................................................................ 3 CONSENT OF SURETY TO FINAL PAYMENT ................................................................................... 7 PROPOSAL/BID BOND ............................................................................................................................. 8 AFFIDAVIT ................................................................................................................................................. 9 NON-COLLUSION AFFIDAVIT ............................................................................................................ 10 PROPOSAL................................................................................................................................................ 11 CITY OF CLEARWATER ADDENDUM SHEET................................................................................ 13 BIDDER’S PROPOSAL ........................................................................................................................... 14 SCRUTINIZED COMPANIES AND BUSINESS OPERATIONS WITH CUBA AND SYRIA CERTIFICATION FORM ....................................................................................................................... 18 SCRUTINIZED COMPANIES THAT BOYCOTT ISRAEL LIST CERTIFICATION FORM ...... 19 SECTION V – Contract Documents SECTION V Page 1 of 19 Updated: 5/4/2020 20-0019-EN_2021 Stormwater Pipe Cleaning Bond No.: ________________ PUBLIC CONSTRUCTION BOND (1) This bond is given to comply with § 255.05, Florida Statutes, and any action instituted by a claimant under this bond for payment must be in accordance with the notice and time limitation provisions in subsections (2) and (10). Pursuant to § 255.05(1)(b), Florida Statutes, “Before commencing the work or before recommencing the work after a default or abandonment, the contractor shall provide to the public entity a certified copy of the recorded bond. Notwithstanding the terms of the contract or any other law governing prompt payment for construction services, the public entity may not make a payment to the contractor until the contractor has complied with this paragraph.” CONTRACTOR SURETY OWNER Shenandoah General Construction LLC 1888 NW 22 Street Pompano Beach, FL 33069 954-975-0098 [name] [principal business address] [phone number] City of Clearwater Engineering Department 100 S. Myrtle Avenue Clearwater, FL 33756 (727) 562-4750 PROJECT NAME: 2021 STORMWATER PIPE CLEANING PROJECT NO.: 20-0019-EN PROJECT DESCRIPTION: An annual on-call services contract to provide all labor, equipment, and materials for stormwater pipe cleaning and repairs. BY THIS BOND, We, Shenandoah General Construction LLC , as Contractor, and, _________________________ a corporation, as Surety, are bound to the City of Clearwater, Florida, herein called Owner, in the sum of $400,000.00, for payment of which we bind ourselves, our heirs, personal representatives, successors, and assigns, jointly and severally. THE CONDITION OF THIS BOND is that if Contractor: 1. Performs the contract dated _________________, between Contractor and Owner for construction of Stormwater Pipe Cleaning, the contract documents being made a part of this bond by reference (which include the Advertisement for Bids, Proposal, Contract, Surety Bond, Instructions to Bidders, General Conditions, Plans, Technical Specifications and Appendix, and such alterations as may be made in said Plans and Specifications as therein provided for), at the times and in the manner prescribed in the contract; and 2. Promptly makes payments to all claimants, as defined in Section 255.05(1), Florida Statutes, supplying Contractor with labor, materials, or supplies, used directly or indirectly by Contractor in the prosecution of the work provided for in the contract; and SECTION V – Contract Documents SECTION V Page 2 of 19 Updated: 5/4/2020 20-0019-EN_2021 Stormwater Pipe Cleaning Bond No.:________________ PUBLIC CONSTRUCTION BOND (2) 3. Pays Owner all losses, damages, expenses, costs, and attorney’s fees, including appellate proceedings, that Owner sustains because of a default by Contractor under the contract; and 4. To the limits of § 725.06(2), Florida Statutes, shall indemnify and hold harmless Owner, their officers and employees, from liabilities, damages, losses and costs, including, but not limited to, reasonable attorney’s fees, to the extent caused by the negligence, recklessness, or intentional wrongful misconduct of Contractor and persons employed or utilized by Contractor in the performance of the construction contract; and 5. Performs the guarantee of all work and materials furnished under the contract for the time specified in the contract, then this bond is void; otherwise it remains in full force. 6. Any action instituted by a claimant under this bond for payment must be in accordance with the notice and time limitation provisions in Section 255.05(2), Florida Statutes. 7. Any changes in or under the contract documents and compliance or noncompliance with any formalities connected with the contract or the changes does not affect Surety’s obligation under this bond, and Surety does hereby waive notice of any such change, extension of time, alteration or addition to the terms of the contract or to the work or to the specifications. IN TESTIMONY WHEREOF, witness the hands and seals of the parties hereto this __________ day of ________________, 20___. (If sole Ownership or Partnership, two (2) Witnesses required). (If Corporation, Secretary only will attest and affix seal). Shenandoah General Construction LLC By: ____________________________ Title: ____________________________ Print Name: ____________________________ WITNESS: WITNESS: _______________________________________ _______________________________________ Corporate Secretary or Witness Print Name: ____________________________ Print Name: _____________________________ (affix corporate seal) _______________________________________ (Corporate Surety) By: _________________________________ ATTORNEY-IN-FACT Print Name: ___________________________ (affix corporate seal) (Power of Attorney must be attached) SECTION V – Contract Documents SECTION V Page 3 of 19 Updated: 5/4/2020 20-0019-EN_2021 Stormwater Pipe Cleaning CONTRACT (1) This CONTRACT made and entered into this ___ day of ____________, 20___ by and between the City of Clearwater, Florida, a municipal corporation, hereinafter designated as the "City", and Shenandoah General Construction LLC, of the City of Pompano Beach County of Broward and State of Florida, hereinafter designated as the "Contractor". [Or, if out of state:] This CONTRACT made and entered into this ___ day of ____________, 20___ by and between the City of Clearwater, Florida, a municipal corporation, hereinafter designated as the "City", and _____________________________________, a/an _____________(State) Corporation authorized to do business in the State of Florida, of the City of ____________________ County of __________________________ and State of ____________, hereinafter designated as the "Contractor". WITNESSETH: That the parties to this contract each in consideration of the undertakings, promises and agreements on the part of the other herein contained, do hereby undertake, promise and agree as follows: The Contractor, and his or its successors, assigns, executors or administrators, in consideration of the sums of money as herein after set forth to be paid by the City and to the Contractor, shall and will at their own cost and expense perform all labor, furnish all materials, tools and equipment for the following: PROJECT NAME: 2021 STORMWATER PIPE CLEANING PROJECT NO.: 20-0019-EN in the amount of $400,000.00 In accordance with such proposal and technical supplemental specifications and such other special provisions and drawings, if any, which will be submitted by the City, together with any advertisement, instructions to bidders, general conditions, technical specifications, proposal and bond, which may be hereto attached, and any drawings if any, which may be herein referred to, are hereby made a part of this contract, and all of said work to be performed and completed by the contractor and its successors and assigns shall be fully completed in a good and workmanlike manner to the satisfaction of the City. If the Contractor should fail to comply with any of the terms, conditions, provisions or stipulations as contained herein within the time specified for completion of the work to be performed by the Contractor, then the City, may at its option, avail itself of any or all remedies provided on its behalf and shall have the right to proceed to complete such work as Contractor is obligated to perform in accordance with the provisions as contained herein. SECTION V – Contract Documents SECTION V Page 4 of 19 Updated: 5/4/2020 20-0019-EN_2021 Stormwater Pipe Cleaning CONTRACT (2) THE CONTRACTOR AND HIS OR ITS SUCCESSORS AND ASSIGNS DOES HEREBY AGREE TO ASSUME THE DEFENSE OF ANY LEGAL ACTION WHICH MAY BE BROUGHT AGAINST THE CITY AS A RESULT OF THE CONTRACTOR'S ACTIVITIES ARISING OUT OF THIS CONTRACT AND FURTHERMORE, IN CONSIDERATION OF THE TERMS, STIPULATIONS AND CONDITIONS AS CONTAINED HEREIN, AGREES TO HOLD THE CITY FREE AND HARMLESS FROM ANY AND ALL CLAIMS FOR DAMAGES, COSTS OF SUITS, JUDGMENTS OR DECREES RESULTING FROM ANY CLAIMS MADE UNDER THIS CONTRACT AGAINST THE CITY OR THE CONTRACTOR OR THE CONTRACTOR'S SUB CONTRACTORS, AGENTS, SERVANTS OR EMPLOYEES RESULTING FROM ACTIVITIES BY THE AFOREMENTIONED CONTRACTOR, SUB CONTRACTOR, AGENT SERVANTS OR EMPLOYEES, TO THE LIMITS OF § 725.06(2). In addition to the foregoing provisions, the Contractor agrees to conform to the following requirements: In connection with the performance of work under this contract, the Contractor agrees not to discriminate against any employee or applicant for employment because of race, sex, religion, color, or national origin. The aforesaid provision shall include, but not be limited to, the following: employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; lay off or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Contractor agrees to post hereafter in conspicuous places, available for employees or applicants for employment, notices to be provided by the contracting officer setting forth the provisions of the non-discrimination clause. The Contractor further agrees to insert the foregoing provisions in all contracts hereunder, including contracts or agreements with labor unions and/or worker's representatives, except sub-contractors for standard commercial supplies or raw materials. It is mutually agreed between the parties hereto that time is of the essence of this contract, and in the event that the work to be performed by the Contractor is not completed within the time stipulated herein, it is then further agreed that the City may deduct from such sums or compensation as may be due to the Contractor the sum of $1,000.00 per day for each day that the work to be performed by the Contractor remains incomplete beyond the time limit specified herein, which sum of $1,000.00 per day shall only and solely represent damages which the City has sustained by reason of the failure of the Contractor to complete the work within the time stipulated, it being further agreed that this sum is not to be construed as a penalty but is only to be construed as liquidated damages for failure of the Contractor to complete and perform all work within the time period as specified in this contract. It is further mutually agreed between the City and the Contractor that if, any time after the execution of this contract and the public construction bond which is attached hereto for the faithful performance of the terms and conditions as contained herein by the Contractor, that the City shall at any time deem the surety or sureties upon such public construction bond to be unsatisfactory or if, for any reason, the said bond ceases to be adequate in amount to cover the performance of the work the Contractor shall, at his or its own expense, within ten (10) days after receipt of written notice from the City to do so, furnish an additional bond or bonds in such term and amounts and with such surety or sureties as shall be satisfactory to the City. If such an event occurs, no further payment shall be made to the Contractor under the terms and provisions of this contract until such new or additional security bond guaranteeing the faithful performance of the work under the terms hereof shall be completed and furnished to the City in a form satisfactory to it. SECTION V – Contract Documents SECTION V Page 5 of 19 Updated: 5/4/2020 20-0019-EN_2021 Stormwater Pipe Cleaning CONTRACT (3) In addition to all other contract requirements as provided by law, the contractor executing this agreement agrees to comply with public records law. IF THE CONTRACTOR HAS QUESTIONS REGARDING THE APPLICATION OF CHAPTER 119, FLORIDA STATUTES, THE CONTRACTORS DUTY TO PROVIDE PUBLIC RECORDS RELATING TO THIS CONTRACT. CONTACT THE CUSTODIAN OF PUBLIC RECORDS AT 727-562-4092, Rosemarie.Call@myclearwater.com, 600 Cleveland St. Clearwater, FL 33756 The contractor’s agreement to comply with public records law applies specifically to: a) Keep and maintain public records required by the City of Clearwater (hereinafter “public agency”) to perform the service being provided by the contractor hereunder. b) Upon request from the public agency’s custodian of public records, provide the public agency with a copy of the requested records or allow the records to be inspected or copied within a reasonable time at a cost that does not exceed the cost provided for in Chapter 119, Florida Statutes, as may be amended from time to time, or as otherwise provided by law. c) Ensure that the public records that are exempt or confidential and exempt from public records disclosure requirements are not disclosed except as authorized by law for the duration of the contract term and following completion of the contract if the contractor does not transfer the records to the public agency. d) Upon completion of the contract, transfer, at no cost, to the public agency all public records in possession of the contractor or keep and maintain public records required by the public agency to perform the service. If the contractor transfers all public records to the public agency upon completion of the contract, the contractor shall destroy any duplicate public records that are exempt or confidential and exempt from public records disclosure requirements. If the contractor keeps and maintains public records upon completion of the contract, the contractor shall meet all applicable requirements for retaining public records. All records stored electronically must be provided to the public agency, upon request from the public agency’s custodian of public records, in a format that is compatible with the information technology systems of the public agency. e) A request to inspect or copy public records relating to a public agency’s contract for services must be made directly to the public agency. If the public agency does not possess the requested records, the public agency shall immediately notify the contractor of the request and the contractor must provide the records to the public agency or allow the records to be inspected or copied within a reasonable time. f) The contractor hereby acknowledges and agrees that if the contractor does not comply with the public agency’s request for records, the public agency shall enforce the contract provisions in accordance with the contract. g) A contractor who fails to provide the public records to the public agency within a reasonable time may be subject to penalties under Section 119.10, Florida Statutes. h) If a civil action is filed against a contractor to compel production of public records relating to a public agency’s contract for services, the court shall assess and award against the contractor the reasonable costs of enforcement, including reasonable attorney fees, if: 1. The court determines that the contractor unlawfully refused to comply with the public records request within a reasonable time; and SECTION V – Contract Documents SECTION V Page 6 of 19 Updated: 5/4/2020 20-0019-EN_2021 Stormwater Pipe Cleaning CONTRACT (4) 2. At least 8 business days before filing the action, the plaintiff provided written notice of the public records request, including a statement that the contractor has not complied with the request, to the public agency and to the contractor. i) A notice complies with subparagraph (h)2. if it is sent to the public agency’s custodian of public records and to the contractor at the contractor’s address listed on its contract with the public agency or to the contractor’s registered agent. Such notices must be sent by common carrier delivery service or by registered, Global Express Guaranteed, or certified mail, with postage or shipping paid by the sender and with evidence of delivery, which may be in an electronic format. j) A contractor who complies with a public records request within 8 business days after the notice is sent is not liable for the reasonable costs of enforcement. IN WITNESS WHEREOF, the parties to the agreement have hereunto set their hands and seals and have executed this Agreement, the day and year first above written. CITY OF CLEARWATER IN PINELLAS COUNTY, FLORIDA By: __________________________________ (SEAL) William B. Horne, II City Manager Attest: Countersigned: __________________________________________ Rosemarie Call City Clerk By: __________________________________ Approved as to form: Frank Hibbard Mayor __________________________________________ Owen Kohler Assistant City Attorney Contractor must indicate whether: ______ Corporation, ______ Partnership, ______ Company, or ______ Individual __________________________________________ (Contractor) By: _________________________ (SEAL) Print Name: ________________________________ Title: _____________________________________ The person signing shall, in his own handwriting, sign the Principal's name, his own name, and his title; where the person is signing for a Corporation, he must, by Affidavit, show his authority to bind the Corporation – provide Affidavit. SECTION V – Contract Documents SECTION V Page 7 of 19 Updated: 5/4/2020 20-0019-EN_2021 Stormwater Pipe Cleaning CONSENT OF SURETY TO FINAL PAYMENT TO OWNER: City of Clearwater PROJECT NAME: 2021 STORMWATER PIPE CLEANING Engineering Department PROJECT NO.: 20-0019-EN 100 S. Myrtle Ave. CONTRACT DATE: [__________] Clearwater, FL 33756 BOND NO.: [__________], recorded in O.R. Book [____], Page [____], of the Public Records of Pinellas County, Florida. CONTRACTOR: Shenandoah General Construction LLC Pursuant to § 255.05(11), Florida Statutes, and in accordance with the provisions of the Contract between the Owner and the Contractor as indicated above, the: [insert name of Surety] [address] [address] ,SURETY, on bond of Shenandoah General Construction LLC 1888 NW 22 Street Pompano Beach, FL 33069 ,CONTRACTOR, hereby approves of the final payment to the Contractor, and agrees that final payment to the Contractor shall not relieve Surety of any of its obligations to City of Clearwater Engineering Department 100 S. Myrtle Ave. Clearwater, FL 33756 ,OWNER, as set forth in said Surety’s bond. IN WITNESS WHEREOF, the Surety has hereunto set its hand this ___ day of ___________, ______ __________________________________________ (Surety) __________________________________________ (Signature of authorized representative) __________________________________________ (Printed name and title) Attest: (Seal): Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8112 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Engineering Department Agenda Number: 7.14 SUBJECT/RECOMMENDATION: Approve the conveyance of a Distribution Easement to Duke Energy Florida, LLC, d/b/a Duke Energy, for the installation, operation and maintenance of electric facilities to support Duke’s new transformers and electrical facility installation for the Imagine Clearwater project. (consent) SUMMARY: The Distribution Easement will provide Duke Energy with the rights necessary to construct and maintain its electric equipment within the easement. The facilities will be located within areas agreed to by the City and Duke Energy. Subsequent to Duke Energy installing its electrical facilities, the City will survey the installed electrical facilities and provide Duke Energy a descriptive legal description as a finalized Exhibit “A” to the Distribution Easement. Once finalized, the Distribution Easement will be recorded in public records. The Engineering Department supports conveyance of the Distribution Easement. Page 1 City of Clearwater Printed on 9/3/2020 Prepared By: Manny R. Vilaret, Esquire Return To: Duke Energy Vilaret Law, PLLC Attn: Land Services 10901 Danka Circle, Suite C 2401 25th Street North, SP-15 St. Petersburg, Florida 33716 St. Petersburg, Florida 33713 SEC: 16 TWP: 29 RGE: 15 COUNTY: PINELLAS PROJECT: Imagine Clearwater GRANTOR: CITY OF CLEARWATER ADDRESS: PO BOX 4748, Clearwater, FL. 33756 SITE ADDRESS: Osceola Ave., Cleveland St., Pierce St., Drew St., Clearwater, FL TAX PARCEL NUMBERS: 16-29-15-43956-000-0010, 16-29-15-00000-210-0100, 16-29-15-76482-002- 0010, 16-29-15-57996-000-0030, 16-29-15-20358-001-0040, 16-29-15-00000-130-0500, 16-29-15-00000-130- 600, 16-29-15-00000-130-0700 and 16-29-15-00000-130-0800. DISTRIBUTION EASEMENT KNOW ALL MEN BY THESE PRESENTS, that the undersigned, their heirs, successors, lessees and assigns (“GRANTOR”), in consideration of the mutual benefits, covenants and conditions herein contained, does hereby grant and convey to DUKE ENERGY FLORIDA, LLC, d/b/a DUKE ENERGY, a Florida Limited Liability Company, Post Office Box 14042, St. Petersburg, Florida 33733, and to its successors and assigns, (“GRANTEE”), an easement to install, operate and maintain in perpetuity, such facilities as may be necessary or desirable for providing electric energy and, said facilities being located in the following described “Easement Area” within GRANTOR’S premises in Pinellas County, to wit: A 20.00 foot wide by 20.00 foot wide Easement Area for each switchgear and a 10.00 foot wide Easement Area lying 5.00 feet on each side of GRANTEE's facilities to be installed at mutually agreeable locations over, under, upon, across, through and within the following described property to accommodate present and future development: See legal description on the accompanying Exhibit “A” attached hereto and incorporated herein by this reference. This easement will be replaced with a Descriptive Easement, 5.00 feet on either side of all facilities installed by GRANTEE, as will be shown on a certified surveyed sketch and legal description to be provided by GRANTOR within one hundred twenty (120) days after the installation of facilities by GRANTEE. If the certified sketch and legal description are not provided by GRANTOR within one hundred twenty (120) days after completion of installation, GRANTEE will record this easement. The rights herein granted to GRANTEE by GRANTOR specifically include: (a) the right for GRANTEE to patrol, inspect, alter, improve, repair, rebuild, relocate, and remove said facilities; further GRANTEE hereby agrees to restore the Easement Area to as near as practicable the condition which existed prior to such construction, repairs, alteration, replacement, relocation or removal as a result of GRANTEE’s safe and efficient installation, operation or maintenance of said facilities; (b) the reasonable right for GRANTEE to increase or decrease the voltage and to change the quantity and type of facilities; (c) the reasonable right for GRANTEE to clear the Easement Area of trees, limbs, undergrowth and other physical objects which, in the opinion of GRANTEE, endanger or interfere with the safe and efficient installation, operation or maintenance of said facilities; (d) the reasonable right for GRANTEE to request that GRANTOR trim or remove any trees or vegetation adjacent to, but outside the Easement Area which, in the reasonable opinion of GRANTEE, endangers or interferes with the safe and efficient installation, operation or maintenance of said facilities; (e) the reasonable right for GRANTEE to enter upon land of the GRANTOR adjacent to said Easement Area for the purpose of exercising the rights herein granted; and (f) all other rights and privileges reasonably necessary or convenient for GRANTEE’s safe and efficient installation, operation and maintenance of said facilities and for the enjoyment and use of said easement for the purposes described above. The rights and easement herein granted are non-exclusive as to entities not engaged in the provision of electric energy and service and GRANTOR reserves the right to grant rights to others affecting said easement area provided that such rights do not create an unsafe condition or unreasonably conflict with the rights granted to GRANTEE herein. GRANTOR hereby covenants and agrees that no buildings, structures or obstacles (except fences) shall be located, constructed, excavated or created within the Easement Area. If the fences are installed, they shall be placed so as to allow ready access to GRANTEE’s facilities and provide a working space of not less than ten (10) feet on the opening side, six (6) feet on the back for working space and three (3) feet on all other sides of any pad mounted transformer. If GRANTOR’s future orderly development of the premises is in physical conflict with GRANTEE’s facilities, GRANTEE shall, within 60 days after receipt of written request from GRANTOR, relocate said facilities to another mutually agreed upon Easement Area in GRANTOR’s premises, provided that (a) GRANTOR shall reimburse GRANTEE the full actual cost of the relocation, and (b) GRANTOR shall execute and deliver to GRANTEE, at no cost, an acceptable and recordable easement to cover the relocated facilities. Upon the completion of the relocation, the easement herein shall be considered cancelled as to the portion vacated by such relocation. If this easement is being granted to provide electric service to GRANTOR, then this legal description was provided by GRANTOR. In the event facilities are located outside of this legal description, GRANTOR shall pay for any relocation costs necessary or shall amend this legal description to cover the actual facilities. Should this easement be granted to provide electric service to a third party, GRANTEE shall provide the legal description and GRANTOR shall not have any liability related to errors in the legal description. GRANTOR covenants not to interfere with GRANTEE’s facilities within the Easement Area in GRANTOR’s premises, and GRANTOR further covenants, to the extent of Florida Statute 768.28 to indemnify and hold GRANTEE harmless from damages and injuries, whether to persons or property, arising directly from the negligent act related to GRANTEE’s facilities by GRANTOR or by GRANTOR’ s agents or employees. Nothing contained herein, however, shall be construed to waive or modify the provisions of Florida Statute 768.28 or the doctrine of sovereign immunity as to any party hereto. In addition, nothing contained herein shall be construed as consent by the GRANTOR to be sued by third parties in any manner arising from this grant of easement, or as a waiver of sovereign immunity. GRANTEE agrees to indemnify and hold GRANTOR harmless for, from and against any and all losses, claims or damages incurred by GRANTOR arising directly from GRANTEE’s negligence or failure to exercise reasonable care in the construction, reconstruction, operation, use or maintenance of GRANTEE's facilities located on the above described easement. GRANTOR hereby warrants and covenants (a) that GRANTOR is the owner of the fee simple title to the premises in which the above described Easement Area is located, (b) that GRANTOR has full right and lawful authority to grant and convey this easement to GRANTEE, and (c) that GRANTEE shall have quiet and peaceful possession, use and enjoyment of this easement. All covenants, terms, provisions and conditions herein contained shall inure and extend to and be obligatory upon the heirs, successors, lessees and assigns of the respective parties hereto. IN WITNESS WHEREOF, the said GRANTOR has caused this easement to be signed in its corporate name by its proper officers thereunto duly authorized and its official corporate seal to be hereunto affixed and attested this _____ day of ___________________________, 2020. GRANTOR: Countersigned: _________________________________ By: _______________________________ Frank Hibbard, Mayor William B. Horne, II, City Manager Approved as to form: Attest: ____________________________ ____________________________ Laura Mahony Rosemarie Call, City Clerk Senior Assistant City Attorney STATE OF __________________________________ COUNTY OF ________________________________ The foregoing instrument was acknowledged before me by means of ☐ physical presence or ☐ online notarization, this ______ day _____________, 2020, by Frank Hibbard and William B. Horne, II, the Mayor and City Manager, respectively, of the City of Clearwater, Florida, on behalf of the City who is personally known to me or who has produced ___________________________________________ as identification. [Notary Seal] _______________________________________ Notary Public _______________________________________ Name typed, printed or stamped My Commission Expires: __________________ Exhibit “A” (IMAGINE CLEARWATER) A TRACT OF LAND LYING NORTH OF PIERCE STREET, WEST OF OSCEOLA AVENUE, SOUTH OF DREW STREET AND EAST OF CLEARWATER HARBOR. TOGETHER WITH ALL UPLANDS WEST OF THE WESTERLY STREET END OF DREW STREET, EAST OF CLEARWATER HARBOR/BAY. TOGETHER WITH FOUR ADJACENT PARCELS AT THE SOUTHWEST CORNER OF PIERCE STREET AND OSCEOLA AVENUE WHOSE PARCEL ID’S ARE: 16-29-15-00000-130-0500, 16-29-15-00000-130-600, 16-29-15-00000-130-0700 AND 16-29-15-00000-130-0800. CONT 28.03 AC ± DREW ST PIERCE ST TURNER ST COURT ST S EAST AVEJONES ST MEMO R I A L C S W Y N MYRTLE AVE N GARDEN AVE CLEVELAND ST CHESTNUT ST S MYRTLE AVE PARK ST ELDRIDGE ST OAK AVE N FORT HARRISON AVE FRANKLIN ST S FORT HARRISON AVE BAY AVE N OSCEOLA AVE LAURA ST N EAST AVEROGERS ST SPRUCE AVE MAPLE ST HART ST ROGERS ST AERIAL MAP Document Path: C:\Users\Wioletta.Dabrowski\City of Clearwater\Engineering Geographic Technology - Location Maps\ImagineClearwater_Aer2020.mxd ²Prepared by:Engineering DepartmentGeographic Technology Division100 S. Myrtle Ave, Clearwater, FL 33756Ph: (727)562-4750, Fax: (727)526-4755www.MyClearwater.com Distribution EasementImagine ClearwaterMultiple Parcel Numbers Page: 1 of 18/12/2020Date:XXXXGrid #:N.T.S.Scale:WDMap Gen By:XX-XXs-XXeS-T-R:RBReviewed By: DREW ST COURT ST TURNER ST DRUID RD SEMINOLE ST N MYRTLE AVE CLEVELAND ST N GARDEN AVE VINE AVE ELDRIDGE ST JONES ST MEMORIAL CSWY S MYRTLE AVE PIERCE ST N OSCEOLA AVE S MISSOURI AVE N FORT HARRISON AVE CHESTNUT ST S PROSPECT AVE MIDWAY I S MARSHALL ST PALMETTO ST LAURA ST PARK ST WINDWARD IS OAK AVE S FORT HARRISON AVE PENNSYLVANIA AVE PINE ST S MARTIN LUTHER KING, JR. AVE FRANKLIN ST GOULD ST PLAZA ST EWING AVE ORANGE AVE N JEFFERSON AVE LOCATION MAP PROJECTLOCATION ^ Document Path: C:\Users\Wioletta.Dabrowski\City of Clearwater\Engineering Geographic Technology - Location Maps\ImagineClearwater_Loc.mxd ²Prepared by:Engineering DepartmentGeographic Technology Division100 S. Myrtle Ave, Clearwater, FL 33756Ph: (727)562-4750, Fax: (727)526-4755www.MyClearwater.com Distribution EasementImagine ClearwaterMultiple Parcel Numbers Page: 1 of 18/4/2020Date:XXXXGrid #:N.T.S.Scale:WDMap Gen By:XX-XXs-XXeS-T-R:RBReviewed By: Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8131 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Planning & Development Agenda Number: 7.15 SUBJECT/RECOMMENDATION: Authorize a Work Order to HDR, Inc. of Tampa, Florida in the amount of $236,324 to assist in updating the City’s Comprehensive Plan per Clearwater Code of Ordinances, 2.564(1)(d) Other Government Contracts, and authorize the appropriate officials to execute same. (consent) SUMMARY: The City of Clearwater Comprehensive Plan (the Plan) is the city’s plan for the next 10 to 20 years, capturing the vision of where the city wants to be in the future. A series of goals, objectives and policies addressing a variety of “elements” such as future land use, transportation, and public utilities, guide the decisions of City Council, the city administration, and staff. The Plan establishes the policy direction for planning and land use decisions, and the Future Land Use Map, adopted as part of the Plan, shows the proposed distribution, location, and extent of the various categories of land (e.g., Residential Urban, Commercial General). The Plan is also the basis for capital projects, identifying infrastructure needs and where new or redeveloped public infrastructure should be placed. The Comprehensive Plan is implemented through the Community Development Code, Capital Improvements Program, and redevelopment/neighborhood and special area plans. The comprehensive planning process allows the city to identify factors influencing and shaping the city such as demographic trends and changing development patterns and provides an opportunity to evaluate how community needs are being met. The planning process should involve consensus building between the overall community, elected officials, and other interested stakeholders. Although the Planning and Development Department maintains this city plan, the Plan’s policy direction governs a wide variety of city departments’ work programs and operations. This comprehensive planning process will allow the city to take a step back from its day -to-day operations to engage the community to evaluate its vision for the city, and to modify the Plan goals, objectives and policies so the departments can implement the plan going forward to achieve this vision. The last major update to the Comprehensive Plan was completed in 2008, with the planning horizon established as 10 years (2008-2018 plan). While the Plan has been amended since then, city staff has not completed a more detailed analysis of the Plan and changes to the city since 2008. In 2015, Planning and Development Department staff completed the Page 1 City of Clearwater Printed on 9/3/2020 File Number: ID#20-8131 state-mandated Evaluation and Appraisal Review of the Plan, determining that the Plan was in compliance with Florida Statutes, and that no specific amendments were required beyond certain changes that were already in process at the time (e.g., “Peril of Flood” related amendments). This is an extensive project which will require significant staff resources to complete. As detailed in the attached scope of work, HDR, Inc. will supplement staff’s work, providing support in the visioning and outreach efforts, as well as leading the development of the Future Land Use, Transportation, and Housing Elements. HDR and their subconsultant S.B. Friedman have been involved in many recent countywide efforts related to these very important topics, while HDR is also very familiar with the City of Clearwater having worked on several recent planning projects. Community engagement will be integrated into multiple phases of the project, including visioning and for the draft Plan. Additionally, workshops will be held with the Community Development Board and City Council several times prior to Plan adoption. With these firms’ support, this project is estimated to take just under two years, inclusive of the six -month adoption process (i.e., local public hearings and two review periods by the Department of Economic Opportunity and other state agencies). In 2019, Pinellas County approved 11 firms to provide as-needed consulting services for nine major disciplines: multimodal transportation planning and analysis, economic analysis, communications and public involvement, urban design, land use and redevelopment, historic preservation, community resilience, community development, and redevelopment planning . HDR was prequalified in seven of the nine disciplines. Code of Ordinances sec. 2.564 (1)(d) allows for direct contracting with consultants utilizing contracts previously awarded by other governmental entities. APPROPRIATION CODE AND AMOUNT: Funding for this contract has been included in the fiscal year 2020/21 budget in new special program M2101, Planning Study Fund. USE OF RESERVE FUNDS: N/A Page 2 City of Clearwater Printed on 9/3/2020 Proposal for Comprehensive Planning Support Services Clearwater, Florida August2020 01 02 06 Contents 00 Cover Letter 01 HDR Project Experience 02 HDR Staff 03 S.B. Friedman Qualifications Attachment A: Scope of Services Attachment B: Budget 19 hdrinc.com 4830 West Kennedy Blvd, Suite 400, Tampa, FL 33609-2548T 813.282.2400 F 813.282.2430 August 14, 2020 Gina Clayton, AICP Planning and Development Director City of Clearwater, Florida Municipal Services Building, 100 S. Myrtle Ave, 2nd Floor Clearwater, FL 33756 RE: Proposal to Provide Comprehensive Planning Support Services Dear Ms. Clayton, HDR is pleased to submit this proposal to provide support services to assist the City in updating the Comprehensive Plan. Given our past involvement with the City on a range of important projects, including the Fort Harrison Avenue Complete Streets Concept, the Downtown Form-based Code, and the US 19 Corridor Redevelopment Plan and Development Standards, combined with our recent work on land use, redevelopment, mobility, and affordable housing planning assignments for Forward Pinellas and Pinellas County, we believe we are uniquely qualified to assist in bringing the Comprehensive Plan up-to-date and ready for finalization and adoption. Attached please find a review of our qualifications to complete the work, including qualifications for HDR and our subconsultant S.B. Friedman, along with attachments addressing the scope of services and budget for the effort. Please let us know if you have any questions. We look forward to continuing out work with you and your team. Sincerely, HDR Engineering, Inc. Steven Schukraft Section Manager, Community + Transportation Planning 1 01 HDR Project Experience Through our work with municipalities in the Tampa Bay Region and across Florida, we’ve helped local leaders find creative, sustainable solutions to the full range of land use, mobility, and redevelopment challenges. In the past few years, we’ve led visioning efforts for the transformation of suburban corridors across the region; crafted planning and economic strategies for infill, redevelopment, affordable housing, and transit-oriented development; defined area- specific sustainability and place making strategies; prepared guidelines and form-based codes to guide private investment; and designed traffic calming, streetscape, and complete streets plans to improve mobility, increase connectivity, and capitalize on planned transit investment. Defining creative, cost-effective strategies to realize the full potential of a place is the central focus of our practice. Our team prepares tools to spark appropriate investment, leverage assets, improve livability, conserve resources, and create vibrant, competitive, enduring communities and destinations. Our planning work for Clearwater’s US 19 Corridor received the 2012 One Bay Award and First Place in the development/ infrastructure category of the 2012 Future of the Regions Awards. 2 Comprehensive Planning Support Services US 19 CORRIDOR REDEVELOPMENT PLAN & CODE | CLEARWATER, FL HDR worked with the City of Clearwater to prepare a redevelopment plan and form-based code standards for sites along the U.S. 19 corridor. Plan recommendations define the preferred mix of land uses, intensity of development, and the character of building, site, and landscape improvements; offer strategies to improve vehicle, pedestrian and bike connections, and leverage planned investment in Bus Rapid Transit (BRT) service; and promote low impact and resource-efficient site and building designs. Engagement efforts included hands-on listening sessions, briefings, and public workshops to support an open exchange of ideas. Using the MindMixer platform, community members participated in an on-line dialogue around a range of important topics. The second phase of the process, drafting a form-based code to guide redevelopment, is underway. RIVERFRONT CROSSINGS SUB-AREA PLAN & FORM-BASED CODE | IOWA CITY, IA In 2010, Iowa City was selected as one of five cities in the nation to receive a Sustainable Community Partnership Brownfields Pilot Grant from the Partnership for Sustainable Communities. This grant helped Iowa City continue its work on post-recovery efforts from a 2008 flood that inundated significant areas adjacent to the Iowa River. Together with SRA International, HDR created a master plan for 70 acres along the southern portion of the Riverfront Crossings District, an area envisioned for future growth just south of Downtown Iowa City. Working with City staff and key stakeholders, the HDR team designed a new mixed-use, pedestrian-oriented neighborhood and riverfront park. The neighborhood will include a range of residential and commercial uses with an interconnected mobility network. Stations for future high-speed rail and light-rail are designated within the area. When the wastewater treatment plant is relocated, a new riverfront park will be developed on the site to better absorb flood waters from the adjacent Ralston Creek and Iowa River. CAUSEWAY BOULEVARD CORRIDOR STUDY & FORM-BASED CODE | DUNEDIN, FL Building on an HDR-led Community Visioning Process completed in 2004, the City of Dunedin engaged HDR to explore ideas for land use and development along Causeway Boulevard between Bayshore Boulevard and the bridge to Honeymoon Island. Planning, regulatory, and economic development recommendations for the corridor grew out of an intensive and collaborative process. Through a series of listening sessions and a multi-day design charrette, Dunedin residents and business owners shared ideas for the future of the area. Participants talked about the district’s special qualities and emphasized the value of proximity to Honeymoon and Caladesi Islands, the ability to walk and bike to local destinations, and the protection of views to the water. The HDR Team used ideas from the workshop as the basis for design sketches, the testing of market and development strategies, and the development of recommendations for incorporation in a Framework Plan and Form-based Code. 3 Comprehensive Planning Support Services BRANDON CORRIDORS & MIXED USE CENTERS PROJECT | HILLSBOROUGH COUNTY, FL As part of a joint effort with the Hillsborough Metropolitan Planning Organization (MPO) and Hillsborough Planning Commission, HDR led a study of the Brandon area of Hillsborough County. The project was designed to better coordinate the envisioned land use pattern with planned transportation improvements along the three major east-west corridors in Brandon that connect residential areas to I-75 and employment centers in Hillsborough County. The goal of the project was the evaluate land use and transportation improvement options along the key arterials and identify appropriate and market-ready locations for the creation of walkable and transit-supportive centers, and define policies, regulatory strategies, and capital investments to advance place-making, economic development, and multimodal transportation improvement objectives. ORLANDO MAIN STREET DISTRICT BICYCLE AND PEDESTRIAN STUDY | ORLANDO, FL Study for the City of Orlando to identify and evaluate opportunities to improve the safety and comfort of walking and bicycling in the Mills 50 and Milk Main Street Districts. The study defines future bicycle and pedestrian projects along with their implementation strategies. Enhancing the bicycle and pedestrian environment within the Main Street Districts will better connect the Districts to the surrounding neighborhoods, enriching the quality of life in Orlando. GULFPORT 2030 COMPREHENSIVE PLAN | GULFPORT, MS The City of Gulfport’s Comprehensive Plan, called Gulfport 2030, offers goals, policies, and strategies for the community’s long- term growth and development. An important guide to local decision makers, Gulfport 2030 addresses a wide range of important issues—from the rebuilding of neighborhoods damaged by Hurricane Katrina to the quality and character of development city-wide and in potential future growth areas in unincorporated Harrison County. Building on post-Katrina plans and studies for the Downtown, Mississippi City, Handsboro, and publicly-owned sites throughout the City, Gulfport 2030 offers strategies for community improvement, quality development, capital investments, and the conservation of important local resources. 4 Comprehensive Planning Support Services YBOR CITY CRA2 VISION PLAN | TAMPA, FL In 2010, HDR was retained by the City of Tampa and the Ybor City Development Corporation to update the Vision Plan for Ybor City’s CRA 2 district. The Vision Plan, addressing conditions in historic neighborhoods and mixed use districts to north and south of 7th Avenue, offers recommendations to protect the area’s unique qualities, enhance livability, attractive appropriate forms of investment, and improve connections to the City and region. Organized around an intensive process of public engagement, plan strategies were designed to address issues and opportunities explored during listening sessions and workshops with neighborhood stakeholders, representatives of Ybor’s neighborhood and business associations, and members of the general public. The Vision Plan Amendment is organized in five chapters, the first of which provides information regarding the scope of the study, the planning process, and a summary of information presented in past plans. Chapters II and III provide a summary of issues and an assessment of existing conditions. Planning strategies and recommendations are presented in Chapter IV, and Chapter V includes an Action Plan matrix identifying priorities, responsibilities, and target completion dates for key strategies. INTEGRATED COMMUNITY SUSTAINABILITY PLAN | CORPUS CHRISTI, TX In 2010, the City of Corpus Christi TX selected HDR to develop an Integrated Community Sustainability Plan as part of the implementation of its Energy Efficiency and Conservation Block Grant (EECBG) program. This plan builds on HDR’s integrated, systems approach to community planning, wherein an interdisciplinary team of technical specialist—who understand the ways in which changes in one community system affect other systems within the whole—work together to plan for the sustainable growth and re-development of our communities. The plan’s mobility and place-making strategies focused on applying Complete Streets concepts to key transportation corridors, intersections, hike/bike trail connections, and a downtown transit circulator. PROGRESS GALVESTON PLANNING & DEVELOPMENT REGULATIONS | GALVESTON, TX The City of Galveston, Texas selected HDR for an ambitious planning project designed to ensure public and private actions align to improve the community’s livability, sustainability, and competitiveness. This planning effort, known as Progress Galveston, is organized in three parts: 1) completing an update to the City’s Comprehensive Plan; 2) preparing a series of Specialized Plans addressing important issues such as historic preservation, mobility, parks and recreation, disaster recovery, and coastal management; and 3) rewriting and streamlining ordinances and regulations affecting the development of private property. As a central component of the City’s post-Hurricane Ike recovery process, the project was funded through a grant from the U.S. Department of Housing and Urban Development. 5 02 HDR Staff We understand the dynamics shaping the economy, sustainability, quality of life, and mobility of the City of Clearwater, and have pulled together a team of professionals with the right combination of technical expertise, local knowledge, and creativity to advance the City’s agenda. Our team, HDR with S.B. Friedman, has a long history delivering successful community planning, redevelopment, and multimodal transportation planning projects for the City of Clearwater as well as for communities across Florida and the Tampa Bay Region. Through work with the region’s stakeholders—from the MPOs, transit agencies, and FDOT, to local governments and regional interest groups—we’ve gained a thorough understanding of the City’s history, challenges, assets, and opportunities. We’ve been directly engaged in shaping the long-term vision for the region’s future, and we’ve helped translate big picture visions into realistic and achievable policies and programs. Our team also understands the importance of quality public communications and engagement— from framing the issues and being able to tell a project’s story to diverse audiences, whether a technical group, elected leaders, or the general public. We have the tools to ensure communications are clear and concise, and we have the experience to engage stakeholders meaningfully and productively. 6 EDUCATION Master of Planning, University of Virginia, 1992 Bachelor of Arts, Political Science, University of South Florida, 1985 REGISTRATIONS American Institute of Certified Planners, Florida, United States, No. 015562, Issued: 07/01/2000 Certified Charrette Planner, Florida, United States, Issued: 10/01/2006 PROFESSIONAL MEMBERSHIPS American Planning Association Congress for New Urbanism Urban Land Institute Steve Schukraft, AICP Project Manager Mr. Schukraft is an accomplished community planner with over 25 years experience helping communities improve mobility, enhance livability, and encourage more sustainable patterns of growth and development. He has managed a range of transportation, community planning, and transit-oriented development projects; led dozens of public planning charrettes and workshops; and designed and managed large-scale visioning, goal setting, and planning initiatives. Mr. Schukraft has prepared initegrated transportation and community plans for projects throughout the Tampa Bay Region, including recently completed projects for the Hillsborough and Pinellas MPOs, Hillsborough and Pibnellas County, and the cities of Tampa, Clearwater, Largo, and Dunedin. He has completed transit-oriented development projects across the US, including the Project Connect North Corridor project in Austin, Texas; the Braddock Road and Clarendon station areas in Northern Virginia; The Cedar Hill City Center sough of Dallas, and the Upper Wisconsin Avenue and H Street NE corridors in the District of Columbia. He has prepared plans and designs for streetcar and transitway improvements in Tampa, transit stops and stations for the Columbia Pike SuperStop program in Arlington County, Virginia; and stop and station designs for planned BRT and express bus service in Hillsborough, Pinellas, and Sarasota Counties in Florida. RELEVANT EXPERIENCE ▪City of Clearwater, Flood Hazard Policies and Strategies - Pinellas County, FL ▪City of Clearwater, Downtown Form-Based Code Development - Pinellas County, FL ▪Pinellas County, US 19 Corridor Land Use & Economic Analysis: Palm Harbor - Pinellas County, FL ▪Forward Pinellas, US 19 Corridor Land Use & Economic Analysis: Largo - Pinellas County, FL ▪Forward Pinellas, US 19 Corridor Land Use & Economic Analysis: Tarpon Springs -Pinellas County, FL ▪Florida Department of Transportation, District 6, JV – Archer/DeMoya, I-395 Aesthetics -Miami-Dade County, FL ▪City of Clearwater, Downtown Form-Based Code Development - Pinellas County, FL ▪City of Clearwater, Flood Hazard Policies and Strategies - Pinellas County, FL ▪FDOT District 7, I-275 Pinellas County PD&E Study- Pinellas County, Florida ▪City of Tampa, Tampa Streetcar Extension and Modernization Study - Tampa, FL ▪Hillsborough MPO & Planning Commission, Brandon Corridors and Mixed Use Centers Pilot Project - Hillsborough County, FL ▪FDOT District 5, I-4 Ultimate Aesthetic Enhancement Program - Orange/Seminole Counties, FL ▪HART, North/South Corridor Bus Rapid Transit (BRT) Study - Hillsborough County, FL ▪Project Connect North Corridor Transit-Support Land Use Planning - Austin, TX ▪City of Clearwater, US 19 Corridor Redevelopment Plan & Code - Clearwater, FL ▪HART, Marion Transitway Enhancement Study - Tampa, FL 7 EDUCATION Master of Regional Planning, Cornell University, 2006 Bachelor of Arts, History, University of Virginia, 2002 REGISTRATIONS AICP - American Institute of Certified Planners National Charrette Institute Charrette Planner Certified PROFESSIONAL MEMBERSHIPS American Planning Association (APA), Member, 2004-present; APA Florida Sun Coast Section, Executive Committee, Treasurer, 2016-present Urban Land Institute, Member, 2009-present OFFICE LOCATION Tampa, FL Stefanie McQueen, AICP Land Use & Redevelopment Stefanie is a planner with 15 years of professional experience in several planning disciplines including land use and transportation planning, economic development, military planning, public involvement, and urban design. She has a diverse set of skills including: compiling and assessing land use, demographic, socioeconomic, transportation, and environmental data for planning policy and community design projects; designing and facilitating public engagement events and activities; preparing analytical and presentation maps and graphics; presenting planning proposals to community stakeholders, public officials, and peer professionals; and creating planning reports, codes and regulations. RELEVANT EXPERIENCE ▪City of Clearwater, U.S. 19 Corridor Redevelopment Plan and Form-Based Code - Clearwater, FL ▪City of Tampa, InVision: Tampa Streetcar Extension & Modernization Study - Tampa, FL ▪Florida Department of Transportation, District Three, Brooks Bridge Replacement PD&E Study - Okaloosa County, FL ▪Florida Department of Transportation, District Seven, SR 679 Pinellas Bayway Bridge Replacement Design-Build Project from North of Yacht Club Lane to SR 682- Pinellas County, FL ▪Forward Pinellas, US 19 Express Bus Service Concepts Study - Pinellas County, FL ▪Forward Pinellas, US 19 Land Use and Economic Analyses - Pinellas County, FL ▪Pinellas County, San Martin Boulevard over Riviera Bay Bridge Replacement PD&E Study -Pinellas County, FL ▪Hillsborough County City-County Planning Commission/Hillsborough County MPO, Brandon Corridors & Mixed Use Centers Pilot Project - Hillsborough County, FL ▪Hillsborough County City-County Planning Commission, Hillsborough County Economic Development Strategy - Hillsborough County, FL ▪Hillsborough County City-County Planning Commission, Ybor City Community Redevelopment Area 2 Vision Plan Amendment - Tampa, FL ▪Hillsborough Area Regional Transit (HART) Authority, USF to Wesley Chapel Transit Corridor Study - Hillsborough and Pasco Counties, FL ▪City of Largo, Largo Activity Center Guidelines - Largo, FL ▪City of Dunedin, Dunedin Causeway Boulevard Corridor Study & Form-Based Code - Dunedin, FL ▪City of Treasure Island, Treasure Island Special Area Plan & Form-Based Code Treasure Island, FL ▪Florida Department of Transportation, District Seven, I-275/SR 93 PD&E Study from south of 54th Avenue S to north of 4th Avenue N - Pinellas County, FL ▪Florida Department of Transportation, District Three, Santa Rosa Alternate Crossing Evaluation (ACE) - Okaloosa County, FL ▪Pinellas County, FEMA Coastal Mapping Update – Pinellas County ▪City of Galveston, Progress Galveston Planning & Development Regulations - Galveston, Texas 8 EDUCATION Master of Engineering, Transportation Engineering (Civil Engineering), University of Florida, 1996 Bachelor of Science, Civil Engineering, University of Florida, 1995 REGISTRATIONS Professional Traffic Operations Engineer, United States National Registration, No. 1403 Professional Engineer - Civil, Florida, United States, No. 56143 PROFESSIONAL MEMBERSHIPS Institute of Transportation Engineers (ITE), Member Institute of Transportation Engineers (ITE), Pedestrian & Bicycle Council OFFICE LOCATION Orlando, FL Jamie Krzeminski, P.E., PTOE Mobility Planning Jamie serves as one of HDR’s national technical leaders for Complete Streets planning and design. He has worked with both public and private clients including cities, counties and MPOs in more than 20 states around the U.S. to advance Complete Streets through projects ranging from intersection and corridor-level multimodal improvements to region- wide bicycle and pedestrian master plans. He has presented at numerous national and international conferences on Complete Streets planning and design, and has also conducted training presentations and webinars on this topic around the country. As a regular bicycle commuter and recreational cyclist, Jamie brings a true cyclist’s perspective to his work, which adds to his credibility with clients, and bicycling and walking advocates. He currently serves on the Board of Directors for Bike/Walk Central Florida, is a past Chairman of the City of Winter Park, Florida’s Pedestrian and Bicycle Advisory Board, and is a League of American Bicyclists Cycling Instructor. RELEVANT EXPERIENCE ▪City of Clearwater, U.S. 19 Corridor Redevelopment Plan and Form-Based Code - Clearwater, FL ▪Lake~Sumter MPO, SR 44 (Dixie Ave.) Complete Streets - Leesburg, FL ▪Lake~Sumter MPO, US 27 (14th St.) Complete Streets - Leesburg, FL ▪MetroPlan Orlando, Silver Star Road (SR 438) Complete Streets - Ocoee, FL ▪MetroPlan Orlando, Edgewater Drive Complete Streets Concepts - Orlando, FL ▪City of Orlando, Main Streets Bicycle/Pedestrian Study - Orlando, FL ▪Orange County, Complete Streets Policy and Implementation Plan - Orange County, FL ▪Florida-Alabama & Bay County TPO Bicycle & Pedestrian Plans - Pensacola, FL and Panama City, FL ▪Corpus Christi MPO, Strategic Plan for Active Transportation, Bicycle Mobility Element -Corpus Christi, TX ▪City of Pittsburgh, Strip District Transportation and Land Use Plan -Pittsburgh, PA ▪City of Kansas City, Bicycle Facility Selection Tool - Kansas City, MO ▪City of Sandy Springs, Bicycle, Pedestrian & Trail Plan - Sandy Springs, GA ▪City of Orange City, South Holly Avenue Streetscape & Urban Design -Orange City, FL ▪Osceola County, Trails Corridor Feasibility - Osceola County, FL ▪City of Oviedo Transportation Master Plan - Oviedo, FL ▪City of Orlando, Bicycle Plan Update – Orlando, FL ▪City of Orlando, Primary Bicycle Routes Study - Orlando, FL ▪City of Orlando, Downtown Orlando Transportation Plan - Orlando, FL 9 EDUCATION Master of Science, Urban Planning and Policy, University of Illinois Chicago, 2014 Bachelor of Arts, Graphic Design, University of Florida, 2004 PROFESSIONAL MEMBERSHIPS American Planning Association, Member, 2018-present OFFICE LOCATION Tampa, FL Michelle Zehnder Land Use & Redevelopment Mrs. Zehnder has 5 years of planning experience. She is focused in land use and transportation planning, public involvement, and urban design. Michelle works closely with the project team to coordinate and develop strategies for projects, compile research on relevant planning topics, create presentations and reports, and advance public and client relationships. Prior to joining HDR, Michelle was a graphic designer in the architecture and planning industry. She has over 15 years as a designer and project manager. RELEVANT EXPERIENCE ▪City of Clearwater, Flood Hazard Policies and Strategies - Pinellas County, FL ▪City of Tampa, InVision: Tampa Streetcar Extension & Modernization Study - Tampa, FL ▪Hillsborough County City-County Planning Commission/Hillsborough County MPO, Brandon Corridors & Mixed Use Centers Pilot Project - Hillsborough County, Florida ▪City of Clearwater, Downtown Form-Based Code Development - Pinellas County, FL ▪Pinellas County, US 19 Corridor land Use & Economic Analysis: Palm Harbor - Pinellas County, FL ▪Forward Pinellas, US 19 Corridor Land Use & Economic Analysis: Largo - Pinellas County, FL ▪Forward Pinellas, US 19 Corridor Land Use & Economic Analysis: Tarpon Springs - Pinellas County, FL ▪Florida Department of Transportation, District 6, JV – Archer/DeMoya, I-395 Aesthetics -Miami-Dade County, FL 10 EDUCATION M.U.R.P., Urban and Regional Planning, University of Central Florida, 2017 Bachelor of Arts, Advertising and Public Relations with Minors in Spanish, and History, University of Central Florida, 2009 OFFICE LOCATION Tampa, FL *Work performed for graduate school. Sharisse Kenney Mobility Planning Sharisse is a valued contributor, performing both technical research and writing for a variety of transportation projects. She is involved in public involvement for local government and transit operations, and infuses strategic insight related to built environment health and community sustainability into conceptual approaches. Sharisse also contributes graphic design proficiency and offers experience in public engagement, communications and public speaking to the projects she supports RELEVANT EXPERIENCE ▪Osceola County, Simpson Road PD&E Study – Osceola County, FL ▪City of Orlando, Main Streets Bicycle and Pedestrian Study – Orlando, FL ▪FDOT District 5, Central Florida Visitor Study – Central FL ▪LYNX, Transit Development Plan & Route Optimization Study – Orlando, FL ▪Orange County, Complete Streets Policy & Implementation Plan – Central FL ▪Orange County, Sand Lake Roadway Conceptual Analysis (RCA) – Orlando, FL ▪City of Altamonte Springs, Trail Feasibility Study – Altamonte Springs, FL ▪City of Casselberry, Healthy Community Element* - Central FL ▪Daytona Beach Shores, Police Department Strategic Plan* - Central FL 11 EDUCATION B.A., Communications, University of Central Florida, 2003 *Experience outside of HDR Teresa Donaldson Public Involvement & Strategic Communications Teresa is a public relations and brand marketing professional with over 15 years experience in communication and storytelling, brand development, community relations, and issues in management experience. She has strong skills in strategic planning, business development and communication which have been proven successful in the development of communications strategies that promote internal engagement and external awareness and advocacy. Teresa is an organized and energetic manager with a proven track record of producing results. RELEVANT EXPERIENCE FDOT District 5, Public Engagement Plan, Districtwide, FL MetroPlan Orlando, 2045 Metropolitan Transportation Plan, Orange, Seminole and Osceola Counties, FL Broward MPO, Speak Up Broward Phase 2, Broward County, FL Coastal Conservation Association*, Orlando, FL Say It Loud*, Orlando, FL &Barr*, Orlando, FL Old Florida National Bank *, Orlando, FL 12 EDUCATION Architecture and Town Planning, University of Stuttgart, Germany, Master of Architecture, 1997 OFFICE LOCATION Portland, OR Oliver Kuehne, LEED AP Urban Design & Placemaking Oliver has over two decades of experience in planning and urban design. Trained in architecture, Oliver is comfortable working at a wide range of scales, from site plans to streetscape and corridor design, to master plans for neighborhoods, downtowns, districts or campuses, and to city-wide land use or transportation plans. At every scale, Oliver focuses on creating attractive and vibrant places where people want to live, work, learn, shop and play — places that integrate a range of uses and a variety of open spaces within a short walk or bike ride. An avid walker, bicyclist and transit rider himself, Oliver understands the needs of slower-speed travelers. He views streets not merely as thoroughfares to efficiently move cars, but as public spaces where people drive, bicycle and walk, get on and off buses, and meet and socialize. Oliver is an expert in developing form-based codes and design standards, which he views as important place making tools. RELEVANT EXPERIENCE ▪Osceola County, Code Update for TOD Station Areas and Multimodal Corridors - Osceola County, FL ▪City of Tampa, Marion Transitway Improvements - Tampa, FL ▪City of Clearwater, City Hall & Transit Center Site Study - Clearwater, FL ▪Miami-Dade Expressway Authority, SR 924 Project Development & Environment Study - Miami-Dade County, FL ▪City of Clearwater, US 19 Corridor Redevelopment Plan and Form-Based Code ▪Clearwater, FL ▪Town of Queen Creek, General Plan Update - Queen Creek, Arizona ▪Los Angeles County Metropolitan Transportation Authority, Link Union Station - Los Angeles, CA ▪City of Astoria, Riverfront Vision Code Update - Astoria, Oregon ▪Port of Portland, NE 82nd Avenue/NE Airport Way Interchange Analysis - Portland, OR ▪Missoula Redevelopment Agency, Front-Main Two-Way Conversion Study - Missoula, MT ▪City of Omaha, Downtown Omaha 2030 - Omaha, NE ▪Kendig Keast Collaborative, Arapahoe Urban Center Form-Based Code - Centennial, CO ▪City of Caldwell, City Center Building Design Guidelines - Caldwell, ID ▪City of Council Bluffs, Playland Park Master Plan - Council Bluffs, IA ▪City of Gulfport, Gulfport SmartCode - Gulfport, MS ▪University of Nebraska at Kearney, South Campus Development Project - Kearney, NE ▪City of Iowa City, Riverfront Crossings Form-Based Development Standards - Iowa City, IA ▪City of Happy Valley, Happy Valley Style Design Standards and Guidelines - Happy Valley, OR ▪Smith-Monterey LLC, Downtown Addition Specific Plan - King City, CA 13 EDUCATION Master of Engineering, Civil Engineering, 2010, University of Florida Bachelor of Science, Civil Engineering, 2009 University of Florida REGISTRATIONS Professional Engineer, Florida, # 78530, 1/1/2015 OFFICE LOCATION Tampa, FL Heather E. Hubbard, PE Mobility Planning Ms. Hubbard has over 8 years of experience providing traffic engineering, multi-modal transportation planning, and PD&E services throughout the State of Florida and throughout the country. She is currently serving as a transportation and traffic professional engineer. She has served as a key member on numerous projects in both technical and lead capacities. Her main areas of focus include innovative interchange and intersection concept development through microsimulation and macroscopic operational analysis, travel demand modeling, GIS mapping, complete streets development, interchange access requests, freeway and managed lanes analysis, corridor studies, and PD&E studies. RELEVANT EXPERIENCE ▪Forward Pinellas, 34th Street Lane Elimination Study - Pinellas County, FL ▪Hillsborough MPO, Brandon Corridors/Reversible Lanes Study - Hillsborough County, FL ▪FDOT District 7, Tampa Port Authority Hooker’s Point Traffic Circulation Study – Public Transportation Operations (PTO) Contract - Tampa, FL ▪FDOT District 1, US 17/Bartow Airport Railroad Crossing Improvement Study – Systems Planning Contract - Bartow, FL ▪FDOT District 7, Rail Study and Plans Review: PTO Contract - District 7 Counties, FL ▪FDOT District 1, I-75/University Parkway Diverging Diamond Interchange (DDI) - Sarasota County, FL ▪FDOT District 7, District-Wide (DW) Traffic Operational Studies for InnovativeIntersection and Interchange Treatments - District 7 Counties, FL ▪FDOT District 7, I-275 from 54th Avenue S to 4th Street N PD&E Study - Pinellas County, FL ▪FDOT District 1, US 92 PD&E Study from County Line Road to Wabash Avenue - Polk County, FL ▪Pinellas County, San Martin PD&E Study - Pinellas County, FL ▪Pasco County, Prospect Road Pond and Route Study from SR 52 Extension to SR 52 - Pasco County, FL ▪FDOT District 1, I-75/Bee Ridge Road DDI and Continuous-Flow Intersection (CFI) - Sarasota County, FL ▪FDOT District 7, I-4/I-275 Downtown Interchange PD&E Study - Hillsborough County, FL ▪FDOT District 7, I-75 PD&E Study from MLK to Bearss - Hillsborough County, FL ▪FDOT District 6, 87th and Okeechobee PD&E Re-Evaluation - Miami-Dade County, FL 14 Michael Schmedt, GISP Data Analytics & Tools Drawing on nearly 20 years of industry experience, Michael serves as HDR’s Transportation Geospatial Cross-Sector Services Director providing innovative geospatial solutions for a wide variety of projects and clients. Michael utilizes his strong technical expertise on the development of data driven decision support systems, data management, analysis and visualization, transportation planning studies, travel demand modeling and environmental impact assessments. He is a GISCI certified GIS Professional and serves as board member on the Central Florida GIS (CFGIS) Workshop. EDUCATION Masters of Science in Geography, University of Cologne, Germany, 2002 Bachelor of Science, Geography, University of Cologne, Germany, 1998 REGISTRATIONS Certified Geographic Information Systems (GIS) Professional (GISP) PROFESSIONAL MEMBERSHIP Central Florida GIS (CFGIS) Workshop Board Member RELEVANT EXPERIENCE Orange County, FL, ADA Compliance for the Transportation Networks in the Public ROW Orange County, FL, Transit Stop ADA Assessment Study Greater Orlando Aviation Authority, Regulatory Sign Inventory FDOT Central Office, Florida Red Map Book FDOT Central Office – NETJOIN: An Automated Network Integration Tool FDOT Districts 4 & 6, Seven50 Travel Demand Model Update FDOT Central Office – Rail Highway Crossing Inventory FDOT District 5, TransPort: An Interactive Planning Transit Tool FDOT District 3, Critical Habitat Hot-Spots Mapping FDOT District 5, 2050 Highway Capacity Analysis FDOT District 5, Systems Operational Analysis Report (SOAR) Improvements Inventory FDOT District 5, Strategic Intermodal System (SIS) Highway Connector Assessment Lake~Sumter MPO Safe Routes to School, Phases 2 and 3, Lake and Sumter Counties, FL Kissimmee & Okeechobee Spatial Data Integration and Migration (KOSDIM), South Florida Water Management District, West Palm Beach, FL Solid Waste System Study, City of Hialeah, FL Transfer Station Siting and Engineering Study, City of North Port, FL Northwest Solid Waste Transfer Station, Orange County Government, Orange County, FL Project RENEW, Orlando Utilities Commission (2010), Orlando, FL Dakota, Minnesota, and Eastern (DM&E) Railroad, Boston, MA FDOT District 2, Interactive GIS Mapping System for Railroad Crossings Hurricane Monitoring & Debris Clean Up, Miami, FL Tupelo Railroad Relocation Planning & Environment Study – Phase I Feasibility Analysis SCAT North-South BRT Alternatives Analysis, Sarasota County Area Transit, FL Environmental Resource Permit (ERP) Application, Prime 1 Orlando Outlet Master Plan (Phase 2 Construction) Prime Retail, Orlando, FL Northwest Florida Transportation Corridor Authority, US 98 Master Plan Bloomington-Normal Urbanized Area Travel Demand Model Conversion and Update 15 EDUCATION M.S., Civil Engineering, North Carolina State University, 2012 B.S., Civil Engineering, University of North Carolina at Charlotte, 2008 REGISTRATION American Institute of Certified Planners OFFICE LOCATION Orlando, FL Jessica Smith, AICP Land Use & Redevelopment Jessica is a Senior Transportation Planner with over 10 years of private and public experience. She has extensive policy and network planning experience with state DOTs, regional planning organizations, and local municipalities. Prior to joining HDR, Jessica worked as Chief of Planning for the Matanuska-Susitna Borough based in Palmer, Alaska, where she was the transportation policy liaison for Alaska’s second largest and fastest growing population and over a jurisdiction of over 25,000 square miles and $55 million annually in State Transportation Improvement Program investment. RELEVANT EXPERIENCE Emerald Coast Regional Council, 2045 Bay County TPO Long Range Transportation Plan, Bay County, FL Emerald Coast Regional Council, Florida-Alabama TPO Long RangeTransportation Plan, Pensacola, FL Emerald Coast Regional Council, Regional Rural Transportation Plan, Pensacola, FL Emerald Coast Regional Council, General Planning Contract, Pensacola, FL MetroPlan Orlando, 2045 Metropolitan Transportation Plan (MTP), Pensacola, FL Orange County, Complete Streets Policy and Implementation Plan, Orange County,FL Orange County, Capital Improvement Program Assessment & Fiscal Plan, Orange County, FL Broward MPO, General Planning Consultant, Broward County, FL Broward MPO, Speak Up Broward Phase 2, Broward County, FL Anchorage Metropolitan Area Transportation Solutions (AMATS), AnchorageBike Plan Implementation*, Anchorage, AK Anchorage Metropolitan Area Transportation Solutions (AMATS), AnchoragePedestrian Plan Implementation*, Anchorage, AK Municipality of Anchorage (MOA), Downtown Trails Connection *, Anchorage, AK Municipality of Anchorage (MOA), Duben Avenue Upgrades*, Anchorage, AK Municipality of Anchorage (MOA), 10th Avenue Bike Boulevard*, Anchorage, AK Municipality of Anchorage (MOA), Golden View Drive Reconstruction *,Anchorage, AK Municipality of Anchorage (MOA), Senate District G & M PavementRehabilitation*, Anchorage, AK Municipality of Anchorage (MOA), Baxter Road Pavement Rehabilitation andWater Improvements*, Anchorage, AK Alaska Department of Transportation & Public Facilities (ADOT&PF), ParksHighway/Talkeetna Spur Road Pedestrian Improvements *, Talkeetna, AK Alaska Department of Transportation & Public Facilities (ADOT&PF), Knik GooseBay Road Reconstruction*, Wasilla AK 16 EDUCATION BS, Civil Engineering, University of Central Florida, 2009 REGISTRATIONS Professional Engineer, Florida OFFICE LOCATION Orlando, FL Mark Suarez, PE Mobility Planning Mark has extensive experience in transportation design from conceptual to final construction plans. He has successfully completed a wide variety of projects from developing alternative alignments, typical section packages and pavement designs to roadway plan and profiles, cross sections, traffic control plans, stormwater design and cost estimation. Mark is proficient in the use of the latest Corridor Modeling software and techniques to deliver a fully 3D design submittal. RELEVANT EXPERIENCE •City of Orlando, Church Street Streetscape Improvements, Orlando, FL •City of Orlando, Livingston Street Extension, Orlando, FL •City of Orlando, Downtown Connector Trail, Orlando, FL •Osceola County, Trail Network Review and Neptune Road Trail Concept Study (2018), Osceola County, FL •FDOT District 5, South Pomegranate Ave. Extension, Sanford, FL •Orange County Planning Department, Orlando/Orange County International Drive Feasibility and Technology Assessment / I-Drive Transit Study, Orlando, FL •City of Orlando, Bicycle Beltway Downtown Gap, Orlando, FL •FDOT District 4, Park and Ride Master Plan Support (2019), Fort Lauderdale, FL •MetroPlan Orlando Silver Star Road (2019), Orlando, FL •Lake Sumter MPO (2018), Orlando, FL •MetroPlan Orlando, Edgewater Drive Concept (2018), Orlando, FL •City of West Palm Beach, Northwest Cultural Trail •FDOT District 5, North Lake Trail Corridor Study •Orange County Planning Department, UCF Research Parkway Study, Orlando, FL 17 EDUCATION Master of Arts, Sustainable Development, University of South Florida, 2014 Bachelor of Science, Other Physical Sciences, University of Arkansas-Fayetteville, 2000 REGISTRATIONS ISI Envision Sustainability Professional ▪ United States National Registration. Issued: 04/08/2014, Expires: 04/08/2019 Professional Wetland Scientist ▪ United States National Registration, No. 2049 Issued: 09/07/2010, Expires: 09/07/2020 Gopher Tortoise Agent ▪ Florida, United States, No. GTA-09- 00207 Issued: 07/15/2009, Expires: 07/15/2019 Greenroads Sustainable Transportation Professional (STP) PROFESSIONAL MEMBERSHIPS Sarasota Bay Estuary Program Citizens Advisory Committee Member Sarasota Bay Estuary Program Technical Advisory Committee Florida Association of Environmental Professionals OFFICE LOCATION Sarasota, FL Sherri Swanson, PWS, GTA, ENV PV, STP Resiliency & Climate Action Planning Ms. Swanson has enjoyed a diverse career in science involving positions within local and federal governments, the private sector, a not-for-profit, and an international water entity. She has spent her career working with engineers to provided environmentally-sound, sustainable, and resilient solutions for infrastructure projects. Sherri regularly leads environmental studies and manages projects involving wetland mitigation, habitat restoration, wildlife surveys, and climate science. She holds a solid understanding of local, state and federal regulatory procedures, has experience with agency negotiations, and facilitates public workshops with diverse interest groups. RELEVANT EXPERIENCE ▪City of Sarasota Infrastructure Vulnerability Study and Climate Adaptation Plan - Sarasota, FL ▪Low Impact Development Water Quality Project, Anna Maria, Florida. (SWFWMDSurface Water Improvement and Management Program). ▪Coral Mitigation Assessment for the CVN Pier Construction - Mangrove Assessment - Apra Harbor Naval Base, Guam ▪Coronal Development Services. Critical Environmental Issues Analyses for Solar Siting Projects - Alachua and Gilchrest Counties, FL ▪Sarasota Stormwater Infrastructure Management Rehabilitation Program - Canal Stabilization Alternatives Report, Sarasota, Florida. ▪Curry Creek Preserve Amenities Permits, Design and Construction - Venice, FL ▪Curry Creek Regional Off-site Mitigation Area (ROMA) - Venice, FL ▪Fox Creek ROMA, Sarasota County, Florida. ▪Indian River Lagoon Coastal Armoring Research and Field Study, Saint Lucie County. ▪Lee County Buckingham Trails Preserve Site Improvements, Lee County, Florida. ▪Mid-Bay Bridge Authority, Bridge Connector, Eglin AFB, Florida. ▪Myakka River Deer Prairie Creek Preserve Restoration, Southwest Florida Water Management District, Sarasota, Florida. ▪Myakka River Regional Off-site Mitigation Area (ROMA), Sarasota County, Florida. ▪National Ecological Observatory Network (NEON) Florida Grasshopper Sparrow Survey and Reporting, Kissimmee, Florida. ▪Peace River Regional Water Supply Authority - Wind and Solar Energy Opportunities and Critical Ecological Issues Analysis, Desoto County, Florida. ▪Peace River Regional Water Supply Authority – Pipeline Mapping. ▪Pithlachascotee River Flow Regime Study, Pasco County, Florida. ▪FDOT Central Office. I-4 Design-Build Envision Assessment – Orlando, FL ▪Florida DOT District 1. Federal Endangered Species Biological Assessments (ESBA), South Florida ▪Florida DOT District 7. S.R. 60/Courtney Campbell Causeway Multi-use Trail Seagrass Survey, Tampa, Florida. ▪Florida DOT District 7. Wildlife Surveys - Kettering Road Borrow Site, Hernando County, Florida. 18 03 S.B.Friedman Qualifications The following pages provide background information on S.B. Friedman, HDR's subconsultant focused on housing planning and policy. Included is an introduction to their practice, relevant project experience, and resumes of key staff. 19 SB FRIEDMAN DEVELOPMENT ADVISORS SB Friedman Development Advisors (SB Friedman) assists in the planning and implementation of complex real estate development projects. Founded in 1990, the firm works closely with its clients to evaluate development potential and financial and business impacts; project market and financial feasibility; identify innovative public- private development solutions; and prepare implementable development strategies. SB Friedman has been recognized as one of the few consulting companies that truly understand both the public and the private perspectives on development issues. Firm Overview SB Friedman understands that a successful development project must have the support of the community in which it will be built. Our staff has substantial experience working to create plans and projects that resonate with the public. Our expertise has been applied to a wide variety of development situations, including: »Downtown Revitalization »Transit-Oriented Development »Office, Research Park & Industrial Projects »Retail Projects »Institutional Projects »Residential Development »Airport Collateral Land Development »Marina and Waterfront Development »Mixed-Use Developments »Community Facilities Why SB Friedman? The firm has extensive experience in bringing together economics and planning to provide action-oriented development advice. Drawing on planning training, basic conceptual issues can be addressed and then supplemented by teams that include physical planning professionals such as site planners, urban designers, landscape architects, architects and engineers. Among the key advantages of the firm are the following: Development Consulting is Our Business We provide objective, independent advice in the field of real estate development, specializing in the business aspects of development, including public-private partnerships. We Understand Both the Public and Private Perspectives We have worked for both private developers and public agencies. We analyze economic feasibility of developments from the private sector perspective and understand public sector concerns with benefits, level of assistance and fiscal impacts. Extensive Experience as a Development AdvisorOur firm has worked on behalf of municipalities, counties, private developers, non-profits and many others. We have provided strategic and tactical advice in cities as large as Chicago and as small as Scales Mound, Illinois. While every problem, like every town and piece of real estate, is unique, we have a great breadth and depth of experience from which to draw when working to solve your problem or help you plan for the future. In-Depth Experience in Public-Private Development Finance SB Friedman Development Advisors has served as analyst and advisor for $4.6 billion of public funds that were part of $27.0 billion in development projects over the past 12 years. We have extensive experience with a wide range of public finance tools including tax increment financing, New Markets Tax Credits, special district financing, Low Income Housing Tax Credits, value capture, infrastructure financing, and other elements of the layered capital stack typical of many projects. Reflecting our role, SB Friedman Development Advisors is registered with the Municipal Securities Rulemaking Board as a Municipal Advisor. 20 SB FRIEDMAN DEVELOPMENT ADVISORS Pinellas Gateway / Mid-County Area Master PlanFORWARD PINELLAS SB Friedman is providing real estate market analysis and economic development and land use strategy services as a part of a larger master planning team for the Gateway Master Plan in Pinellas County. The Gateway is an approximately 30-square mile area under four local government jurisdictions, including the cities of Largo, St. Petersburg, Pinellas Park and Pinellas County. This area is the primary economic engine of Pinellas County and comprises a mixture of Class-A corporate office space, industrial, retail and residential uses. The area is largely built out which complicates growth. Further, it suffers from the challenges of a disconnected automobile centric development pattern. SB Friedman is working as a part of a multi-disciplinary team led by WRT to develop a Master Plan that creates a vision, addresses the challenges, and provides strategies to enhance the study area in the future. A Steering Committee, made up of City staff, key stakeholders and economic development professionals, is providing ongoing input and guidance at key decision points in the project, including identifying challenges and opportunities and selecting priority sites. SB Friedman utilized a customized market analysis approach to project development potential for retail, office, industrial and hospitality uses These market findings have informed targeted redevelopment strategies for key areas within the study area. One priority subarea was the Carillon Office Park, a suburban Class-A office park anchored by multiple Fortune 500 companies. Our plan sought to leverage future transit enhancements and a multi-modal transit hub to transform the existing surface parking lots and underutilized land and catalyze additional mixed-use development. Results: This project is ongoing. SB Friedman presented findings from the market analysis to the Stakeholder Management Team in July 2018. We are targeting plan finalization in early 2020. DDRRAAFFTT Source: CoStar, ESRI, SB Friedman 04 Office: Study Area Office Class A Office Under Construction or Proposed Building Attribute Less than 10,00010,000 –25,00025,000 –50,00050,000 –100,000More than 100,000 Building RBAStudy Area 21 SB FRIEDMAN DEVELOPMENT ADVISORS us 19 Land use and economic analysis SB Friedman provided real estate market analysis and guidance for a transportation and land use strategy related to the proposed US 19 Corridor roadway improvements in Pinellas County. The Florida Department of Transportation (FDOT), Forward Pinellas (the metropolitan planning organization), and Pinellas County have long-range plans to improve transportation operations in the US 19 Corridor. To better understand how transportation improvements would impact various stretches of the US 19 Corridor, Pinellas County and Forward Pinellas engaged HDR and SB Friedman to prepare a land use and planning analysis. It includes Phase I in Palm Harbor (analysis initiated by WTL+A); Phase II in Largo; and Phase III in Tarpon Springs. While the US 19 Corridor was developed as a conventional suburban auto-oriented thoroughfare, the character and market potential varies. For each phase, SB Friedman utilized a customized market analysis approach to evaluate the development impacts of planned transportation improvements that will limit access in order to improve mobility, by: »Conducting interviews and engaging with key stakeholders; »Investigating existing demographic, employment, and market conditions in the corridor; »Preparing top-down demand forecasts of the market potential for office, hotel, residential and retail uses; and »Providing a framework for a targeted redevelopment strategy in the future. Results: The information gathered in the corridor studies will inform the need for potential future action plans related to transportation, land use, economic and/or community-identified issues and opportunities. We presented our analysis for Phase I (Palm Harbor) in 2017, and Phases II and III (Largo and Tarpon Springs) in 2018. WORKFORCE HOUSING MARKET ASSESSMENT SB Friedman was engaged by Pinellas County, Florida, to assess the availability of housing at various price points affordable to the local workforce. The analysis informed policy direction regarding the use of Penny for Pinellas sales tax revenues to support economic and workforce housing development. Pinellas County is a largely built-out county, with limited sites for new residential development. Given the land constraints, there is concern amongst local stakeholders regarding the availability of housing for low- to moderate-income households and employees moving to the County to work within target employment sectors. SB Friedman was engaged to assess the local housing market and to assist in preparing a policy framework focused on increasing the supply of workforce housing. Our work included: »Evaluating housing supply by typology and tenure; »Assessing land availability for residential development, both in the County and in adjacent counties; »Analyzing the supply of low-to-moderate income housing, defined as households earning 60-80% of area medianincome (AMI); »Analyzing the supply of housing available to households earning 120% of AMI; »Assessing availability of new construction and outlining redevelopment challenges; and »Assisting in preparing policy guidelines focused on increasing workforce housing in the County. Results: Our market findings were presented to the County in April 2019. Our analysis informed the housing component of the policy guidelines for Penny for Pinellas IV, which were adopted December 10, 2019. PINELLAS COUNTY, FLORIDA PINELLAS COUNTY, FLORIDA 22 SB FRIEDMAN DEVELOPMENT ADVISORS airport-adjacent corridor market assesment SB Friedman conducted a market assessment as part of a corridor master planning process, led by Vrana Consulting, for the City of Zephyrhills. Our assessment will be used to inform near- to long-term market potential in the corridor for several industrial and other commercial land uses. The City of Zephyrhills received a community planning technical assistance grant from the state of Florida to help foster a vibrant, healthy community focused on growing the City’s employment base. With the grant, the City engaged our team to assess market potential for industrial, office and retail land uses within a corridor adjacent to the City’s municipal airport. We performed the following steps to provide a thorough assessment of the market potential for each land use: »Spatially analyzed historical and recent patterns of new industrial, office and retail development within the region; »Assessed the corridor’s position in the competitive market for these land uses; »Reviewed industrial, office and retail competitive supply and market data; »Researched overall trends in industrial, office and retail typologies and how those trends could fit within thecorridor; and »Projected near- to long-term development scenarios for industrial, office and retail development. Results: SB Friedman delivered the results of our assessment to the City in March 2019. The corridor master planning process was completed in 2019. Downtown Circulator TOD Planning Study SB Friedman is working as part of a consulting team led by Skidmore, Owings & Merrill (SOM) to conduct a transit-oriented development (TOD) planning study along a proposed four-mile bus rapid transit (BRT) line in downtown Rochester. Our role includes conducting a market assessment and projecting the impact of the BRT line on real estate development potential. The City of Rochester was awarded a Federal Transit Administration (FTA) grant under the Pilot Program for TOD Planning to conduct a comprehensive analysis of transit-supportive land use and economic development opportunities related to the proposed BRT line. The Mayo Clinic is the City’s largest employer and a dominant institutional anchor in the region. As the Mayo Clinic continues to expand, the City is aiming to provide strategic direction to guide future development in the downtown area, as envisioned in the Destination Medical Center (DMC) initiative. The BRT is viewed by the City as an integral step in advancing the goals and objectives of the DMC initiative. SB Friedman is conducting a market assessment to project office, retail and hotel development in the region and the BRT study area. To date, we have engaged with local developers and institutional drivers such as the Mayo Clinic to understand the current development climate, researched emerging innovation clusters in biotechnology, and analyzed the impacts of population, employment and visitation growth to identify real estate development opportunities. Our analysis considers the impact that a high-quality BRT system can have on the value, pace and density of development. Results: SB Friedman has completed an existing market conditions report and is in the process of completing demand projections. Next steps include conducting a financial feasibility analysis for office and retail development within the BRT corridor. CITY OF ZEPHYRHILLS, FLORIDA CITY OF ROCHESTER, MINNESOTA 23 SB FRIEDMAN DEVELOPMENT ADVISORS EQUITABLE GROWTH THROUGH TOD PLANCITY OF MILWAUKEE DEPARTMENT OF ECONOMIC DEVELOPMENT As part of a larger planning effort led by SOM, SB Friedman evaluated the economic feasibility of redevelopment in two neighborhoods next to downtown Milwaukee, and prepared development strategies that would maintain affordability for existing residents and businesses. The City of Milwaukee undertook a major planning effort focused on extending the City’s streetcar line into two downtown-adjacent neighborhoods: Bronzeville and Walkers Point. These neighborhoods have been historically immigrant and African-American communities that have not benefited from the development momentum that is occurring in the central business district. The goal of the City was to leverage the streetcar extension in a manner that connects existing residents to economic opportunities in the downtown area, as well as encourage redevelopment in the neighborhood without displacing existing residents and businesses. Our work included: »Defining development programs for key catalytic sites; »Evaluating the economic feasibility of development under various land use,affordability and financing scenarios; »Outlining strategies to catalyze redevelopment and reduce cost burdensassociated with redevelopment; and »Identifying funding and financing mechanisms to support transit-orienteddevelopment and transit improvements. Results: The Equitable Growth Through Transit Oriented Development Plan was adopted by the Milwaukee City Council in October 2018. The City is currently exploring the availability of financing sources for the two streetcar extensions and is incorporating the plan’s recommendations into its overall planning and development initiatives. This project won a Planning Excellence for Economic Development Award from APA-Wisconsin in October 2019. To view the final plan, please visit the City’s website. 24 SB FRIEDMAN DEVELOPMENT ADVISORS PROJECT EXPERIENCE Geoff is a real estate and economic development advisor with expertise in market analysis and development strategy, public-private development finance, financial gap analysis, and special district establishment. Geoff provides market-based development strategies to public, private and institutional clients that are implementable. His experience includes conducting a customized market analysis to account for the significant development potential to be generated by a planned light rail line in Hennepin County, Minnesota, and leading a market analysis along the US 19 commercial corridor in Pinellas County, Florida. Geoff is a Series-50 Qualified Municipal Advisor Representative. Land Use Plan for Planned Bottineau LRT Line • Hennepin County, MNLed a customized market analysis to account for the significant development potential to be generated by a planned light rail line in suburban Minneapolis Transit-Supportive Development Suitability Assessment • Pinellas County, FLAssessed and identified priority transit corridors suitable for transit-supportive development that provide better opportunities to support ridership and facilitate economic development for underserved areas by linking affordable housing, employment and workforce training opportunities Penny IV: Affordable Housing & Economic Development Program Policy Guidelines •Pinellas County, FLConducted market analyses to inform and create policy regarding the use of Penny IV funds for affordable housing and economic development; utilized a customized market analysis approach to estimate development potential, identify prototypical development typologies, and identify barriers to office and industrial development; crafted policy to strategically invest in capital projects to ameliorate barriers to development Pinellas County Workforce Housing Market Assessment • Pinellas County, FLAssessed workforce and affordable housing availability in Pinellas County and nearby counties to help inform policy direction regarding the use of Penny for Pinellas funding in support of affordable housing; assessment considered the typology, spatial distribution, quantity and characteristics of available housing at 60% AMI, 80% AMI and 120% AMI Cumberland Station Area TOD Study • Des Plaines, ILPrepared a transit-oriented development study for the Cumberland Metra station area; developed a detailed implementation strategy including key projects, action steps and potential funding sources; goals included fostering improvements to the station area, attracting/retaining businesses, enhancing transit access, and increasing ridership TOD Triangle Developer Selection & Negotiation Support • Orland Park, ILAssisted the Village in evaluating and selecting a developer for parcels within its TOD Downtown Triangle area; also supported negotiation efforts with the developer TOD Infill Project Requests for Municipal Financial Assistance Support • Elmhurst, ILSupported two separate developer requests for municipal financial assistance to make two commuter rail-adjacent rental apartment buildings financially feasible; public funds were required to support extraordinary infrastructure, environmental remediation and other project costs TOD Strategy & New Urbanist Master Plan • Tinley Park, ILEvaluated commuter rail transit-oriented development potential as part of a new urbanist master planning effort for the former 280-acre Tinley Park Mental Health Center Campus; assessment included evaluation of market potential by land use, preliminary development phasing, and value capture strategies to support anticipated public sector infrastructure expenditures GEOFFREY DICKINSON, AICPSENIOR VICE PRESIDENT EDUCATIONMaster of Urban Planning, University of Michigan, 2004 Bachelor of Arts Degree in History, Northwestern University, 1993 PROFESSIONAL/CIVIC ORGANIZATIONSAmerican Planning Association (APA) /American Institute of Certified Planners (AICP) Illinois Tax Increment Association (ITIA) (Board Member) Lambda Alpha International- Ely Chapter (Board Member) Amita Health SMEMC Community Leadership Board SELECT PUBLICATIONS 2017, “Constructing Effective Public-Private Partnerships” (with L. Dorn), American Planning Association PAS Memo 2016, “Reviewing a Deal: Finding the Right Size and Structure” (with L. Dorn), ILCMA Newsletter2014, “(Re-)Development Strategy: The Bridge from Goals to Implementation” (with S. Friedman and F. Lefor Rood), ILCMA Newsletter2013, “What’s Next?” (with S. Friedman), ILCMA Newsletter SELECT PRESENTATIONS “TIF Legal & Procedural Nuts & Bolts” (CDFA TIF Webcourse, 2019) “Public-Private Partnerships and Economic Development Tools” (Chicago Bar Association, 2018) “Beyond TIF: Economic Development Tools and Strategies” (ILCMA Metro Luncheon, 2017) “Economic Development Despite the State of Illinois” (ILCMA Winter Conference, 2017) “Reinventing Resource-Rich Midwestern Cities” (APA National Conference, 2016) 25 SB FRIEDMAN DEVELOPMENT ADVISORS Transit-Supportive Development Suitability Assessment • Pinellas County, FLAssessed and identified priority transit corridors suitable for transit-supportive development that provide better opportunities to support ridership and facilitate economic development for underserved areas by linking affordable housing, employment and workforce training opportunities Penny IV: Affordable Housing & Economic Development Program Policy Guidelines • Pinellas County, FLConducted market analyses to inform and create policy regarding the use of Penny IV funds for affordable housing and economic development; utilized a customized market analysis approach to estimate development potential, identify prototypical development typologies, and identify barriers to office and industrial development; crafted policy to strategically invest in capital projects to ameliorate barriers to development Pinellas County Workforce Housing Market Assessment • Pinellas County, FLAssessed workforce and affordable housing availability in Pinellas County and nearby counties to help inform policy direction regarding the use of Penny for Pinellas funding in support of affordable housing; assessment considered the typology, spatial distribution, quantity and characteristics of available housing at 60% AMI, 80% AMI and 120% AMI Near West Side & East Garfield Park Neighborhood Development Strategy • Chicago, ILConducted a residential market assessment and helped create a strategy to cultivate the development of a balanced housing market in Chicago’s Near West Side and East Garfield Park neighborhoods Land Use & Economic Analysis for the US 19 Corridor • Pinellas County, FLAssessed the impact of transformative transportation improvements along specific stretches of the US 19 corridor and provided real estate market analysis for commercial, office, hotel and multifamily land uses as part of a transportation and land use strategy related to the US 19 Corridor roadway improvements in Pinellas County Pinellas County Gateway Master Plan • Pinellas County, FLProvided real estate market analysis and economic development and land use strategy as part of a larger master planning team for the Gateway Master Plan in Pinellas County; study identified available public assistance tools and opportunities for public-private partnerships to facilitate development SOM Rochester Downtown Circulator TOD Planning • Rochester, MNEvaluated transit-oriented development potential as part of a Downtown Circulator planning effort; assessment included evaluation of market potential by land use and considered the multiplier impact that a high-quality BRT system can have on the value, pace and density of development. 17th and Madison Financial Deal Review • Kansas City, MOReviewed a financial request to evaluate the appropriate level and structure of public financial assistance on behalf of the Economic Development Corporation of Kansas City EDUCATION Master of Science in City Design and Social Science, London School of Economics, 2014 Master of Business and Master of Arts in Community Development and Planning, Clark University, 2012 Bachelor of Arts in Economics, Wheaton College (MA), 2010 professional/civic organizations American Planning Association/American Institute of Certified Planners (AICP) SELECT PUBLICATIONS “Exchange Publics” (with Ibrahim, D., Martin Sainz de los Terreros, J., and M. Morel), Public City, MSc City Design and Social Science Studio Publication 2011-2012 (pp. 114-135). London, UK: The Cities Programme, The London School of Economics and Political Science. SELECT PRESENTATIONS “The Changing Retail Real Estate Landscape” (ITIA Fall Conference, 2018) “E-Commerce and Vibrant Communities: Planning for Retail and Industrial Development” (Chicago Metro Section, APA IL, June 2018) “The Red Zone: Right-Sizing Retail for Comprehensive Planning” (Speed Planning Session, APA IL Conference, 2017) PREVIOUS EXPERIENCE Policy and Planning Researcher, Downtown Boston Business Improvement DistrictResearch Consultant, London School of Economics Enterprise (Client: Better Bankside Business Improvement District in London, UK) PROJECT EXPERIENCE Caitlin specializes in urban economics, public-private development finance and economic development. She has expertise in market analysis and redevelopment strategy, focusing on the interplay between transportation and land use. Caitlin utilizes a data-driven approach to evaluate development opportunities, guide the use of public funds to support redevelopment and inform land use decisions. Her experience at SB Friedman includes providing market and economic development/land use strategy advice as part of various comprehensive, master and subarea plans. CAITLIN johnson, AICPPROJECT MANAGER 26 Clearwater Comprehensive Plan | Scope of Services Page 1 of 9 Scope of Services Clearwater Comprehensive Plan Update HDR | 14Aug20 TASK 1. PROJECT START UP 1.1 Kick-Off Meeting Consultant will participate in a kick off meeting with City staff to review the project scope, discuss project management and communication protocols, and review the project schedule. 1.2 Project Schedule & Management Following the kick-off meeting, the consultant will prepare a refined version of the project schedule and submit for staff review. Management activities will include bi weekly calls with staff to review project progress, preparation of project invoices and progress reports, and on- going coordination with staff through the project. 1.3 Outreach & Engagement Plan The consultant will prepare a plan for outreach and engagement organized by planning stage. The plan, developed in collaboration with staff, will identify methods to inform stakeholders of the project, educate stakeholders about issues and opportunities, and solicit and document public feedback. The plan will also define: • a graphic identity for the plan, including naming convention, color palette, and plan logo for use in public communications and plan preparation; • the general structure and content of a Comprehensive Plan-specific web page and online engagement tools to be developed by the City using Engagement HQ or a similar online platform; • recommendations for the use of social media strategy for staff to provide project updates and announcements; • recommendations for in-person public involvement activities to engage community stakeholders; and • plans for periodic briefings with City Council, CDB, and other appointed and elected officials. Development of the plan will involve close coordination with the City’s Public Communications staff. Clearwater Comprehensive Plan | Scope of Services Page 2 of 9 1.4 Project Web Site Development The consultant will prepare project content for posting on the project web site. The web site, to be developed by the City, will provide introductory information on the plan update process, periodic updates on the planning process, and engagement tools and surveys to gain public and stakeholder feedback on planning issues, opportunities, and recommendations. The consultant will provide content for the web site three times during the project: 1) during the initial development of the project site; 2) following the data and analysis effort to include information on existing conditions; and 3) following preparation of an initial draft of the plan. TASK 2. DATA & ANALYSIS 2.1 Socio-Economics & Demographics The consultant will guide staff in the evaluation of existing demographic and socio-economic conditions to include information regarding the following: • analysis and reporting of existing and projected population and employment using BEBR as base with projections by TAZ from regional model; • analysis and reporting of existing socio-economic and demographic data focused on characteristics relevant to planning policy development, including age, income, household size, vehicle ownership, commute mode and distance, etc.; and • analysis and reporting of readily available health data (CDC’s 500 Cities Project: Local Data for Better Health) to identify areas with cluster of residents with poor health outcomes. Such mapping may be used to set priorities for active transportation, transit, or other potential improvements. The consultant will provide direct assistance for a portion of the mapping and evaluation of certain demographic and socioeconomic conditions. This portion of the total effort will focus on identifying areas of the City with populations that may be more likely to experience challenges with housing affordability and access to jobs, community and social services, and parks and recreation facilities. 2.2 Land Use & Urban Form The consultant will complete an evaluation of existing patterns of land use and development with the intent of documenting existing land uses and identifying the existing pattern and character of development. This will include mapping of designated activity center and corridors, industrial and employment districts, and different types of residential areas exhibiting similar characteristics, e.g. age of construction, value, lot and house size, etc. Mapping will also show Clearwater Comprehensive Plan | Scope of Services Page 3 of 9 environmental constraints such as floodplains and wetlands. The consultant will also complete a review of past planning studies addressing the form and character of development. 2.3 Housing Affordability & Availability The consultant will complete the following analysis to address housing conditions and affordability: • Inventory Existing Housing Stock. Working with available proprietary private databases, along with federal, state and city data, the consultant will prepare an inventory and analysis of the existing City housing supply, including market rate and affordable housing products. The inventory will include all housing typologies including single-family detached, single-family attached, multifamily and mobile homes. Key variables will include: o Overall housing profile (tenure, occupancy, age, price) o Percent and location of housing units that are:  Legally restricted affordable housing;  Naturally occurring affordable housing with no legal restriction; and  Located in age restricted or assisted living communities. • Analyze Affordability of Existing Housing Stock. The consultant will develop a high level housing affordability model for the City as a whole which will quantify the extent to which there is a mismatch between the cost of the existing housing stock (both for- sale and rental) and current residents’ household incomes. Using available ACS data, the model will compare the number of households by income cohort to the housing stock affordable at 30% of a household’s annual gross income. The affordability assessment will be based on ACS data on housing units, home values and rents, household income and tenure. 2.4 Sustainability/Resiliency The consultant will guide staff in evaluating existing policies and strategies, and the preparation of a map set and narrative to address the following: • areas vulnerable to climate change, including areas identified in Task 2.1; • sea level rise and storm surge strategies, including the City’s Peril of Flood amendment effort; • recent research by Tampa Bay’s Climate Science Advisory Panel and policy developed by Tampa Bay Regional Planning Council’s Resiliency Council; • existing community-wide greenhouse gas emissions data; and Clearwater Comprehensive Plan | Scope of Services Page 4 of 9 • recent policy recommendations from Tampa Bay Regional Planning Council to align with Tampa Bay Estuary Program’s Comprehensive Conservation and Management Plan. 2.5 Mobility The consultant will prepare planning level analysis of the existing transportation and transit networks serving the City. This evaluation will address the following: • existing roadway capacity highlighting areas at and over capacity based on an evaluation of volume over capacity; • existing crash hot spots showing crashes by type and severity; • existing and planned active transportation network improvements, including sidewalks, trails, and bicycle accommodations, and mapping indicating areas generating the highest demand for active transportation based on factors such as age, income, automobile ownership, etc.; • existing and planned transit service, including information on routes and stops with highest levels of use; • review of complete streets and context zone work previously completed, including mapping of streets previously identified as being appropriate for complete streets improvements; and • review and mapping of planned and programmed improvements. The mobility analysis will draw on data, analysis, and recommendations in Advantage Pinellas (the Forward Pinellas LRTP) and other countywide and regional plans. The consultant will use readily available data regarding traffic volumes and transportation system conditions, capacity, and plans. 2.6 Policy Context The consultant will guide staff in the preparation of a report summarizing existing policy and regulatory provisions shaping land use and development in the City. The summary report, to be prepared by staff and reviewed by HDR, will document the following: • provisions of the Countywide Plan Rules, including a review of existing policy and categories and an assessment of the potential impact of recent rule changes; • the validity of existing Comprehensive Plan goals, objective, and policies to indicate which should be carried forward in the update, which require evaluation and adaptation, and which may no longer valid or appropriate; • land development code review and evaluation focusing on existing standards shaping the physical form and configuration of development with the purpose of identifying Clearwater Comprehensive Plan | Scope of Services Page 5 of 9 areas of the code requiring refinement or adjustment to achieve plan goals and objectives; and • policies related to annexation and extra-jurisdictional issues. 2.7 Annotated Outline and Template for Plan & Plan Elements The consultant will prepare an annotated outline for the full plan. The outline will include a description of content for plan elements, including an overall structure for each element, element-specific content, and a detailed description of the map series required to support the full plan. The consultant also will prepare a graphic template for the full plan providing direction regarding page layout, text treatments, the design of tables and figures, and the design and placement of maps for incorporation in the plan. 2.8 Planning Context Summary Report The consultant will prepare a report and presentation providing a high-level summary of findings from the data and analysis. The report will be in the form of a highly-graphic briefing booklet, approximately 10 pages in length, including summary narrative, maps, and infographics. Staff will provide map graphics for use in the report and presentation. Material prepared for the report will be available to the City for posting on the project web site. TASK 3. VISIONING & PLANNING FRAMEWORK 3.1 Outreach & Engagement Activities The consultant will assist staff in planning for the first round of online and in person engagement activities designed to engage stakeholders and the general public in discussions about the City’s future. Feedback from these activities will inform the development of the Vision Statement and Preliminary Framework Report. The consultant will assist in planning for the following activities. (Notes below indicate the number of sessions in which the consultant will participate.) • Listening Sessions with Key Leaders. Staff will prepare for and complete one-on-one and small group meetings with key leaders to introduce the planning process and discuss ideas for the future of the City. These sessions could include one-on-one listening sessions with City Council members. Consultant will advise on meeting structure and agendas, prepare discussion questions, and participate in up to seven listening sessions. • Public Visioning Sessions/Community Conversations. Staff will prepare for and complete a mix of in person workshops and/or online webinars to engage participants in Clearwater Comprehensive Plan | Scope of Services Page 6 of 9 discussions about visions for the future of the City and ideas for conservation, improvement, and transformation. Consultant will prepare a project presentation, define discussion topics, and prepare other meeting material to support public dialogue. Consultant will participate in up to four public visioning sessions/community conversations. • Web Feedback Instrument. The consultant will guide the City on the preparation of an online feedback instrument to gain public input on issues and vision. The consultant will guide staff in the preparation of a flyers, posters, social media posts, mailers, or other print or electronic material for use in engagement activities or for broader distribution. Staff will be responsible for meeting scheduling, logistics, printing and mailing, misc. meeting materials, equipment, and invitations. 3.2 Vision Statement & Preliminary Framework Report The consultant will prepare a Vision Statement (or Guiding Principles) and Preliminary Framework Report stating the City’s vision for the future and presenting a preliminary framework to guide preparation of the plan elements. The Vision Statement (or Guiding Principles) and Preliminary Framework Report will be prepared as a brief (approximately 10 pages), user-friendly document. • Vision Statement. The Vision Statement (or Guiding Principles) will be presented as a series of statements with supportive graphics stating the City’s broad intention to improve livability, housing affordability, sustainability/resiliency, mobility, equity and inclusion, place quality, parks and public spaces, and competitiveness. • Preliminary Framework Report. The Preliminary Framework Report will include maps and a narrative describing an overall geographic framework and generalized direction for the plan addressing land use, development, and community character. Illustrative maps will be used to present a citywide structure for the City and narrative and supporting graphics will be used to present preliminary goal and policy statements, density and intensity ranges, and character prescriptions by geographic area. The preliminary framework will identify transportation systems by type of facility and modal priority and indicate recommendations for improvements such as enhanced transit service, trail connections, and complete street improvement priorities. The framework will also include preliminary policy direction for cross-cutting issues like resiliency and sustainability, housing affordability, transit-supportive land use, and multimodal mobility. Clearwater Comprehensive Plan | Scope of Services Page 7 of 9 3.3 Vision & Framework Review & Finalization The consultant will prepare for and participate in in up to five briefings with senior City staff and prepare for and participate in workshops (one each) with the Community Development Board (CDB) and the City Council to review feedback from public engagement activities and present drafts of the Vision Statement and Preliminary Framework Report. The consultant will incorporate feedback from senior staff, the CDB, and City Council into a final Vision Statement and Preliminary Framework Report. Material prepared for the report will be available to the City for posting on the project web site. TASK 4. PLAN DRAFTING 4.1 Drafting of Plan Elements The consultant will assist staff in the preparation of an initial draft of the plan. A brief description of the contents of the introductory section and each element follows. Notes in italics indicate which sections of the plan the consultant will take the lead preparing. • Introductory and Cross-Cutting Content (Consultant prepares initial draft.) o Vision Statement o Plan Framework • Land Use Element Draft (Consultant prepares initial draft of the element. City staff prepares map series.) o Summary of Existing Conditions o Citywide Goals, Objectives, Policies, and Strategies o Goals, Objectives, Policies, and Strategies by Place Type o Map Series • Mobility Element Draft (Consultant prepares initial draft of the element. City staff prepares map series.) o Summary of Existing Conditions o Goals, Objectives, Policies, and Strategies o Map Series • Housing Element Draft (Consultant prepares initial draft of the element. City staff prepares map series.) o Summary of Existing Conditions o Goals, Objectives, Policies, and Strategies o Map Series Clearwater Comprehensive Plan | Scope of Services Page 8 of 9 • Other Elements Draft (City staff prepares all draft elements. Consultant reviews and provides comments regarding consistency and compatibility with land use, mobility, and housing elements.) o Other drafts to include Coastal Management, Conservation Element, Recreation and Open Space, Intergovernmental Coordination, Capital Improvements, and Utilities. 4.2 Preliminary Executive Summary The consultant will prepare a preliminary draft of an approximately ten page Executive Summary and a PowerPoint presentation for use in public meetings. The consultant also will prepare summary material for posting on the project web site. 4.3 Engagement Activities The consultant will assist staff in planning for a second round of online and in person engagement activities designed to engage stakeholders and the general public in review of the draft plan. (Notes below indicate the number of sessions in which the consultant will participate.) • Briefings with Key Leaders. Staff will prepare for and complete one-on-one and small group meetings with key leaders to review the draft plan and seek feedback regarding refinements. Consultant will participate in up to five briefings with key leaders. • Planning Workshops. Staff will prepare for and complete workshops and/or online webinars to engage participants in review of the draft plan. Consultant will prepare a project presentation define discussion topics, and prepare other meeting material to support public dialogue. Consultant will participate in up to six public workshops. • Web Feedback Instrument. Using the project web site and tools available through Engagement HQ, the consultant will guide the City on the preparation of an online feedback instrument to gain public input on the draft plan. The consultant will guide staff in the preparation of a flyers, posters, social media posts, mailers, or other print or electronic material for use in engagement activities or for broader distribution. Staff will be responsible for meeting scheduling, logistics, printing and mailing, misc. meeting materials, equipment, and invitations. Clearwater Comprehensive Plan | Scope of Services Page 9 of 9 TASK 5. PLAN REFINEMENT & ADOPTION 5.1 Work Sessions with City Council/CDB The consultant will provide support to staff in the final review and adoption of the plan. This support will consist of preparing for and participating in up five work sessions and hearings with Community Development Board and City Council. 5.2 Plan Review & Refinement The City will take the lead on preparing edits to the initial draft plan based on feedback from City leaders and key stakeholders. The consultant will assist by conducting a full review of up to three full revisions to the initial draft plan. The review will focus on ensuring consistency and readability across all plan elements. 5.3 Plan Publication & Final Executive Summary Following plan adoption, the consultant will prepare an update to the preliminary draft of the Executive Summary and guide staff on final edits and layout of the final plan document. ATTACHMENT B: BUDGET Comprehensive Plan Services - City of Clearwater 14-Aug-20 SS SM MZ CS TP Senior Principal Planner (Chief Planner) Senior Planner/Urban Designer (Senior Planner) Professional Planner (Planner II) GIS Technician (GIS Specialist) Administrative/ Project Support (Secretary/ Clerical) Executive Professionals (Sr Vice President) Project Manager (Associate Project Manager) Senior Project Associate (Associate)TASK $260 $165 $145 $94 $93 $265 $200 $160TASK 1. PROJECT START UP 1.1 Kick-Off Meeting 4 4 4 0 0 12 0 4 0 4 1.2 Project Schedule & Management 36 0 36 0 24 96 4 4 0 8 1.3 Outreach & Engagement Plan 4 8 44 0 0 56 0 0 0 0 1.4 Web Site Development 2 0 24 0 0 26 0 0 0 0 Subtotal Hours 46 12 108 0 24 190 4 8 0 12 202 Subtotal Fee $11,960 $1,980 $15,660 $0 $2,232 $31,832 $1,060 $1,600 $0 $2,660 $34,492 TASK 2. DATA & ANALYSIS 2.1 Socio-Economics & Demographics 2 0 16 20 0 38 0 0 0 0 2.2 Land Use & Urban Form 8 12 48 16 0 84 0 0 0 02.3 Housing Affordability & Availability 4 0 12 0 0 16 16 32 85 1332.4 Sustainability/Resiliency 2 0 4 0 0 6 0 0 0 02.5 Mobility 8 40 60 40 0 148 0 0 0 02.6 Policy Context 4 0 8 0 0 12 0 0 0 02.7 Annotated Outline and Template for Plan & Plan Elements 2 2 20 0 0 24 0 0 0 02.8 Planning Context Summary Report 8 16 40 8 0 72 0 0 0 0Subtotal Hours 38 70 208 84 0 400 16 32 85 133 533Subtotal Fee $9,880 $11,550 $30,160 $7,896 $0 $59,486 $4,240 $6,400 $13,600 $24,240 $83,726TASK 3. VISIONING & PLANNING FRAMEWORK3.1 Outreach & Engagement Activities 20 0 48 0 0 68 0 0 0 03.2 Vision Statement & Preliminary Framework Report 8 8 40 16 0 72 0 0 0 03.3 Vision & Framework Review & Finalization 20 0 36 4 0 60 0 0 0 0Subtotal Hours 48 8 124 20 0 200 0 0 0 0 200Subtotal Fee $12,480 $1,320 $17,980 $1,880 $0 $33,660 $0 $0 $0 $0 $33,660TASK 4. PLAN DRAFTING4.1 Drafting of Plan Elements 8 16 80 8 0 112 8 16 24 48 4.2 Preliminary Executive Summary 12 8 40 8 0 68 0 0 0 0 4.3 Outreach & Engagement Activities 14 8 30 0 0 52 0 0 0 0 Subtotal Hours 34 32 150 16 0 232 8 16 24 48 280 Subtotal Fee $8,840 $5,280 $21,750 $1,504 $0 $37,374 $2,120 $3,200 $3,840 $9,160 $46,534 TASK 5. PLAN REFINEMENT & ADOPTION 5.1 Work Sessions with City Council/CDB 12 0 24 0 0 36 4 8 0 12 5.2 Plan Review & Refinement 8 12 40 8 0 68 5.3 Plan Publication 4 8 24 0 0 36 0 0 0 0 Subtotal Hours 24 20 88 8 0 140 4 8 0 12 152 Subtotal Fee $6,240 $3,300 $12,760 $752 $0 $23,052 $1,060 $1,600 $0 $2,660 $25,712 TOTAL HOURS 190 142 678 128 24 1162 32 64 109 205 1367TOTAL FEE $49,400 $23,430 $98,310 $12,032 $2,232 $185,404 $8,480 $12,800 $17,440 $38,720 $224,124 TOTAL FEES $224,124 DIRECT EXPENSES $2,200 WEB PLATFORM DIRECT EXPENSE $10,000 TOTAL NOT-TO-EXCEED BUDGET $236,324 HDR Subotal Hours/Fee SBF Subotal Hours/Fee HDR SB Friedman HDR/SBF TOTALS SCHEDULE Clearwater Comprehensive Plan Update 14-Aug-20 TASK 1. PROJECT START UP Kick-Off Meeting Project Schedule & Management Outreach & Engagement Plan Web Site Development TASK 2. DATA & ANALYSIS Socio-Economics & Demographics Land Use & Urban Form Housing Affordability & Availability Sustainability/Resiliency Mobility Policy Context Annotated Outline and Template for Plan & Plan Elements Planning Context Summary Report TASK 3. VISIONING & PLANNING FRAMEWORK Outreach & Engagement Activities Vision Statement & Preliminary Framework Report Vision & Framework Review & Finalization TASK 4. PLAN DRAFTING Drafting of Plan Elements Preliminary Executive Summary Outreach & Engagement Activities TASK 5. PLAN REFINEMENT & ADOPTION Work Sessions with City Council/CDB Plan Review & Refinement Plan Adoption Plan Publication 2020 Oct Nov 2021 2022 May Jun Jul AugOctNovFebMarAprDecJanFebSepDecJanMarAprMayJunJulAug Pinellas County Legislation Details (With Text) File #: Version:118-517A Status:Type:Contract/Agreement Passed File created:In control:4/3/2018 Planning On agenda:Final action:2/5/2019 2/5/2019 Title:Ranking of firms and Agreement with 11 firms for requirements of Planning Department support services. Sponsors: Indexes: Code sections: Attachments:1. FE Planning Support Services Agreement with HCP Associates Inc, 2. FE Planning Support Services Agreement with HDR Engineering Inc, 3. FE Planning Support Services Agreement with Kimley-Horn and Associates Inc, 4. FE Planning Support Services Agreement with Redevelopment Mgmt Associates LLC, 5. FE Planning Support Services Agreement with Renaissance Planning Group Inc, 6. FE Planning Support Services Agreement with S B Friedman & Co, 7. FE Planning Support Services Agreement with Stantec Consulting Services Inc, 8. FE Planning Support Services Agreement with The Corradino Group Inc, 9. FE Planning Support Services Agreement with Tindale- Oliver & Associates Inc, 10. FE Planning Support Services Agreement with Wade Trim Inc, 11. FE Planning Support Services Agreement with Wantman Group Inc, 12. Agreement - Wantman Group, 13. Agreement - Wade Trim, Inc., 14. Agreement - Tindale Oliver, 15. Agreement - The Corradino Group, Inc., 16. Agreement - Stantec Consulting, 17. Agreement - S B Friedman, 18. Agreement - Renaissance Planning Group, Inc., 19. Agreement - Redevelopment Management Associates-, 20. Agreement - Kimley-Horn, 21. Agreement - HDR, 22. Agreement - HCP Associates, 23. Ranking Spreadsheet Action ByDate Action ResultVer. Subject: Ranking of firms and Agreement with 11 firms for requirements of Planning Department support services. Recommended Action: Approval of the ranking of firms and execution of Agreements with eleven (11) firms for requirements of Planning Department support services. The expenditure associated with each firm is based on a five (5) year total per Planning Department estimates based on discipline: 1. HCP Associates, Inc. $200,000.00 2. HDR Engineering, Inc. $875,000.00 3. Kimley-Horn and Associates, Inc. $750,000.00 4. Redevelopment Management Associates, LLC $500,000.00 5. Renaissance Planning Group, Inc. $625,000.00 6. S.B. Friedman & Company $200,000.00 7. Stantec Consulting Services, Inc. $500,000.00 8. The Corradino Group, Inc. $250,000.00 9. Tindale-Oliver & Associates, Inc. $250,000.00 Pinellas County Printed on 8/14/2020Page 1 of 3 powered by Legistar™ File #:18-517A,Version:1 10. Wade Trim, Inc. $500,000.00 11. Wantman Group, Inc. $1,000,000.00 ·Contract with 11 firms for Planning function support services with a five year estimated expenditure of $5,650,000.00. ·The contract provides the Planning Department with as-needed consultant services for nine major disciplines as outlined in the staff report below. ·It will greatly assist the Planning Department to meet activity goals over the next 2-3 years including updates to the Comprehensive Plan and Lealman CRA activities. Strategic Plan: Deliver First Class Services to the Public and Our Customers 5.2 Be responsible stewards of the public’s resources 5.3 Ensure effective and efficient delivery of county services and support 5.4 Strive to exceed customer expectations Summary: This contract provides consultant services for the Planning Department on an as-needed basis in nine (9) disciplines including: multimodal transportation planning and analysis, economic analysis, communications and public involvement, urban design, land use and redevelopment, historic preservation, community resilience, community development and redevelopment planning. The goal of this contract is to more efficiently engage consultant services in specialized areas of the planning field. Background Information: On July 11, 2018 the Purchasing Department, on behalf of the Planning Department released a request for proposal for the above services, resulting in twelve (12) responsive proposals. The firms in order of ranking are attached on the ranking spreadsheet. The Planning Department is projected to engage in various planning activities over the next 2-3 years that will require consultant services across a range of disciplines. Expected projects include drafting and implementing form-based codes, major update to the Comprehensive Plan, updating the Post- Disaster Mitigation Plan, drafting and implementing a corridor plan for un-incorporated US 19 and Lealman CRA initiatives. Fiscal Impact: Estimated expenditures not to exceed: $5,650,000.00. Estimated annual expenditure not to exceed $1,130,000.00 Funds are derived through the Planning Department’s General Fund Budget. Staff Member Responsible: Renea Vincent, Director, Planning Joe Lauro, Director, Purchasing Partners: N/A Pinellas County Printed on 8/14/2020Page 2 of 3 powered by Legistar™ File #:18-517A,Version:1 Attachments: Agreement (11) Ranking Spreadsheet Pinellas County Printed on 8/14/2020Page 3 of 3 powered by Legistar™ RFP TITLE: Planning Support Services RFP #: 178-0356-P Company Name Point Total Ranking Wantman Group, Inc.902.00 1 HDR Engineering, Inc.889.00 2 Kimley - Horn and Associates, Inc 854.00 3 Renaissance Planning Group, Inc. 846.00 4 Wade Trim, Inc.843.00 5 Tindale-Oliver & Associates, Inc.822.00 6 HCP Associates, Inc 808.00 7 The Corradino Group, Inc.773.50 8 Stantec Consulting Services, Inc.725.50 9 S.B. Friedman & Company 658.00 10 Redevelopment Management Associates, LLC 643.50 11 Urbanics Consultants Ltd.502.50 12 PINELLAS COUNTY RANKING PINELLAS COUNTY GOVERNMENT IS COMMITTED TO PROGRESSIVE PUBLIC POLICY, SUPERIOR PUBLIC SERVICE, COURTEOUS PUBLIC CONTACT, JUDICIOUS EXERCISE OF AUTHORITY AND SOUND MANAGEMENT OF PUBLIC RESOURCES, TO MEET THE NEEDS AND CONCERNS OF OUR CITIZENS TODAY AND TOMORROW. Pinellas County RFP TITLE: Planning Support Services RFP CONTRACT NO. 178-0356-P FIRM: SUBAREAS: HDR Engineering, Inc. Multimodal Transportation Planning and Analysis Economic Analysis Communications and Public Involvement Urban Design Land Use and Redevelopment Historic Preservation Community Resilience Page 2 of 15 SERVICES AGREEMENT THIS SERVICES AGREEMENT ("Agreement") is made as of this ~J day o 1Jt ("Effective Date"), by and between Pinellas County, a political subdivision of the State of Florida(" ounty"), and HDR Engineering, Inc., Tampa, FL ("Contractor") (individually, "Party," collectively, "Parties"). W I T N E S S E T H: WHEREAS, the County requested proposals pursuant to 178-0356-P ("RFP") for Planning Support services; and WHEREAS, based upon the County's assessment of Contractor's proposal, the County selected the Contractor to provide the Services as defined herein; and WHEREAS, Contractor represents that it has the experience and expe1iise to perform the Services as set forth in this Agreement. NOW, THEREFORE, in consideration of the above recitals, the mutual covenants, agreements, terms and conditions herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby mutually acknowledged, the Parties agree as follows: 1. Definitions. A. "Agreement" means this Agreement, including all Exhibits, which are expressly incorporated herein by reference, and any amendments thereto. B. "County Confidential Information" means any County information deemed confidential and/or exempt from Section 119 .07, Florida Statutes, and Section 24(a), Article 1 of the Florida Constitution, or other applicable law, including, but not limited to, data or information referenced in and any other information designated in writing by the County as County Confidential Information. C. "Contractor Confidential Information" means any Contractor information that is designated as confidential and/or exempt by Florida's public records law, including information that constitutes a trade secret pursuant to Chapter 688, Florida Statutes, and is designated in this Agreement or in writing as a trade secret by Contractor (unless otherwise determined to be a public record by applicable Florida law). Notwithstanding the foregoing, Contractor Confidential Information does not include information that: (i) becomes public other than as a result of a disclosure by the County in breach of the Agreement; (ii) becomes available to the County on a non-confidential basis from a source other than Contractor, which is not prohibited from disclosing such information by obligation to Contractor; (iii) is known by the County prior to its receipt from Contractor without any obligation or confidentiality with respect thereto; or (iv) is developed by the County independently of any disclosures made by Contractor. D. "Contractor Personnel" means all employees of Contractor, and all employees of subcontractors of Contractor, including, but not limited to temporary and/or leased employees, who are providing the Services at any time during the project tenn. E. "Services" means the work, duties and obligations to be carried out and performed safely by Contractor under this Agreement, as described throughout this Agreement and as specifically described in th e Statement of Work and incorporated herein by reference. As used in thi s Agreement, Services shall include any component task, subtask, service, or function inherent, necessary, or a customary pa1i of the Services, but not specifically described in thi s Agreement, and shall include the provision of all standard day-to-day adm inistrati ve, overhead, and internal expenses, including costs of bonds and insurance as required herein, labor, materi als, equipment, safety equipment, products, office supplies, consumables, tools, po stage, computer hardware/software, telephone charges, copier usage, fax charges, travel, lodging, and per diem and all other costs required to perform Services except as otherwise specifically provided in thi s Agreement. Pinellas County Purchasing Standard Services Agreement 07-201 7 Page 3 of 15 2. Conditions Precedent. This Agreement, and the Pa1iies' rights and obligations herein, are contingent upon and subject to the Contractor securing and/or providing the performance security, if required in Section 3, and the insurance coverage(s) reql!ired in Sectjon 13, within ten (10) days of the Effective Date. No Services shall be performed by the ·Contractor and the County shall not incur any obligations of any type until Contractor satisfies these conditions. Unless waived in writing by the County, in the event the Contractor fails to satisfy the conditions precedent within the time required herein, the Agreement shall be deemed not to have been entered into and shall be null and void. 3. Services. A. Services. The County retains Contractor, and Contractor agrees to provide the Services. All Services shall be performed to the satisfaction of the County, and shall be subject to the provisions and terms contained herein and the Exhibits attached hereto. B. Services Requiring Prior Approval. Contractor shall not commence work on any Services requiring prior written authorization in the Statement of Work without approval from Section Manager or Principal Planner. C. Additional Services. From the Effective Date and for the duration of the project, the County may elect to have Contractor perform Services that are not specifically described in the Statement of Work but are related to the Sei"Vices ("Additional Services"), in which event Contractor shall perform such Additional Services for the compensation specified in the Statement of Work in accordance with the schedule of rate value attached to this Agreement and incorporated herein as Exhibit C. Contractor shall commence performing the applicable Additional Services promptly upon receipt of written approval as provided herein. D. De-scoping of Services. The County reserves the right, in its sole di scretion, to de-scope Services upon written notification to the Contractor by the County. Upon issuance and receipt of the notification, the Contractor and the County shall enter into a written amendment reducing the appropriate Services Fee for the impacted Services by a sum eq ual to the amount associated with the de-scoped Services as defined in the payment schedule in this Agreement, if applicable, or as determined by mutual written consent of both Parties based upon the scope of work performed prior to issuance of notification. E. Independent Contractor Status and Compliance with the Immigration Reform and Control Act. Contractor is and shall remain an independent contractor and is neither agent, employee, partner, nor joint venturer of County. Contractor acknowledges that it is responsible for complying with the provisions of the Immigration Reform and Control Act of 1986 located at 8 U.S.C. 1324, et seq, and regulations relating thereto, as either may be amended from time to time. Fai lure to comply with the above provisions shall be considered a material breach of the Agreement. F. Non-Exclusive Services. This is a non-exclusive Agreement. During the term of this Agreement, and any extensions thereof, the County reserves the right to contract for another provider for simi lar services as it determines necessary in its sole di scretion. G. Project Monitoring. During the term of the Agreement, Contractor shall cooperate with the County, either directly or through its representatives, in monitoring Contractor's progress and performance of this Agreement. 4. Term of Agreement. A. Initial Term. The term of this Agreement shall commence on (select appropriate box): ~ the Effective Date and shall remain in full force and for five (5) years, or until termination of the Agreement, whichever occurs first. Pinellas County Purchasing Standard Services Agreement 07-2017 Page 4 of 15 5. Compensation and Method of Payment. A. Services Fee. As total compensation for the Services, the County shall pay the Contractor the sum s as provided in this Section 5 ("Services Fee"), pursuant to the terms and conditions as provided in this Agreement. It is acknowledged and agreed by Contractor that this compensation constitutes a limitation upon County's obligation to compensate Contractor for such Services required by this Agreement, but does not constitute a limitation upon Contractor's obligation to perform all of the Services required by this Agreement. In no event will the Services Fee paid exceed the not-to-exceed sums set out in subsections 5.B. and C., unless the Parties agree to increase this sum by written amendment as authorized in Section 21 of the Agreement. B. The County agrees to pay the Contractor the not-to-exceed sum of $875,000.00 for Services completed and accepted as provided in Section 15 herein if applicable, payable at the following hourly rates (select appropriate box): D the hourly rate of$ __ ; or ~ the hourly rates set out in Exhibit C attached hereto, upon submittal of an invoice as required herein. C. Travel Expenses. (Select appropri ate box.) ~ The Services Fee includes all travel , lodging and per diem expenses incurred by Contractor in performing the Services. D The County shall reimburse the Contractor the sum of not-to-exceed $ __ for the travel expenses incurred in accordance with Section 112.061, Florida Statutes, and/or County Travel Policy, and as approved in writing in advance by __ . D. Taxes. Contractor acknowledges that the County is not subject to any state or federal sales, use, transportation and certain excise taxes. E. Payments. Contractor shall submit invoices for payments due as provided herein and authorized reimbursable expenses incurred with such documentation as required by County. Invoices shall be submitted to (select appropriate box): ~ the designated person as set out in Section 18 herein; D as provided in Exhibit __ attached hereto. For time and materials Services, all Contractor Personnel shall maintain logs of time worked, and each invoice shall state the date and number of hours worked for Services authorized to be billed on a time and materials basis. All payments shall be mad e in accordance with the requirements of Section 218.70 et seq., Florida Statutes, "The Local Government Prompt Payment Act." The County may dispute any payments invoiced by Contractor in accordance with the County's Invoice Payments Dispute Resolution Process established in accordance with Section 218.76, Florida Statutes, and any such disputes shall be resolved in accordance with the County's Dispute Resolution Process. Pinellas County Purchasing Standard Services Agreement 07-2017 Page 5 of 15 6. Personnel. A. Qualified Personnel. Contractor agrees that each person performing Services in connection with this Agreement shall have the qualifications and shall fulfill the requirements set forth in this Agreement. B. Approval and Replacement of Personnel. The County shall have the right to approve all Contractor Personnel assigned to provide the Services, which approval shall not be unreasonably withheld. Prior to commencing the Services, the Contractor shall provide at least ten (10) days written notice of the names and qualifications of the Contractor Personnel assigned to perfonn Services pursuant to the Agreement. Thereafter, during the term of this Agreement, the Contractor shall promptly and as required by the County provide written notice of the names and qualifications of any additional Contractor Personnel assigned to perform Services. The County, on a reasonable basis, shall have the right to require the removal and replacement of any of the Contractor Personnel performing Services, at any time during the term of the Agreement. The County will notify Contractor in writing in the event the County requires such action. Contractor shall accomplish any such removal within forty-eight (48) hours after receipt of notice from the County and shall promptly replace such person with another person, acceptable to the County, with sufficient knowledge and expertise to perform the Services assigned to such individual in accordance with this Agreement. In situations where individual Contractor Personnel are prohibited by applicable law from providing Services, removal and replacement of such Contractor Personnel shall be immediate and not subject to such forty-eight (48) hour replacement timeframe and the provisions of Section 7. A.I. shall apply if minimum required staffing is not maintained. 7. Termination. A. Contractor Default Provisions and Remedies of County. 1. Events of Default. Any of the following shall constitute a "Contractor Event of Default" hereunder: (i) Contractor fails to maintain the staffing necessary to perform the Services as required in the Agreement, fails to perform the Services as specified in the Agreement, or fails to complete the Services within the completion dates as specified in the Agreement; (ii) Contractor breaches Section 9 (Confidential Information); (iii) Contractor fails to gain acceptance of a deliverable per Section 15, if applicable, for two (2) consecutive iterations; or (iv) Contractor fails to perform or observe any of the other material provisions of this Agreement. 2. Cure Provisions. Upon the occurrence of a Contractor Event of Default as set out above, the County shall provide written notice of such Contractor Event of Default to Contractor ("Notice to Cure"), and Contractor shall have thirty (30) calendar days after the date of a Notice to Cure to correct, cure, and/or remedy the Contractor Event of Default described in the written notice. 3. Termination for Cause by the County. In the event that Contractor fails to cure a Contractor Event of Default as authorized herein, or upon the occurrence of a Contractor Event of Default as specified in Section 7.A.1.(iii), the County may termjnate this Agreement in whole or in part, effective upon receipt by Contractor of written notice of termination pursuant to this provision, and may pursue such remedies at law or in equity as may be available to the County. B. County Default Provisions and Remedies of Contractor. 1. Events of Default. Any of the following shall constitute a "County Event of Default" hereunder: (i) the County fails to make timely undisputed payments as described in this Agreement; (ii) the County breaches Section 9 (Confidential Information); or (iii) the County fails to perform any of the other material provisions of this Agreement. 2. Cure Provisions. Upon the occurrence of a County Event of Default as set out above, Contractor shall provide written notice of such County Event of Default to the County ("Notice to Cure"), and the County shall have thi11y (30) calendar days after the date of a Notice to Cure to correct, cure, and/or remedy the County Event of Default described in the written notice. Pinellas County Purchasing Standard Services Agreement 07-2017 Page 6 of 15 3. Termination for Cause by Contractor. In the event the County fails to cure a County Event of Default as authorized herein, Contractor may terminate this Agreement in whole or in part effective on receipt by the County of written notice of termination pursuant to this provision, and may pursue such remedies at law or in equity as may be available to the Contractor. C. Termination for Convenience. Notwithstanding any other provision herein, the County may terminate this Agreement, without cause, by giving thirty (30) days advance written notice to the Contractor of its election to terminate this Agreement pursuant to this provision. 8. Time is of the Essence. Time is of the essence with respect to all provisions of this Agreement that specify a time for performance, including the Services as described in Exhibits attached hereto; provided, however, that the foregoing shall not be construed to limit a Party's cure period allowed in the Agreement. 9. Confidential Information and Public Records. A. County Confidential Information. Contractor shall not disclose to any third party County Confidential Information that Contractor, through its Contractor Personnel, has access to or has received from the County pursuant to its performance of Services pursuant to the Agreement, unless approved in writing by the County Contract Manager or required to be disclosed by law, subpoena or other court or administrative order. All such County Confidential Information will be confidential from the date of disclosure by the Co unty, and discussions involving such County Confidential In formation shall be limited to Contractor Personnel as is necessary to complete the Services. B. Contractor Confidential Information. All Contractor Confidential Information received by the County from Contractor will be held confidenti al from the date of disclosure by Contractor and discussions involving such Contractor Confidential Information shal I be limited to the members of the County's staff and the County's subcontractors who require such information in the performance of this Agreement. The County acknowledges and agrees to respect the copyrights, registrations, trade secrets and other proprietary rights of Contractor in the Contractor Confidenti al Information during and after the term of the Agreement and shall at all times maintain the confidentiality of the Contractor Confidential Information provided to the County, subject to federal law an d the laws of the State of Florida related to public records disclosure. Contractor shall be solely responsible for taking any and all action it deems necessary to protect its Contractor Confidenti al Information except as provided herein. Contractor acknowledges that the County is subj ect to public records legislation, including but not limited to Chapter 119, Florida Statutes, and the Florida Rules of Judicial Administration, and that any of th e County's obligations under this Section may be superseded by its obligations under any requirements of said laws. C. Public Records. Contractor acknowledges that information and data it manages as part of the services may be public records in accordance with Chapter 119, Florida Statutes and Pinellas County public records policies. Contractor agrees that prior to providing services it will implement policies and procedures to maintain, produce, secure, and retain public records in accordance with applicable laws, regulations, and County polici es, including but not limited to the Section 119.0701 , Florida Statutes. Notwithstanding any other provision of this Agreement relating to compensation, the Contractor agrees to charge the County, and/or any third pat1ies requesting public records only such fees allowed by Section 119.07, Florida Statutes, and County policy for locating and producing public records during the term of this Agreement. If the Contractor has questions regarding the application of Chapter 119, Florida Statutes, to the Contractor's duty to provide public records relating to this contract, contact the Pinellas County Board of County Commissioners, Purchasing Department, Operations Manager custodian of public records at 727-464-3311, purchase@pinellascounty.org, Pinellas County Government, Purchasing Department, Operations Manager, 400 S. Ft. Harrison Ave, 6th Floor, Clearwater, FL 33756. Pinellas County Purchasing Standard Services Agreement 07-2017 • Page 7 of 15 10. Audit. Contractor shall retain all records relating to this Agreement for a period of at least five (5) years after final payment is made. All records shall be kept in such a way as will permit their inspection pursuant to Chapter 119, Florida Statutes. In addition, County reserves the right to examine and/or audit such records. 11. Compliance with Laws. Contractor shall comply with all applicable federal, state, county and local laws, ordinances, rules and regulations in the performance of its obligations under this Agreement, including the procurement of permits and certificates where required, and including but not limited to laws related to Workers Compensation, Americans with Disabilities Act (ADA), Section 504 of the Rehabilitation Act of 1973, Minority Business Enterprise (MBE), occupational safety and health and the environment, equal employment opportunity, privacy of medical records and information, as applicable. Failure to comply with any of the above provisions shall be considered a material breach of the Agreement. 12. Public Entities Crimes Contractor is directed to the Florida Public Entities Crime Act, Section 287 .133, Florida Statutes, as well as Florida Statute 287.135 regarding Scrutinized Companies, and represents to County that Contractor is qualified to transact business with public entities in Florida, and to enter into and fully perform this Agreement subject to the provisions state therein. Failure to comply with any of the above provisions shall be considered a material breach of the Agreement. 13. Liability and Insurance. A. Insurance. Contractor shall comply with the insurance requirements set out in Exhibit B, attached hereto and incorporated herein by reference. B. Indemnification. Except to the extent that Florida Statue 725.08 applies to Contractor's services, Contractor agrees to indemnify, pay the cost of defense, including attorney's fees, and hold harmless the County, its officers, employees and agents from all damages, suits, actions or claims, including reasonable attorney's fees incurred by the County, of any character brought on account of any injuries or damages received or sustained by any person, persons, or property, or in any way relating to or arising from the Agreement; or on account of any act or omission, neglect or misconduct of Contractor; or by, or on account of, any claim or amounts recovered under the Workers' Compensation Law or of any other laws, regulations, ordinance, order or decree; or arising from or by reason of any actual or claimed trademark, patent or copyright infringement or litigation based thereon; except only such injury or damage as shall have been occasioned by the sole negligence of the County. To the extent that Florida Statute 725.08 is applicable, Contractor's obligations under this section shall be limited as provided in that statue. C. Liability. Neither the County nor Contractor shall make any express or implied agreements, guaranties or representations, or incur any debt, in the name of or on behalf of the other Party. Neither the County nor Contractor shall be obligated by or have any liability under any agreements or representations made by the other that are not expressly authorized hereunder. The County shall have no liability or obligation for any damages to any person or prope1iy directly or indirectly arising out of the operation by Contractor of its business, whether caused by Contractor's negligence or willful action or failure to act. D. Contractor's Taxes. The County will have no liability for any sales, service, value added, use, excise, gross receipts, property, workers' compensation, unemployment compensation, withholding or other taxes, whether levied upon Contractor or Contractor's assets, or upon the County in connection with Services performed or business conducted by Contractor. Payment of all such taxes and liabilities shall be the responsibility of Contractor. 14. County's Funding. The Agreement is not a general obligation of the County. It is understood that neither this Agreement nor any representation by any County employee or officer creates any obligation to appropriate or make monies available for the purpose of the Agreement beyond the fiscal year in which this Agreement is executed. No liability shall be incurred by the County, or any department, beyond the monies budgeted and availabl e for this purpose. If funds are not appropriated by the County for any or all of this Agreement, the County shall not be obligated to pay any sum s provided pursuant to this Agreement beyond the portion for whi ch funds are appropriated. The County agrees to promptly notify Contractor in writing of such fa ilure of appropriation, and upon receipt of such notice, this Agreement, and al l rights and obligations contained herein, shall terminate without liability or penalty to the County. Pinellas County Purchasing Standard Services Agreement 07-2017 Page 8 of 15 15. Acceptance of Services. For all Services deliverables that require County acceptance as provided in the Statement of Work, the County, through the Principal Planner or designee, wi ll have ten (10) calendar days to review the deliverable(s) after receipt or completion of same by Contractor, and either accept or reject the deliverable(s) by written notice to HDR Engineering, Inc. If a deliverable is rejected, the written notice from the County will specify any required changes, deficiencies, and/or additions necessary. Contractor shall then have seven (7) calendar days to revise the deliverable(s) to resubmit and/or complete the deliverable(s) for review and approval by the County, who will then have seven (7) calendar days to review and approve, or reject the deliverable(s); provided however, that Contractor shall not be responsible for any delays in the overall project schedule that result from the County's failure to timely approve or reject deliverable(s) as provided herein. Upon final acceptance of the deliverable(s), the County will accept the deliverable(s) in writing. 16. Subcontracting/ Assignment. A. Subcontracting. Contractor is fully responsible for completion of the Services required by thjs Agreement and for completion of all subcontractor work, if authorized as provided herein. Contractor shall not subcontract any work under this Agreement to any subcontractor other than the subcontractors specified in the proposal and previously approved by the County, without the prior written consent of the County, which shall be determined by the County in its sole discretion. B. Assignment. (Select appropriate box.) D This Agreement, and any rights or obligations hereunder, shall not be assigned, transferred or delegated to any other person or entity. Any purported assignment in violation of this section shall be nul I and void. [8:1 This Agreement, and all rights or obligations hereunder, shall not be assigned, transferred, or delegated in whole or in pa1i, including by acquisition of assets, merger, consolidation, dissolution, operation of law, change in effective control of the Contractor, or any other assignment, transfer, or delegation of rights or obligations, without the prior written consent of the County. The Contractor shall provide written notice to the County witrun fifteen (15) calendar days of any action or occurrence assigning the Agreement or any rights or obligations hereunder as described in this section. In the event the County does not consent to the assignment, as determined in its sole discretion, the purported assignment in violation of thjs section shall be null and voi d, and the County may elect to terminate this Agreement by providing written notice of its election to terminate pursuant to this provision upon fifteen (15) days notice to Contractor. 17. Survival. The fol lowing provisions shal I survive the expiration or termination of the Term of this Agreement: 7, 9, 10, 13 20, 23 , and any other which by their nature would survive termination. 18. Notices. All notices, authorizations, and requests in connection with this Agreement shall be deemed given on the day they are: (1) deposited in the U.S. mail, postage prepaid, certified or registered, return receipt requested; or (2) sent by air express courier (e.g., Federal Express, Airborne, etc.), charges prepaid, return receipt requested; or (iii) sent via email and addressed as set forth below, which designated person(s) may be amended by either Party by giving written notice to the other Party: For County: Attn: Caroline Lanford Pinell as County Planning Department 310 Cou1i Street Clearwater, Florida 33 756 with a copy to: Purchasing Director Pinellas County Purchasing Depaiiment 400 South Fort Harrison Avenue Clearwater, FL 33756 For Contractor: Attn: Steve Schukraft HDR Engineering, Inc. 4830 W Kennedy Boulevard, Suite 400 Tampa, Florida 33609 Pinellas County Purchasing Standard Services Agreement 07-2017 Page 9 of 15 19. Conflict oflnterest. A. The Contractor represents that it presently has no interest and shall acquire no interest, either direct or indirect, which would conflict in any manner with the performance of the Services required hereunder, and that no person having any such interest shall be employed by Contractor during the agreement term and any extensions. B. The Contractor shall promptly notify the County in writing of any business association, interest, or other circumstance which constitutes a conflict of interest as provided herein. If the Contractor is in doubt as to whether a prospective business association, interest, or other circumstance constitutes a conflict of interest, the Contract may identify the prospective business association, interest or circumstance, the nature of work that the Contractor may undertake and request an opinion as to whether the business association, interest or circumstance constitutes a conflict of interest if entered into by the Contractor. The County agrees to notify the Contractor of its opinion within (10) calendar days of receipt of notification by the Contractor, which shall be binding on the Contractor. 20. Right to Ownership. All work created, originated and/or prepared by Contractor in performing Services pursuant to the Agreement, including work products, techniques, and other documentation or improvements related thereto, to the extent that such work, products, documentation, materials or information are described in or required by the Services (collectively, the "Work Product") shall be County's property when completed and accepted, if acceptance is required in this Agreement, and the County has made payment of the sums due therefore. The ideas, concepts, know-how or techniques developed during the course of this Agreement by the Contractor or jointly by Contractor and the County may be used by the County without obligation of notice or accounting to the Contractor. Any data, information or other materials furnished by the County for use by Contractor under this Agreement shall remain the sole property of the County. 21. Amendment. This Agreement may be amended by mutual written agreement of the Parties hereto. 22. Severability. The terms and conditions of this Agreement shall be deemed to be severable. Consequently, if any clause, term, or condition hereof shall be held to be illegal or void, such determination shall not affect the validity or legality of the remaining terms and conditions, and notwithstanding any such determination, thi s Agreement shall continue in full force and effect unless the particular clause, term, or condition held to be illegal or void renders the balance of the Agreement impossible to perform. 23. Applicable Law and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Florida (without regard to principles of conflicts of laws). The Parties agree that all actions or proceedings arising in connection with this Agreement shall be tried and litigated exclusively in the state or federal (if permitted by law and a Party elects to file an action in federal cowi) cou1is located in or for Pinellas County, Florida. This choice of venue is intended by the Parties to be mandato1y and not permissive in nature, and to preclude the possibility of litigation between the Paiiies with respect to , or arising out of, this Agreement in any jurisdiction other than that specified in this section. Each Party waives any right it may have to assert the doctrine of forum non conveniens or similar doctrine or to object to venue with respect to any proceeding brought in accordance with this section. 24. Waiver. No waiver by either Party of any breach or violation of any covenant, term, condition, or provision of this Agreement or of the provisions of any ordinance or law, shall be construed to waive any other term, covenant, condition, provisions, ordinance or law, or of any subsequent breach or violation of the same. 25. Due Authority. Each Paiiy to this Agreement represents and warrants that: (i) it has the full right and authority and has obtained all necessary approvals to enter into thi s Agreement; (ii) each person executing this Agreement on behalf of the Party is authorized to do so; (iii) this Agreement constitutes a valid and legally binding obligation of the Party, enforceabl e in accordance with its terms. 26. No Third Party Beneficiary. The Pa1iies hereto acknowledge and agree that there are no third paiiy beneficiaries to this Agreement. Persons or entities not a party to this Agreement may not claim any benefit from this Agreement or as third party beneficiaries hereto. 27. Entire Agreement. This Agreement constitutes the entire Agreement between the Parties and supersedes all prior negotiations, representations or agreements either oral or written. (Signature Page Follows) Pinellas County Purchasing Standard Services Agreement 07-2017 :.. Page 10 of 15 IN WITNESS WHEREOF, the Parties hereto have executed this Agreement the day and year first written. PINELLAS COUNTY, FLORIDA By and through its Board of County Commissioners ATTEST: Ken Burke, By: HDR Engineering, Inc. Name o( Firm- Ti~. . Clerk of the Circuit Court /) By ~<[)~ Deputy Clerk APPROVED AS TO FORM Pinellas County Purchasing Standard Services Agreement 07-2017 SERVICES AGREEMENT Page 11 of 15 EXHIBIT A ASSIGNMENT OF WORK Work to be performed by the Contractor shall be on an assignment-by-assignment basis. Work assignments shall be made by the County's Planning Department Principal Planner or designee. Prior to any work assignments being made, based on mutual discussions between the County and the Contractor; the Contractor shall prepare a detailed scope of work for the assignment which shall include hours and a not to exceed budget amount for the assignment. The budget shall be itemized using the classifications and hourly rates in accordance with the schedule of rate value attached to this agreement and incorporated herein as Exhibit C. All work assignment authorizations by the County shall have a work assignment number and be in writing. The Contractor shall perform no work under this agreement without written authorization through a purchase order. The Contractor hereby agrees to waive any claim for compensation for any work performed without written authorization. Pinellas County Purchasing Standard Services Agreement 07-2017 SERVICES AGREEMENT Page 12 of 15 EXHIBIT B INSURANCE REQUIREMENTS a) The minimum insurance requirements and limits for this Agreement, which shall remain in effect throughout its duration and for two (2) years beyond final acceptance for projects with a Completed Operations exposure, are as follows: (1) Workers' Compensation Insurance Limit Employers' Liability Limits Per Employee Per Employee Disease Policy Limit Disease Florida Statutory $ 500,000.00 $ 500,000.00 $ 500,000.00 (2) Commercial General Liability Insurance including, but not limited to, Independent Contractor, Contractual Liability Premises/Operations, Products/Completed Operations, and Personal Injury. Limits Combined Single Limit Per Occurrence Products/Completed Operations Aggregate Personal Injury and Advertising Injury General Aggregate $ 1,000,000.00 $ 2,000,000 .. 00 $ 1,000,000.00 $ 2,000,000.00 (3) Business Automobile or Trucker's/Garage Liability Insurance covering owned, hired, and non-owned vehicles. If the Proposer does not own any vehicles, then evidence of Hired and Non-owned coverage is sufficient. Coverage shall be on an "occurrence" basis, such insurance to include coverage for loading and unloading hazards, unless Proposer can show that this coverage exists under the Commercial General Liability policy. Limit Combined Single Limit Per Accident $ 1,000,000.00 (4) Professional Liability (Errors and Omissions) Insurance with at least minimum limits as follows. If "claims made" coverage is provided, "tail coverage" extending three (3) years beyond completion and acceptance of the project with proof of "tail coverage" to be submitted with the invoice for final payment. In lieu of "tail coverage", Proposer may submit annually to the County, for a three (3) year period, a current certificate of insurance providing "claims made" insurance with prior acts coverage in force with a retroactive date no later than commencement date of this contract. Limits Each Occurrence or Claim General Aggregate $ 2,000,000.00 $ 2,000,000.00 For acceptance of Professional Liability coverage included within another policy required herein, a statement notifying the certificate holder must be included on the certificate of insurance and the total amount of said coverage per occurrence must be greater than or equal to the amount of Professional Liability and other coverage combined. (5) Property Insurance Proposer will be responsible for all damage to its own property, equipment and/or materials. Pinellas County Purchasing Standard Services Agreement 07-2017 Pinellas County Purchasing SERVICES AGREEMENT EXHIBIT C PAYMENT SCHEDULE (Exhibit C-Payment Schedule Follows) Standard Services Agreement Page 13 of 15 07-2017 Classification 2 Person Field Survey Crew 2 Person SUE Crew 3 Person Field Survey Crew 3 Person SUE Crew 4 Person Field Survey Crew 4 Person SUE Crew 5 Person Field Survey Crew 5 Person SUE Crew SUE Technician Survey Intern Survey Technician Senior Survey Technician Hydrographic/Bathymetric Crew Laser Scan Crew Photogrammetrist Professional Surveyor Senior Professional Surveyor Principal Surveyor FIRM: HDR Engineering, Inc. EXHIBIT C -PAYMENT SCHEDULE Planning Support Services Contract No. 178-0356-P (RW) "SURVEY PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent ; "ARCHITECTURAL/DESIGN ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Architect Intern Architectural Associate Architectural Illustrator CADD/Designer Designer Landscape Designer Hourly Rate Hourly Rate Classification FIRM: HDR Engineering, Inc. EXHIBIT C -PAYMENT SCHEDULE Planning Support Services Contract No. 178-0356-P (RW) "PARAPROFESSIONAL/TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent Economic Development Assistant Graphic Designer Senior Designer Entry Level Designer CRA Clerk Technician I Traffic/ITS Specialist Entry Level Planner "ADMINISTRATIVE /PROJECT SUPPORT" TO INCLUDE THE FOLLOWING TITLES Classification Classification Equivalent Administrative Administrative Assistant Administration/Clerical Clerical Secretary/Clerical Secretary /Clerical Project Aide I Marketing Assistant Office Support Real Estate Research Assistant "GIS TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent GIS Specialist GIS Specialist GIS Technician GIS/CAD Operator Hourly Rate 140 Hourly Rate 93 Hourly Rate 94 Classification Architect Intern Architectural Associate Architectural Illustrator CADD/Designer Designer Landscape Designer Classification Enviromnental Analyst Enviromnental Technician Classification Technician II Engineering Technician Engineering Intern Senior CADD Designer Transportation Analyst Classification Technician/Support Staff Senior Engineer Intern Senior Technician Transportation Modeler FIRM: HDR Engineering, Inc. EXHIBIT C -PAYMENT SCHEDULE Planning Support Services Contract No. 178-0356-P (RW) "ARCHITECTURAL/DESIGN ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent "ENVIRONMENTAL TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent "ENGINEERING TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent Engineering Intern "SENIOR TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent Hourly Rate Hourly Rate Hourly Rate 105 Hourly Rate FIRM: HDR Engineering, Inc. EXHIBIT C -PAYMENT SCHEDULE Planning Support Services Contract No. 178-0356-P (RW) "INSPECTOR" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Field Inspector IConsrruction illspectoc I I I "PUBLIC INVOLVEMENT SPECIALIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Public Involvement Officer Public Involvement Specialist "ASSISTANT PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Planning Assistant Urban Design Assistant Landscape Architect I Research "PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Planner Planner Planner I Urban Designer I FIRM: HDR Engineering, Inc. EXHIBIT C -PAYMENT SCHEDULE Planning Support Services Contract No. 178-0356-P (RW) "ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate ,~:~:::~ I I I I "PROFESSIONAL PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Urban Designer II Professional Planner II Planner II 145 Planner II "PROFESSIONAL ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Engineer II Civil Engineer Field Engineer Project Engineer Project Engineer 150 Design Engineer Transportation Engineer Traffic Engineer Roadway Engineer "SENIOR ECONOMIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Economist Senior Economist 235 Senior Advisor -Economic Research Classification FIRM: HDR Engineering, Inc. EXHIBIT C -PAYMENT SCHEDULE Planning Support Services Contract No. 178-0356-P (RW) "PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent Deputy Project Manager/Project Support Project Manager I Program Manager Editor Consultant Senior Advisor Marketing Manager "SENIOR PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Associate Research Associate Associate Technician Project Manager II Associate Registered Designer Associate Consultant for Economics Economic Development Manager Chief Designer "SENIOR PRINCIPAL PLANNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Chief Planner Chief Planner Senior Principal Planner Hourly Rate Hourly Rate Hourly Rate 260 Classification Professional Appraiser Tourism Specialist Creative Director Photographer Finance QA/QC Reviewer Senior Broker Senior Progra1mner Classification Senior Planner Senior Project Planner Senior Urban Designer Associate Planner FIRM: HOR Engineering, Inc. EXHIBIT C - PAYMENT SCHEDULE Planning Support Services Contract No. 178-0356-P (RW) "PROJECT PROFESSIONAL" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent Senior Environmental Scientist "SENIOR PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent Senior Planner Director -Urban Design & Planning Principal Planner Planning Manager Senior Designer Hourly Rate 195 Hourly Rate 165 FIRM : HDR Engineering, Inc. EXHIBIT C -PAYMENT SCHEDULE Planning Support Services Contract No. 178-0356-P (RW) "SENIOR PROJECT PROFESSIONAL" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Project Professional Senior Landscape Architect Director -Business Attraction & Marketing Director -Economic Development Director -Real Estate Director of Administration Director of Digital Solutions Director of Operations Construction Director Senior Redevelopment Associate Senior Support Controller "PROJECT MANAGER" TO INCLUDE THE FOLLOWING TITLES: Cla ssification Classification Equivalent Project Manager Day to Day Manager Associate Project Manager Managing Director Senior Project Manager Hourly Rate 210 Hourly Rate Classification Associate Engineer Senior Project Engineer Senior Engineer Senior Roadway Engineer Senior Design Engineer Senior Traffic Engineer Classification Chief Engineer Executive Engineer Principal Engineer Senior Principal Engineer Senior Civil Engineer Senior Transportation Engineer FIRM: HDR Engineering, Inc. EXHIBIT C -PAYMENT SCHEDULE Planning Support Services Contract No. 178-0 356-P (RW) "SENIOR ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent "PRINCIPAL ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent Chief Engineer Hourly Rate Hourly Rate 255 FIRM: HOR Engineering, Inc. EXHIBIT C -PAYMENT SCHEDULE Planning Support Services Contract No. 178-0356-P (RW) "EXECUTIVE PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Chief Professional/Project Director Chief Economist Chief Economist Founding Principal Executive Vice President Senior Professional President President -Project Management Principal Principal-in-Charge Vice President Senior Vice President "PROJECT SUPPORT SPECIALIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Senior Administrative Assistant Bookkeeper Senior Accountant Budget & Operations Analyst Intern/Marketing Coordinator Economic Development Coordinator Project Coordinator Marketing Coordinator Business Development Coordinator Senior Analyst Sales Associate Hourly Rate 320 Hourly Rate 123 Classification 2 Person Field Survey Crew 2 Person SUE Crew 3 Person Field Survey Crew 3 Person SUE Crew 4 Person Field Survey Crew 4 Person SUE Crew 5 Person Field Survey Crew 5 Person SUE Crew SUE Technician Survey Intern Survey Technician Senior Survey Technician Hydrographic/Bathymetric Crew Laser Scan Crew Photogranunetrist Professional Surveyor Senior Professional Surveyor Principal Surveyor HDR Engineering, Inc Subconsultant: H.W. Lochner, Joe. EXHIBIT C -PAYMENT SCHEDULE Planning Suppmt Services Contract No. 178-0356-P (R W) "SURVEY PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent "ARCHITECTURAL/DESIGN ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Architect Intern Architectural Associate Architectural lllustrator CAD D/Designer Designer Landscape Designer "PARAPROFESSIONAL/TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Economic Development Assistant Graphic Designer Entry Level Designer CRA Clerk Technician I Traffic/ITS Specialist Entry Level Planner "ADMINISTRATIVE /PROJECT SUPPORT" TO INCLUDE THE FOLLOWING TITLES Classification Classification Equivalent Administrative Administrative Assistant Administration/Cle1ical Clerical Secretary/Clerical Project Aide I Marketing Assistant Office Suppo1t Real Estate Research Assistant "GIS TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent GlS Specialist GIS Technician GIS/CAD Operator Hourly Rate Hourly Rate Hourly Rate 115 Hourly Rate 60 Hourly Rate "ARCHITECTURAL/DESIGN ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classifi cation Classification Equivalent Architect Intern Architectural Associate Architectural Illustrator CADD/Designer Designer Landscape Designer "ENVIRONMENTAL TECHNICIAN" TO INCLUDE THE FOLLOW ING TITLES: Classification Classification Equivalent Environmental Analyst Environmental Technician "ENGINEERJNG TECHNICIAN " TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Technician II Engineering Technjcian Engineering Intern Senior CADD Designer Transportation Analyst "SENIOR TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Technician/Support Staff Senior Engineer Intern Senior Technician Transpo,tation Modeler "INSPECTOR" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Constmction Inspector Field Inspector "PUBLIC INVOLVEMENT SPECIALIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Public Involvement Officer Public Involvement Specialist Classification Planning Assistant Urban Design Assistant Landscape Architect I Research Classification Project Planner Planner Planner I Urban Designer I Classification I Engineer Engineer I "ASSISTANT PROFESSIONALS" TO INCLUDE THE FOL LOWING TITLES: Classification Equivalent "PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Equi valent "ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent Hourly Rate Hourly Rate Hourly Rate 95 Hourly Rate Hourly Rate Hourly Rate Hourly Rate Hourly Rate 90 I Hourly Rate "PROFESSIONAL PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Urban Designer II Professional Planner II Planner II "PROFESSIONAL ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Engineer II Civil Engineer Field Engineer Project Engineer 155 Design Engineer Transpmtation Engineer Traffic Engineer Roadway Engineer "SENIOR ECONOMIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Economist Senior Advisor -Economic Research "PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Deputy Project Manager/Project Suppmt Project Manager I Program Manager Editor Consultant Senior Advisor Marketing Manager "SENIOR PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Associate Research Associate Associate Technician Project Manager 11 Associate Registered Designer Associate Consultant for Economics Economic Development Manager Chief Designer "SENIOR PRINCIPAL PLANNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Planner 240 Senior P1incipal Planner "PROJECT PROFESSIONAL" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Professional Appraiser Tourism Specialist Creative Director Photographer Finance QA/QC Reviewer Senior Broker Senior Programmer "SENIOR PLANNER/URBAN DESIGNER" TO INCLUDE T HE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Planner 205 Senior Project Planner Senior Urban Designer Associate P Janner Director -Urban Design & Planning Principal Planner Planning Manager Senior Designer "SENIOR PROJECT PROFESSIONAL" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Professional Director -Business Attraction & Marketing Director -Economic Development Director -Real Estate Director of Administration Director of Digital Solutions Director of Operations Construction Director Senior Redevelopment Associate Senior Suppmi Controller "PROJECT MANAGER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Manager Day to Day Manager Associate Project Manager Managing Director Senior Project Manager "SENIOR ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Associate Engineer Senior Project Engineer Senior Engineer 210 Senior Roadway Engineer Senior Design Engineer Senior Traffic Engineer "PRINCIPAL ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Engineer 260 Executive Engineer Principal Engineer 230 Senior Principal Engineer Senior Civil Engineer Senior Transpmtation Engineer "EXECUTIVE PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Professional/Project Director Chief Economist Founding Principal Executive Vice President Senior Professional President President -Project Management Principal Principal-in-Charge Vice President Senior Vice President "PROJECT SUPPORT SPECIALIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Administrative Assistant Bookkeeper Budget & Operations Analyst Intern/Marketing Coordinator Economic Development Coordinator Project Coordinator Marketing Coordinator Business Development Coordinator Senior Analyst Sales Associate Classification 2 Person Field Survey Crew 2 Person S.UE Crew 3 Person Field Survey Crew 3 Person SUE Crew 4 Person Field Survey Crew 4 Person SUE Crew 5 Person Field Survey Crew 5 Person SUE Crew SUE Technician Survey Intern Survey Technician Senior Survey Technician Hydrographic/Bathymetric Crew Laser Scan Crew Photogranunetrist Professiona I Surveyor Senior Professional Surveyor Principal Surveyor HDR Engineering, Inc Subconsultant : SB FRIEDMAN EXHIBIT C -PAYMENT SCHEDULE Planning Support Services Contract No. 178-0356-P (RW) "SURVEY PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent "ARCHITECTURAL/DESIGN ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Architect Intern Architectural Associate Architectural Illustrator CA.DD/Designer Designer Landscape Designer "PARAPROFESSIONAL/TECHNICIAN" TO INCLUDE TH E FOLLOWING TITLES: Classification Classification Equivalent Economic Development Assistant Graphic Designer Entry Level Designer CRA Clerk Technician I Traffic/ITS Specialist Ent1y Level Planner "ADMINISTRATIVE /PROJECT SUPPORT" TO INCLUDE THE FOLLOWING TITLES Classification Classification Equivalent Administrative Administrative Assistant Administration/Clerical Clerical Secretaiy/Clerical Project Aide I Marketing Assistant Office Supp011 Real Estate Research Assistant "GIS TECHNI CIAN" TO INCLUDE THE FOLLOWI NG TITLES: Classification Classification Equivalent GIS Specialist GIS Teclrnician GIS/CAD Operator Hourly Rate Hourly Rate Hourly Rate Hourly Rate Hourly Rate "ARCHITECTURAL/DESIGN ASSOCIATE" TO INCLUDE THE FOLLOWlNG TITLES: Classification Classification Equivalent Hourly Rate Architect Intern Architectural Associate Architectural Illustrator CA DD/Designer Designer Landscape Designer "ENVIRONMENTAL TECHNlCIAN" TO INCLUDE THE FOLLOWlNG TITLES: Classification Classification Equivalent Hourly Rate Environmental Analyst Environmental Technician "ENGINEERING TECHNlCIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Technician II Engineering Technician Engineering Intern Senior CADD Designer Transportation Analyst "SENIOR TECHNlCIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Technician/Support Staff Senior Engineer Intern Senior Technician Transpo11ation Modeler "INSPECTOR" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Construction Inspector Field Inspector "PUBLIC INVOLVEMENT SPECIALIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Public Invo lvement Officer Public Involvement Specialist "ASSISTANT PROFESSIONALS" TO INCLUDE THE FOLLOWlNG TITLES: Classification Classification Equivalent Hourly Rate Planning Assistant Urban Design Assistant Landscape Architect I Research "PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Planner Planner Planner I Urban Designer I "ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate I Engineer "PROFESSIONAL PLANNER/URBAN DESIGNER" TO INCLUDE TH E FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Urban Designer II Professional Planner II Planner II "PROFESSIONAL ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Engineer II Civil Engineer Field Engineer Project Engineer Design Engineer Transpmtation Engineer Traffic Engineer Roadway Engineer "SENIOR ECONOMIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Economist Senior Advisor -Economic Research "PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Deputy Project Manager/Project Suppmt Project Manager I Program Manager Editor $130 Consultant Senior Advisor Marketing Manager "SENIOR PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Associate $160 Research Associate $145 Associate Technician Project Manager II Associate Registered Designer Associate Consultant for Economics Economic Development Manager Chief Designer "SENIOR PRINCIPAL PLANNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Planner Senior Principal Planner "PROJECT PROFESSIONAL" TO IN CLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Professional Appraiser Tourism Specialist Creative Director Photographer Finance QA/QC Reviewer Senior Broker Senior Programmer "SENIOR PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Planner Senior Project Planner Senior Urban Designer Associate P tanner Director -Urban Design & Planning Principal Planner Planning Manager Senior Designer "SENIOR PROJECT PROFESSIONAL" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Professional Director -Business Attraction & Marketing Director -Economjc Development Director -Real Estate Director of Administration Director of Digital Solutions Director of Operations Construction Director Senior Redevelopment Associate Senior Suppmt Controller "PROJECT MANAGER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Manager Day to Day Manager Associate Project Manager $200 Managing Director Senior Project Manager "SENIOR ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Associate Engineer Senior Project Engineer Senior Engineer Senior Roadway Engineer Senior Design Engineer Senior Traffic Engineer "PRINCIPAL ENGJNEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Engineer Executive Engineer Principal Engineer Senior Principal Engineer Senior Civil Engineer Senior Transpmtation Engineer "EXECUTIVE PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Professional/Project Director Chief Economist Founding Principal Executive Vice President $365 Senior Professional President $400 President -Project Management Principal Principal-in-Charge Vice President $230 Senior Vice President $265 "PROJECT SUPPORT SPECIALIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Administrative Assistant Bookkeeper Budget & Operations Analyst Intern/Marketing Coordinator $100 Economic Development Coordinator Project Coordinator Marketing Coordinator Business Development Coordinator Senior Analyst Sales Associate Classification 2 Person Field Survey Crew 2 Person SUE Crew 3 Person Field Survey Crew 3 Person SUE Crew 4 Person Field Survey Crew 4 Person SUE Crew 5 Person Field Survey Crew 5 Person SUE Crew SUE Technician Survey Intern Survey Technician Senior Survey Technician Hydrographic/Bathymetric Crew Laser Scan Crew Photogrammetrist Professional Surveyor Senior Professional Surveyor Principal Surveyor HDR Engineering, Inc Subconsultant: PlusUrbia Design EXHIBIT C -PAYMENT SCHEDULE Planning Support Services Contract No. 178-0356-P (R W) "SURVEY PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent "ARCHITECTURAL/DESIGN ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Architect Intern Architectural Associate Architectural Illustrator CADD/Designer Designer Landscape Designer "PARAPROFESSIONAL/TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Economic Development Assistant Graphic Designer Entry Level Designer CRA Clerk Technician I Traffic/ITS Specialist Entry Level Planner "ADMINISTRATIVE /PROJECT SUPPORT" TO INCLUDE THE FOLLOWING TITLES Classification Classification Equivalent Administrative Officer Manager Administrative Assistant Administration/Clerical Clerical Secretary/Clerical Project Aide I Marketing Assistant Office Support Real Estate Research Assistant "GIS TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent GIS Specialist GIS Technician GIS/CAD Operator Hourly Rate Hourly Rate Hourly Rate Hourly Rate 125 Hourly Rate "ARCHITECTURAL/DESIGN ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Architect Intern Architectural Associate Architectural Illustrator CA DD/Designer Designer Landscape Designer "ENVIRONMENTAL TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Environmental Analyst Environmental Technician "ENGINEERING TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Technician II Engineering Technician Engineering Intern Senior CADD Designer Transpmtation Analyst "SENIOR TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Technician/Support Staff Senior Engineer Intern Senior Technician Transportation Modeler "INSPECTOR" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Construction Inspector Field Inspector "PUBLIC INVOLVEMENT SPECIALIST" TO IN CLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Public Involvement Officer Public Involvement Specialist Communications Leader 125 "ASSISTANT PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Planning Assistant Urban Design Assistant Junior Designer 60 Landscape Architect I Research "PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Planner Planner Planner I Urban Designer I Des igner $80 "ENGINEER" TO INCLUDE Tl-IE FOLLOWING TITLES: I Engineer Classification Classification Equivalent I Hourly Rate Engineer I "PROFESSIONAL PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Urban Designer 11 Professional Planner I I Planner II "PROFESSIONAL ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Engineer 11 Civil Engineer Field Engineer Project Engineer Design Engineer Transportation Engineer Traffic Engineer Roadway Engineer "SENIOR ECONOMIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Economist Senior Advisor -Economic Research "PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Deputy Project Manager/Project Support Project Manager I Program Manager Editor Consultant Senior Advisor Marketing Manager "SENIOR PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Associate Research Associate Associate Technician Project Manager ll Associate Registered Designer Associate Consultant for Economics Economic Development Manager Chief Designer "SENIOR PRINCIPAL PLANNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent I Hourly Rate I Chief Planner ~enior Principal Planner "PROJECT PROFESSIONAL" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Professional Appraiser Tourism Specialist Creative Director Photographer Finance QNQC Reviewer Senior Broker Senior Programmer "SENIOR PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Planner Senior Project Planner Senior Urban Designer Senior Designer 125 Associate Planner Director -Urban Design & Planning same 270 Principal Planner same 240 Planning Manager same 210 Senior Designer "SENIOR PROJECT PROFESSIONAL" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Professional Director -Business Attraction & Marketing Director -Economic Development Director -Real Estate Director of Administration Director of Digital Solutions Director of Operations Construction Director Senior Redevelopment Associate Senior Support Controller "PROJECT MANAGER" TO INCLUDE THE FOLLOWll!IIG TITLES: Classification Classification Equivalent Hourly Rate Project Manager Day to Day Manager Associate Project Manager Managing Director Senior Project Manager "SENIOR ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Associate Engineer Senior Project Engineer Senior Engineer Senior Roadway Engineer Senior Design Engineer Senior Traffic Engineer "PRINCIPAL ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Engineer Executive Engineer Principal Engineer Senior Principal Engineer Senior Civil Engineer Senior Transportation Engineer "EXECUTIVE PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Professional/Project Director Chief Economist Founding Principal Executive Vice President Senior Professional President President -Project Management Principal Principal 315 Principal-in-Charge Vice President Senior Vice President "PROJECT SUPPORT SPECIALIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Administrative Assistant Bookkeeper Budget & Operations Analyst Intern/Marketing Coordinator Economic Development Coordinator Project Coordinator Marketing Coordinator Business Development Coordinator Senior Analyst Sales Associate Classification 2 Person Field Survey Crew 2 Person SUE Crew 3 Person Field Survey Crew 3 Person SUE Crew 4 Person Field Survey Crew 4 Person SUE Crew 5 Person Field Survey Crew 5 Person SUE Crew SUE Technician Survey Intern Survey Technician Senior Survey Technician HDR Engineering, Inc Subconsultant : DA YID CONNER+ ASSOCIATES EX HIBIT C -PAYM ENT SCHEDULE Planning Suppo1t Services Contract No. 178-0356-P (RW) "SURVEY PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent Hydrographic/Bathymetric Crew Laser Scan Crew Photogrammetrist Professional Surveyor Senior Professional Surveyor Principal Surveyor "ARCHITECTURAL/DESIGN ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Architect Intern Architectural Associate Architectural Illustrator CADD/Designer Designer Landscape Designer "PARAPROFESSIONAL/TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Economic Development Assistant Graphic Designer Entry Level Designer CRA Clerk Technician I Traffi c/ITS Specialist Entry Level P Janner "ADMINISTRATIVE /PROJECT SUPPORT" TO INCLUDE THE FOLLOWING TITLES Classification Classifi cation Equivalent Administrative Administrative Assistant Administration/Clerical Clerical Secretary/Clerical Project Aide I Marketing Assistant Office Suppo1t Real Estate Research Assistant "GIS TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent GI S Specialist GIS Technician GIS/CAD Operator Hourly Rate Hourly Rate $75.00 $75.00 Hourly Rate Hourly Rate $45.00 Hourly Rate "ARCHITECTURAL/DESIGN ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Architect Intern Architectural Associate Architectural Illustrator CAD D/Designer Designer Landscape Designer "ENVIRONMENTAL TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Environmental Analyst Environmental Technician "ENGINEERING TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Technician II Engineering Technician Enginee1ing Intern Senior CADD Designer Transportation Analyst "SENIOR TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Technician/Suppmi Staff Senior Engineer Intern Senior Technician Transpmtation Modeler "INSPECTOR" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Construction Inspector Field Inspector "PUBLIC INVOLVEMENT SPECIALIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Public Involvement Officer Public Involvement Specialist "ASSISTANT PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Planning Assistant Urban Design Assistant Landscape Architect I Research "PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Planner Planner Planner I Urban Designer I "ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent I Hourly Rate I Engineer "PROFESSIONAL PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Urban Designer II Professional Planner II - Planner II "PROFESSIONAL ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Engineer II Civil Engineer Field Engineer Project Engineer Design Engineer Transportation Engineer Traffic Engineer Roadway Engineer "SENIOR ECONOMIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Economist Senior Advisor -Economic Research "PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Deputy Project Manager/Project Support Project Manager I Program Manager Editor Consultant Senior Advisor Marketing Manager "SENIOR PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Associate Research Associate Associate Technician Project Manager II Associate Registered Designer Associate Consultant for Economics Economic Development Manager Chief Designer "SENIOR PRINCIPAL PLANNER" TO INCLUDE THE FOLLOWING TITLES: I Chief Planner Senior Principal Planner Classification Classification Equivalent I Hourly Rate "PROJECT PROFESSIONAL" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Professional Appraiser Tourism Specialist Creative Director Photographer Finance QA/QC Reviewer Senior Broker Senior Programmer "SENIOR PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Planner Senior Project Planner Senior Urban Designer Associate P Janner Director - Urban Design & Planning Principal Planner Planning Manager Senior Designer "SENIOR PROJECT PROFESSIONAL" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Professional Director -Business Attraction & Marketing Director - Economic Development Director -Real Estate Director of Administration Director of Digital Solutions Director of Operations Construction Director Senior Redevelopment Associate Senior Support Controller "PROJECT MANAGER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Manager Day to Day Manager Associate Project Manager Managing Director Senior Project Manager "SENIOR ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Associate Engineer Senior Project Engineer Senior Engineer Senior Roadway Engineer Senior Design Engineer Senior Traffic Engineer "PRINCIPAL ENGINEER" TO INCLUDE THE FOLLOWING T ITLES: Classification Classification Equivalent Hourly Rate Chief Engineer Executive Engineer Principal Engineer Senior Principal Engineer Senior Civil Engineer Senior Transportation Engineer "EXECUTIVE PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Professional/Project Director Chief Economist Founding Principal Executive Vice President Senior Professional President Principal Landscape Architect $165.00 President -Project Management Principal Principal-in-Charge Vice President Senior Vice President "PROJECT SUPPORT SPECIALIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Administrative Assistant Bookkeeper Budget & Operations Analyst Intern/Marketing Coordinator Economic Development Coordinator Project Coordinator Marketing Coordinator Business Development Coordinator Senior Analyst Sales Associate Classification 2 Person Field Survey Crew 2 Person SUE Crew 3 Person Field Survey Crew 3 Person SUE Crew 4 Person Field Survey Crew 4 Person SU E Crew 5 Person Field Survey Crew 5 Person SUE Crew SUE Technician Survey Intern Survey Technician Senior Survey Technician Hydrographic/Bathymetric Crew Laser Scan Crew Photogrammetrist Professional Sw-veyor Senior Professional Surveyor Principal Sw-veyor HDR Engineering, Inc Subconsultant : VRANA CONSUL TING, INC. EXHIB IT C - PAYMENT SCHEDULE Planning SuppOI1 Services Contract No. 178-0356-P (RW) "SURVEY PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent "ARCHITECTURAL/DESIGN ASSOCIAT E" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Architect Intern Architectural Associate Architectural Illustrator CADD/Designer - Designer Landscape Designer "PARAPROFESSIONAL/TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Economic Development Assistant Graphic Designer Entry Level Designer CRA Clerk Technician I Traffic/ITS Specialist Entry Level P Janner "ADM INISTRATIVE /PROJECT SUPPORT" TO INCLUDE THE FOLLOWING TITLES Classification Classification Equivalent Administrative Administrative Assistant Administration/Clerical Clerical Secretary/Clerical Project Aide I Marketing Assistant Office SuppOI1 Real Estate Research Assistant "GIS TECHNICIAN " TO INCLUDE THE FOLLOWING T ITLES: Classifi cation Classification Equivalent GIS Specialist GIS Technician GIS/CAD Operator Hourly Rate Hourly Rate Hour ly Rate Hourly Rate Hourly Rate "ARCHITECTURAL/DESIGN ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Architect Intern Architectural Associate Architectural Illustrator CADD/Designer Designer Landscape Designer "ENVIRONMENTAL TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Environmental Analyst Environmental Technician "ENGINEERING TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Technician II Engineering Technician Engineering Intern Senior CADD Designer Transportation Analyst "SENIOR TECHNICIAN" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Technician/Support Staff Senior Engineer Intern Senior Technician Transportation Modeler "INSPECTOR" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Construction Inspector Field Inspector "PUBLIC INVOLVEMENT SPECIALIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Public Involvement Officer Public Involvement Specialist Classification Planning Assistant Urban Design Assistant Landscape Architect I Research Classification Project Planner Planner Planner I Urban Designer I Classification I Engineer Engineer I "ASSISTANT PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent "PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent "ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Equivalent Hourly Rate Hourly Rate Hourly Rate Hourly Rate Hourly Rate Hourly Rate Hourly Rate Hourly Rate (fourly Rate "PROFESSIONAL PLANNER/URBAN DESIGNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Urban Designer II Professional Planner I I Planner II "PROFESSIONAL ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Engineer II Civil Engineer Field Engineer Project Engineer Design Engineer Transpo1tation Engineer Traffic Engineer Roadway Engineer "SENIOR ECONOMIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Economist Senior Advisor -Economic Research "PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Deputy Project Manager/Project Support Project Manager l Program Manager Editor Consultant Senior Advisor Marketing Manager "SENIOR PROJECT ASSOCIATE" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Associate Research Associate Associate Technician Project Manager II Associate Registered Designer Associate Consultant for Economics Economic Development Manager Chief Designer "SENIOR PRINCIPAL PLANNER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Planner Senior Principal Planner Senior Planner 148 "PROJECT PROFESSIONAL" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Professional Appraiser Tourism Specialist Creati ve Director Photographer Finance QN QC Reviewer Senior Broker Senior Programmer "SENIOR PLANNER/URBAN DESIGNER" TO INCLUDE T HE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Planner Senior Project Planner Senior Urban Designer Associate Planner Director -Urban Design & Planning Principal Planner Planning Manager Senior Designer "SENIOR PROJECT PROFESSIONAL" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Professional Director -Business Attraction & Marketing Director -Economic Development Director -Real Estate Director of Administration Director of Digital Solutions Director of Operations Construction Director Senior Redevelopment Associate Senior Support Controller "PROJECT MANAGER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Project Manager Day to Day Manager Associate Project Manager Managing Director Senior Project Manager "SENIOR ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Associate Engineer Senior Project Engineer Senior Engineer Senior Roadway Engineer Senior Design Engineer Senior Traffic Engineer ;'PRINCIPAL ENGINEER" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Engineer Executive Engineer Principal Engineer Senior Principal Engineer Senior Civil Engineer Sen ior Transportation Engineer "EXECUTIVE PROFESSIONALS" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Chief Professional/Project Director Chief Economist Founding Principal Executive Vice President Senior Professional President President -Project Management Principal Principal-in-Charge Vice President Senior Vice President "PROJECT SUPPORT SPECIALIST" TO INCLUDE THE FOLLOWING TITLES: Classification Classification Equivalent Hourly Rate Senior Administrative Assistant Bookkeeper Budget & Operations Analyst Intern/Marketing Coordinator Economic Development Coordinator Project Coordinator Marketing Coordinator Business Development Coordinator Senior Analyst Sales Associate SERVICES AGREEMENT Page 14 of 15 EXHIBIT D PAYMENT/INVOICES PAYMENT/INVOICES: SUPPLIER shall submit invoices for payment due as provided herein with such documentation as required by Pinellas County and all payments shall be made in accordance with the requirements of Section 218.70 et. seq, Florida Statutes, "The Local Government Prompt Payment Act." Invoices shall be submitted to the address below unless instructed otherwise on the purchase order, or if no purchase order, by the ordering department: Finance Division Accounts Payable Pinellas County Board of County Commissioners P. 0 . Box 2438 Clearwater, FL 33757 Each invoice shall include, at a minimum, the Supplier's name, contact information and the standard purchase order number. In order to expedite payment, it is recommended the Supplier also include the information shown in below. The County may dispute any payments invoiced by SUPPLIER in accordance with the County's Dispute Resolution Process for Invoiced Payments, established in accordance with Section 218.76 , Florida Statutes, and any such disputes shall be resolved in accordance with the County's Dispute Resolution Process. INVOICE INFORMATION: Supplier Information Company name, mailing address, phone number, contact name and email address as provided on the PO Remit To Billing address to which you are requesting payment be sent Invoice Date Creation date of the invoice Invoice Number Company tracking number Shipping Address Address where goods and/or services were delivered Ordering Department Name of ordering department, including name and phone number of contact person PO Number Ship Date Quantity Description Unit Price Line Total Invoice Total Standard purchase order number Date the goods/services were senUprovided Quantity of goods or services billed Description of services or goods delivered Unit price for the quantity of goods/services delivered Amount due by line item Sum of all of the line totals fo r the invoice Pinellas County offers a credit card payment process (ePayables) through Bank of America. Pinellas County does not charge vendors to participate in the program; however, there may be a charge by the company that processes your credit card transactions. For more information pl ease visit Pinellas County purchasing website at www.pinellascounty.org/pu rchase. Pinellas County Purchasing Standard Services Agreement 07-2017 SERVICES AGREEMENT Page 15 of 15 EXHIBIT E DISPUTE RESOLUTION FOR PINELLAS COUNTY BOARD OF COUNTY COMMISSIONERS IN MATTERS OF INVOICE PAYMENTS: Payment of invoices for work performed for Pinellas County Board of County Commissioners (County) is made, by standard, in arrears in accordance with Section 218.70, et. seq., Florida Statutes, the Local Government Prompt Payment Act. If a dispute should arise as a result of non-payment of a payment request or invoice the following Dispute Resolution process shall apply: A. Pinellas County shall notify a vendor in writing within ten (10) days after receipt of an improper invoice, that the invoice is improper. The notice should indicate what steps the vendor should undertake to correct the invoice and resubmit a proper invoice to the County. The steps taken by the vendor shall be that of initially contacting the requesting department to validate their invoice and receive a sign off from that entity that would indicate that the invoice in question is in keeping with the terms and conditions of the agreement. Once sign off is obtained, the vendor should then resubmit the invoice as a "Corrected Invoice" to the requesting department which will initiate the payment timeline. 1.) Requesting department for this purpose is defined as the County department for whom the work is performed. 2.) Proper invoice for this purpose is defined as an invoice submitted for work performed that meets prior agreed upon terms or conditions to the satisfaction of Pinellas County. B. Should a dispute result between the vendor and the County about payment of a payment request or an invoice then the vendor should submit their dissatisfaction in writing to the Requesting Department. Each Requesting Department shall assign a representative who shall act as a "Dispute Manager" to resolve the issue at departmental level. C. The Dispute Manager shall first initiate procedures to investigate the dispute and document the steps taken to resolve the issue in accordance with section 218.76 Florida Statutes. Such procedures shall be commenced no later than forty-five ( 45) days after the date on which the payment request or invoice was received by Pinellas County, and shall not extend beyond sixty (60) days after the date on which the payment request or invoice was received by Pinellas County. D. The Dispute Manager should investigate and ascertain that the work, for which the payment request or invoice has been submitted, was performed to Pinellas County's satisfaction and duly accepted by the Proper Authority. Proper Authority for this purpose is defined as the Pinellas County representative who is designated as the approving authority for the work performed in the contractual document. The Dispute Manager shall perform the required investigation and arrive at a solution before or at the sixty (60) days timeframe for resolution of the dispute, per section 218.76, Florida Statutes. The County Administrator or his or her designee shall be the final arbiter in resolving the issue before it becomes a legal matter. The County Administrator or his or her designee will issue their decision in writing. E. Pinellas County Dispute Resolution Procedures shall not be subject to Chapter 120 of the Florida Statutes. The procedures shall also, per section 218.76, Florida Statutes, not be intended as an administrative proceeding which would prohibit a court from ruling again on any action resulting from the dispute. F. Should the dispute be resolved in the County's favor interest charges begin to accrue fifteen (15) days after the final decision made by the County. Should the dispute be resolved in the vendor's favor the County shall pay interest as of the original date the payment was due. G. For any legal action to recover any fees due because of the application of sections 218. 70 et. seq., Florida Statutes, an award shall be made to cover court costs and reasonable attorney fees, including those fees incurred as a result of an appeal, to the prevailing party If it is found that the non-prevailing party held back any payment that was the reason for the dispute without having any reasonable lawful basis or fact to dispute the prevailing party's claim to those amounts. Pinellas County Purchasing Standard Services Agreement 07-2017 ATTACHMENT A GRANT FUNDING CONDITIONS BID NUMBER: 178-0356-P (RW) BID TITLE: Planning Support Services This solicitation is either fully or partially Grant funded. Bidders shall comply with the clauses as enumerated below. In addition, Attachment B shall be executed and returned with all submittals. Bidders may be deemed non-responsive for non-compliance and failure to submit Attachment B. 1. Drug Free Workplace Requirements (See Attachment B): Drug-free workplace requirements in accordance with Drug Free Workplace Act of 1988 (Pub I 100-690, Title V, Subtitle D) All contractors entering into Federal funded contracts over $100,000 must comply with Federal Drug Free workplace requirements as Drug Free Workplace Act of 1988. 2. Contractor Compliance: The contractor shall comply with all uniform administrative requirements, cost principles, and audit requirements for federal awards. 3. Conflict of Interest: The contractor must disclose in writing any potential conflict of interest to the County or pass-through entity in accordance with applicable Federal policy. 4. Mandatory Disclosures: The contractor must disclose in writing all violations of Federal criminal law involving fraud, bribery, or gratuity violations potentially affecting the Federal award. 5. Utilization of Minority and Women Firms (M/WBE) (Attachment B): The contractor must take all necessary affirmative steps to assure that minority businesses, women's business enterprises, and labor surplus area firms are used when possible. Prior to contract award, the contractor shall document efforts (see Attachment B) to utilize M/WBE firms including what firms were solicited as suppliers and/or subcontractors as applicable and submit this information with their bid submittal. Information regarding certified M/WBE firms can be obtained from: Florida Department of Management Services (Office of Supplier Diversity) Florida Department of Transportation Minority Business Development Center in most large cities and Local Government M/DBE programs in many large counties and cities Please see information requested on Attachment B 6. Equal Employment Opportunity: (As per Executive Order 11246) The contractor may not discriminate against any employee or applicant for employment because of age, race, color, creed, sex, disability or national origin. The contractor agrees to take affirmative action to ensure that applicants are employed and that employees are treated during employment without regard to their age, race, color, creed, sex, disability or national origin. Such action shall include but not be limited to the following: employment, upgrading, demotion or transfer, recruitment advertising, layoff or termination, rates of pay or other forms of compensation and selection for training including apprenticeship. 7. Davis-Bacon Act: If applicable to this contract, the contractor agrees to comply with all provisions of the Davis Bacon Act as amended (40 U.S.C. 3141-3148). Contractors are required to pay wages to laborers and mechanics at a rate not less th an the prevailing wages specified in a wage determination made by the Secretary of Labor. In addition, contractors must be required to pay wages not less than once a week. If the grant award contains Davis Bacon provisions, the County will place a copy of the current prevailing wage determination issued by the Department of Labor in the solicitation document. The decision to award a contract shall be conditioned upon the acceptance of the wage determination. Page 1 of 2 Board of County Commissioners Pinellas County, FL Rev 5/11 /16 8. Copeland Anti Kick Back Act: Contractors shall comply with all the requirements of 29 CFR Part 3 which are incorporated by reference to this contract. Contractors are prohibited from inducing by any means any person employed in the construction, completion or repair of public work to give up any part of the compensation to which he or she is otherwise entitled. 9. Contract Work Hours and Safety Standards Act (40 U.S.C. 3701-3708): Where applicable, all contracts awarded in excess of $100,000 that involve the employment of mechanics or laborers must be in compliance with 40 U.S.C. 3702 and 3704, as supplemented by Department of Labor regulations (29 CFR Part 5). Under 40 U.S.C. 3702 of the Act, each contractor is required to compute the wages of every mechanic and laborer on the basis of a standard work week of 40 hours. Work in excess of the standard work week is permissible provided that the worker is compensated at a rate of not less than one and a half times the basic rate of pay for all hours worked in excess of 40 hours in the work week. The requirements of 40 U.S.C. 3704 are applicable to construction work and provide that no laborer or mechanic must be required to work in surroundings or under working conditions which are unsanitary, hazardous or dangerous. These requirements do not apply to the purchases of supplies or materials or articles ordinarily available on the open market, or contracts for transportation or transmission of intelligence. 10. Clean Air Act (42 U.S.C. 7401-7671q.) and the Federal Water Pollution Control Act (33 U.S.C. 1251-1387): as amended-The Contractor agrees to comply with all applicable standards, orders or regulations issued pursuant to the Clean Air Act (42 U.S.C. 7401-7671q) and the Federal Water Pollution Control Act as amended (33 U.S.C. 1251-1387). Violations must be reported to the Federal awarding agency and the Regional Office of the Environmental Protection Agency (EPA). 11 . Debarment and Suspension (See Attachment B) (Executive Orders 12549 and 12689): A contract award (see 2 CFR 180.220) must not be made to parties listed on the government wide exclusions in the System for Award Management (SAM), in accordance with the OMB guidelines at 2 CFR 180 that implement Executive Orders 12549 (3 CFR part 1986 Comp., p. 189) and 12689 (3 CFR part 1989 Comp., p. 235), "Debarment and Suspension. SAM Exclusions contains the names of parties debarred, suspended, or otherwise excluded by agencies, as well as parties declared ineligible under statutory or regulatory a·uthority other than Executive Order 12549. The bidder shall certify compliance as per Attachment B 12. Byrd Anti-Lobbying Amendment (See attachment B) (31 U.S.C. 1352): Contractors that apply or bid for an award exceeding $100,000 must file the required certification. Each tier certifies to the tier above that it will not and has not used Federal appropriated funds to pay any person or organization for influencing or attempting to influence an officer or employee of any agency, a member of Congress, officer or employee of Congress, or an employee of a member of Congress in connection with obtaining any Federal contract, grant or any other award covered by 31 U.S.C. 1352. Each tier must also disclose any lobbying with non-Federal funds that takes place in connection with obtaining any Federal award. Such disclosures are forwarded from tier to tier up to the non-Federal award. The bidder shall certify compliance as per Attachment B 13. Rights to Inventions Made Under a Contract or Agreement: If the Federal award meets the definition of "funding agreement" under 37 CFR § 401.2 (a) and the recipient or subrecipient wishes to enter into a contract with a small business firm or nonprofit organization regarding the substitution of parties, assignment or performance of experimental, developmental, or research work under that "funding agreement," the recipient or subrecipient must comply with the requirements of 37 CFR Part 401 , "Rights to Inventions Made by Nonprofit Organizations and Small Business Firms Under Government Grants, Contracts and Cooperative Agreements," and any implementing regulations issued by the awarding agency 14. Prohibition on utilization of cost plus a percentage of cost contracts: The County will not award contracts containing Federal funding on a cost plus percentage of cost basis. 15. Prohibition on utilization of time and material type contracts: The County wi ll not award contracts based on a time and material basis if the contract contains Federal funding. Page 2 of 2 Board of County Commissioners Pinellas County, FL RevS/11 /16 ATTACHMENT B CERT/FICA TIONS REGARDING LOBBYING; DRUG FREE WORKPLACE AND REQUIREMENTS DEBARMENT, SUSPENSION OTHER RESPONSIBILITY MATTERS and UTILIZATION OF DISADVANTAGED FIRMS (MIWBE) BID NUMBER: 178-0356-P BID TITLE: Planning Support Services This solicitation requires execution of this form which affirms compliance with certification requirements under 10 CFR Part 601 "New Restrictions on Lobbying, 10 CFR Part 607 "Government wide Requirements for Drug-Free Workplace (Grants) and 10 CFR Part 606 "Government Debarment and Suspension 1. LOBBYING The undersigned certifies, to the best of his or her knowledge and belief, that: (I) No Federal appropriated funds have been paid or will be paid, by or on behalf of the undersigned, to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with the awarding of any Federal contract, the making of any Federal grant, the making of any Federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement. (2) If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant, loan , or cooperative agreement, the undersigned shall complete and submit Standard Form-LLL, "Disclosure Form to Report Lobbying," in accordance with its instructions. (3) The undersigned shall require that the language of this certification be included in the award documents for all subawards at all tiers (including subcontracts, subgrants, and contracts under grants, loans, and cooperative agreements) and that all subrecipients shall certify and disclose accordingly. This certification is a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certification is a prerequisite for making or entering into this transaction imposed by section 1352, title 31 , U.S. Code. Any person who fails to file the requ ired certification shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such fail ure. ADDITIONAL LOBBYING REPRESENTATION Contractors which are described in section 501 (c)(4) of the Internal Revenue Code of 1986 and engage in lobbying activities after December 31 , 1995, are not eligible for the receipt of Federal funds constituting an award, grant, or loan. As set forth in section 3 of the Lobbying Disclosure Act of 1995 as amended, (2 U.S.C. 1602), lobbying activities are defined broadly to include, among other things, contacts on behalf of an organization with specified employees of the Executive Branch and Congress with regard to Federal legislative, regulatory, and program administrative matters. Check the appropriate block: The compan~ organization described in section 501 (c)(4) of the Internal Revenue Code of 1986: c::::::::J Yes LlS_J No If, you checked "Yes" above, check the appropriate block: The applicant represents that after December 31 , 1995 it has c=J has not c=J Engaged in any lobbying activities as defined in the Lobbying Disclosure Act of 1995, as amended. Page 1 of 5 Board of County Commissioners Pinellas County, FL Rev 3/28/16 100 2. DRUG FREE WORKPLACE CERTIFICATION In accordance with the Drug-Free Workplace Act of 1988 (Pub.L.100-690, Title V, Subtitle D) and is implemented through additions to the Debarment and Suspension regulations, published in the Federal Register on January 31 , 1989, and May 25, 1990. AL TERNA TE I (Vendors OTHER THAN INDIVIDUALS) A business certifies that it will or will continue to provide a drug-free workplace by: As the person authorized to sign the statement, I certify that this firm complies fully with the these requirements. (a) Publishing a statement notifying employees that the unlawful manufacture, distribution, dispensing, possession, or use of a controlled substance is prohibited in the grantee's workplace and specifying the actions that will be taken against employees for violation of such prohibition; (b) Establishing an ongoing drug-free awareness program to inform employees about: (]) The dangers of drug abuse in the workplace; (2) The grantee's policy of maintaining a drug-free workplace; (3) Any available drug counseling, rehabilitation, and employee assistance programs; and (4) The penalties that may be imposed upon employees for drug abuse violations occurring in the workplace; (c) Making it a requirement that each employee to be engaged in the performance of the grant be given a copy of the statement required by paragraph (a); (d) Notifying the employee in the statement required by paragraph (a) that, as a condition of employment under the grant, the employee will: (I) Abide by the terms of the statement; and (2) Notify the employer in writing of his or her conviction for a violation of a criminal drug statute occurring in the workplace not later than five calendar days after such conviction; (e) Notifying the agency, in writing, within ten calendar days after receiving notice under subparagraph (d)(2) from an employee or otherwise receiving actual notice of such conviction. Employers of convicted employees must provide notice, including position title, to every grant officer or other designee on whose grant activity the convicted employee was working , unless the Federal agency has designated a central point for the receipt of such notices. Notice shall include the identification number(s) of each affected grant; (t) Taking one of the following actions, within 30 calendar days of receiving notice under subparagraph (d)(2), with respect to any employee who is so convicted: (I) Taking appropriate personnel action against such an employee, up to and including termination, consistent with the requirements of the Rehabilitation Act of 1973, as amended; or (2) Requiring such employee to participate satisfactorily in a drug abuse assistance or rehabilitation program approved for such purposes by a Federal, State or local health, law enforcement, or other appropriate agency; Making a good faith effort to continue to maintain a drug-free wo rkplace through implementation of paragraphs (a),(b),(c),(d),(e), and (f). Page 2 of 5 Board of County Commissioners Pinellas County, FL Rev 3/28/16 101 AL TERNA TE II (Vendors who are Individuals) (I) The vendor certifies that, as a condition of the grant, he or she will not engage in the unlawful manufacture, distribution, dispensing, possession, or use of a controlled substance in conducting any activity with the grant. (2) If convicted of a criminal drug offense resulting from a violation occurring during the conduct of any grant activity, he or she will report the conviction, in writing, within 10 calendar days of the conviction, to every grant officer or other designee, unless the Federal agency designates a central point for the receipt of such notices. When notice is made to such a central point, it shall include the identification number(s) of each affected grant. 3. DEBARMENT, SUSPENSION, AND OTHER RESPONSIBILITY MATTERS (I) The prospective lower tier participant certifies to the best of its knowledge and belief, that it and its principals: (a) Are not presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from covered transactions by any Federal department or agency; (b) Have not within a three-year period preceding this proposal been convicted of or had a civil judgment rendered against them for commission of fraud or a criminal offense in connection with obtaining, attempting to obtain, or performing a public (Federal, State or local) transaction or contract under a public transaction; violation of Federal or State antitrust statutes or commission of embezzlement, theft, forgery, bribery; falsification or destruction of records, making false statements, or receiving stolen property; (c) Are not presently indicted fo r or otherwise criminally or civilly charged by a governmental entity (Federal, State or local) with commission of any of the offenses enumerated in paragraph (1 )(b) of this certification; and (d) Have not within a three-year period preceding this application/proposal had one or more public transactions (Federal, State or local) terminated for cause or default. (2) Where the prospective primary participant is unable to certify to any of the statements in this certification, such prospective participant shall attach an explanation to this proposal. Page 3 of 5 Board of County Commissioners Pinellas County, FL Rev 3/28/16 102 4. DBE GOOD FAITH EFFORTS A. B. c. D. The bidder must submit documentation of its good faith efforts to assure that minority businesses, woman- owned business enterprises and labor surplus firms are used when possible. Pinellas County may require that bidder provide additional substantiation of good faith efforts. Date: Firm and Contact Person: Area of Expertise: 7/26/2018 Plusurbia, LLC OBA Plusurbia Design, Juan Mullerat Design, Planning Response: Plusurbia has joined our team. Firm and Contact Person: Area of Expertise: 7/19/2018 Vrana Consulting, Inc., Tammy Vrana Architecture, Planning Response: Vrana Consulting has joined our team. Firm and Contact Person: Area of Expertise: Response: Firm and Contact Person: Area of Expertise: Response: Page4of5 Board of County Commissioners Pinellas County, FL Rev 3/28/16 103 SIGNATURE As the duly authorized representative of the company, I hereby certify that the company will comply with the above certifications. HDR Engineering, Inc. Company Name: Katie Duty, PE, Vice President Printed Name and Title of Authorized Representative: sf~;t~ 8/8/2018 DATE The company may insert in the space provided below the site(s) for the performance of work done in connection with the specific grant: Place of Performance: (Street address, city, county, state, zip code) Street Address City, County, State, Zip c=]check if there are workplaces on file that are not identified here. 187294624 DUNS Number (Company Data Universal Numbering System regulated by Dun & Bradstreet) Page 5 of 5 Board of County Commissioners Pinellas County, FL Rev 3/28/16 104 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8132 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: ReportIn Control: Information Technology Agenda Number: 7.16 SUBJECT/RECOMMENDATION: Authorize a purchase order to CDW Government LLC (CDW-G), of Vernon Hills, IL, in the amount of $156,377.00, pursuant to Clearwater Code of Ordinances Section 2.564(1)(d) Exceptions to Bid - Other Government Entities’ Bids, authorize lease purchase under the City's Master Lease Purchase Agreement or internal financing via an interfund loan from the Capital Improvement Fund, whichever is deemed to be in the City's best interests, and authorize the appropriate officials to execute same. (consent) SUMMARY: Authorization is requested to piggyback off of the State of Florida Software Value Added Reseller Contract #4323000-NASPO-16-ACS-SVAR (Naspo Contract #ADSPO16-130652) and National IPA Technology Solutions Contract #2018011-01 for the utilization of FortiNet hardware and software network management solutions in the amount of $156,377.00 through April 7, 2021. This authorization upgrades the City’s annual support renewal due to expire on September 17, 2020. Fortinet purchases through CDW-G will include hardware and software as well as licensing support for eight existing firewalls. These items, combined with two previous purchases with CDW-G for FortiNet products will bring the annual total spend to $193,563.00 through various state and national contracts as listed below: Locations are: (2) MSB, (2) CPD, (2) Fire-48, (2) City Offices $64,975.00: for annual support renewal $40,000.00: for two (2) additional firewalls for new Crown Castle connection. $26,297.00: for an additional Forti-Analyzer appliance $10,889.00: for additional Forti-Auth upgrade and tokens $14,216.00: ten percent (10%) contingency for purchases of hardware, software and services as necessary. APPROPRIATION CODE AND AMOUNT: Funds are available in capital improvement projects 355-L1908, Network Infrastructure R&R, and 355-M2007, City EOC & Disaster Recovery R&R, to fund the current year portion of this contract. Project funding for fiscal year 2020/21 is included in the proposed budget. Page 1 City of Clearwater Printed on 9/3/2020 AMENDMENT NO.: 3 - Renewal Alternate Contract Source No.: 43230000-NASPO-16-ACS-SVAR Alternate Contract Source Name: Software Value Added Reseller Software Value Added Reseller Page 1 of 2 Alternate Contract Source No.: 43230000-NASPO-16-ACS-SVAR This Amendment No. 3 (“Amendment”) effective as of April 8, 2020, to the Software Value Added Reseller (SVAR) Agreement, Contract No. 43230000-NASPO-16-ACS-SVAR (“Participating Addendum”) is made by and between the State of Florida, Department of Management Services (“Department”), and CDW Government, LLC (“Contractor”), collectively referred to herein as the “Parties.” All capitalized terms used herein have the meaning assigned to them in the Participating Addendum unless otherwise defined herein. WHEREAS the Parties agreed that the Participating Addendum may be amended by mutual agreement as provided in Section II.d., “Amendments,” of the Participating Addendum; and WHEREAS the Parties agreed that the Participating Addendum may be renewed as provided in Section 2.2, “Renewal,” of Exhibit A of the Participating Addendum. NOW THEREFORE, in consideration of the mutual covenants contained herein, the Parties agree as follows: I. Participating Addendum Amendment – Orders. Section II.c., “Orders,” of the Participating Addendum is hereby deleted and replaced with the following: c. Orders. Agencies, as defined in section 287.012, Florida Statutes, may purchase products and services under the Master Agreement using this State of Florida Alternate Contract Source No. 43230000-NASPO-16-ACS-SVAR. Agencies acknowledge and agree to be bound by the terms and conditions of the Master Agreement except as otherwise specified in this Participating Addendum. II. Participating Addendum Renewal. The Participating Addendum is hereby renewed for a period of one (1) year, with a new expiration date of April 7, 2021, under the same terms and conditions, except as amended herein. III. Warranty of Authority. Each person signing this Amendment warrants that he or she is duly authorized to do so and to bind the respective party. IV. Conflict. To the extent any of the terms of this Amendment conflict with the terms of the Participating Addendum, the terms of this Amendment shall control. V. Effect. Unless otherwise modified by this Amendment, all terms and conditions contained in the Participating Addendum, as previously amended, shall continue in full force and effect. (Remainder of Page Intentionally left Blank) AMENDMENT NO.: 3 - Renewal Alternate Contract Source No.: 43230000-NASPO-16-ACS-SVAR Alternate Contract Source Name: Software Value Added Reseller Software Value Added Reseller Page 2 of 2 Alternate Contract Source No.: 43230000-NASPO-16-ACS-SVAR IN WITNESS WHEREOF, the Parties have executed this Amendment by their duly authorized representatives. State of Florida: Department of Management Services Contractor: CDW Government, LLC By: _____________________________ By: _____________________________ Name: Tami Fillyaw Name: Title: Chief of Staff Title: President Date: Date: AMENDMENT NO.: 3 - Renewal Alternate Contract Source No.: 43230000-NASPO-16-ACS-SVAR Alternate Contract Source Name: Software Value Added Reseller Software Value Added Reseller Page 2 of 2 Alternate Contract Source No.: 43230000-NASPO-16-ACS-SVAR IN WITNESS WHEREOF, the Parties have executed this Amendment by their duly authorized representatives. State of Florida: Department of Management Services By: _____________________________ Name: Tami Fillyaw Title: Chief of Staff Date: Contractor: CDW Government, LLC By: _____________________________ Name: Title: Date: Dario J. Bertocchi Director, Program Sales March 05, 2020 DocuSign Envelope ID: 5CAF5855-3940-4EEB-B3EE-A7D079BD1FA2 3/23/2020 | 2:03 PM EDT 2/20/2020 Senior Group Manager Stephen Nettles 1 | Page Software Value-Added Reseller (SVAR) Services MASTER PRICE AGREEMENT with CDW Government LLC Contract No. ADSPO16-130652 State of Arizona Lead State Effective: April 8, 2016 to April 7, 2018 2 | Page Master Agreement Table of Contents State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services Table of Contents EXECUTED OFFER AND ACCEPTANCE FORM......................................................................................................... 2 TABLE OF CONTENTS ................................................................................................................................................. 3 SECTION 1: NASPO ValuePoint Solicitation ADSPO16-00005829 – GENERAL INCFORMATION ......................... 4 SECTION 2: SCOPE OF WORK ................................................................................................................................... 7 SECTION 3: NASPO ValuePoint Master Agreement Terms and Conditions ......................................................... 22 SECTION 4: Lead State (State of Arizona) Terms and Conditions ........................................................................ 37 State of Arizona Special Terms and Conditions ....................................................................................... 37 State of Arizona Uniform Terms and Conditions ...................................................................................... 50 Master Agreement Section 1: General Information State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 1.1 Purpose The State of Arizona, State Procurement Office, is requesting proposals for Software Value-Added Reseller (SVAR) services in furtherance of the NASPO ValuePoint Cooperation Purchasing Program (NASPO ValuePoint). The purpose of this Request for Proposal (RFP) is to establish Master Agreements with qualified Offerors so that NASPO ValuePoint Cooperative Members may acquire Commercial off the Shelf Software (COTS) and related services from Software Value-Added Resellers. The objective of this RFP is to obtain best value, and in some cases achieve more favorable pricing, than is obtainable by an individual state or local government entity because of the collective volume of potential purchases by numerous state and local government entities. The Master Agreement(s) resulting from this procurement may be used by state governments (including departments, agencies, institutions), institutions of higher education, political subdivisions (i.e., colleges, school districts, counties, cities, etc.), the District of Colombia, territories of the United States, and other eligible entities subject to approval of the individuals state procurement director and compliance with local statutory and regulatory provisions, as explained in section 3 of the NASPO ValuePoint Master Agreement Terms and Conditions. The initial term of the Master Agreement shall be two (2) years with renewal provisions as outlined in Section 3 of the NASPO ValuePoint Master Terms and Conditions (Section 4). 1.2 Lead State, Solicitation Number and Lead State Contract Administrator (LSCA) The State of Arizona, State Procurement Office (SPO) is the Lead State and issuing office for this document and all subsequent addenda relating to it. This solicitation (RFP) is a competitive process, in accordance with the Arizona Procurement Code available at https://spo.az.gov/ . The Arizona Procurement Code is a compilation in one place of Arizona Revised Statutes (ARS) 41-2501 et seq. and administrative rules and regulations A.A.C R2-7-1010 et.seq. The Solicitation #ADSPO16- 00005829 must be referred to on all proposals, correspondence, and documentation relating to this RFP. The Lead State Contract Administrator (LSCA) identified below is the single point of contact during this procurement process. Offerors and interested persons shall direct to the Lead State Contract Administrator all questions concerning the procurement process, technical requirements of this RFP, contractual requirements, requests for brand approval, change, clarification, protests, the award process, and any other questions that may arise related to this solicitation and the resulting Master Agreement. The Lead State Contract Administrator (LSCA) designated by the State of Arizona, State Procurement Office is: Charlotte Righetti, CPPB, CTNS State Procurement Manager State of Arizona, State Procurement Office 100 N. 15th Avenue, Suite 201 Phoenix, Arizona 85007 Phone: (602)542.9127 1.3 NASPO ValuePoint Background Information NASPO ValuePoint (formerly known as WSCA-NASPO) is a cooperative purchasing program of all 50 states, the District of Columbia and the territories of the United States. The Program is facilitated by the NASPO Cooperative Purchasing Organization LLC, a nonprofit subsidiary of the National Association of State Procurement Officials (NASPO), doing business as NASPO ValuePoint. NASPO is a non-profit association dedicated to strengthening the procurement community through education, research, and communication. It is made up of the directors of the central purchasing offices in each Master Agreement Section 1: General Information State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 5 | Page of the 50 states, the District of Columbia and the territories of the United States. NASPO ValuePoint facilitates administration of the cooperative group contracting consortium of state chief procurement officials for the benefit of state departments, institutions, agencies, and political subdivisions and other eligible entities (i.e., colleges, school districts, counties, cities, some nonprofit organizations, etc.) for all states, the District of Columbia, and territories of the United States. For more information consult the following websites: www.naspovaluepoint.org and www.naspo.org . 1.4 Participating States In addition to the Lead State conducting this solicitation, the Participating States listed below have requested to be named in this RFP as potential Users of the resulting Master Agreement. Other entities may become Participating Entities after award of the Master Agreement. State specific terms and conditions will govern each state’s Participating Addendum that will govern each state’s Participating Addendum. A listing of the Participating States can be found in Exhibit I. 1.5 Definitions – all capitalized terms in this document have the meaning as defined in AAC R2-7-101. Any capitalized term not defined in AAC R2-7-101 has the meaning defined below. "Appliance" means a separate and discrete hardware device with integrated software (firmware), specifically designed to provide a specific computing resource. For the purposes of this solicitation only an “Appliance” which is the sole means of obtaining the Software product is allowable. “Attachment” means any item the Solicitation requires an Offeror to submit as part of the Offer. “Best and Final Offer (BAFO)” means a revision to an Offer submitted after negotiations are completed that contains the Offeror’s most favorable terms for price, service, and products to be delivered. “Commercial Off the Shelf” (“COTS”) for the purposes of this solicitation means non-developmental software which has been created for specific uses and is available to the general public in the commercial marketplace. COTS products are designed to be implemented easily into existing systems without the need for customization. “End-User License Agreement (EULA)” is a legal contract between the manufacturer (publisher) and the end User of an application that details how the software can and cannot be used. “eProcurement (Electronic Procurement)” means conducting all or some of the procurement function over the Internet. Point, click, buy and ship Internet technology is replacing paper-based procurement and supply management business processes. Elements of eProcurement also include Invitation for Bids, Request for Proposals, and Request for Quotations. “Excluded Software Publishers” means a Software Publisher who is unwilling to do business with a Reseller. “Exhibit” means any document or object labeled as an Exhibit in the Solicitation or placed in the Exhibits section of the Solicitation. Master Agreement Section 1: General Information State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 6 | Page “Lead State Contract Administrator” (“LSCA”) means the Procurement Officer for the Master Agreement. “Master Agreement” (“MPA”) means the contractual agreement executed between the winning (awarded) contractor (s) and the Lead State conducting the procurement on behalf of NASPO ValuePoint. “Non-perpetual license” or Subscription License” is a temporary license that provides the right to use a particular licensed product until the end of the license-agreement term. “Participating State Contract Administrator” (“PSCA”) means the Procurement Officer for the Participating State. “Perpetual license” means a license which is everlasting and valid if the software is being used in accordance with the license-agreement requirements. “Person” means any corporation, business, individual, union, committee, club, or other organization or group of individuals “Publisher” means a software manufacturer (e.g., Microsoft) “Reseller” means a Software Value-Added Reseller who is awarded under this solicitation, and who has a fully-executed (MPA and PA-s) contract. “Reseller Cost” means the price that the Reseller pays the Publisher or Distributor to purchase software on behalf of the Participating State. Reseller Cost should not include any administrative or other mark-up costs. “Software” means the computer program, including media and associated documentation. “Software Licensing” means allowing an individual or group to use a piece of software. “Software Maintenance and Support” means any software upgrades, annual updates, patches and fixes needed to improve functionality and keep the software in working order. “Solicitation Amendment” means a change to the Solicitation issued by the Procurement Officer. “Volume License Agreements (VLAs)” means an agreement with a Software Publisher wherein the Participating State’s total expected purchasing over a period of time is considered in establishing the discount level. Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 7 | Page 2.1 Software Value-Added Reseller (‘Reseller’ – “SVAR”) 2.1.1 Software Value-Added Reseller (‘Reseller’ – “SVAR”) shall be a large account reseller authorized to sell products direct from Key Software Publishers or authorized Distributors. 2.1.2 SVAR shall do the following: 2.1.2.1 Provide Commercial Off-the-Shelf-Software (COTS). 2.1.2.2 Honor existing Volume or Enterprise license agreements. 2.1.2.3 Offer maintenance and support packages on licenses already owned by the Participating State and other Purchasing Entities. 2.1.2.4 Advise the LSCA, each PSCA, and other Purchasing Entities of SVAR’s channel partner status with Key Software Publishers. 2.1.2.5 Retain or enhance reseller certifications with software publishers - At a minimum, maintain Reseller certification levels held at time of award. If Reseller’s certification or reseller status is withdrawn or reduced, Reseller is required to immediately notify, in writing, the Lead State Contract Administrator (LSCA), each PSCA and other Purchasing Entities explaining:  The change;  The impact on their costs to obtain the product;  Limitations on the products or services they may provide; and,  The reasons for the change. Failure to provide the required notification, regarding significant negative changes in their reseller status, may be grounds for suspension or cancellation of the MPA and PA’s. 2.1.2.6 Provide Pre-Sale Advisement - There shall be no charge for these services: 2.1.2.6.1 Advise the Purchasing Entity in making strategic software application decisions by providing evaluation copies, product comparisons, needs analysis, product information and application recommendations. 2.1.2.6.2 Act as liaison between the Purchasing Entity and individual publishers in identifying best approaches and cost savings opportunities for the Purchasing Entity. 2.1.1.6.3 Examples of such advice would be:  In selecting appropriate software;  In explaining Volume License Agreements with complicated rules;  In determining the most cost-effective buying strategies;  In ensuring that Participating States and other Purchasing Entities are in compliance with licensing requirements; and,  In finding software options to meet a specific need, for example, a flow-charting package. 2.1.2.7 Reseller shall negotiate to reduce Reseller Cost, to pass on savings to the Participating State and other Purchasing Entitites. Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 8 | Page 2.1.2.8 Provide assistance in explaining and developing Volume License and Enterprise Agreements. 2.1.2.9 Provide Software Installation Assistance. 2.1.2.9.1 Provide, at no additional cost, assistance or advice in basic installation or implementation of COTS product. 2.1.2.8.2 If the Purchasing Entity encounters difficulty in downloading or installing the software, the Reseller must provide assistance within eight (8) business hours of being informed of the problem. 2.1.2.10 Provide Software De-Installation Assistance. 2.1.2.11 Provide Tracking, Management, Usage Monitoring and Reporting of Licenses 2.1.2.11.1 Reseller shall have in place a product license inventory and asset management system, which will include an accurate inventory record of product licenses purchased under this Contract. 2.1.2.11.2 Reseller must also have the capability tracking maintenance renewal and other significant due dates. 2.1.2.11.3 At a minimum, this system shall be able to provide this information by Participating State and Purchasing Entity. 2.1.2.11.4 Reseller shall work with Participating State, other Purchasing Entities, publishers, previous and subsequent contract software resellers, and hardware computer contractors to ensure the most comprehensive record of licenses is created, maintained, and the information transferrable. 2.1.2.11.5 States may choose to award multiple PA’s under this Agreement. Details on how licenses are to be tracked and managed under multiple awards will be determined by that awarding State. 2.1.2.11.6 As may be required by a Participating State, or other Purchasing Entity, Reseller shall work with NASPO ValuePoint computing equipment contractors, or a Participating State’s comparable computer hardware contractor, to see that any software acquired under those contracts can be tracked through this contract. 2.1.2.12 Notify Participating State and Purchasing Entities of publisher publicly announced changes pertinent to User licensing. 2.1.3 SVAR shall Develop and Maintain Website 2.1.3.1 For Participating States, Reseller shall develop and support a website specific to that State, with content approved from the LSCA or PSCA as appropriate based on content. 2.1.3.1.1 This web site information shall be available through the Internet without the use of additional software or licenses. Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 9 | Page 2.1.3.1.2 Website should be User friendly to allow for quick and easy access and use. 2.1.3.1.3 Website shall be available 24 x 7, except for scheduled maintenance. 2.1.3.1.4 Website shall be ADA compliant. 2.1.3.1.5 No costs or expenses associated with providing this information shall be charged to the States. 2.1.3.1.6 Universal Resource Locator (URL) for the website must be supplied to the PSCA and the LSCA within sixty (60) days of the execution of the PA. 2.1.3.1.7 The website will include contract information, product information/catalog, the capability to generate online reports, and other pertinent information as may be reasonably requested by States, such as copies of VLAs. 2.1.3.1.8 Publisher Notifications and Other Industry Information. In the event that a publisher publicly announces changes that are pertinent to User licensing, the Reseller shall assist Users by posting the information on the state websites. 2.1.3.1.9 Reseller shall provide, at no additional cost, training on how to use their website and how to use this contract in obtaining quotes and placing orders. Online training should be available on the website, but supplementary electronic (e.g. Webinars, emails), telephone or on-site training should be provided, as needed, during standard working hours. 2.1.3.2 Contract and General Information. The website shall provide contract and ordering information to include, at a minimum: 2.1.3.2.1 The contract number(s) (MPA and PA); 2.1.3.3.2 The Reseller primary contact and contacts to whom incidents are to be escalated:  Name(s and titles  Areas of responsibility for each contact name;  Phone number(s); and,  Email address(es). 2.1.3.3.3 Information on use of website, 2.1.3.3.4 Quote and ordering information; and, 2.1.3.3.5 Notifications regarding publishers and products, such as pending key product changes or upgrades. 2.1.3.3 Online Catalog 2.1.3.3.1 Reseller shall provide COTS software, and software maintenance of new or existing licensed software, under this contract. Information on approved products, customized by Participating State, will be available through an online catalog and through Reseller’s representatives either through email or telephone inquiry during the standard working hours of the Participating State. The online catalog shall provide an expansive list Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 10 | Page of products allowed per the contracts, particularly those products of itemized publishers. 2.1.3.3.2 The website shall provide contract and ordering information to include, at a minimum: publishers, product names, standard product pricing, and product descriptions (photos optional or links to access product literature). Regardless of the number and types of links to the Reseller’s electronic catalog, the Reseller shall ensure that all eligible agencies purchasing under one PA are accessing the same current base version of the product catalog. Online information shall include purchases of Volume or Enterprise License Agreement software as well as individual COTS software licenses. 2.1.3.3.3 Online catalog shall be restricted to just software. Non-authorized products or groups of products shall not be on the website. Reseller shall not use this proposed website to cross sell or cross advertise other products and or services the Reseller may be able to offer. 2.1.3.4 Product Searching Capability. At a minimum, the online catalog should be searchable by Purchasing Entity and their VLAs, Software Publisher, Product name, OEM product number, and software description (e.g., GIS, Security). The online category can be modified as Users’ needs dictate, such as including products obtained through a distributor (non-itemized publisher products) that are frequently purchased. 2.1.3.5 Online Product Quotes. Product price displayed online is a ‘not-to-exceed’ product price quote based on contract rate and real time Reseller Cost. For high dollar purchases, or quantity purchases, Purchasing Entity should request a quote by contacting Reseller representative off-line. The online pricing should allow for overrides when a quote with a negotiated better price has been offered and is being placed online. Website should have capability to track all quotes by Purchasing Entity and be easily accessible for viewing by quote number. Website shall include a shopping cart feature that allows Purchasing Entities to provide shipping instructions. Purchasing Entities can place orders on the web either via credit card or purchase order. Specifics regarding an individual state’s requirements for placing an order may be included in that State’s Participating Addendum (PA). 2.1.3.6 User Differentiation. Catalog should be designed so as to provide a means to identify the Participating State (state agency or other eligible Purchasing Entity). This method used must not require any administrative tasks on the part of the LSCA for the MPA, the PSCA for the individual PSCA. Website should allow Users to develop personal lists and profiles, including an option to securely store and maintain procurement card information. Catalog should have the capability of being used as a ‘Punch Out’ to an individual state’s electronic purchasing system. 2.1.3.7 Online Reports. Website shall have capability to provide order history, as well as order status and order tracking. 2.1.3.8 Other. Other information may be added to the website as may be required by State (such as copies of volume license agreements) or enhancements that may be proposed by Reseller and approved by State. Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 11 | Page 2.2 COTS Products 2.2.1 Software which requires little or no services IN SCOPE Offerings OUT OF SCOPE Offerings LICENSING TYPE COTS Individual Licensing Volume Licensing Enterprise Licensing Custom/Customized LICENSING PERIOD Perpetual Subscription none Delivery Shrink-Wrap Download none HOSTING as part of delivery & use. On Premise Off Premise Managed Service Managed Services means the proactive management of an IT (Information Technology) asset or object, by a third party typically known as a MSP, on behalf of a customer mspalliance.com/definition-of- managed-services/ 2.2.1.1 Most Current Version - Purchase orders shall be deemed to reference a manufacturer’s most recent release model or version of the product at the time of the order, unless the Purchasing Entity specifically requests in writing an earlier model or version and the Reseller is willing to provide such model or version. 2.2.1.2 Licenses and Maintenance Agreements 2.2.1.2.1 Volume License Agreements (VLA) and Enterprise License Agreements (ELA) The Reseller will honor existing Participating State’s VLA’s or ELA’s with publishers and include those licenses as part of the Reseller’s license tracking service. Following an executed PA with a Participating State, and if so required by the Participating State, the Purchasing Entity and/or an individual publisher, the Reseller will identify itself to software publishers as Reseller for that Participating State or Purchasing Entity. If so required by the Publisher and Participating State, Reseller will execute a change of channel partner agreement with the Publisher. Resellers will sell additional seats consistent with Purchasing Entities’ Enterprise or Volume Agreements. Reseller will work with Participating State, Purchasing Entity(ies) and Publishers as needed to establish new VLAs or ELAs. The Reseller will work with the Publisher and Participating State as necessary to ensure the Participating State receives timely and pertinent license information, such as: license or agreement renewals, or opportunities based on actual volume. Reseller will work directly with Purchasing Entity(ies) in establishing, signing and maintaining enrollment agreements. If Reseller is sole SVAR contractor in a State, Reseller will aggregate all enrollments together for Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 12 | Page Master Agreement reporting purposes. If a PSCA elects to have multiple SVAR contractors, Reseller’s responsibilities will be delineated in that State’s PA. Resellers shall monitor and be able to report on the current levels of software ordered towards any of the Participating State’s VLA required sales levels to ensure the Participating State does not fall short and thereby incur Publisher penalties. The Reseller shall be responsible for providing license usage information to the Publishers, if such information is required by the Publishers, in a timely manner (e.g., for ‘true up’ assessments) 2.2.1.2.2 Individual Software Licenses. Purchasing Entities can purchase individual COTS licenses, such as perpetual and non-perpetual licenses, through the Reseller. 2.2.1.3 Software Maintenance and Support Agreements. Purchasing Entities can purchase maintenance agreements, including upgrade protection, through the Reseller. Resellers will sell software maintenance agreements, even if the software was not purchased under this agreement, such as on-going support for a User’s existing perpetual license. As requested, Reseller will explain what product support or services are included in a publisher’s maintenance agreement. 2.2.1.3.1 Software Maintenance and Support. Reseller to provide needed services to support maintenance products such maintenance agreements, software upgrades, annual updates, patches and fixes needed to improve functionality and keep the software in working order. Such services may include providing recommendations on most cost-effective or appropriate long-term maintenance plan. Reseller will provide such support, not only to maintenance packages purchases under this agreement, but in support of any existing and current agreements. 2.2.1.3.2 Software Updates. 2.2.1.3.2.1 Users are eligible to receive, from the Publisher, all new releases and updates of the software, at no additional charge, while under a maintenance agreement. A “Release” means any collection of enhancements or updates which the Publisher generally makes available to its installed base of customers of such programs. The Reseller shall assist the Purchasing Entity to obtain such releases or updates for their Users from the Publisher. 2.2.1.3.2.2 Should a User not want to receive the next upgrade, the User shall so notify the respective Publisher. 2.2.1.3.3 License Confirmations For licenses ordered under the contract by Purchasing Entity(ies), Reseller shall be able to provide: Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 13 | Page (i) Certified Licensing Confirmation Certificates for all software licenses; (ii) Reseller’s certified license confirmation certificates in the name of such Licensee; or, (iii) Written confirmation from the Reseller or Publisher accepting the Eligible Participating State’s contract or purchase order as proof of license. The form of “Proof of License” provided must be acceptable proof to the Publisher, and in the format requested by the Purchasing Entity. The Proof of License shall be provided as an electronic file and/or a hardcopy document, as required by the Purchasing Entity. Reseller will retain an electronic file of Participating State’s Proof of Licenses and provide copies to the Participating State as requested. 2.2.1.3.4 Transitioning License Tracking Information at Contract Termination The license information data acquired and retained by Reseller will be stored as sortable data fields so the license information can be transferred to the Participating State upon contract termination. Reseller will work with States and Participating Entities, or their designees, to ensure that the license information data has been successfully transferred in a usable format. 2.2.1.4 Leases Lease purchase and term leases are allowable only for Purchasing States whose rules and regulations permit leasing of software. Individual Purchasing Entities may enter into a lease agreement for the products covered in this Master Agreement, if they have the legal authority to enter into these types of agreements without going through a competitive process. No lease agreements will be reviewed or evaluated as part of this RFP evaluation process. 2.2.1.5 Software Publishers, Categories. The identified software product needs under this solicitation have been divided into three tiers: Key Itemized Publishers, Other Itemized Publishers, and Non-Itemized Publishers. See descriptions and chart which follow. As indicated, it is most desirable for Reseller to have a direct reseller agreement with the itemized software publishers. If a direct reseller agreement is not already in place between itemized software publishers and the Reseller, the Reseller is expected to enter into a direct reseller agreement and submit a rate for that itemized publisher that is better than the rate for a Non-Itemized Publisher. Over the life of this contract, product needs or volumes may change and new publishers may be added by amendment to the itemized publishers’ lists. 2.2.1.5.1 Itemized Highest Volume Publishers (Highest Volume, Itemized Lines). The products of the publishers in this category represent the highest tier of sales volume identified for this solicitation, of those publishers who sell through resellers. This category is the one most likely to include a Participating State’s enterprise or high volume agreements with a publisher. Resellers shall be certified direct resellers for publishers in this Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 14 | Page category. The preferred pricing that a Reseller receives based on their reseller certification status, in conjunction with the anticipated considerable volume of purchases through these Contracts, is the expected foundation for a very competitive base Reseller Cost, with further reductions of Reseller Cost as they are achieved through ongoing Reseller negotiations. A percentage rate above or below Reseller Cost is to be provided for each itemized publisher. Specific requirements may be required for some publishers in this category in an individual State’s PA. 2.2.1.5.2 Other Itemized Publishers (High Volume, Itemized Lines). The products of the publishers in this category represent a high level of sales volume as identified for this solicitation. This category may include a Participating State’s high volume agreements or VLAs with a publisher. It is desirable for Resellers to be certified direct resellers for publishers in this category. A percentage rate above or below Reseller Cost is to be provided for each itemized publisher 2.2.1.5.3 Non-Itemized Publishers (all other distributed software purchases). This category is defined to include all other distributed computer software not specifically itemized. Enterprise or Volume Licensing Agreements are not anticipated in this category. New or existing software products can be added to this category at any time during the term of the Contract without the written consent of the LSCA and may be itemized in the online catalog, if volume justifies the addition. There should be one percentage rate above or below Reseller cost covering all products in this category KEY ITEMIZED PUBLISHERS Certification as Direct Reseller. OTHER ITEMIZED PUBLISHERS Certification as direct reseller desirable. If not certified, the percentage rate should be no greater than Non-Itemized rate NON-ITEMIZED PUBLISHER One ‘not to exceed’ rate ADOBE AI SQUARED CITRIX AIRWATCH MOBILE DEVICE MANAGEMENT VMWARE MICROSOFT ALLIANCE ENTERPRISES NOVELL APPLE SYMANTEC ATTACHMATE – MICROFOCUS VMWARE AUTODESK AUTONOMY – HP BAKBONE – DELL BARRACUDA BOMGAR REMOTE SOFTWARE CA TECHNOLOGIES CISCO COMPUTRONIX USA Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 15 | Page COMPUWARE COREL DOUBLETAKE EMC ENCHOICE ESET ESRI FREEDOM SCIENTIFIC GUARDIAN EDGE – SYMANTEC GW MICRO IBM ICM CONVERSIONS INFOR INTERMEDIX EMSYSTEMS HP HUMANWARE INFORMATION BUILDERS KRONOS SOFTWARE LANDESK LASERFISCHE LIQUIDWARE STATUSPHERE MICROFOCUS INC MINJET MPS MQSOFTWARE – BMC SOFTWARE NCIRCLE NETOP NUANCE ORACLE OSAM PASSPORT PATCHLINK PROOFPOINT RSA SECURITY REFERENCIA SYSTEMS SAP AMERICA SAS SOLUTIONS SOFTWARE SOPHOS SPLUNK SOFTWARE STASEEKER NETWORK INFRASTRUCTURE MONITORING STELLENT – ORACLE Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 16 | Page SUNGUARD SYBASE TECHSMITH TREND MICRO TRUSTWARE ULTRABAC VORMETRIC WEBSENSE 2.2.1.6 Software Publishers, General Representation. 2.2.1.6.1 Excluded Software Publishers. The Reseller must agree that there are no software publishers with whom they will refuse to do business if the Software Publisher is willing to do business with them. Resellers shall advise the LSCA or designee of any Excluded Software Publishers and provide explanations for the non-representation. 2.2.1.6.2 Expanded Representation. The Reseller is expected to continue to work towards reseller certifications with publishers not currently represented, particularly with those publishers whose sales volume merit classification into the itemized publisher lines. Similarly, Reseller is expected to continue to work towards a higher certification level with current publishers 2.2.1.7 Price Quote, General. Pricing is submitted in the MPA as a percentage of Reseller Cost. Individual PA’s will use the MPA pricing as a base and may negotiate an adjusted rate. Any negotiated PA rates, exclusive of taxes or any individual state’s administrative fee, shall not exceed the MPA rates. As requested by Purchasing Entity, for example on a high volume single order, Reseller shall negotiate to reduce Reseller Cost, to pass on savings to the Participating State. Firm individual order quotes shall be provided to Purchasing Entity prior to order submittal. 2.2.1.7.1 Telephone or Email Quote Support. Reseller shall accept requests for quotes by telephone, fax, email, or online. Reseller shall accept collect telephone calls and/or provide and maintain a toll-free number for eligible agency use. Reseller shall provide an email address for receipt of requests for price quotes. Reseller shall provide written quotes by fax, email or online as requested by the Participating State. 2.2.1.7.2 Quoted Delivery Method. The quote must clearly indicate the method of delivery, whether via media, download, or 3.3 Services below. 2.2.1.7.3 Timely Quotes. Reseller agrees to work with publishers and distributors to obtain quotes and deliver software in a timely fashion. Expected response should be within twenty-four (24) hours but no more than three (3) business days. If, after three (3) business days, the Reseller has been unable to obtain the quote or assurances that Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 17 | Page they can obtain the software, the Reseller shall contact the Participating State or other Purchasing Entity with a status report. The Reseller and the Participating State/Purchasing Entity will mutually agree as to whether the Reseller shall continue to pursue a quote and within what timeframe, or whether the Reseller will provide the Participating State/Purchasing Entity with a written statement that the Reseller cannot supply the software. If the Reseller has been unable to obtain a quote within ten (10) days of the request for quote, the Reseller shall provide a written statement (email is sufficient) to Participating State/Purchasing Entity, and the LSCA as may be required under the PA, that the Reseller cannot supply the software, and the reason why. 2.2.1.7.4 Guaranteed 30 Day Quote. Reseller is required to honor all quotes for thirty (30) calendar days. If it is known that a price adjustment will occur during the thirty (30) calendar days following the quote, the Reseller may provide two quotes, based upon the date that the order is received. 2.2.1.7.5 Sales Promotion. The Reseller may conduct sales promotions involving specific products or groups of products for specified time periods. If electing to exercise this provision, the Reseller shall submit a formal request for approval to the LSCA. The request should include: the product or product groups, the promotional price as compared to the standard price and the Master Agreement price for the product or product groups, and the start and end dates of the sales promotion. LSCA’s approval shall be in the form of an amendment to the MPA. Upon approval, the Reseller shall provide conspicuous notice of the promotion to all Participating Entities. 2.2.1.7.6 A Participating State or other Participating Entity may allow the Contractor to charge a credit card fee in their Participating Addendum. 2.2.1.8 Product Delivery and Returns 2.2.1.8.1 Media. The Reseller shall work with Participating State or other Purchasing Entity to provide media via any method available and as requested by the Participating State including, but not limited to: original Publisher media, CD copies of master media duplicated by the Reseller, electronic downloads, etc. In cases where original publisher’s media is not available, the Reseller shall provide CD’s copied from master disks of the software purchased under any volume or enterprise license agreement. 2.2.1.8.2 Delivery Period. Reseller to provide delivery no longer than ten (10) business days after receipt of a valid order unless conditions arise that are outside the control of the Reseller. If delivery cannot be within this time frame, Reseller is to notify Purchasing Entity of delay and anticipated Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 18 | Page ship date. If this delayed delivery is unacceptable to Purchasing Entity, the order can be cancelled without penalty. 2.2.1.8.3 Product Returns. Unopened software can be returned with no restocking fee up to 30 days from date of receipt, if allowed by the software publisher. If the software publisher has a shorter timeframe for returns or requires a restocking fee, this must be stated on the quote. If that information is not provided to the Participating State by the Reseller, Reseller is responsible for the restocking fee. If delivered software is defective, or if the incorrect product was delivered, the Reseller must agree to accept returns. If delivered software is defective, the Reseller is responsible for return shipping and packaging costs and for restocking charges if applicable. The Reseller must agree that any defective or incorrectly delivered media will be replaced by overnight delivery at the Reseller’s expense if requested by the Participating State or Purchasing Entity. If overnight delivery is not requested, all replacement products must be received by the Participating State or Purchasing Entity within seven (7) days of initial notification. 2.2.1.8.4 Shipping Charges. Items covered under this contract are FOB Destination and shipping charges are not to be included on any invoice unless the Purchasing Entity has ordered expedited shipment. For expedited shipment, Purchasing Entity would submit their order including related shipping charges, which may not exceed the cost of delivery by the carrier. 2.3 Services IN SCOPE OUT OF SCOPE SOFTWARE & LICENSING TYPE COTS Volume Licensing Custom/Customized LICENSING PERIOD Perpetual Subscription Not Applicable Delivery Shrink-Wrap Download Not Applicable Hosting as part of delivery & use On-Premise Off-Premise Managed Services SERVICES Basic Installation, Training and Maintenance Means that activity which does not require Consulting, Configuration, Engineering, Design or any other type of service specific to a Purchasing Entity requiring description of tasks and deliverables and agreement by the parties (Statement of Work). Consulting, configuration, engineering, design, etc., any type of service specific to a Purchasing Entity requiring description of tasks and deliverables and agreement by the parties 2.3.1 In Scope Services: Basic Installation, Maintenance packages and Training (3.4) are considered to be within the Scope of this Solicitation. This Master Agreement is intended for the acquisition of distributed, commercial off the shelf software Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 19 | Page 2.3.2 (RESERVED) 2.3.3 A Participating State may include a statement in their Participating Addendum allowing state employees to purchase software licenses. 2.3.4 Individual Participating Addendums may further limit the Scope of this Solicitation. 2.3.5 This Master Agreement is not intended for the purchase of custom software applications. 2.4 Training. 2.4.1 Training shall be available in the form of tutorials for basic installation and web-based training for software operation, basic phone support. 2.4.2 Provision of information on how to access a Software Publisher’s “Help Desk” (either telecom or web-based) for basic use questions. 2.5 Customer Service and Representation. 2.5.1 Dedicated Representation and Timely Response. Reseller shall provide a dedicated representative for each Participating State. Such representative will become familiar with the State and its cooperative partners, provide a single point as needed for quote assistance, offer software recommendations, track and report on renewal deadlines, and serve as a contact point for the LSCA. Reseller must commit to returning phone calls or responding to emails within two (2) business days. 2.5.2 Problem Escalation. The Reseller must provide an incident escalation path for each State, showing on that State’s website, the name, contact information, and role of individuals to whom problems should be escalated if the problems are not resolved by primary assigned contacts. 2.5.3 Product purchasing trends. The Reseller will speak with LSCA and sourcing team quarterly to review usage and discuss possible revisions of the categorization of publishers based upon actual sales volume or other changes. 2.5.4 Contract Reviews. 2.5.4.1 Reseller is expected to conduct quarterly reviews of all sales volumes and report sales figures and savings from Publisher’s list price, by Publisher and by PA, as well as observed trends or purchasing patterns, and to present the information to the LSCA. 2.5.4.2 At the discretion of the individual participating states, an equivalent review, limited to that state, will be presented to the PSCA. 2.5.4.3 All awardees under this contract shall meet once a year with the LSCA and Sourcing Team to review usage and discuss possible revisions of the categorization of publishers based upon actual sales volume, and to discuss any service concerns, industry trends, and the effectiveness of the contract. 2.5.4.3.1 Reseller is expected to conduct a customer satisfaction survey and an audit prior to this discussion and be prepared to discuss the results, and Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 20 | Page provide reports, at this review. At a minimum, the audit will report address quoting and billing accuracy, and any Reseller Cost that exceeds a Publisher’s List price for that item. 2.5.4.3.2 Based on historical sales volume information, Reseller should be prepared to discuss potential cost savings opportunities which could be passed through to Participating States. 2.5.4.3.2 In a renewal year, the annual review will take place prior to contract extensions. 2.6. Interactions with Software Publishers 2.6.1 Best Interests of Participating State. Reseller would represent the best interests of the Participating State and other Participating Entities in negotiating or otherwise working with Publishers for such items as: maximizing cost savings with best use of volume or enterprise license agreements, better pricing on individual volume buys, taking advantage of publishers’ specials, promotions, coupons or other savings opportunities. 2.6.2 Liaison with Publisher. A State may establish, in their individual PA, a requirement for Reseller to arrange with the software publisher or software publisher’s designee for implementation, customization, training, support, maintenance and other software related services. The provision of said services must be under a separate agreement between the Participating State and the applicable parties. 2.7 Reporting 2.7.1 Standard Reports Individual participating states may require their own standard reports, such as report on savings. Reseller shall provide these reports at the intervals, and in the format, as reasonably requested by the States. Reseller shall advise of standard reports which they can provide, and work with participating states on additional standard reports. 2.7.2 Online Reports The SVAR shall be able to provide online, real time, reporting capabilities using website established for the state. These reports may include Back Order or Current Order Status reports. In addition, the system shall be able to provide the ability for the User agency to create custom reports. The requesting Participating State shall be able to select specific fields and create a necessary report for their specific needs. Data Fields shall include, but not be limited to, purchasing entity, Purchase Order Number, Order date, Invoice date, Publisher, Publisher Part Number, Software Reseller’s Part Number, Description, Quantity Shipped, Unit actual price, Extended Price, Sales Tax and order total. Reports shall be able to be shown online as well as emailed to the requesting Participating State, if requested. Examples of Reseller’s standard and online reports shall be submitted with the offer. 2.7.3 Custom Reports Master Agreement Section 2: Scope of Work State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 21 | Page Participating State and SVAR may mutually agree to include terms and conditions and pricing for the development and provision of customized reports as an optional service in a Participating Addendum. 2.8 Other Value-Added Services SVAR may propose other Value-Added Services, e.g., key escrow, in their response. Such services from an awarded Offeror, if consistent with this Statement of Work, recommended by the Evaluation Team, and accepted by the PSCA, would be added to the final awarded contract. Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 1. Master Agreement Order of Precedence a. Any Order placed under this Master Agreement shall consist of the following documents: (1) A Participating State’s Participating Addendum (“PA”); (2) NASPO ValuePoint Master Agreement Terms & Conditions; (3) A Purchase Order issued against the Master Agreement; (4) The Statement of Work; (5) The Solicitation; and (6) Contractor’s response to the Solicitation, as revised (if permitted) and accepted by the Lead State. b. These documents shall be read to be consistent and complementary. Any conflict among these documents shall be resolved by giving priority to these documents in the order listed above. Contractor terms and conditions that apply to this Master Agreement are only those that are expressly accepted by the Lead State and must be in writing and attached to this Master Agreement as an Exhibit or Attachment. 2. Definitions Acceptance is defined by the applicable commercial code, except Acceptance of a Product fo which acceptance testing is not required shall not occur before the completion of delivery in accordance with the Order, installation, if required, and a reasonable time for inspection of the Product. Contractor means the person or entity delivering Products or performing services under the terms and conditions set forth in this Master Agreement. Embedded Software means one or more software applications which permanently reside on a computing device. Intellectual Property means any and all patents, copyrights, service marks, trademarks, trade secrets, trade names, patentable inventions, or other similar proprietary rights, in tangible or intangible form, and all rights, title, and interest therein. Lead State means the State centrally administering any resulting Master Agreement(s). Master Agreement means the underlying agreement executed by and between the Lead State, acting on behalf of the NASPO ValuePoint program, and the Contractor, as now or hereafter amended. NASPO ValuePoint is the NASPO Cooperative Purchasing Organization LLC, doing business as NASPO ValuePoint, a 501(c)(3) limited liability company that is a subsidiary organization the National Association of State Procurement Officials (NASPO), the sole member of NASPO ValuePoint. NASPO ValuePoint facilitates administration of the NASPO cooperative group contracting consortium of state chief procurement officials for the benefit of state departments, institutions, agencies, and political subdivisions and other eligible entities (i.e., colleges, school districts, counties, cities, some nonprofit organizations, etc.) for all states and the District of Columbia. NASPO ValuePoint is identified in the Master Agreement as the recipient of reports and may perform contract administration functions relating to collecting and receiving reports as well as other contract administration functions as assigned by the Lead State. Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 23 | Page Order or Purchase Order means any purchase order, sales order, contract or other document used by a Purchasing Entity to order the Products. Participating Addendum means a bilateral agreement executed by a Contractor and a Participating State incorporating this Master Agreement and any other additional Participating State specific language or other requirements, e.g. ordering procedures specific to the Participating State, other terms and conditions. Participating State means a state, or other legal entity, properly authorized to enter into a Participating Addendum. Participating State means a state, the District of Columbia, or one of the territories of the United States that is listed in the Request for Proposal as intending to participate. A Participating State is not required to participate through execution of a Participating Addendum. Upon execution of the Participating Addendum, a Participating State becomes a Participating State. Product means any equipment, software (including embedded software), documentation, service or other deliverable supplied or created by the Contractor pursuant to this Master Agreement. The term Products, supplies and services, and products and services are used interchangeably in these terms and conditions. Purchasing Entity means a state, city, county, district, other political subdivision of a State, and a nonprofit organization under the laws of some states if authorized by a Participating Addendum, who issues a Purchase Order against the Master Agreement and becomes financially committed to the purchase. 3. Term of the Master Agreement The initial term of this Master Agreement is for two (2) years. This Master Agreement may be extended beyond the original contract period for successive periods with a maximum aggregate, including all extensions, not to exceed five (5) years at the Lead State’s discretion and by mutual agreement and upon review of requirements of Participating Entities, current market conditions, and Contractor performance. 4. Amendments The terms of this Master Agreement shall not be waived, altered, modified, supplemented or amended in any manner whatsoever without prior written approval of the Lead State. 5. Assignment/Subcontracts a. Contractor shall not assign, sell, transfer, subcontract or sublet rights, or delegate responsibilities under this Master Agreement, in whole or in part, without the prior written approval of the Lead State. b. The Lead State reserves the right to assign any rights or duties, including written assignment of contract administration duties to NASPO Cooperative Purchasing Organization LLC, doing business as NASPO ValuePoint. 6. Price and Rate Guarantee Period All prices and rates must be guaranteed for the initial term of the Master Agreement. Following the initial Master Agreement period, any request for price or rate adjustment must be for an equal guarantee period, and must be made at least ninety (90) days prior to the effective date. Requests for price or rate adjustment must include sufficient documentation supporting the request. Any adjustment or amendment to the Master Agreement shall not be effective unless approved by the Lead State. No retroactive adjustments to prices or Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 24 | Page rates will be allowed. 7. Cancellation Unless otherwise stated, this Master Agreement may be canceled by either party upon 60 days written notice prior to the effective date of the cancellation. Further, any Participating State may cancel its participation upon 30 days written notice, unless otherwise limited or stated in the Participating Addendum. Cancellation may be in whole or in part. Any cancellation under this provision shall not affect the rights and obligations attending orders outstanding at the time of cancellation, including any right of and Purchasing Entity to indemnification by the Contractor, rights of payment for Products delivered and accepted, and rights attending any warranty or default in performance in association with any Order. Cancellation of the Master Agreement due to Contractor default may be immediate. 8. Confidentiality, Non-Disclosure, and Injunctive Relief Provisions governing confidentiality of information during performance of orders for the State of Arizona are governed by The State of Arizona Special Terms and Conditions. Except where a Participating Addendum prescribes otherwise, this section governs confidentiality and disclosure of information of other Purchasing Entities. a. Confidentiality. Contractor acknowledges that it and its employees or agents may, in the course of providing a Product under this Master Agreement, be exposed to or acquire information that is confidential to Purchasing Entity’s or Purchasing Entity’s clients. Any and all information of any form that is marked as confidential or would by its nature be deemed confidential obtained by Contractor or its employees or agents in the performance of this Master Agreement, including, but not necessarily limited to (1) any Purchasing Entity’s records, (2) personnel records, and (3) information concerning individuals, is confidential information of Purchasing Entity (“Confidential Information”). Any reports or other documents or items (including software) that result from the use of the Confidential Information by Contractor shall be treated in the same manner as the Confidential Information. Confidential Information does not include information that (1) is or becomes (other than by disclosure by Contractor) publicly known; (2) is furnished by Purchasing Entity to others without restrictions similar to those imposed by this Master Agreement; (3) is rightfully in Contractor’s possession without the obligation of nondisclosure prior to the time of its disclosure under this Master Agreement; (4) is obtained from a source other than Purchasing Entity without the obligation of confidentiality, (5) is disclosed with the written consent of Purchasing Entity or; (6) is independently developed by employees, agents or subcontractors of Contractor who can be shown to have had no access to the Confidential Information. b. Non-Disclosure. Contractor shall hold Confidential Information in confidence, using at least the industry standard of confidentiality, and shall not copy, reproduce, sell, assign, license, market, transfer or otherwise dispose of, give, or disclose Confidential Information to third parties or use Confidential Information for any purposes whatsoever other than what is necessary to the performance of Orders placed under this Master Agreement. Contractor shall advise each of its employees and agents of their obligations to keep Confidential Information confidential. Contractor shall use commercially reasonable efforts to assist Purchasing Entity in identifying and preventing any unauthorized use or disclosure of any Confidential Information. Without limiting the generality of the foregoing, Contractor shall advise Purchasing Entity, applicable Participating State, and the Lead State immediately if Contractor learns or has reason to believe that any person who has had access to Confidential Information has violated or intends to violate the terms of this Master Agreement, and Contractor shall at its expense cooperate with Purchasing Entity in seeking injunctive or other equitable relief in the name of Purchasing Entity or Contractor against any such person. Except as directed by Purchasing Entity, Contractor will not at any time during or after the term of this Master Agreement disclose, directly or Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 25 | Page indirectly, any Confidential Information to any person, except in accordance with this Master Agreement, and that upon termination of this Master Agreement or at Purchasing Entity’s request, Contractor shall turn over to Purchasing Entity all documents, papers, and other matter in Contractor's possession that embody Confidential Information. Notwithstanding the foregoing, Contractor may keep one copy of such Confidential Information necessary for quality assurance, audits and evidence of the performance of this Master Agreement. c. Injunctive Relief. Contractor acknowledges that breach of this section, including disclosure of any Confidential Information, will cause irreparable injury to Purchasing Entity that is inadequately compensable in damages. Accordingly, Purchasing Entity may seek and obtain injunctive relief against the breach or threatened breach of the foregoing undertakings, in addition to any other legal remedies that may be available. Contractor acknowledges and agrees that the covenants contained herein are necessary for the protection of the legitimate business interests of Purchasing Entity and are reasonable in scope and content. d. Purchasing Entity Law. These provisions shall be applicable only to extent they are not in conflict with the applicable public disclosure laws of any Purchasing Entity. 9. Right to Publish Throughout the duration of this Master Agreement, Contractor must secure from the Lead State prior approval for the release of any information that pertains to the potential work or activities covered by the Master Agreement. The Contractor shall not make any representations of NASPO ValuePoint’s opinion or position as to the quality or effectiveness of the services that are the subject of this Master Agreement without prior written consent. Failure to adhere to this requirement may result in termination of the Master Agreement for cause. 10. Defaults and Remedies a. The occurrence of any of the following events shall be an event of default under this Master Agreement: (1) Nonperformance of contractual requirements; or (2) A material breach of any term or condition of this Master Agreement; or (3) Any certification, representation or warranty by Contractor in response to the solicitation or in this Master Agreement that proves to be untrue or materially misleading; or (4) Institution of proceedings under any bankruptcy, insolvency, reorganization or similar law, by or against Contractor, or the appointment of a receiver or similar officer for Contractor or any of its property, which is not vacated or fully stayed within thirty (30) calendar days after the institution or occurrence thereof; or (5) Any default specified in another section of this Master Agreement. b. Upon the occurrence of an event of default, Lead State shall issue a written notice of default, identifying the nature of the default, and providing a period of 15 calendar days in which Contractor shall have an opportunity to cure the default. The Lead State shall not be required to provide advance written notice or a cure period and may immediately terminate this Master Agreement in whole or in part if the Lead State, in its sole discretion, determines that it is reasonably necessary to preserve public safety or prevent immediate public crisis. Time allowed for cure shall not diminish or eliminate Contractor’s liability for damages, including liquidated damages to the extent provided for under this Master Agreement. c. If Contractor is afforded an opportunity to cure and fails to cure the default within the period specified in the written notice of default, Contractor shall be in breach of its obligations under this Master Agreement and Lead State shall have the right to exercise any or all of the following remedies: Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 26 | Page (1) Exercise any remedy provided by law; and (2) Terminate this Master Agreement and any related Contracts or portions thereof; and (3) Impose liquidated damages as provided in this Master Agreement; and (4) Suspend Contractor from being able to respond to future bid solicitations; and (5) Suspend Contractor’s performance; and (6) Withhold payment until the default is remedied. d. Unless otherwise specified in the Participating Addendum, in the event of a default under a Participating Addendum, a Participating State shall provide a written notice of default as described in this section and have all of the rights and remedies under this paragraph regarding its participation in the Master Agreement, in addition to those set forth in its Participating Addendum. Unless otherwise specified in a Purchase Order, a Purchasing Entity shall provide written notice of default as described in this section and have all of the rights and remedies under this paragraph and any applicable Participating Addendum with respect to an Order placed by the Purchasing Entity. Nothing in these Master Agreement Terms and Conditions shall be construed to limit the rights and remedies available to a Purchasing Entity under the applicable commercial code. 11. Shipping and Delivery. Section 3.2.1.8 of the solicitation prescribes requirements for product delivery and return. 12. Changes in Contractor Representation The Contractor must notify the Lead State of changes in the Contractor’s key administrative personnel, in writing within 10 calendar days of the change. The Lead State reserves the right to approve changes in key personnel, as identified in the Contractor’s proposal. The Contractor agrees to propose replacement key personnel having substantially equal or better education, training, and experience as was possessed by the key person proposed and evaluated in the Contractor’s proposal. 13. Force Majeure Neither party to this Master Agreement shall be held responsible for delay or default caused by “force majeure,” as that term is defined in and under conditions specified in section 6.4 of the State of Arizona Uniform Terms and Conditions. 14. Indemnification a. Section 5.1X1.1 of the State of Arizona Special Terms and Conditions governs indemnification of the State of Arizona. With respect to other entities, the Contractor shall defend, indemnify and hold harmless NASPO, NASPO Cooperative Purchasing Organization LLC (doing business as NASPO ValuePoint), the Lead State, Participating Entities, and Purchasing Entities, along with their officers, agents, and employees as well as any person or entity for which they may be liable, from and against claims, damages or causes of action including reasonable attorneys’ fees and related costs for any death, injury, or damage to property arising from act(s), error(s), or omission(s) of the Contractor, its employees or subcontractors or volunteers, at any tier, relating to the performance under the Master Agreement. b. Indemnification – Intellectual Property. Section 6.3 of the State of Arizona Uniform Terms and Conditions governs indemnification of the State for intellectual property infringement claims. With respect to other entities the Contractor shall defend, indemnify and hold harmless NASPO, NASPO Cooperative Purchasing Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 27 | Page Organization LLC (doing business as NASPO ValuePoint), Participating Entities, Purchasing Entities, along with their officers, agents, and employees as well as any person or entity for which they may be liable ("Indemnified Party"), from and against claims, damages or causes of action including reasonable attorneys’ fees and related costs arising out of the claim that the Product or its use, infringes Intellectual Property rights ("Intellectual Property Claim"). (1) The Contractor’s obligations under this section shall not extend to any combination of the Product with any other product, system or method, unless the Product, system or method is: (a) provided by the Contractor or the Contractor’s subsidiaries or affiliates; (b) specified by the Contractor to work with the Product; or (c) reasonably required, in order to use the Product in its intended manner, and the infringement could not have been avoided by substituting another reasonably available product, system or method capable of performing the same function; or (d) It would be reasonably expected to use the Product in combination with such product, system or method. (2) The Indemnified Party shall notify the Contractor within a reasonable time after receiving notice of an Intellectual Property Claim. Even if the Indemnified Party fails to provide reasonable notice, the Contractor shall not be relieved from its obligations unless the Contractor can demonstrate that it was prejudiced in defending the Intellectual Property Claim resulting in increased expenses or loss to the Contractor. If the Contractor promptly and reasonably investigates and defends any Intellectual Property Claim, it shall have control over the defense and settlement of it. However, the Indemnified Party must consent in writing for any money damages or obligations for which it may be responsible. The Indemnified Party shall furnish, at the Contractor’s reasonable request and expense, information and assistance necessary for such defense. If the Contractor fails to vigorously pursue the defense or settlement of the Intellectual Property Claim, the Indemnified Party may assume the defense or settlement of it and the Contractor shall be liable for all costs and expenses, including reasonable attorneys’ fees and related costs, incurred by the Indemnified Party in the pursuit of the Intellectual Property Claim. Unless otherwise agreed in writing, this section is not subject to any limitations of liability in this Master Agreement or in any other document executed in conjunction with this Master Agreement. 15. Independent Contractor The Contractor shall be an independent contractor. Contractor shall have no authorization, express or implied, to bind the Lead State, Participating States, other Participating Entities, or Purchasing Entities to any agreements, settlements, liability or understanding whatsoever, and agrees not to hold itself out as agent except as expressly set forth herein or as expressly agreed in any Participating Addendum. 16. Individual Customers Except to the extent modified by a Participating Addendum, each Purchasing Entity shall follow the terms and conditions of the Master Agreement and applicable Participating Addendum and will have the same rights and responsibilities for their purchases as the Lead State has in the Master Agreement, including but not limited to, any indemnity or right to recover any costs as such right is defined in the Master Agreement and applicable Participating Addendum for their purchases. Each Purchasing Entity will be responsible for its own charges, fees, and liabilities. The Contractor will apply the charges and invoice each Purchasing Entity individually. Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 28 | Page 17. Insurance a. The insurance requirements of the State of Arizona are specified in section 5.1 X 1.2 of the State of Arizona Special Terms and Conditions. For performance in other states, unless otherwise agreed in a Participating Addendum, Contractor shall, during the term of this Master Agreement, maintain in full force and effect, the insurance described in this section. Contractor shall acquire such insurance from an insurance carrier or carriers licensed to conduct business in each Participating State’s state and having a rating of A-, Class VII or better, in the most recently published edition of Best’s Reports. Failure to buy and maintain the required insurance may result in this Master Agreement’s termination or, at a Participating State’s option, result in termination of its Participating Addendum. b. Coverage shall be written on an occurrence basis. The minimum acceptable limits shall be as indicated below, with no deductible for each of the following categories: 1) Commercial General Liability (CGL) – Occurrence Form Policy shall include bodily injury, property damage, and broad form contractual liability coverage. General Aggregate $2,000,000 Products – Completed Operations Aggregate $1,000,000 Personal and Advertising Injury $1,000,000 Damage to Rented Premises $50,0000 Each Occurrence $1,000,000 2) Business Automobile Liability Bodily injury and Property Damage for any owned, hired, and/or non-owned automobiles used in the performance of this Contract. Combined Single Limit (CSL) $1,000,000 3) Technology Errors & Omissions Insurance Each Claim $2,000,000 Annual Aggregate $2,000,000 Such insurance shall cover any, and all errors, omissions, or negligent acts in the delivery of products, services, and/or licensed programs under this contract. Coverage shall include or shall not exclude services, and/or licensed programs under this contract. Coverage shall include or shall not exclude settlement and/or defense of claims involving intellectual property, including but not limited to patent or copyright infringement. In the event that Tech E&O insurance required by this Contact is written on a claims-made basis, Contractor warrants that any retroactive date under the policy shall precede the effective date of this Contract and, either continuous coverage will be maintained or an extended discovery period will be exercised for a period of two (2) years, beginning at the time work under this contract is completed. c. Contractor shall pay premiums on all insurance policies. Such policies shall also reference this Master Agreement and shall have a condition that they not be revoked by the insurer until thirty (30) calendar days Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 29 | Page after notice of intended revocation thereof shall have been given to Purchasing Entity and Participating State by the Contractor. d. Prior to commencement of performance, Contractor shall provide to the Lead State a written endorsement to the Contractor’s general liability insurance policy or other documentary evidence acceptable to the Lead State that (1) names the Participating States identified in the Request for Proposal as additional insureds, (2) provides that no material alteration, cancellation, non-renewal, or expiration of the coverage contained in such policy shall have effect unless the named Participating State has been given at least thirty (30) days prior written notice, and (3) provides that the Contractor’s liability insurance policy shall be primary, with any liability insurance of any Participating State as secondary and noncontributory. Unless otherwise agreed in any Participating Addendum, the Participating State’s rights and Contractor’s obligations are the same as those specified in the first sentence of this subsection. Before performance of any Purchase Order issued after execution of a Participating Addendum authorizing it, the Contractor shall provide to a Purchasing Entity or Participating State who requests it the same information described in this subsection. e. Contractor shall furnish to the Lead State, Participating State, and, on request, the Purchasing Entity copies of certificates of all required insurance within thirty (30) calendar days of the execution of this Master Agreement, the execution of a Participating Addendum, or the Purchase Order’s effective date and prior to performing any work. The insurance certificate shall provide the following information: the name and address of the insured; name, address, telephone number and signature of the authorized agent; name of the insurance company (authorized to operate in all states); a description of coverage in detailed standard terminology (including policy period, policy number, limits of liability, exclusions and endorsements); and an acknowledgment of the requirement for notice of cancellation. Copies of renewal certificates of all required insurance shall be furnished within thirty (30) days after any renewal date. These certificates of insurance must expressly indicate compliance with each and every insurance requirement specified in this section. Failure to provide evidence of coverage may, at sole option of the Lead State, or any Participating State, result in this Master Agreement’s termination or the termination of any Participating Addendum. f. Coverage and limits shall not limit Contractor’s liability and obligations under this Master Agreement, any Participating Addendum, or any Purchase Order. 18. Laws and Regulations Any and all Products offered and furnished shall comply with solicitation section 5.10, Compliance with Applicable Laws. 19. License of Pre-Existing Intellectual Property Any rights to intellectual property shall be as prescribed in the Lead State’s solicitation and resulting contract, and Purchasing Entities shall have the same rights as the Lead State under those provisions. 20. No Waiver of Sovereign Immunity In no event shall this Master Agreement, any Participating Addendum or any contract or any Purchase Order issued thereunder, or any act of a Lead State, a Participating State, or a Purchasing Entity be a waiver of any form of defense or immunity, whether sovereign immunity, governmental immunity, immunity based on the Eleventh Amendment to the Constitution of the United States or otherwise, from any claim or from the jurisdiction of any court. This section applies to a claim brought against the Participating State only to the extent Congress Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 30 | Page has appropriately abrogated the Participating State’s sovereign immunity and is not consent by the Participating State to be sued in federal court. This section is also not a waiver by the Participating State of any form of immunity, including but not limited to sovereign immunity and immunity based on the Eleventh Amendment to the Constitution of the United States. 21. Ordering a. Master Agreement order and purchase order numbers shall be clearly shown on all acknowledgments, shipping labels, packing slips, invoices, and on all correspondence. b. The resulting Master Agreements permit Purchasing Entities to define project-specific requirements and informally compete the requirement among companies having a Master Agreement on an “as needed” basis. This procedure may also be used when requirements are aggregated or other firm commitments may be made to achieve reductions in pricing. This procedure may be modified in Participating Addenda and adapted to Purchasing Entity rules and policies. The Purchasing Entity may in its sole discretion determine which Master Agreement Contractors should be solicited for a quote. The Purchasing Agency may select the quote that it considers most advantageous, cost and other factors considered. c. Each Purchasing Entity will identify and utilize its own appropriate purchasing procedure and documentation. Contractor is expected to become familiar with the Purchasing Entities’ rules, policies, and procedures regarding the ordering of supplies and/or services contemplated by this Master Agreement. d. Contractor shall not begin work without a valid Purchase Order or other appropriate commitment document compliance with the law of the Purchasing Entity. e. Orders may be placed consistent with the terms of this Master Agreement during the term of the Master Agreement. f. All Orders pursuant to this Master Agreement, at a minimum, shall include: (1) The services or supplies being delivered; (2) The place and requested time of delivery; (3) A billing address; (4) The name, phone number, and address of the Purchasing Entity representative; (5) The price per hour or other pricing elements consistent with this Master Agreement and the contractor’s proposal; (6) A ceiling amount of the order for services being ordered; and (7) The Master Agreement identifier. g. All communications concerning administration of Orders placed shall be furnished solely to the authorized purchasing agent within the Purchasing Entity’s purchasing office, or to such other individual identified in writing in the Order. h. Orders must be placed pursuant to this Master Agreement prior to the termination date thereof, but may have a delivery date or performance period up to 120 days past the then-current termination date of this Master Agreement. Contractor is reminded that financial obligations of Purchasing Entities payable after the current applicable fiscal year are contingent upon agency funds for that purpose being appropriated, budgeted, and otherwise made available. i. Notwithstanding the expiration or termination of this Master Agreement, Contractor agrees to perform in accordance with the terms of any Orders then outstanding at the time of such expiration or termination. Contractor shall not honor any Orders placed after the expiration or termination of this Master Agreement, or Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 31 | Page otherwise inconsistent with its terms. Orders from any separate indefinite quantity, task orders, or other form of indefinite delivery order arrangement priced against this Master Agreement may not be placed after the expiration or termination of this Master Agreement, notwithstanding the term of any such indefinite delivery order agreement. 22. Participants a. Contractor may not deliver Products under this Master Agreement until a Participating Addendum acceptable to the Participating State and Contractor is executed. The NASPO ValuePoint Master Agreement Terms and Conditions are applicable to any Order by a Participating State (and other Purchasing Entities covered by their Participating Addendum), except to the extent altered, modified, supplemented or amended by a Participating Addendum. By way of illustration and not limitation, this authority may apply to unique delivery and invoicing requirements, confidentiality requirements, defaults on Orders, governing law and venue relating to Orders by a Participating State, indemnification, and insurance requirements. Statutory or constitutional requirements relating to availability of funds may require specific language in some Participating Addenda in order to comply with applicable law. The expectation is that these alterations, modifications, supplements, or amendments will be addressed in the Participating Addendum or, with the consent of the Purchasing Entity and Contractor, may be included in the ordering document (e.g. purchase order or contract) used by the Purchasing Entity to place the Order. b. Use of specific NASPO ValuePoint cooperative Master Agreements by state agencies, political subdivisions and other Participating Entities (including cooperatives) authorized by individual state’s statutes to use state contracts are subject to the approval of the respective State Chief Procurement Official. Issues of interpretation and eligibility for participation are solely within the authority of the respective State Chief Procurement Official. c. Obligations under this Master Agreement are limited to those Participating Entities who have signed a Participating Addendum and Purchasing Entities within the scope of those Participating Addenda. Financial obligations of Participating States are limited to the orders placed by the departments or other state agencies and institutions having available funds. Participating States incur no financial obligations on behalf of political subdivisions. Contractor shall email a fully executed PDF copy of each Participating Addendum to PA@wsca- naspo.org to support documentation of participation and posting in appropriate data bases. d. NASPO Cooperative Purchasing Organization LLC, doing business as NASPO ValuePoint, is not a party to the Master Agreement. It is a nonprofit cooperative purchasing organization assisting states in administering the NASPO cooperative purchasing program for state government departments, institutions, agencies and political subdivisions (e.g., colleges, school districts, counties, cities, etc.) for all 50 states, the District of Columbia and the territories of the United States. e. State Participating Addenda or other Participating Addenda shall not be construed to amend the terms of this Master Agreement between the Lead State and Contractor. f. Participating Entities who are not states may under some circumstances sign their own Participating Addendum, subject to the approval of participation by the Chief Procurement Official of the state where the Participating State is located. g. Resale. “Resale” means any transfer of software for compensation or assignment of services for compensation. Subject to any specific conditions included in the solicitation or Contractor’s proposal as accepted by the Lead State, or as explicitly permitted in a Participating Addendum, Purchasing Entities may not resell Products (the definition of which includes software and services that are deliverables). Absent any Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 32 | Page such condition or explicit permission, this limitation does not prohibit: payments by employees of a Purchasing Entity for Products; sales of Products to the general public as surplus property; and fees associated with inventory transactions with other governmental or nonprofit entities under cooperative agreements and consistent with a Purchasing Entity’s laws and regulations. Any sale or transfer permitted by this subsection must be consistent with license rights granted for use of intellectual property. 23. Payment Payment for completion of a contract order is normally made within 30 days following the date the entire order is delivered or the date a correct invoice is received, whichever is later. After 45 days the Contractor may assess overdue account charges up to a maximum rate of one percent per month on the outstanding balance. Payments will be remitted by mail. Payments may be made via a State or political subdivision “Purchasing Card” with no additional charge. Any prompt payment terms proposed by contractor shall be extended to all Purchasing Entities. 24. Public Information. This Master Agreement and all related documents are subject to disclosure pursuant to the Purchasing Entity’s public information laws. 25. Records Administration and Audit. a. The Contractor shall maintain books, records, documents, and other evidence pertaining to this Master Agreement and orders placed by Purchasing Entities under it to the extent and in such detail as shall adequately reflect performance and administration of payments and fees. Contractor shall permit the Lead State, a Participating State, a Purchasing Entity, the federal government (including its grant awarding entities and the U.S. Comptroller General), and any other duly authorized agent of a governmental agency, to audit, inspect, examine, copy and/or transcribe Contractor's books, documents, papers and records directly pertinent to this Master Agreement or orders placed by a Purchasing Entity under it for the purpose of making audits, examinations, excerpts, and transcriptions. This right shall survive for a period of five (5) years following termination of this Agreement or final payment for any order placed by a Purchasing Entity against this Agreement, whichever is later, to assure compliance with the terms hereof or to evaluate performance hereunder. b. Without limiting any other remedy available to any governmental entity, the Contractor shall reimburse the applicable Lead State, Participating State, or Purchasing Entity for any overpayments inconsistent with the terms of the Master Agreement or orders or underpayment of fees found as a result of the examination of the Contractor’s records. c. The rights and obligations herein right exist in addition to any quality assurance obligation in the Master Agreement requiring the Contractor to self-audit contract obligations and that permits the Lead State to review compliance with those obligations. 26. Administrative Fees a. The Contractor shall pay to NASPO ValuePoint, or its assignee, a NASPO ValuePoint Administrative Fee of one-quarter of one percent (0.25% or 0.0025) no later than 60 days following the end of each calendar quarter. The NASPO ValuePoint Administrative Fee shall be submitted quarterly and is based on all sales of products and services under the Master Agreement (less any charges for taxes or shipping). The NASPO ValuePoint Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 33 | Page Administrative Fee is not negotiable. This fee is to be included as part of the pricing submitted with proposal. b. Additionally, some states, such as the State of Arizona, may require an additional fee be paid directly to the state only on purchases made by Purchasing Entities within that state. For all such requests, the fee level, payment method and schedule for such reports and payments will be incorporated into the Participating Addendum that is made a part of the Master Agreement. The Contractor may adjust the Master Agreement pricing accordingly for purchases made by Purchasing Entities within the jurisdiction of the state. All such agreements shall not affect the NASPO ValuePoint Administrative Fee percentage or the prices paid by the Purchasing Entities outside the jurisdiction of the state requesting the additional fee. The NASPO ValuePoint Administrative Fee in subsection 26a shall be based on the gross amount of all sales (less any charges for taxes or shipping) at the adjusted prices (if any) in Participating Addenda. 27. NASPO ValuePoint Summary and Detailed Usage Reports In addition to other reports that may be required by this solicitation, the Contractor shall provide the following NASPO ValuePoint reports. a. Summary Sales Data. The Contractor shall submit quarterly sales reports directly to NASPO ValuePoint using the NASPO ValuePoint Quarterly Sales/Administrative Fee Reporting Tool found at http://www.naspo.org/WNCPO/Calculator.aspx. Any/all sales made under the contract shall be reported as cumulative totals by state. Even if Contractor experiences zero sales during a calendar quarter, a report is still required. Reports shall be due no later than 30 day following the end of the calendar quarter (as specified in the reporting tool). b. Detailed Sales Data. Contractor shall also report detailed sales data by: (1) state; (2) entity/customer type, e.g. local government, higher education, K12, non-profit; (3) Purchasing Entity name; (4) Purchasing Entity bill- to and ship-to locations; (4) Purchasing Entity and Contractor Purchase Order identifier/number(s); (5) Purchase Order Type (e.g. sales order, credit, return, upgrade, determined by industry practices); (6) Purchase Order date; (7) Ship Date; (8) and line item description, including product number if used. The report shall be submitted in any form required by the solicitation. Reports are due on a quarterly basis and must be received by the Lead State and NASPO ValuePoint Cooperative Development Team no later than thirty (30) days after the end of the reporting period. Reports shall be delivered to the Lead State and to the NASPO ValuePoint Cooperative Development Team electronically through a designated portal, email, CD-Rom, flash drive or other method as determined by the Lead State and NASPO ValuePoint. Detailed sales data reports shall include sales information for all sales under Participating Addenda executed under this Master Agreement. The format for the detailed sales data report is in shown in EXHIBIT III_Cooperative Contract Sales Reporting Data Requirements and Data Format. c. Reportable sales for the summary sales data report and detailed sales data report includes sales to employees for personal use where authorized by the solicitation and the Participating Addendum. Report data for employees should be limited to ONLY the state and entity they are participating under the authority of (state and agency, city, county, school district, etc.) and the amount of sales. No personal identification numbers, e.g. names, addresses, social security numbers or any other numerical identifier, may be submitted with any report. d. Contractor shall provide the NASPO ValuePoint Cooperative Development Coordinator with an executive summary each quarter that includes, at a minimum, a list of states with an active Participating Addendum, states that Contractor is in negotiations with and any PA roll out or implementation activities and issues. NASPO ValuePoint Cooperative Development Coordinator and Contractor will determine the format and content of the executive summary. The executive summary is due 30 days after the conclusion of each Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 34 | Page calendar quarter. e. Timely submission of these reports is a material requirement of the Master Agreement. The recipient of the reports shall have exclusive ownership of the media containing the reports. The Lead State and NASPO ValuePoint shall have a perpetual, irrevocable, non-exclusive, royalty free, transferable right to display, modify, copy, and otherwise use reports, data and information provided under this section. 28. Standard of Performance and Acceptance. Determination of the acceptability of services shall be made by the sole judgement of the Purchasing Entity. Acceptance shall be in writing, verbal acceptance will not be allowed. Services shall be completed in accordance with the Scope of Work, agreed to and accepted schedules, plans, and agreed to performance standards. Acceptance shall be one hundred percent (100%) functionality, which will be determined by the Purchasing Entity. Acceptance criteria shall include, but not be limited to conformity to the scope of work, quality of workmanship, and successfully performing all required Tasks. Nonconformance to a stated acceptance and performance criteria of both services and or products, as required, shall result in a delay for payment. The warranty period will begin upon Acceptance. 29. Warranty The Contractor warrants for a period of 90 days from the date of Acceptance in accordance with the provisions of section 7 of the State of Arizona Uniform Terms and Conditions and section 5.1 N. of the State of Arizona Special Terms and Conditions, with rights of the State available to other Purchasing Entities. Upon breach of the warranty, the Contractor will repair or replace (at no charge to the Purchasing Entity) the Product whose nonconformance is discovered and made known to the Contractor. If the repaired and/or replaced Product proves to be inadequate, or fails of its essential purpose, the Contractor will refund the full amount of any payments that have been made. The rights and remedies of the parties under this warranty are in addition to any other rights and remedies of the parties provided by law or equity, including, without limitation, actual damages, and, as applicable and awarded under the law, to a prevailing party, reasonable attorneys’ fees and costs. 30. (RESERVED) 31. Title of Product Upon Acceptance by the Purchasing Entity, Contractor shall convey to Purchasing Entity title to Product consisting of tangible media free and clear of all liens, encumbrances, or other security interests. 32. Waiver of Breach Failure of the Lead State, Participating State, or Purchasing Entity to declare a default or enforce any rights and remedies shall not operate as a waiver under this Master Agreement or Participating Addendum. Any waiver by the Lead State, Participating State, or Purchasing Entity must be in writing. Waiver by the Lead State or Participating State of any default, right or remedy under this Master Agreement or Participating Addendum, or by Purchasing Entity with respect to any Purchase Order, or breach of any terms or requirements of this Master Agreement, a Participating Addendum, or Purchase Order shall not be construed or operate as a waiver of any subsequent default or breach of such term or requirement, or of any other term or requirement under this Master Agreement, Participating Addendum, or Purchase Order. Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 35 | Page 33. Assignment of Antitrust Rights Contractor irrevocably assigns to a Participating State any claim for relief or cause of action which the Contractor now has or which may accrue to the Contractor in the future by reason of any violation of state or federal antitrust laws (15 U.S.C. § 1-15 or a Participating State’s state antitrust provisions), as now in effect and as may be amended from time to time, in connection with any goods or services provided to the Contractor for the purpose of carrying out the Contractor's obligations under this Master Agreement or Participating Addendum, including, at a Participating State's option, the right to control any such litigation on such claim for relief or cause of action. 34. Debarment The Contractor certifies that neither it nor its principals are presently debarred, suspended, proposed for debarment, declared ineligible, or voluntarily excluded from participation in this transaction (contract) by any governmental department or agency. This certification represents a recurring certification made at the time any Order is placed under this Master Agreement. If the Contractor cannot certify this statement, attach a written explanation for review by the Lead State. 35. Governing Law and Venue a. The procurement, evaluation, and award of the Master Agreement shall be governed by and construed in accordance with the laws of the Lead State sponsoring and administering the procurement. The construction and effect of the Master Agreement after award shall be governed by the law of the state serving as Lead State (in most cases also the Lead State). The construction and effect of any Participating Addendum or Order against the Master Agreement shall be governed by and construed in accordance with the laws of the Participating State’s or Purchasing Entity’s State. b. Unless otherwise specified in the RFP, the venue for any protest, claim, dispute or action relating to the procurement, evaluation, and award is in the Lead State. Venue for any claim, dispute or action concerning the terms of the Master Agreement shall be in the state serving as Lead State. Venue for any claim, dispute, or action concerning any Order placed against the Master Agreement or the effect of a Participating Addendum shall be in the Purchasing Entity’s State. c. If a claim is brought in a federal forum, then it must be brought and adjudicated solely and exclusively within the United States District Court for (in decreasing order of priority): the Lead State for claims relating to the procurement, evaluation, award, or contract performance or administration if the Lead State is a party; the Participating State if a named party; the Participating State state if a named party; or the Purchasing Entity state if a named party. 36. NASPO ValuePoint eMarket Center In July 2011, NASPO ValuePoint entered into a multi-year agreement with SciQuest, Inc. whereby SciQuest will provide certain electronic catalog hosting and management services to enable eligible NASPO ValuePoint’s customers to access a central online website to view and/or shop the goods and services available from existing NASPO ValuePoint Cooperative Contracts. The central online website is referred to as the NASPO ValuePoint eMarket Center. The Contractor will have visibility in the eMarket Center through Ordering Instructions. These Ordering Instructions are available at no cost to the Contractor and provided customers information regarding the Contractors website and ordering information. Master Agreement Section 3: NASPO ValuePoint Master Agreement Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 36 | Page At a minimum, the Contractor agrees to the following timeline: NASPO ValuePoint eMarket Center Site Admin shall provide a written request to the Contractor to begin Ordering Instruction process. The Contractor shall have thirty (30) days from receipt of written request to work with NASPO ValuePoint to provide any unique information and ordering instructions that the Contractor would like the customer to have. 37. Contract Provisions for Orders Utilizing Federal Funds. Pursuant to Appendix II to 2 Code of Federal Regulations (CFR) Part 200, Contract Provisions for Non-Federal Entity Contracts Under Federal Awards, Orders funded with federal funds may have additional contractual requirements or certifications that must be satisfied at the time the Order is placed or upon delivery. These federal requirements may be proposed by Participating Entities in Participating Addenda and Purchasing Entities for incorporation in Orders placed under this master agreement. 38. State Government Support No support, facility space, materials, special access, personnel or other obligations on behalf of the states or other Participating Entity, other than payment, are required under the Master Agreement. Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 5.1 State of Arizona Special Terms and Conditions A. Purpose Pursuant to provisions of the Arizona Procurement Code, A.R.S. 41-2501 Et Seq., the State of Arizona intends to establish a Contract (Participating Addendum, PA) for the materials or services as listed herein in service to the State. B. Term of Contract The term of any resultant Contract shall commence on date of execution and shall be for an initial period of two (2) years, unless terminated, canceled or extended as otherwise provided herein. C. Contract Extensions The Contract term is for period stated in Item B. subject to additional successive periods with a maximum aggregate including all extensions not to exceed five (5) years. D. Contract Type – Fixed Price E. Eligible Agencies (STATEWIDE) This Contract shall be for the use of all State of Arizona departments, agencies, commissions and boards. In addition, eligible State Purchasing Cooperative members may participate at their discretion. In order to participate in this contract, a cooperative member shall have entered into a Cooperative Purchasing Agreement with the Department of Administration, State Procurement Office as required by Arizona Revised Statues § 41-2632. Membership in the State Purchasing Cooperative is available to all Arizona political subdivisions including cities, counties, school districts, and special districts. Membership is also available to all non- profit organizations, as well as State governments, the US Federal Government and Tribal Nations. Non-profit organizations are defined in A.R.S. § 41-2631(4) as any nonprofit corporation as designated by the internal revenue service under section 501(c)(3) through 501(c)(6). F. Licenses The Contractor shall maintain in current status, all federal, state and local licenses and permits required for the operation of the business conducted by the Contractor. G. Volume of Work The State does not guarantee a specific amount of work either for the life of the Contract or on an annual basis. Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 38 | Page H. Key Personnel It is essential that the Contractor provide adequate experienced personnel, capable of and devoted to the successful accomplishment of work to be performed under this Contract. The Contractor must agree to assign specific individuals to the key positions if required. 1. The Contractor agrees that, once assigned to work under this Contract, key personnel shall not be removed or replaced without written notice to the State. 2. Key personnel who are not available for work under this Contract for a continuous period exceeding thirty (30) calendar days, or are expected to devote substantially less effort to the work than initially anticipated, the Contractor shall immediately notify the State, and shall, subject to the concurrence of the State, replace such personnel with personnel of substantially equal ability and qualifications. I. Changes The State may at any time make changes within the general scope of this Contract. The Contractor shall respond to the Change Order with a proposal. If any such change causes an adjustment in the cost of, or the time required for the performance of any part of the work under this Contract, whether changed or not changed by the Change Order, the Procurement Officer shall modify the Contract in writing via a bilateral Contract Amendment. J. Price Adjustment Any price adjustment shall be within the confines of the awarded contract, or as negotiated in service to this Contract. Any negotiated price adjustments for this Contract shall be documented via a bilateral Contract Amendment. K. Payment Procedures The State will not make payments to any Entity, Group or individual other than the Contractor with the Federal Employer Identification (FEI) Number identified in the Contract. Contractor invoices requesting payment to any Entity, Group or individual other than the contractually specified Contractor shall be returned to the Contractor for correction. The Contractor shall review and insure that the invoices for services provided show the correct Contractor name prior to sending them for payment. If the Contractor Name and FEI Number change, the Contractor must complete an “Assignment and Agreement” form transferring contract rights and responsibilities to the new Contractor. The State must indicate consent on the form. A written Contract Amendment must be signed by both parties and a new W-9 form must be submitted by the new Contractor and entered into the system prior to any payments being made to the new Contractor. L. Information Disclosure The Contractor shall establish and maintain procedures and controls that are acceptable to the State for the purpose of assuring that no information contained in its records or obtained from the state or from others in carrying out its functions under the contract shall be used or disclosed by it, its agents, officers, or employees, except as required to efficiently perform duties under the Contract. Persons requesting such information should be referred to the State. The Contractor also agrees that any information pertaining to individual persons shall not be divulged other than to employees or officers of Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 39 | Page the Contractor as needed for the performance of duties under the Contract, unless otherwise agreed to in writing by the State. M. Employees of the Contractor All employees of the Contractor employed in the performance of work under the Contract shall be considered employees of the Contractor at all times, and not employees of the State. The Contractor shall comply with the Social Security Act, Workman’s Compensation laws and Unemployment laws of the State of Arizona and all State, local and Federal legislation relevant to the Contractor’s business. N. Warranty All services supplied under this Contract shall be fully guaranteed by the Contractor for a minimum period of ninety (90) days from the date of acceptance by the State. Any defects of design, workmanship, or delivered materials, that would result in non-compliance shall be fully corrected by the Contractor without cost to the State. O. Compliance with Applicable Laws The Materials and services supplied under this Contract shall comply with all applicable Federal, state and local laws, and the Contractor shall maintain all applicable licenses and permit requirements. Contractor represents and warrants to the State that Contractor has the skill and knowledge possessed by members of its trade or profession and Contractor will apply that skill and knowledge with care and diligence so Contactor and Contractor's employees and any authorized subcontractors shall perform the Services described in this Contract in accordance with the Statement of Work. Contractor represents and warrants that the Materials provided through this Contract and Statement of Work shall be free of viruses, backdoors, worms, spyware, malware and other malicious code that will hamper performance of the Materials, collect unlawful personally identifiable information on Users or prevent the Materials from performing as required under the terms and conditions of this Contract. P. Non-Exclusive Contract Any Contract resulting from this solicitation shall be awarded with the understanding and agreement that it is for the sole convenience of the State of Arizona. The State reserves the right to obtain like goods or services from another source when necessary, or when determined to be in the best interest of the State. Q. Administrative Fee/Usage Reports 1. In accordance with ARS § 41-2633 the Department of Administration, State Procurement Office includes an Administrative Fee, in the majority of its Statewide contracts – multiple agency, multiple government, cooperative contracts. The Administrative Fee is used by the State to defray the additional costs associated with soliciting, awarding and administering statewide contracts. In addition to the State agencies, boards and commissions, statewide contracts are available to members of the State Purchasing Cooperative including cities, counties, school districts, special districts, other state governments, agencies of the federal government, tribal nations, schools, medical institutions, and nonprofit organizations. The Administrative Fee is the responsibility of the contractor. The Administrative Fee is a part of the contractor’s unit prices and is not to be charged directly to the customer in the form of a Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 40 | Page separate line item. In accordance with Section 26 of the NASPO ValuePoint Master Agreement Terms and Conditions, the 0.25% NASPO ValuePoint Administrative fee shall be incorporated into the Offerors base price. Other states, including the State of Arizona, may negotiate additional Administrative Fees in their Participating Addenda following award of a Master Agreement. Further, Statewide contracts maintain one set of pricing for all customers and not separate prices for State agency customers and State Purchasing Cooperative customers. 2. State of Arizona Fee Amount: Unless defined differently within the contract, the Statewide Contracts Administrative Fee shall be one percent (1.0%) of quarterly sales receipts under an active Statewide contract, transacted by only the members of the State Purchasing Cooperative, minus any taxes or regulatory fees, minus any returns or credits, and minus any shipping charges not already included in the unit prices. The Administrative Fee percentage is only applicable to amounts actually received by the contractor during the quarter and is not applicable to amounts ordered by customers but not yet paid for. The administrative fee is not paid on transactions with state agency customers. 3. Method of Assessment At the completion of each quarter, the contractor reviews all sales under their contract in preparation for submission of their Usage Report. The contractor identifies all sales receipts transacted by members of the State Purchasing Cooperative and assesses one percent (1.0%) of this amount in their Usage Report. An updated list of State Purchasing Cooperative members may be found at: https://spo.az.gov/state-purchasing-cooperative . At its option, the State may expand or narrow the applicability of this fee. The State shall provide thirty (30) written notice prior to exercising or changing this option. The contractor shall summarize all sales, along with all assessed Administrative Fee amounts within their Usage Report, including total amounts for the following:  Total sales receipts from State agencies, boards and commissions;  Total sales receipts from members of the State Purchasing Cooperative; and  Total Administrative Fee amount based on one percent (1.0%) of the sales receipts from members of the State Purchasing Cooperative. 4. Submission of Reports and Fees. Within thirty (30) days following the end of the quarter, the contractor submits their Usage Report and if applicable, a check in the amount of one percent (1%) of their sales receipts from members of the State Purchasing Cooperative, to the Department of Administration, State Procurement Office. Contractors are required to use the State’s current report templates unless you have authorization from your contract officer to use a different format. You need to complete Form 799, which is a cover letter that gives the totals of your transactions; and Form 801, which is an Excel spreadsheet that details your transactions. Sales to state agencies and the cooperative members are to be totaled separately. The most current forms can be downloaded at https://spo.az.gov/statewide-contracts-administrative-fee. 4.1 The submission schedule for Administrative Fees and Usage reports shall be as follows: FY Q1, July through September Due October 31 FY Q2, October through December Due January 31 FY Q3, January through March Due by April 30 FY Q4, April through June Due by July 31 Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 41 | Page 4.2 Usage Reports and any questions are to be submitted by email to the state's designated usage report email address: usage@azdoa.gov 4.3 Administrative Fees shall be made out to the “State Procurement Office” and mailed to: Department of Administration General Services Division ATTN: “Statewide Contracts Administrative Fee” 100 N. 15th Avenue, Suite 202 Phoenix, AZ 85007 5. The Administrative Fee shall be a part of the Contractor’s unit prices and is not to be charged directly to the customer in the form of a separate line item. Statewide contracts shall not have separate prices for State Agency customers and State Purchasing Cooperative customers. 6. Contractor's failure to remit administrative fees in a timely manner consistent with the contract’s requirements may result in the State exercising any recourse available under the contract or as provided for by law. R. Acceptance Determination of the acceptability of services shall be made by the sole judgment of the State. Acceptance shall be in writing, verbal acceptance will not be allowed. Services shall be completed in accordance with the Scope of Work, agreed to and accepted schedules, plans, and agreed to performance standards. Acceptance shall be one hundred percent (100%) functionality, which will be determined by the State. Acceptance criteria shall include, but not be limited to conformity to the scope of work, quality of workmanship and successfully performing all required Tasks. Nonconformance to any of the stated acceptance and performance criteria of both services and or products as required shall result in a delay for payment. Payment shall not be made until nonconformance to the criteria is corrected as determined by the State. T. Performance Contractor agrees that, from and after the date that the applicable services commence, its performance of the Scope of Services will meet or exceed industry best practices subject to the limitations and in accordance with the provisions set forth in this Contract. If the Services provided pursuant to this Contract are changed, modified or enhanced (whether by Change Order or through the provision of new Services), The State and the Contractor will review the current performance experience and will in good faith determine whether such experience should be adjusted and whether additional services should be implemented or whether services be removed. The following requirements shall also apply: 1. Failure to Perform If Contractor fails to complete any deliverable, then Contractor shall: 1.1 Promptly perform a root-cause analysis to identify the cause of such failure; 1.2 Use commercially reasonable efforts to correct such failure and to begin meeting the requirements as promptly as practicable; 1.3 Provide the State with a report detailing the cause of, and procedure for correcting, such Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 42 | Page failure; and 1.4 If appropriate under the circumstances, take action to avoid such failure in the future. 2. Root-Cause Analysis In the event of the Contractor's failure to perform required services or meet agreed upon service levels or other Contractor service standards as required by the State under this Contract, the Contractor shall perform an analysis of the cause of the service level problem and implement remediation steps as appropriate. The State shall have the right to review the analysis and approve the remediation steps prior to or subsequent to their implementation, as deemed appropriate by the State, if the remediation steps impact State assets or operational processes. U. Compensation Should the Contractor fail to provide all required services or deliver work products, as agreed upon by State and the Contractor, the State shall be entitled to invoke applicable remedies, including but not limited to, withholding payment to the Contractor and declaring the Contractor in material breach of the Contract. If the Contractor is in any manner in default of any obligation or the Contractor’s work or performance is determined by the State to be defective, sub-standard, or if audit exceptions are identified, the State may, in addition to other available remedies, either adjust the amount of payment or withhold payment until satisfactory resolution of the default, defect, exception or sub-standard performance. The Contractor shall reimburse the State on demand, or the State may deduct from future payments, any amounts paid for work products or performance which are determined to be an audit exception, defective or sub-standard performance. The Contractor shall correct its mistakes or errors without additional cost to the State. The State shall be the sole determiner as to defective or sub-standard performance. The Contractor shall fulfill their contractual requirements including the Deliverables identified in the Statement of Work and fulfill the roles and responsibilities described in the Statement of Work for a firm fixed price, inclusive of travel and travel-related expenses. The fixed amount shall be inclusive of any fees for the use of any third party products or services required for use in the performance of this Contract V. Contractor Performance Reports Program management shall document Contractor performance, both exemplary and needing improvements where corrective action is needed or desired. Copies of corrective action reports will be forwarded to the Procurement Office for review and any necessary follow-up. The Procurement Office may contact the Contractor upon receipt of the report and may request corrective action. The Procurement Office shall discuss the Contractor’s suggested corrective action plan with the Procurement Specialist for approval of the plan. W. Offshore Performance of Work Prohibited Due to security and identity protection concerns, direct services under this contract shall be performed within the borders of the United States. Any services that are described in the specifications or scope of work that directly serve the State of Arizona or its clients and may involve access to secure or sensitive data or personal client data or development or modification of software for the State shall be performed within the borders of the United States. Unless specifically stated otherwise in the specifications, this definition does not apply to indirect or “overhead” services, redundant back-up Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 43 | Page services or services that are incidental to the performance of the contract. This provision applies to work performed by subcontractors at all tiers. X. Indemnification and Insurance 1.1 Indemnification Clause To the fullest extent permitted by law, Contractor shall defend, indemnify, and hold harmless the State of Arizona, and its departments, agencies, boards, commissions, universities, and any jurisdiction or agency issuing permits for any work included in the project, and their respective directors, officers, officials, agents and employees (hereinafter referred to as "Indemnitee") from and against any and all claims, actions, liabilities, costs, losses, or expenses, (including reasonable attorney's fees), (hereinafter collectively referred to as "Claims") arising out of actual or alleged bodily injury or personal injury of any person (including death) or loss or damage to tangible or intangible property caused, or alleged to be caused, in whole or in part, by the negligent or willful acts or omissions of Contractor or any of Contractor's directors, officers, agents, employees, volunteers or subcontractors. This indemnity includes any claim or amount arising or recovered under the Workers' Compensation Law or arising out of the failure of Contractor to conform to any federal, state or local law, statute, ordinance, rule, regulation or court decree. It is the specific intention of the parties that the Indemnitee shall, in all instances, except for Claims arising solely from the negligent or willful acts or omissions of the Indemnitee, be indemnified by Contractor from and against any and all Claims. It is agreed that Contractor will be responsible for primary loss investigation, defense and judgment costs where this indemnification is applicable. This indemnification will survive the termination of the above listed contract with the Contractor. This indemnity shall not apply if the contractor or sub-contractor(s) is/are an agency, board, commission or university of the State of Arizona. 1.2 Insurance Requirements 1.2.1 Contractor and subcontractors shall procure and maintain, until all of their obligations have been discharged, including any warranty periods under this Contract, insurance against claims for injury to persons or damage to property arising from, or in connection with, the performance of the work hereunder by the Contractor, its agents, representatives, employees or subcontractors. 1.2.2 The Insurance Requirements herein are minimum requirements for this Contract and in no way limit the indemnity covenants contained in this Contract. The State of Arizona in no way warrants that the minimum limits contained herein are sufficient to protect the Contractor from liabilities that arise out of the performance of the work under this Contract by the Contractor, its agents, representatives, employees or subcontractors, and the Contractor is free to purchase additional insurance. 1.3 Minimum Scope and Limits of Insurance Contractor shall provide coverage with limits of liability not less than those stated below. Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 44 | Page 1.3.1 Commercial General Liability (CGL) – Occurrence Form Policy shall include bodily injury, property damage, and broad form contractual liability coverage. General Aggregate $2,000,000 Products – Completed Operations Aggregate $1,000,000 Personal and Advertising Injury $1,000,000 Damage to Rented Premises $50,000 Each Occurrence $1,000,000 a. The policy shall be endorsed, as required by this written agreement, to include the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees as additional insureds with respect to liability arising out of the activities performed by or on behalf of the Contractor. b. Policy shall contain a waiver of subrogation endorsement, as required by this written agreement, in favor of the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees for losses arising from work performed by or on behalf of the Contractor. 1.3.2 Business Automobile Liability Bodily Injury and Property Damage for any owned, hired, and/or non-owned automobiles used in the performance of this Contract.  Combined Single Limit (CSL) $1,000,000 Policy shall be endorsed, as required by this written agreement, to include the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees as additional insureds with respect to liability arising out of the activities performed by, or on behalf of, the Contractor involving automobiles owned, hired and/or non-owned by the Contractor. c. Policy shall contain a waiver of subrogation endorsement as required by this written agreement in favor of the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees for losses arising from work performed by or on behalf of the Contractor. 1.3.3 Workers’ Compensation and Employers' Liability  Workers' Compensation Statutory  Employers' Liability  Each Accident $1,000,000  Disease – Each Employee $1,000,000  Disease – Policy Limit $1,000,000 d. Policy shall contain a waiver of subrogation endorsement, as required by this written agreement, in favor of the State of Arizona, and its departments, agencies, boards, Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 45 | Page commissions, universities, officers, officials, agents, and employees for losses arising from work performed by or on behalf of the Contractor. e. This requirement shall not apply to each Contractor or subcontractor that is exempt under A.R.S. § 23-901, and when such Contractor or subcontractor executes the appropriate waiver form (Sole Proprietor or Independent Contractor). 1.3.4 Technology Errors & Omissions Insurance  Each Claim $2,000,000  Annual Aggregate $2,000,000 f. Such insurance shall cover any, and all errors, omissions, or negligent acts in the delivery of products, services, and/or licensed programs under this contract. g. Coverage shall include or shall not exclude settlement and/or defense of claims involving intellectual property, including but not limited to patent or copyright infringement. h. In the event that the Tech E&O insurance required by this Contract is written on a claims-made basis, Contractor warrants that any retroactive date under the policy shall precede the effective date of this Contract and, either continuous coverage will be maintained or an extended discovery period will be exercised for a period of two (2) years, beginning at the time work under this Contract is completed. 1.3.5 Media Liability Coverage  Each Claim $2,000,000  Annual Aggregate $2,000,000 i. Such insurance shall cover any and all errors and omissions or negligent acts in the production of content, including but not limited to plagiarism, defamation, libel, slander, false advertising, invasion of privacy, and infringement of copyright, title, slogan, trademark, service mark and trade dress. j. In the event that the Media Liability insurance required by this Contract is written on a claims-made basis, Contractor warrants that any retroactive date under the policy shall precede the effective date of this Contract and, either continuous coverage will be maintained, or an extended discovery period will be exercised for a period of two (2) years beginning at the time work under this Contract is completed. 1.4 Additional Insurance Requirements The policies shall include, or be endorsed to include, as required by this written agreement, the following provisions: 1.4.1 The Contractor's policies, as applicable, shall stipulate that the insurance afforded the Contractor shall be primary and that any insurance carried by the Department, its agents, Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 46 | Page officials, employees or the State of Arizona shall be excess and not contributory insurance, as provided by A.R.S. § 41-621 (E). 1.4.2 Insurance provided by the Contractor shall not limit the Contractor’s liability assumed under the indemnification provisions of this Contract. 1.5 Notice of Cancellation Applicable to all insurance policies required within the Insurance Requirements of this Contract, Contractor’s insurance shall not be permitted to expire, be suspended, be canceled, or be materially changed for any reason without thirty (30) days prior written notice to the State of Arizona. Within two (2) business days of receipt, Contractor must provide notice to the State of Arizona if they receive notice of a policy that has been or will be suspended, canceled, materially changed for any reason, has expired, or will be expiring. Such notice shall be sent directly to the Department and shall be mailed, emailed, hand delivered or sent by facsimile transmission to (State Representative’s Name, Address & Fax Number). 1.6 Acceptability of Insurers Contractor’s insurance shall be placed with companies licensed in the State of Arizona or hold approved non-admitted status on the Arizona Department of Insurance List of Qualified Unauthorized Insurers. Insurers shall have an “A.M. Best” rating of not less than A- VII. The State of Arizona in no way warrants that the above-required minimum insurer rating is sufficient to protect the Contractor from potential insurer insolvency. 1.7 Verification of Coverage Contractor shall furnish the State of Arizona with certificates of insurance (valid ACORD form or equivalent approved by the State of Arizona) as required by this Contract. An authorized representative of the insurer shall sign the certificates. 1.7.1 All certificates and endorsements, as required by this written agreement, are to be received and approved by the State of Arizona before work commences. Each insurance policy required by this Contract must be in effect at, or prior to, commencement of work under this Contract. Failure to maintain the insurance policies as required by this Contract, or to provide evidence of renewal, is a material breach of contract. 1.7.2 All certificates required by this Contract shall be sent directly to the Department. The State of Arizona project/contract number and project description shall be noted on the certificate of insurance. The State of Arizona reserves the right to require complete copies of all insurance policies required by this Contract at any time. 1.8 Subcontractors Contractor’s certificate(s) shall include all subcontractors as insureds under its policies or Contractor shall be responsible for ensuring and/or verifying that all subcontractors have valid and collectable insurance as evidenced by the certificates of insurance and endorsements for each subcontractor. All coverages for subcontractors shall be subject to the minimum Insurance Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 47 | Page Requirements identified above. The Department reserves the right to require, at any time throughout the life of this contract, proof from the Contractor that its subcontractors have the required coverage. 1.9 Approval and Modifications The Contracting Agency, in consultation with State Risk, reserves the right to review or make modifications to the insurance limits, required coverages, or endorsements throughout the life of this contract, as deemed necessary. Such action will not require a formal Contract amendment but may be made by administrative action. 1.10 Exceptions In the event the Contractor or subcontractor(s) is/are a public entity, then the Insurance Requirements shall not apply. Such public entity shall provide a certificate of self-insurance. If the Contractor or subcontractor(s) is/are a State of Arizona agency, board, commission, or university, none of the above shall apply. Y. Data Privacy and Security Contractor shall treat all information obtained through performance of the contract, as confidential or sensitive information consistent with State and federal law and State Policy. Contractor or its agents shall not use any data obtained in the performance of the contract in any manner except as necessary for the proper discharge of its obligations and protection of its rights related to this agreement. Contractor shall establish and maintain procedures and controls acceptable to the State for the purpose of assuring that data in its or its agents’ possession is not mishandled, misused, released, disclosed, or used in an inappropriate manner in performance of the contract. This includes data contained in Contractor’s records obtained from the State or others, necessary for contract performance. Contractor and its agents shall take all reasonable steps and precautions to safeguard this information and data and shall not divulge the information or data to parties other than those needed for the performance of duties under the contract. Z. Data Privacy/Security Incident Management Contractor and its agents shall cooperate and collaborate with appropriate State personnel to identify and respond to an information security or data privacy incident, including a security breach. 1. Threat of Security Breach Contractor(s) agrees to notify the State Chief Information Officer (CIO), the State Chief Information Security Officer (CISO) and other key personnel as identified by the State of any perceived threats placing the supported infrastructure and/or applications in danger of breach of security. The speed of notice shall be at least commensurate with the level of threat, as perceived by the Contractor(s). The State agrees to provide contact information for the State CIO, CISO and key personnel to the Contractor(s). 2. Discovery of Security Breach Contractor agrees to immediately notify the State CIO, the CISO and key personnel as identified by the State of a discovered breach of security. The State agrees to provide contact information Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 48 | Page for the State CIO, the CISO and key personnel. AA. Security Requirements for Contractor Personnel Each individual proposed to provide services through this contract agrees to security clearance and background check procedures, including fingerprinting, as defined by the Arizona Department of Administration in accordance with Arizona Revised Statutes §41-710. The results of the individual’s background check procedures must meet all HIPAA and law enforcement requirements. Contractor is responsible for all costs to obtain security clearance for their consultants providing services through this contract. Contractor personnel, agents or sub-contractors that have administrative access to the State’s networks may be subject to any additional security requirements of the State as may be required for the performance of the contract. The Contractor, its agents and sub-contractors shall provide documentation to the State confirming compliance with all such additional security requirements for performance of the contract. Additional security requirements include but are not limited to the following: 1. Identity and Address Verification – that verifies the individual is who he or she claims to be including verification of the candidate’s present and previous addresses; 2. UNAX/confidentiality Training; 3. HIPAA Privacy and Security Training; and 4. Information Security Training. BB. Access Constraints and Requirements Contractor access to State facilities and resources shall be properly authorized by State personnel, based on business need and will be restricted to least possible privilege. Upon approval of access privileges, the Contractor shall maintain strict adherence to all policies, standards, and procedures. Policies / Standards, ADOA/ASET Policies / Procedures, and Arizona Revised Statues (A.R.S.) §28- 447, §28-449, §38-421, §13-2408, §13-2316, §41-770. Failure of the Contractor, its agents or subcontractors to comply with policies, standards, and procedures including any person who commits an unlawful breach or harmful access (physical or virtual) will be subject to prosecution under all applicable state and / or federal laws. Any and all recovery or reconstruction costs or other liabilities associated with an unlawful breach or harmful access shall be paid by the Contractor. CC. Health Insurance Portability and Accountability Act of 1996 The Contractor warrants that it is familiar with the requirements of HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act (HITECH Act) of 2009, and accompanying regulations and will comply with all applicable HIPAA requirements in the course of this Contract. Contractor warrants that it will cooperate with the State in the course of performance of the Contract so that both the State and the Contractor will be in compliance with HIPAA, including cooperation and coordination with the Arizona Strategic Enterprise Technology (ASET) Group, Statewide Information Security and Privacy Office (SISPO), Chief Privacy Officer and HIPAA Coordinator and other compliance officials required by HIPAA and its regulations. Contractor will sign any documents that are reasonably necessary to keep the State and Contractor in compliance with Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 49 | Page HIPAA, including but not limited to, business associate agreements. If requested, the Contractor agrees to sign a “Pledge to Protect Confidential Information” and to abide by the statements addressing the creation, use and disclosure of confidential information, including information designated as protected health information and all other confidential or sensitive information as defined in policy. In addition, if requested, Contractor agrees to attend or participate in job related HIPAA training that is: (1) intended to make the Contractor proficient in HIPAA for purposes of performing the services required and (2) presented by a HIPAA Privacy Officer or other person or program knowledgeable and experienced in HIPAA and who has been approved by the ASET/SISPO Chief Privacy Officer and HIPAA Coordinator. Suggested References: https://www.cms.gov/Regulations-and-Guidance/HIPAA-Administrative- Simplification/HIPAAGenInfo/downloads/hipaalaw.pdf http://www.hhs.gov/ocr/privacy/hipaa/understanding/ DD. Compliance Requirements for A.R.S. § 41-4401, Government Procurement: E-Verify Requirement 1. The Contractor warrants compliance with all Federal immigration laws and regulations relating to employees and warrants its compliance with Section A.R.S. § 23-214, Subsection A. (That subsection reads: “After December 31, 2007, every employer, after hiring an employee, shall verify the employment eligibility of the employee through the E-Verify program.) 2. A breach of a warranty regarding compliance with immigration laws and regulations shall be deemed a material breach of the Contract and the Contractor may be subject to penalties up to and including termination of the Contract. 3. Failure to comply with a State audit process to randomly verify the employment records of Contractors and subcontractors shall be deemed a material breach of the Contract and the Contractor may be subject to penalties up to and including termination of the Contract. 4. The State Agency retains the legal right to inspect the papers of any employee who works on the Contract to ensure that the Contractor or subcontractor is complying with the warranty under paragraph One (1). 5.2 State of Arizona Uniform Terms and Conditions 1. Definition of Terms As used in this Solicitation and any resulting Contract, the terms listed below are defined as follows: 1.1. “Attachment” means any item the Solicitation requires the Offeror to submit as part of the Offer. 1.2. “Contract” means the combination of the Solicitation, including the Uniform and Special Instructions to Offerors, the Uniform and Special Terms and Conditions, and the Specifications and Statement or Scope of Work; the Offer and any Best and Final Offers; and any Solicitation Amendments or Contract Amendments. Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 50 | Page 1.3. "Contract Amendment" means a written document signed by the Procurement Officer that is issued for the purpose of making changes in the Contract. 1.4. “Contractor” means any person who has a Contract with the State. 1.5. “Days” means calendar days unless otherwise specified. 1.6. “Exhibit” means any item labeled as an Exhibit in the Solicitation or placed in the Exhibits section of the Solicitation. 1.7. “Gratuity” means a payment, loan, subscription, advance, deposit of money, services, or anything of more than nominal value, present or promised, unless consideration of substantially equal or greater value is received. 1.8. “Materials” means all property, including equipment, supplies, printing, insurance and leases of property but does not include land, a permanent interest in land or real property or leasing space. 1.9. “Procurement Officer” means the person, or his or her designee, duly authorized by the State to enter into and administer Contracts and make written determinations with respect to the Contract. 1.10. “Services” means the furnishing of labor, time or effort by a contractor or subcontractor which does not involve the delivery of a specific end product other than required reports and performance, but does not include employment agreements or collective bargaining agreements. 1.11. “Subcontract” means any Contract, express or implied, between the Contractor and another party or between a subcontractor and another party delegating or assigning, in whole or in part, the making or furnishing of any material or any service required for the performance of the Contract. 1.12. “State” means the State of Arizona and Department or Agency of the State that executes the Contract. 1.13. “State Fiscal Year” means the period beginning with July 1 and ending June 30. 2. Contract Interpretation 2.1. Arizona Law. The Arizona law applies to this Contract including, where applicable, the Uniform Commercial Code as adopted by the State of Arizona and the Arizona Procurement Code, Arizona Revised Statutes (A.R.S.) Title 41, Chapter 23, and its implementing rules, Arizona Administrative Code (A.A.C.) Title 2, Chapter 7. 2.2. Implied Contract Terms. Each provision of law and any terms required by law to be in this Contract are a part of this Contract as if fully stated in it. 2.3. Contract Order of Precedence. In the event of a conflict in the provisions of the Contract, as accepted by the State and as they may be amended, the following shall prevail in the order set forth below: 2.3.1. Special Terms and Conditions; 2.3.2. Uniform Terms and Conditions; 2.3.3. Statement or Scope of Work; Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 51 | Page 2.3.4. Specifications; 2.3.5. Attachments; 2.3.6. Exhibits; 2.3.7. Documents referenced or included in the Solicitation. 2.4. Relationship of Parties. The Contractor under this Contract is an independent Contractor. Neither party to this Contract shall be deemed to be the employee or agent of the other party to the Contract. 2.5. Severability. The provisions of this Contract are severable. Any term or condition deemed illegal or invalid shall not affect any other term or condition of the Contract. 2.6. No Parole Evidence. This Contract is intended by the parties as a final and complete expression of their agreement. No course of prior dealings between the parties and no usage of the trade shall supplement or explain any terms used in this document and no other understanding either oral or in writing shall be binding. 2.7. No Waiver. Either party’s failure to insist on strict performance of any term or condition of the Contract shall not be deemed a waiver of that term or condition even if the party accepting or acquiescing in the nonconforming performance knows of the nature of the performance and fails to object to it. 3. Contract Administration and Operation 3.1. Records. Under A.R.S. § 35-214 and § 35-215, the Contractor shall retain and shall contractually require each subcontractor to retain all data and other “records” relating to the acquisition and performance of the Contract for a period of five years after the completion of the Contract. All records shall be subject to inspection and audit by the State at reasonable times. Upon request, the Contractor shall produce a legible copy of any or all such records. 3.2. Non-Discrimination. The Contractor shall comply with State Executive Order No. 2009-09 and all other applicable Federal and State laws, rules and regulations, including the Americans with Disabilities Act. 3.3. Audit. Pursuant to ARS § 35-214, at any time during the term of this Contract and five (5) years thereafter, the Contractor’s or any subcontractor’s books and records shall be subject to audit by the State and, where applicable, the Federal Government, to the extent that the books and records relate to the performance of the Contract or Subcontract. 3.4. Facilities Inspection and Materials Testing. The Contractor agrees to permit access to its facilities, subcontractor facilities and the Contractor’s processes or services, at reasonable times for inspection of the facilities or materials covered under this Contract. The State shall also have the right to test, at its own cost, the materials to be supplied under this Contract. Neither inspection of the Contractor’s facilities nor materials testing shall constitute final acceptance of the materials or services. If the State determines non-compliance of the materials, the Contractor shall be responsible for the payment of all costs incurred by the State for testing and inspection. 3.5. Notices. Notices to the Contractor required by this Contract shall be made by the State to the person indicated on the Offer and Acceptance form submitted by the Contractor unless Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 52 | Page otherwise stated in the Contract. Notices to the State required by the Contract shall be made by the Contractor to the Solicitation Contact Person indicated on the Solicitation cover sheet, unless otherwise stated in the Contract. An authorized Procurement Officer and an authorized Contractor representative may change their respective person to whom notice shall be given by written notice to the other and an amendment to the Contract shall not be necessary. 3.6. Advertising, Publishing and Promotion of Contract. The Contractor shall not use, advertise or promote information for commercial benefit concerning this Contract without the prior written approval of the Procurement Officer. 3.7. Property of the State. Any materials, including reports, computer programs and other deliverables, created under this Contract are the sole property of the State. The Contractor is not entitled to a patent or copyright on those materials and may not transfer the patent or copyright to anyone else. The Contractor shall not use or release these materials without the prior written consent of the State. 3.8. Ownership of Intellectual Property. Any and all intellectual property, including but not limited to copyright, invention, trademark, trade name, service mark, and/or trade secrets created or conceived pursuant to or as a result of this contract and any related subcontract (“Intellectual Property”), shall be work made for hire and the State shall be considered the creator of such Intellectual Property. The agency, department, division, board or commission of the State of Arizona requesting the issuance of this contract shall own (for and on behalf of the State) the entire right, title and interest to the Intellectual Property throughout the world. Contractor shall notify the State, within thirty (30) days, of the creation of any Intellectual Property by it or its subcontractor(s). Contractor, on behalf of itself and any subcontractor(s), agrees to execute any and all document(s) necessary to assure ownership of the Intellectual Property vests in the State and shall take no affirmative actions that might have the effect of vesting all or part of the Intellectual Property in any entity other than the State. The Intellectual Property shall not be disclosed by contractor or its subcontractor(s) to any entity not the State without the express written authorization of the agency, department, division, board or commission of the State of Arizona requesting the issuance of this contract. 3.9. Federal Immigration and Nationality Act. The contractor shall comply with all federal, state and local immigration laws and regulations relating to the immigration status of their employees during the term of the contract. Further, the contractor shall flow down this requirement to all subcontractors utilized during the term of the contract. The State shall retain the right to perform random audits of contractor and subcontractor records or to inspect papers of any employee thereof to ensure compliance. Should the State determine that the contractor and/or any subcontractors be found noncompliant, the State may pursue all remedies allowed by law, including, but not limited to; suspension of work, termination of the contract for default and suspension and/or debarment of the contractor. 3.10 E-Verify Requirements. In accordance with A.R.S. § 41-4401, Contractor warrants compliance with all Federal immigration laws and regulations relating to employees and warrants its compliance with Section A.R.S. § 23-214, Subsection A. 3.11 Offshore Performance of Work Prohibited. Any services that are described in the specifications or scope of work that directly serve the State of Arizona or its clients and involve access to secure or sensitive data or personal client data shall be performed within the defined territories of the United States. Unless specifically Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 53 | Page stated otherwise in the specifications, this paragraph does not apply to indirect or 'overhead' services, redundant back-up services or services that are incidental to the performance of the contract. This provision applies to work performed by subcontractors at all tiers. 4. Costs and Payments 4.1. Payments. Payments shall comply with the requirements of A.R.S. Titles 35 and 41, Net 30 days. Upon receipt and acceptance of goods or services, the Contractor shall submit a complete and accurate invoice for payment from the State within thirty (30) days. 4.2. Delivery. Unless stated otherwise in the Contract, all prices shall be F.O.B. Destination and shall include all freight delivery and unloading at the destination. 4.3. Applicable Taxes. 4.3.1. Payment of Taxes. The Contractor shall be responsible for paying all applicable taxes. 4.3.2. State and Local Transaction Privilege Taxes. The State of Arizona is subject to all applicable state and local transaction privilege taxes. Transaction privilege taxes apply to the sale and are the responsibility of the seller to remit. Failure to collect such taxes from the buyer does not relieve the seller from its obligation to remit taxes. 4.3.3. Tax Indemnification. Contractor and all subcontractors shall pay all Federal, state and local taxes applicable to its operation and any persons employed by the Contractor. Contractor shall, and require all subcontractors to hold the State harmless from any responsibility for taxes, damages and interest, if applicable, contributions required under Federal, and/or state and local laws and regulations and any other costs including transaction privilege taxes, unemployment compensation insurance, Social Security and Worker’s Compensation. 4.3.4. IRS W9 Form. In order to receive payment the Contractor shall have a current I.R.S. W9 Form on file with the State of Arizona, unless not required by law. 4.4. Availability of Funds for the Next State fiscal year. Funds may not presently be available for performance under this Contract beyond the current state fiscal year. No legal liability on the part of the State for any payment may arise under this Contract beyond the current state fiscal year until funds are made available for performance of this Contract. 4.5. Availability of Funds for the current State fiscal year. Should the State Legislature enter back into session and reduce the appropriations or for any reason and these goods or services are not funded, the State may take any of the following actions: 4.5.1. Accept a decrease in price offered by the contractor; 4.5.2. Cancel the Contract; or 4.5.3. Cancel the contract and re-solicit the requirements. 5. Contract Changes 5.1. Amendments. This Contract is issued under the authority of the Procurement Officer who signed this Contract. The Contract may be modified only through a Contract Amendment within the scope of the Contract. Changes to the Contract, including the addition of work or materials, the revision of payment terms, or the substitution of work or materials, directed by a person who is Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 54 | Page not specifically authorized by the procurement officer in writing or made unilaterally by the Contractor are violations of the Contract and of applicable law. Such changes, including unauthorized written Contract Amendments shall be void and without effect, and the Contractor shall not be entitled to any claim under this Contract based on those changes. 5.2. Subcontracts. The Contractor shall not enter into any Subcontract under this Contract for the performance of this contract without the advance written approval of the Procurement Officer. The Contractor shall clearly list any proposed subcontractors and the subcontractor’s proposed responsibilities. The Subcontract shall incorporate by reference the terms and conditions of this Contract. 5.3. Assignment and Delegation. The Contractor shall not assign any right nor delegate any duty under this Contract without the prior written approval of the Procurement Officer. The State shall not unreasonably withhold approval. 6. Risk and Liability 6.1. Risk of Loss: The Contractor shall bear all loss of conforming material covered under this Contract until received by authorized personnel at the location designated in the purchase order or Contract. Mere receipt does not constitute final acceptance. The risk of loss for nonconforming materials shall remain with the Contractor regardless of receipt. 6.2. Indemnification 6.2.1. Contractor/Vendor Indemnification (Not Public Agency) The parties to this contract agree that the State of Arizona, its departments, agencies, boards and commissions shall be indemnified and held harmless by the contractor for the vicarious liability of the State as a result of entering into this contract. However, the parties further agree that the State of Arizona, its departments, agencies, boards and commissions shall be responsible for its own negligence. Each party to this contract is responsible for its own negligence. 6.2.2. Public Agency Language Only Each party (as 'indemnitor') agrees to indemnify, defend, and hold harmless the other party (as 'indemnitee') from and against any and all claims, losses, liability, costs, or expenses (including reasonable attorney's fees) (hereinafter collectively referred to as 'claims') arising out of bodily injury of any person (including death) or property damage but only to the extent that such claims which result in vicarious/derivative liability to the indemnitee, are caused by the act, omission, negligence, misconduct, or other fault of the indemnitor, its officers, officials, agents, employees, or volunteers." 6.3. Indemnification - Patent and Copyright. The Contractor shall indemnify and hold harmless the State against any liability, including costs and expenses, for infringement of any patent, trademark or copyright arising out of Contract performance or use by the State of materials furnished or work performed under this Contract. The State shall reasonably notify the Contractor of any claim for which it may be liable under this paragraph. If the contractor is insured pursuant to A.R.S. § 41-621 and § 35-154, this section shall not apply. 6.4. Force Majeure. 6.4.1 Except for payment of sums due, neither party shall be liable to the other nor deemed in Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 55 | Page default under this Contract if and to the extent that such party’s performance of this Contract is prevented by reason of force majeure. The term “force majeure” means an occurrence that is beyond the control of the party affected and occurs without its fault or negligence. Without limiting the foregoing, force majeure includes acts of God; acts of the public enemy; war; riots; strikes; mobilization; labor disputes; civil disorders; fire; flood; lockouts; injunctions-intervention-acts; or failures or refusals to act by government authority; and other similar occurrences beyond the control of the party declaring force majeure which such party is unable to prevent by exercising reasonable diligence. 6.4.2. Force Majeure shall not include the following occurrences: 6.4.2.1. Late delivery of equipment or materials caused by congestion at a manufacturer’s plant or elsewhere, or an oversold condition of the market; 6.4.2.2. Late performance by a subcontractor unless the delay arises out of a force majeure occurrence in accordance with this force majeure term and condition; or 6.4.2.3. Inability of either the Contractor or any subcontractor to acquire or maintain any required insurance, bonds, licenses or permits. 6.4.3. If either party is delayed at any time in the progress of the work by force majeure, the delayed party shall notify the other party in writing of such delay, as soon as is practicable and no later than the following working day, of the commencement thereof and shall specify the causes of such delay in such notice. Such notice shall be delivered or mailed certified-return receipt and shall make a specific reference to this article, thereby invoking its provisions. The delayed party shall cause such delay to cease as soon as practicable and shall notify the other party in writing when it has done so. The time of completion shall be extended by Contract Amendment for a period of time equal to the time that results or effects of such delay prevent the delayed party from performing in accordance with this Contract. 6.4.4. Any delay or failure in performance by either party hereto shall not constitute default hereunder or give rise to any claim for damages or loss of anticipated profits if, and to the extent that such delay or failure is caused by force majeure. 6.5. Third Party Antitrust Violations. The Contractor assigns to the State any claim for overcharges resulting from antitrust violations to the extent that those violations concern materials or services supplied by third parties to the Contractor, toward fulfillment of this Contract. 7. Warranties 7.1. Liens. The Contractor warrants that the materials supplied under this Contract are free of liens and shall remain free of liens. 7.2. Quality. Unless otherwise modified elsewhere in these terms and conditions, the Contractor warrants that, for one year after acceptance by the State of the materials, they shall be: 7.2.1. Of a quality to pass without objection in the trade under the Contract description; 7.2.2. Fit for the intended purposes for which the materials are used; 7.2.3. Within the variations permitted by the Contract and are of even kind, quantity, and quality within each unit and among all units; Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 56 | Page 7.2.4. Adequately contained, packaged and marked as the Contract may require; and 7.2.5. Conform to the written promises or affirmations of fact made by the Contractor. 7.3. Fitness. The Contractor warrants that any material supplied to the State shall fully conform to all requirements of the Contract and all representations of the Contractor, and shall be fit for all purposes and uses required by the Contract. 7.4. Inspection/Testing. The warranties set forth in subparagraphs 7.1 through 7.3 of this paragraph are not affected by inspection or testing of or payment for the materials by the State. 7.5. Compliance With Applicable Laws. The materials and services supplied under this Contract shall comply with all applicable Federal, state and local laws, and the Contractor shall maintain all applicable license and permit requirements. 7.6. Survival of Rights and Obligations after Contract Expiration or Termination. 7.6.1. Contractor's Representations and Warranties. All representations and warranties made by the Contractor under this Contract shall survive the expiration or termination hereof. In addition, the parties hereto acknowledge that pursuant to A.R.S. § 12-510, except as provided in A.R.S. § 12-529, the State is not subject to or barred by any limitations of actions prescribed in A.R.S., Title 12, Chapter 5. 7.6.2. Purchase Orders. The Contractor shall, in accordance with all terms and conditions of the Contract, fully perform and shall be obligated to comply with all purchase orders received by the Contractor prior to the expiration or termination hereof, unless otherwise directed in writing by the Procurement Officer, including, without limitation, all purchase orders received prior to but not fully performed and satisfied at the expiration or termination of this Contract. 8. State's Contractual Remedies 8.1. Right to Assurance. If the State in good faith has reason to believe that the Contractor does not intend to, or is unable to perform or continue performing under this Contract, the Procurement Officer may demand in writing that the Contractor give a written assurance of intent to perform. Failure by the Contractor to provide written assurance within the number of Days specified in the demand may, at the State’s option, be the basis for terminating the Contract under the Uniform Terms and Conditions or other rights and remedies available by law or provided by the contract. 8.2. Stop Work Order. 8.2.1. The State may, at any time, by written order to the Contractor, require the Contractor to stop all or any part, of the work called for by this Contract for period(s) of days indicated by the State after the order is delivered to the Contractor. The order shall be specifically identified as a stop work order issued under this clause. Upon receipt of the order, the Contractor shall immediately comply with its terms and take all reasonable steps to minimize the incurrence of costs allocable to the work covered by the order during the period of work stoppage. 8.2.2. If a stop work order issued under this clause is canceled or the period of the order or any extension expires, the Contractor shall resume work. The Procurement Officer shall make an equitable adjustment in the delivery schedule or Contract price, or both, and Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 57 | Page the Contract shall be amended in writing accordingly. 8.3. Non-exclusive Remedies. The rights and the remedies of the State under this Contract are not exclusive. 8.4. Nonconforming Tender. Materials or services supplied under this Contract shall fully comply with the Contract. The delivery of materials or services or a portion of the materials or services that do not fully comply constitutes a breach of contract. On delivery of nonconforming materials or services, the State may terminate the Contract for default under applicable termination clauses in the Contract, exercise any of its rights and remedies under the Uniform Commercial Code, or pursue any other right or remedy available to it. 8.5. Right of Offset. The State shall be entitled to offset against any sums due the Contractor, any expenses or costs incurred by the State, or damages assessed by the State concerning the Contractor’s non-conforming performance or failure to perform the Contract, including expenses, costs and damages described in the Uniform Terms and Conditions. 9. Contract Termination 9.1. Cancellation for Conflict of Interest. Pursuant to A.R.S. § 38-511, the State may cancel this Contract within three (3) years after Contract execution without penalty or further obligation if any person significantly involved in initiating, negotiating, securing, drafting or creating the Contract on behalf of the State is or becomes at any time while the Contract or an extension of the Contract is in effect an employee of or a consultant to any other party to this Contract with respect to the subject matter of the Contract. The cancellation shall be effective when the Contractor receives written notice of the cancellation unless the notice specifies a later time. If the Contractor is a political subdivision of the State, it may also cancel this Contract as provided in A.R.S. § 38-511. 9.2. Gratuities. The State may, by written notice, terminate this Contract, in whole or in part, if the State determines that employment or a Gratuity was offered or made by the Contractor or a representative of the Contractor to any officer or employee of the State for the purpose of influencing the outcome of the procurement or securing the Contract, an amendment to the Contract, or favorable treatment concerning the Contract, including the making of any determination or decision about contract performance. The State, in addition to any other rights or remedies, shall be entitled to recover exemplary damages in the amount of three times the value of the Gratuity offered by the Contractor. 9.3. Suspension or Debarment. The State may, by written notice to the Contractor, immediately terminate this Contract if the State determines that the Contractor has been debarred, suspended or otherwise lawfully prohibited from participating in any public procurement activity, including but not limited to, being disapproved as a subcontractor of any public procurement unit or other governmental body. Submittal of an offer or execution of a contract shall attest that the contractor is not currently suspended or debarred. If the contractor becomes suspended or debarred, the contractor shall immediately notify the State. 9.4. Termination for Convenience. The State reserves the right to terminate the Contract, in whole or in part at any time when in the best interest of the State, without penalty or recourse. Upon receipt of the written notice, the Contractor shall stop all work, as directed in the notice, notify all subcontractors of the effective date of the termination and minimize all further costs to the State. In the event of termination under this paragraph, all documents, data and reports prepared by Master Agreement Section 4: Lead State (ARIZONA) Terms and Conditions State of Arizona State Procurement Office 100 North 15th Avenue, Suite 201 Phoenix, AZ 85007 Contract No: ADSPO16-130652 Description: Software Value-Added Reseller (SVAR) Services 58 | Page the Contractor under the Contract shall become the property of and be delivered to the State upon demand. The Contractor shall be entitled to receive just and equitable compensation for work in progress, work completed and materials accepted before the effective date of the termination. The cost principles and procedures provided in A.A.C. R2-7-701 shall apply. 9.5. Termination for Default. 9.5.1. In addition to the rights reserved in the contract, the State may terminate the Contract in whole or in part due to the failure of the Contractor to comply with any term or condition of the Contract, to acquire and maintain all required insurance policies, bonds, licenses and permits, or to make satisfactory progress in performing the Contract. The Procurement Officer shall provide written notice of the termination and the reasons for it to the Contractor. 9.5.2. Upon termination under this paragraph, all goods, materials, documents, data and reports prepared by the Contractor under the Contract shall become the property of and be delivered to the State on demand. 9.5.3. The State may, upon termination of this Contract, procure, on terms and in the manner that it deems appropriate, materials or services to replace those under this Contract. The Contractor shall be liable to the State for any excess costs incurred by the State in procuring materials or services in substitution for those due from the Contractor. 9.6. Continuation of Performance Through Termination. The Contractor shall continue to perform, in accordance with the requirements of the Contract, up to the date of termination, as directed in the termination notice. 10. Contract Claims All contract claims or controversies under this Contract shall be resolved according to A.R.S. Title 41, Chapter 23, Article 9, and rules adopted thereunder. 11. Arbitration The parties to this Contract agree to resolve all disputes arising out of or relating to this contract through arbitration, after exhausting applicable administrative review, to the extent required by A.R.S. § 12-1518, except as may be required by other applicable statutes (Title 41). 12. Comments Welcome The State Procurement Office periodically reviews the Uniform Terms and Conditions and welcomes any comments you may have. Please submit your comments to: State Procurement Administrator, State Procurement Office, 100 North 15th Avenue, Suite 201, Phoenix, Arizona, 85007. NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-1 Attachment A: Qualifications 1. Overall Company Information Requirement 1.1 Business Operations 1.1.1 Provide a Brief overview of business operations, with an emphasis on the provision of services as a Software Value-Added Reseller. Response CDW was founded in 1984 as a home-based business, and has since grown tremendously through strategic partnerships, online and onsite inventories and services, and strong technical expertise to earn $12 billion in net sales in 2014. CDW partners with over 1,000 manufacturers to offer a portfolio of 100,000-plus products. Over 7,000 individuals constitute the CDW workforce, ranging from salespeople and field executives to administrative and service experts to highly skilled technology specialists and engineers. Incorporated in 1998, CDW·G is the wholly owned subsidiary of CDW LLC that focuses on the public sector, including federal, state, and local government agencies, educational institutions, and healthcare facilities. With over 200 government and education contracts, we are the nation’s largest direct response provider of multi-brand IT solutions. We are currently the largest value-added reseller in the United States, ranked #253 on the 2015 Fortune 500 list. CDW·G focuses on building strong customer relationships by leveraging our knowledgeable account managers and technical specialists to provide extensive pre- and post-award support. Our experts lead the industry in public-sector customer service and product knowledge, directly benefitting the various personnel of our public-sector customers. Software Services CDW is a market-leading software provider with $3 billion annually in software revenue. Through our distribution partner network, we offer nearly every software title available on the market today and have direct partnerships with over 300 software partners. As a company, we manage 25,000 software agreements and process over 180,000 annual software renewals. For the key itemized publishers named in this RFP, we maintain top-tier partnerships (e.g., Adobe Platinum Partner) and regularly receive annual awards (e.g., 2014 Microsoft O365 Sales Achievement Award). NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-2 Proof of Authorization Our ability to supply NASPO ValuePoint members with the key and secondary itemized software publishers listed in the RFP rests on the strong partnerships forged with industry- leading manufacturers, whose solutions meet the needs of our public sector customers. Letters of authorization for each publisher can be provided upon request. Key Itemized Publishers Publisher Relationship with CDW·G Learn More Adobe  Fully authorized Adobe Licensing Center (ALC)  Platinum Channel Partner  Adobe’s largest and most successful reseller partner since 2001  CDW named Adobe 2015 Consumer and Business Worldwide Partner of the Year at Global Sales Conference (12/15/2015)  Internal Adobe support team (8 licensing specialists, 1 Creative Cloud program specialists, 1 senior brand manager)  The only Adobe reseller with multiple dedicated, onsite channel account managers (23 total) www.cdwg.com/cont ent/brands/adobe/ Citrix  Citrix LAR Certified Partner certification  Large Account Reseller Partner of the Year 2013, 2012, 2011 at Citrix Summit conference  Internal Citrix specialist team (1 partner specialist, 3 technical specialists, 2 business development specialists, 1 brand manager)  Hold over 400 Citrix certifications (e.g., CCA/Certified Administrator, CCEA/Certified Enterprise Administrator, CCSP/Certified Sales Professional) www.cdwg.com/cont ent/brands/citrix/ Microsoft  Microsoft Gold Certified Partner, Software Asset Management (SAM) Partner, Authorized Direct Reseller (ADR) for Open Value licensing programs  Number-one ranked Licensing Solution Provider (LSP) and Enterprise Software Advisor (ESA)  Manage over 25,000 active Microsoft agreements  Largest Microsoft Partner in Office 365 customer deployments, contract volume LSP of EAs/SAs, new enterprise agreements  2014 US OEM Reseller of the Year, Office 365 Sales Achievement Award, Experience Center (MEC) Partner of the Year www.cdwg.com/cont ent/brands/microsoft/ Novell  Novell Gold Partner with distinctions: o ALA, MLSA, SLA, VLA, VLA academic, VLA nonprofit/government authorized reseller o End-user computing sales specialization o California SLP contract authorized reseller o NetIQ authorized reseller  4/6/2015: Micro Focus completed its merger with The Attachmate Group, which acquired acquired Novell, Inc. (4/27/2011); Novell now operates as two separate business units under Novell® and SUSE® brand names, having joined Attachmate® and NetIQ® as holdings of The Attachmate Group www.cdwg.com/cont ent/brands/novell/ NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-3 Key Itemized Publishers Publisher Relationship with CDW·G Learn More Symantec  Symantec Platinum Partner  Named the Symantec 2015 National Access Reseller (NAR) Innovation Partner of the Year at Partner Engage awards (11/5/2015)  Largest/top-selling LAR partner; Specialization Member (includes Endpoint Management, Data Loss Prevention, IT Compliance, Managed Security Services, SMB Backup, SMB Security, Enterprise Security, Archiving and eDiscovery, Data Protection with NetBackup, Storage Management)  Dedicated internal Symantec team (16 CDW-badged coworkers (segment, renewals)) www.cdwg.com/cont ent/brands/symantec / VMware  VMware Authorized Consulting (VAC) Program Gold member  2014 Global and Americas Marketing Partner of the Year award at VMware Partner Exchange  55+ dedicated internal VMware personnel (1 onsite brand manager, 6 pre-sales support specialists, 4 vCloud Air pre-sales/technical/business development specialists, 1 end-user computing channel account representative, 3 business development specialists, 5 renewal specialists, 5 capacity planner assessment engineers, 2 national account managers, 12 inside sales reps, 2 systems engineers, 14 virtualization solution architects)  Over 1,500 VMware Sales Professional (VSP) accreditations; 34 VMware Certified Professional (VCP) accreditations; 71 VMware Technical Sales Professional (VTSP) accreditations www.cdwg.com/cont ent/brands/vmware/ Requirement 1.1.2 Provide the following information using the format below. Response 1.1 Business Operations Required Information Offeror’s Response 1.1.2.1 Offeror’s full legal name CDW Government LLC (CDW·G) 1.1.2.2 Primary business contact information (name, address, phone number, email address, website) Jason Schwartz, Sales Manager 230 N Milwaukee Ave Vernon Hills, IL 60061 P: 877.325.0934 E: jasons@cdw.com W: cdwg.com/PeopleWhoGetIT 1.1.2.3 Date Company was established CDW·G was incorporated in 1998; parent company CDW was founded in 1984. 1.1.2.4 Location where the Offeror is incorporated CDW·G is incorporated in the state of Illinois. 1.1.2.5 Ownership structure (public, partnership, subsidiary, etc.) CDW Government LLC is a wholly owned subsidiary of CDW LLC, which is owned by CDW Corporation, a publicly traded entity under NASDAQ (ticker symbol “CDW”). 1.1.2.6 Office location(s) Corporate Headquarters NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-4 1.1 Business Operations Required Information Offeror’s Response responsible for performance of contract. Include address, contact information. 230 N Milwaukee Ave Vernon Hills, IL 60061 P: 800.808.4239 Eastern Distribution Center 200 N Milwaukee Ave Vernon Hills, IL 60061 P: 847.465.6000 Western Distribution Center 3201 E Alexander Road North Las Vegas, NV 89030 P: 702.495.5000 1.1.2.7 Organizational chart relevant to Scope of Work of this solicitation. An organizational chart pertaining to this solicitation immediately follows this table. Names in red boxes have resumes included in this Attachment. 1.1.2.8 Contact information for the individual who is responsible for any clarifications or discussions regarding the submitted response. Edie Harris, Proposal Manager P: 312.705.6285 E: ellharr@cdw.com The following organizational chart is indicative of the personnel structure that will be supporting the NASPO ValuePoint contract and its members throughout the life of the agreement. Names in red boxes have resumes included in this Attachment. NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-5 Requirement 1.2 Key Personnel—Provide the information, using the format below, regarding each Key Personnel for a resultant contract for items 1.2.1 through 1.2.5: Response The following key personnel will participate in serving the NASPO ValuePoint contract and its participating member agencies. Please note that the named personnel included in this response are not meant to provide an exhaustive list of the CDW·G sales, software, and support individuals who will be involved in serving this contract’s participating states. Program Management 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Jumana Dihu 1.2.2 Position/Title and reporting responsibilities Program Manager, State & Local Government 1.2.3 Years of industry experience 13 years 1.2.4 Years in current position Two (2) years 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Program Manager; will oversee NASPO ValuePoint contract details post-award, including reports, audits, and management NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-6 Software Solutions 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Gabriel Adler 1.2.2 Position/Title and reporting responsibilities Sales Manager, Software Solutions 1.2.3 Years of industry experience Nine (9) Years 1.2.4 Years in current position Two (2) years 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Sales Manager, Software; oversees team of licensing account executives and field specialists, grows public-sector software sales 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Gabe Arias 1.2.2 Position/Title and reporting responsibilities Licensing Account Executive, Software Solutions 1.2.3 Years of industry experience Nine (9) years 1.2.4 Years in current position Four (4) years 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Licensing Account Executive, Software; helps NASPO ValuePoint customers manage software investments and cultivates trusted client relationships at CIO/Director level within state agencies State & Local Sales 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Jason Schwartz 1.2.2 Position/Title and reporting responsibilities Sales Manager, State & Local 1.2.3 Years of industry experience 10 years 1.2.4 Years in current position Two (2) years 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Sales Manager, Pacific Geography; oversees account managers handling NASPO ValuePoint members, maintains regional relationships with publishers/manufacturers, long-term contract success strategy 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Michael Truncone 1.2.2 Position/Title and reporting responsibilities Sales Manager, State & Local 1.2.3 Years of industry experience 11 years 1.2.4 Years in current position One (1) year 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Sales Manager, Keystone Geography; oversees account managers handling NASPO ValuePoint members, maintains regional relationships with NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-7 1.2 Key Personnel Required Information Offeror’s Response publishers/manufacturers, long-term contract success strategy 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Clayton Boras 1.2.2 Position/Title and reporting responsibilities Sales Manager, State & Local 1.2.3 Years of industry experience 17 years 1.2.4 Years in current position 12 years 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Sales Manager, Keystone Geography; oversees account managers handling NASPO ValuePoint members, maintains regional relationships with publishers/manufacturers, long-term contract success strategy 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Dave Stephens 1.2.2 Position/Title and reporting responsibilities Business Development Manager, Public Safety 1.2.3 Years of industry experience 30 years 1.2.4 Years in current position Seven (7) years 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Business Development, Northwest and Pacific Geographies (15 states); works with publishers/manufacturers and NASPO ValuePoint customers to determine best-fit solution options K–12 Sales 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Russell Keene 1.2.2 Position/Title and reporting responsibilities Sales Manager, K–12 Sales 1.2.3 Years of industry experience 19 years 1.2.4 Years in current position 12 years 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Sales Manager, Pacific Geography (includes Arizona, Hawaii); oversees account managers handling NASPO ValuePoint members, maintains regional relationships with publishers/manufacturers, long-term contract success strategy NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-8 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Alex Haycock 1.2.2 Position/Title and reporting responsibilities Sales Manager, K–12 Sales 1.2.3 Years of industry experience Five (5) years 1.2.4 Years in current position One (1) year 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Sales Manager, North Pacific (California and Alaska) Geography; oversees account managers handling NASPO ValuePoint members, maintains regional relationships with publishers/manufacturers, long-term contract success strategy 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Sean Galligan 1.2.2 Position/Title and reporting responsibilities Sales Manager, K–12 Sales 1.2.3 Years of industry experience Eight (8) years 1.2.4 Years in current position One (1) year 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Sales Manager, New England Geography; oversees account managers handling NASPO ValuePoint members, maintains regional relationships with publishers/manufacturers, long- term contract success strategy Higher Education Sales 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Mike Clinton 1.2.2 Position/Title and reporting responsibilities Sales Manager, Higher Education 1.2.3 Years of industry experience 13 years 1.2.4 Years in current position One (1) year 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Sales Manager, Northwest Geography; oversees account managers handling NASPO ValuePoint members, maintains regional relationships with publishers/manufacturers, long-term contract success strategy 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Chris Webb 1.2.2 Position/Title and reporting responsibilities Business Development Manager, Higher Education 1.2.3 Years of industry experience 11 years 1.2.4 Years in current position Seven (7) years 1.2.5 Proposed role relative to Offered Business Development, National Contracts; works NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-9 1.2 Key Personnel Required Information Offeror’s Response services. Include the functions and tasks for which they will have prime responsibilities. with publishers/manufacturers and NASPO ValuePoint customers to determine best-fit solution options 1.2 Key Personnel Required Information Offeror’s Response 1.2.1 Name Eric Goff 1.2.2 Position/Title and reporting responsibilities Sales Manager, Higher Education 1.2.3 Years of industry experience 15 years 1.2.4 Years in current position Seven (7) years 1.2.5 Proposed role relative to Offered services. Include the functions and tasks for which they will have prime responsibilities. Sales Manager, Pacific Geography; oversees account managers handling NASPO ValuePoint members, maintains regional relationships with publishers/manufacturers, long-term contract success strategy Requirement 1.2.6 In addition, provide a brief resume which contains education/credentials/certifications/employment. Response Resumes for the named key personnel in the previous requirement are featured at the end of this section, in the following order:  Jumana Dihu  Gabriel Adler  Gabe Arias  Jason Schwartz  Michael Truncone  Clayton Boras  Dave Stephens  Russell Keene  Alex Haycock  Sean Galligan  Mike Clinton  Chris Webb  Eric Goff Requirement 1.3 Account Management Team—Provide a description of the responsibilities of the dedicated account management team(s) that would be assigned to each Participating State under resultant contract. Include a description of how the account management structure ensures that service will continue despite vacations, illness, other absences or resignations. Response Whenever an account manager (AM) is out of the office (e.g., vacation, illness, absence), they designate a fellow coworker to assist their customers, leaving no gap in support. NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-10 This designated backup AM will be an individual who supports other NASPO ValuePoint customers, to ensure knowledge of contract requirements. As an extra point of redundancy, customers can also reach out to our CDW·G general sales support team at the following:  Phone: 800.808.4239  Email: cdwgsales@web.cdwg.com  Chat: www.cdwg.com Our Connecticut-based team staffing these lines of communication is available Monday- Friday, 7am-6pm CST. In instances of coworker resignation, the sales manager overseeing a given account team will assign the departing AM’s customers to an experienced account manager who possesses familiarity with the NASPO ValuePoint contract and purchase history. Account managers are proactively available to their customers to make regular solution recommendations, in addition to addressing support concerns. For more familiar and less complex public-sector software solutions, the AM can call our Supplemental Presales Support line to assist with product research, competitive comparison, simple design, standard architecture, and more. If necessary, the AM will include the customer on this call to further craft the best solution. With complex customer requests or solutions, the AM engages our software licensing team, and their technology specialists and solution architects. Within 48 hours of the initial request, this group works out an offer/solution to present to the customer, including (but not limited to) features, cost analysis, licensing agreement/contract details, interoperability with current environment, implementation actions, and any available maintenance or software assurance programs. Sales managers work with our AMs to develop strategies that best serve customers for long-term success. They spend significant time meeting with customers to understand the dynamics of the local market, and will ensure NASPO ValuePoint customers receive full advantage of CDW·G’s software offerings. Additionally, sales managers are responsible for building and maintaining strong relationships with our top manufacturing partners in each region. For example, leveraging a strong existing relationship with the area Symantec representative can provide contract-specific cost savings that benefit NASPO ValuePoint members. When the number of customers being supported in a particular geographic location reaches a certain capacity, CDW·G dedicates a local resource to support the group. Field account managers work jointly with our AMs to provide comprehensive sales support, and are available for onsite business meetings as needed to offer project development, technical expertise, roadmapping, and business reviews. NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-11 These coworkers are responsible for promoting the contract to end-users, including free trainings in the field, presentations, and attendance at regional tech fairs. They will meet with NASPO ValuePoint, the LSCA, or agency customers for contract status and progress reports, and will assist in solving customer-service issues in the field. Requirement 1.4 Subcontractors—Provide the following information for items 1.4.1 through 1.4.3, using the format below, for any subcontractors you propose to use.  1.4.1 Name of individual or company;  1.4.2 Proposed work to be performed;  1.4.3 Approximate percentage of work directed to subcontractor relative to total work under a resultant contract;  1.4.4 In addition, provide a brief resume which contains education / credentials / certifications / employment. Response For the purposes of this RFP, at the time of this submission, CDW·G is not proposing the use of any subcontracting partners. 2. Company’s Experience Requirement Describe the Offeror’s experience and expertise providing the following services:  2.1 Account Management (assume ‘accounts’ as equivalent to a state contract, and to a using municipality). Response Expert contract support is a hallmark of CDW·G’s program management team. Most vendors—even large resellers—neglect to have a team devoted to managing their contracts, instead relying on salespeople for compliance and reporting issues, which can result in delayed responses, unreliable support, and potentially faulty reporting. CDW·G, however, understands that contracts are serious commitments, and we honor these commitments through our dedicated program management team. Jumana Dihu will manage the NASPO ValuePoint SVAR contract and agreements. Ms. Dihu has over a decade of contract management experience and has been supporting our NASPO ValuePoint reseller agreements for over two years. Our account teams and manufacturing partners know Ms. Dihu is the resident expert for our NASPO ValuePoint contracts and often reach out to her for assistance on related issues. Other knowledgeable program managers will be actively supporting the contract, both as out-of-office backup for Ms. Dihu or in a scenario where she transitions to a new career level. NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-12 To support our NASPO ValuePoint customers, CDW·G provides one primary point-of- contact—an account manager (as described in requirement 1.3). Our account managers, their supporting product specialists, and their sales managers understand the current technology trends and are specialized to only work public-sector customers. The multiple teams that will be supporting the participating states are, by and large, generalists; they understand the broad range of equipment and services we offer and often have sales certifications for several leading manufacturers. Rather than organizing our account teams by solution type, we’ve seen greater customer benefit organizing them by the type and location of the patrons they serve. By asking our generalist sales teams to have laser-like focus on their customers and a strong general understanding of our product offering, we ensure that we’re matching the right products to each customer’s highly individual needs. For this reason, we go through the effort of breaking down the geography that each of our account managers covers by having them work with customers that are closely located to each other. This is done because we understand that our government customers like to benchmark how they purchase and what they purchase in relation to their neighbors. Due to this degree of granularity when distributing accounts, our account managers can propose products that an agency’s counterpart is using in the next town, middle school, or university in many instances from personal experience. However, we recognize that some of our products and services are so complex that a generalist’s approach is not enough. That is where our specialized sales force comes in. Similar to the general account teams, our specialists are split between in-house teams and field teams. They are organized primarily around technology type (e.g., cloud, mobility, data centers, etc.) and secondarily around customer type. If an account manager or field account executive requires additional depth of knowledge for a certain type of solution, they’ll call in their specialist resources. Requirement  2.2 License Management. Response The Software Licensing Support Team is vital in ensuring purchases that are scalable and complement software that is currently in place, as well as those forecasted for future projects. Our software support team includes over 85 Software Licensing Specialists, 250 Presales Systems Engineers, and 45 Licensing Account Executives. They assist with the full scope of software licensing and assist customers with leveraging their buying power for software purchases; provide the right mix of software products; and offer cost analysis of available discounts and credits. NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-13 Dedicated account managers will help NASPO ValuePoint customers with software license management needs. License management is detailed further in Attachment B. Requirement  2.3 Training Response After the six-week intensive training members of our sales team undergo, they continue to receive an average of 165 hours of training in their first year at CDW·G, and participate in more than 140 hours in each subsequent year of employment. Our sales teams are also proactive in being certified experts in the products they sell, with proof of this dedication in the numbers. For example, we have over 1,500 VMware Sales Professionals (VSPs) on staff; the result is more leads generated, stronger customer relationships, and the ability to help our customers prioritize their technology needs. Requirement  2.4 Software Advisement Response The software-specific coworkers of CDW·G who collaborate with our account managers to help advise customers on their right-size solution include the following:  Software Licensing Specialists (SLS). This team is certified in a wide array of the licensing programs members seek. SLSs are dedicated to assisting customers in understanding and navigating complex licensing options for the top software publishers. They help compare key features of different programs, and ensure interoperability of products and the accuracy and comprehensiveness of software quotes. They assist users in finding the best software to fit their needs, along with the most advantageous licensing level.  Partner Specialists. These individuals provide insight into product features and functionality, making sure that software is being sold correctly. Among their duties, they provide accurate licensing solutions. The Partner Specialist teams providing support to CDW·G solutions include over 30 experts focused on our software offering. These coworkers are designated to a specific brand, such as Microsoft, or to a solution, such as cloud. This relates to expert assistance for not only key itemized manufacturers, but to all the publishers users are purchasing.  Cloud Client Executives (CCE). Similar to our SLS team, our 14 CCEs work with our customers to provide guidance and optional engagements to align their unique business goals with a cloud plan that provides maximum benefits. NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-14 Requirement  2.5 Other (specify) Response CDW·G also leverages the following resources to provide unmatched support for customers’ IT solutions: Engineers Also included in our recognizable attributes is an investment in engineers that are available to help design custom solutions. We have the largest team of engineers when compared to our direct IT competitors, more on par with the big integrator firms that serve the federal market—such as Boeing—than other potential respondents. Through the account teams located in strategic geographies across the nation, our engineers provide customers design and consultative services at no additional charge. Partner Resources Many of our OEM partners have staff dedicated to support CDW•G customers exclusively. In March 2015, over 340 partner coworkers from over 100 various partners were collocated with CDW•G, collaborating with our sales teams and engineers to provide expert help to our customers. The wide variety of partners that are onsite allows us to help customers analyze the best value among the products under consideration and provide the right product for each customer the first time. Distribution Facilities Our distribution infrastructure is another key reason why no other IT solution provider in the industry can match our ability to service NASPO ValuePoint customers. As our number of orders has increased across the public and corporate sector, we continue to achieve higher order accuracy year over year. We own two distribution centers that have one million square feet of storage space and stock over $200 million in inventory at any given time. This combination of stock and shipping infrastructure allows us to ship on average 37,000 boxes per day. Despite all of these capabilities, we do not solely rely on our facilities to meet customer needs; we complement our own distribution centers with our distribution partner network, leveraging the most cost-effective solution for each individual product line and customer order. Distribution Partner Network Our Distribution Partner Network includes over 130 different suppliers, meaning we can provide any solution customers need. Similarly to our OEM partners, we’re the largest partner for many of our distributors. Like our manufacturer partner relationships, this results in direct benefits for CDW•G, which we pass along to our customers. NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-15 Most partners send us EDI (Electronic Data Interchange) downloads or real time information on their available inventory, resulting in access to products usually in as little as a day. As an example, we are a top Ingram Micro partner and hold Elite Partner status. This partnership provides a customized and exclusive support resource to our account teams and customers, among other benefits. 3. Clients Requirement 3.1 Provide information on Offeror’s current government client list.  3.1.1 Explain the services provided to each and how long Offeror has been working with each. Response CDW·G has vested partnerships with nearly every government entity in the US. For insight into our customer base, we served over 5,200 customers in 2014 on our NASPO ValuePoint reseller agreements alone. Our 2014 net sales to federal, state, and local governments totaled $1.5 billion; state and local government sales accounted for approximately 41 percent of these net sales. The top product categories provided to state and local government customers included software, notebooks/mobile devices, and enterprise storage. Specific to this RFP, software is a multibillion-dollar component of CDW’s net revenue. As a whole, we manage more than 25,000 software agreements and conduct over 18,000 software renewals annually. Additionally, we offer electronic delivery of many of our software solutions (about one-fifth of our total revenue). Many of these product sales were components of integrated solutions and coupled with services typical of solutions, such as Data Center, Unified Communications and Collaboration, Security, Mobility, and Cloud. The average customer relationship for CDW, as a whole, is eight years. Our government customers sit at the highest end of the average, as our corporate customer relationships are typically no more than three years. Multiyear contracts and the cultivation of personal connections between customer and account manager attribute greatly to the lengthy tenure of these government relationships. Requirement  3.1.2 List government contracts Offeror has gained over the past three (3) years. Provide an explanation of why Offeror was chosen. Response CDW·G has gained 363 public-sector contracts (non-federal) over the past (3) years; the list of these contracts is attached to this section of our response. Most often, customers select CDW·G for contract award due to our capacity for managing large-scale agreements, as well as the value we can provide their purchasers and end- NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-16 users. Unique differentiators that lead to an award decision include our vendor agnosticism and the investment of ongoing sales training to best serve our customers. CDW·G employs over 1,300 account managers, meaning that size and consistency of support staff is a consistent development initiative in order to support national contracts such as NASPO ValuePoint with any necessary transitions. Requirement  3.1.3 List government contracts Offeror has lost or resigned over the past three (3) years. Provide an explanation of why they were lost or resigned. Response As you can see from the following table, of the total 512 contracts lost or resigned, we were named to a new contract in 211 instances and awarded upon rebid in 73 instances, meaning that over half of the no-longer-current contracts are in new iterations being held by CDW·G. 3.1.3 Lost or Resigned Government Contracts Reason Number Agreement out to RFP 1 Agreement rebid and awarded to CDW·G 73 Agreement rebid and not awarded to CDW·G 7 CDW·G was named to a new Contract 211 Contract may be renewed, pending NY OGS 9 Moved purchasing to local cooperative agreements 7 Signed a new agreement 11 Unknown reason 82 We are still awaiting renewal 3 OEM did not sign a new contract 22 Contract expired and was not rebid/renewed 86 GRAND TOTAL 512 A full list is attached to this section of the response, as well. Through the normal course of business, CDW·G’s contract portfolio changes year to year. Contracts in the Public segment are generally terminable at any time for convenience of the contracting agency or group purchasing organization (GPO) or upon default. An adverse change in government spending policies (including ongoing budget cuts), budget priorities, or revenue levels could cause our government customers to reduce their purchases or to terminate or not renew their contracts with us. In the past three (3) years, CDW·G has not lost a contract to default. The primary reason our contracts end is when a customer is out of available options to extend the contract. NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-17 Requirement 3.2 If Offeror has no government clients, note this in your response and answer questions 3.1.1 through 3.1.3 based on non-government clients. Response As detailed, CDW·G has a substantial number of government clients. We provide our responses to 3.1.1 through 3.1.3 to reflect these relationships. Requirement 3.3 References—Provide information for three (3) client references that replicate or are similar to the requirements of this solicitation. All references shall be for engagements received and completed within the last five (5) years. The State may, at its sole discretion, contact additional clients not presented as references. Reference information is to be provided using the following table format: Response The following references are submitted for NASPO ValuePoint review. 3.3 References Reference Information Client One Client Two Client Three Company Name State of Illinois Central Management Services (CMS) Federal Aviation Administration (FAA) University of Washington Type of Contract Product and Services Delivered CDW·G’s IL CMS Microsoft Large Account Reseller contract includes Microsoft Select, Enterprise Agreements, and Microsoft Academic Select. CMS currently has both a Microsoft Select and an Enterprise Agreement. CDW·G has held this contract for three consecutive iterations, starting in 2005. The current contract, recently awarded, expires September 2019. Software contract includes but is not limited to ACD Systems, Software AG, EMC, HP, IBM, Oracle, and Symantec (among dozens of other publishers, including “weirdware”). With CDW·G has grown software sales from $5 million the first year of the contract to $26 million in GFY15, and grown hardware sales from $15 million to $37 million. Both catalog contracts (Software DTFACT-13-D- 00004, Hardware DTFAWA-11-D-00057) are administered by the SAVES Contracts Office; mandatory for the FAA and open to the Department of Transportation Software agreements under contract include Microsoft EES Agreement, VMware ELA, Citrix ELA, Adobe CLP (all Adobe products = 1,000+ orders annually) Support through assessing changes in UW’s licensing needs, deploying software to end-users, providing guidance on new licensing/support structures, renewing maintenance for all OEMs, identifying large spend of similar products across campus to drive campus-wide agreements that reduce cost Contact Name, Mailing Address, Phone Number, Email James Ellenburg, Contracting Officer 120 W Jefferson 3rd Floor Springfield, IL 62702 Harry Lutz, Contracting Officer USDOT/FAA 800 Independence Ave SW Washington, DC 20591 Ray Hsu, Assistant Director, Procurement Services 4300 Roosevelt Way NE Seattle, WA 98195 NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-18 3.3 References Reference Information Client One Client Two Client Three Address P: 217.785.0897 E: james.ellenburg@illinois .gov P: 609.485.6127 E: harry.lutz@faa.org Elizabeth Ford Ochs, Authorized Contract Officer P: 609.485.5557 E: elizabeth.ford@faa.gov Robert Cochran, Contracting Officer Representative P: 571.209.3111 E: robert.cochron@faa.gov P: 206.543.0793 E: rayhsu@uw.edu Contract Start and End Date October 2015- November 2019 Software: May 2013-April 2018 Hardware: September 2011-September 2016 2010-2020 (10-year renewal) Contract Value Estimated $140 million/duration of contract Software: sales through September 2015 = $52 million Hardware: sales through September 2015 = $96 million $5 million/annual 4. Financial/Accounting Information and Disclosures Requirement 4.1 Offeror must provide evidence of financial stability and capability to fund all cost associated with providing the services through the term of the Contract. The latest two (2) years audited annual financial statement(s), including Total Revenue, Net Income, and Total Assets, must be submitted with the Offeror’s Offer. If audited financial data is unavailable, explain in full the reason and provide latest non-audited financial information to include Balance Sheet, Income Statement, as well as, Statement of Cash flows and Change in Financial position. Include information to attest to the accuracy of the information provided. Response Included at the end of this attachment are CDW’s most recent 10K audit reports (2013 and 2014); audited financial statements are located in Item 8: Financial Statements and Supplementary Data. CDW Financial Information 2014 2013 Total Revenue (listed as Net Sales) $12,074.5 million $10,768.6 million Net Income $244.9 million $132.8 million Total Assets $6,099.9 million $5,924.6 million NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-19 Online versions of these documents are also located at investor.cdw.com. 4.2 Disclosures Requirement 4.2.1 Information regarding any irregularities that were discovered in any account maintained by the Offeror on behalf of others. Describe the circumstances and disposition of the irregularities. Response To the best of our knowledge, at the time of this submission, accounts maintained by CDW on behalf of others have not been subject to any irregularities of circumstance or disposition. Requirement 4.2.2 Full disclosure of any potential conflict of interest, i.e. serving as a member, board member, officer, or having significant financial interest with any company, firm or joint venture with interests in the provision of software. Response To the best of our knowledge, at the time of this submission, CDW does not have any potential conflicts of interest that would prevent us from serving NASPO ValuePoint members via this contract. Requirement 4.2.3 Whether or not, in the last ten (10) years, the Offeror has filed (or had filed against it) any bankruptcy or insolvency proceeding, whether voluntary or involuntary, or undergone the appointment of a receiver, trustee, or assignee for the benefit of creditors, and if so, an explanation providing relevant details; Response To the best of our knowledge, at the time of this submission, CDW has not filed (nor had filed against it) any bankruptcy or insolvency proceeding. No receiver, trustee, or assignee for the benefit of creditors has been specifically appointed. Requirement 4.2.4 Whether or not there are any pending Securities Exchange Commission investigations involving the Offeror, and if such are pending or in progress, an explanation providing relevant details and an attached opinion of counsel as to whether the pending investigation(s) may impair the Offeror’s performance in a Contract under this RFP. Response On 29 October 2015, CDW (the Company) received a request for production of documents in connection with an investigation by the SEC of our vendor partner program incentives. We are cooperating with the SEC in this matter. The Company is party to various legal proceedings that arise in the ordinary course of its business, which include commercial, intellectual property, employment, tort, and other litigation matters. NASPO ValuePoint | Software Value-Added Reseller Services Attachment A: CDW·G Qualifications | A-20 The Company is also subject to audit by federal, state, and local authorities by various partners, group purchasing organizations, and customers (e.g., government agencies) relating to purchases and sales under various contracts. In addition, the Company is subject to indemnification claims under various contracts. From time to time, certain customers of the Company file voluntary petitions for reorganization or liquidation under the US bankruptcy laws. In such cases, certain pre-petition payments received by the Company could be considered preference items and subject to return to the bankruptcy administrator. As of 30 September 2015, the Company does not believe that there is a reasonable possibility that any material loss exceeding the amounts already recognized for these proceedings and matters, if any, has been incurred. However, the ultimate resolutions of these proceedings and matters are inherently unpredictable. As such, the Company’s financial condition and results of operations could be adversely affected in any particular period by the unfavorable resolution of one of more of these proceedings or matters. Requirement 4.2.5 Documenting all open or pending litigation initiated by the Offeror or where the Offeror is a dependent or party in litigation that may have a material impact on Offeror’s ability to deliver the contracted services; Response To the best of our knowledge, at the time of this submission, CDW does not have any open or pending litigation that would present a material impact on our ability to deliver the contracted services. Requirement 4.2.6 Full disclosure of any public sector contracts terminated for cause or convenience in the past five (5) years. Response To the best of our knowledge, at the time of this submission, CDW has not had any public sector contracts terminated for cause or convenience in the past five (5) years. Jumana Dihu Relevant Experience CDW Program Manager (2013–Present)  Manages contract portfolio for healthcare, higher education, K–12, state & local sales segments within CDW Government LLC  Responsible for full range of customer-facing contracts and partner contracts, including master purchase agreement, subcontractor agreements, teaming agreements, referral agreements  Initiates and responds to requests for contract changes, product substitutions, technical refreshments  Facilitates preliminary dispute resolution and coordinates with legal department as necessary to maintain customer satisfaction and bring prompt closure  Ensures document compliance and analyzes success of program to make recommendations for improvement, including product add/drop, offer expansion  Manages all reporting capabilities for high-visibility contracts Sirva, Inc. Program Manager (2002–2013) Handled contract negotiation, cost/price analysis, compliance, market and channel analysis, development of strategic initiatives, and directed business goals and project management Education BS, International Economics, DePaul University Gabriel Adler Relevant Experience CDW Sales Manager, Software Solutions (2014—Present)  Responsible for software sales in multiple public-sector segments with CDW Government LLC (e.g., federal, state & local, K–12, higher education)  Manages team of six inside software solution and licensing sellers, five outside software solution and licensing sellers  Manages continuous pipeline of software number, including cascade of forecast to upper management  Goes in-market with field sellers and interfaces with clients  Develops coworkers via education around products, services, solutions Program Manager, Software Sales (2011–2014) Responsible for multiple software programs, including Microsoft T36 Contract Management, Select Plus, NGVL (Next Generation Volume Licensing), OTRR (On Time Renewal Rate), Licensing Help Desk Microsoft Inside Enterprise Licensing Specialist (2009–2011) Microsoft Sales Executive (2006–2009) AMSB Account Manager (2005–2006) Dave Adler, Inc. Controller & Lead Sales Person Education BA, Business, Northeastern Illinois University Professional Memberships International Association of Web Masters and Designers Skills  Microsoft Office Suite (Excel, Word, Access, Outlook)  Microsoft FrontPage  HTML Programmer  Adobe Photoshop  Cute FTP  Adapta 2000  Microsoft Certified Professional— SAM (Software Asset Management)  Microsoft ESA/LAR FY09 Certified  VMware VSP 5.5  Citrix CSP  AS/400 Gabe Arias Relevant Experience CDW Licensing Account Executive (2011–Present)  Supports state & local government customers manage software investments, including Microsoft volume licensing  Builds trusted client relationships at CIO/Director level within state agencies, counties, cities  Presents CDW Government LLC’s software solution capabilities at client-facing meetings, hosted events, selected software partner events  Acts as subject matter expert for all Microsoft licensing agreements, VMware, Adobe, Citrix, Red Hat, HP, IBM, and professional services offerings  Manages multiple government contracts, answers complex licensing and product questions/scenarios, supports CDW account teams, proactively manages client software business (e.g., EA enrollment process, QBRs, trend analysis, technology briefings) Dell, Inc. Licensing Specialist, Global Accounts (2007–2011) Focused on software and service solutions for large Enterprise and global segment ASAP Software Inside Account Manager (2006–2007) Education BS, Marketing, Illinois State University Awards, Certifications & Trainings  Certified Microsoft Licensing Expert  CDW·G Most Valuable Player, Software Team (2013, 2015)  CDW Presidents Achievement (2014)  Classroom Training Program  Sales Leadership Training  Yellow Belt Certification Training  Microsoft Solution Selling Training  Cloud Computing & Virtualization Conference  Microsoft Volume Licensing Certification  VMware Licensing Certification  Symantec Licensing Certification  Citrix Licensing Certification  Oracle Licensing Certification  IBM Licensing Certification  Effective Presentations Training Jason Schwartz Relevant Experience CDW Sales Manager, State & Local Sales (2015–Present)  Manages 20 account managers supporting state & local government customers in California, Arizona, Alaska, and Hawaii  Builds relationships with coworkers, customers, partners for both small and large enterprises in the public sector  Leads team of sales professionals through motivational coaching, effective partner management, and customer engagement  Consistently interacts with field personnel, customer base, and OEM partners  Performs business pipeline review calls with sales teams to ensure financial objectives are achieved monthly, quarterly, and annually Sales Manager, Sales Academy (2014–2015) Responsible for onboarding account managers hired into Medium Large Central and South regions and Small Business teams; developed individual coaching plans for each account manager Senior Account Manager (2010–2014) Achieved strong sales results with higher education customers through consultative selling of hardware, software, and professional services solutions to assist in long-term strategic IT plan of each customer Education BA, Political Science & Business Administration, University of Iowa Michael Truncone Relevant Experience CDW Sales Manager, State & Local Sales (2015–Present)  Travels to discover, develop, and increase relationships with key clients, manufacturers, and service business partners  Performs business pipeline reviews with sales teams to ensure financial objectives are achieved monthly, quarterly, and annually  Conducts services scope reviews on opportunities with integration services to ensure successful project execution Executive Account Manager (2005–2015)  Worked to develop partner relationships while holding weekly cadence with partners including Cisco, HP, and Lenovo  Demonstrated consistent sales growth throughout career  Pursued relevant certifications within IT field, including partners HP, NetApp, EMC, Cisco, and Microsoft  Participated in Emerging Leaders Program  Worked efficiently and effectively while coordinating and managing within large sales organization  Coached and developed high-performing coworkers Education BA, Economics & Business Administration, University of Connecticut Clayton Boras Relevant Experience CDW Sales Manager, Higher Education (2011–Present)  Supervises 20 inside sales and field sales personnel supporting higher education business in Northeast and Keystone geographies  Develops team members with career opportunities in Emerging Leaders program and promotion to Sales Operations  Consistently interacts with field personnel, customer base, and OEM partners  Lead sales team ranked #1 in Higher Education (2012)  Executes large higher education wins for hardware, software, licensing, and services solutions Sales Manager, K–12 Sales (2007–2011)  Oversaw 22 internal sales and two field sales personnel supporting K–12 education business for Keystone geography  Created sales strategies to identify lucrative contract opportunities and leveraged vendor relationships to achieve significant sales and gain visibility  Interfaced with vendors, executive management contracts for key accounts, and information technology, purchasing, and general services personnel at state level Regional Sales Manager (2003–2007) Territory Sales Manager (2001–2003) Micro Warehouse Inc. Group Business Unit Education Manager (1999–2003) Strategic Business Unit Account Manager (1998–1999) Education  MBA, Marketing, Sacred Heart University  BS, Finance, Sacred Heart University Awards & Certifications  CDW Presidents Club Achievement Award (2008, 2012)  CDW #1 Ranked K–12 Sales Manager (2003, 2008)  CDW #1 Ranked Higher Education Sales Manager (2012)  Mitsubishi Sales Award (2006-2009) Dave Stephens Relevant Experience CDW Business Development Manager, Public Safety (2010–Present)  Manages sales engineering process for large-scale integration projects involving public safety agencies  Provides subject matter expertise to CDW Government LLC resources and offers resource training, as well as partner development and management  Presents at state, regional, and national public safety conferences on topics such as mobility, digital evidence management, CJIS mandate compliance Senior Field Account Executive (2002–2010) Worked with account teams to grow state & local government marketplace; additionally developed high-visibility opportunities within specific sales geography CATG Inc. dba MBS CONNECTING POINT Operation Director (2000–2001) President and General Manager (1999–2000) National Sales Manager (1997–1999) State Contract Sales Manager (1991–1997) Account Manager (1988–1990) VALCOM COMPUTER Account/Assistant/Service Manager (1984–1988) Education BA, Data Processing & Business Administration, Weber State University Russell Keene Relevant Experience CDW Sales Manager, K–12 Sales (2006–Present)  Trains and manages inside sales team of 27 account managers covering K–12 accounts in California, Arizona, Alaska, and Hawaii  Manages a team of six field account executives in California and Arizona  Travels to discover, develop, and increase relationships with key clients, manufacturers, and service business partners  Performs business pipeline reviews with sales teams to ensure financial objectives are achieved monthly, quarterly, and annually  Conducts services scope reviews on opportunities with integration services to ensure successful project execution  Acts as Education liaison for CDW Emerging Leaders Program  Analyzes contracts prior to RFP response submission to ensure positive outcome and acceptable company risk District Manager, Northwest & Pacific Regions (2005–2006) Created regional business plan leading to sales increase and trained/coached inside account teams covering customers in western US Senior Account Manager (1997–2005) Proactively targeted key contracts and successfully bid to further business opportunities while acting as team mentor for new sales coworkers Education BS, Marketing, North Central College Alex Haycock Relevant Experience CDW Sales Manager, K–12 Sales (2015–Present)  Mentors account team with various lengths of tenure across multiple CDW segments  Leads account team to exceed goals via one-on-one coaching and focused selling efforts  Builds strong relationships with vendor partners, inside sales reps, and field resources to ensure customer satisfaction and support Senior Account Manager (2014–2015) Guided peers through daily and monthly sales activities while maintaining and expanding customer relationships in Aggregation Services team Account Manager (2011–2014) Developed strong and long-lasting relationships with back-end departments and vendors to become consistent and reliable resource to customers and colleagues Education BA, Business Administration, Columbia College Awards & Certifications  Cisco CCE  EMC Sales Professional  NetApp Sales Professional  VMware Sales Professional  Tripp Lite Sales Professional Sean Galligan Relevant Experience CDW Sales Manager, K–12 Sales (2014–Present)  Manages recruitment, selection, training, and coaching of 18 direct reports handling millions in total business to ensure sales goals are met  Drives business growth by capitalizing on new revenue potential in existing markets in New England geography  Leverages strategic relationships with customers, peers, and vendor partners  Provides customer service management and problem resolution training and mentorship  Utilizes knowledge of partner sales programs and procedures to effectively steer sales growth projects with key partners such as Cisco, NetApp, VMware, and Aruba Account Manager (2007–2014) Managed, fostered, and maintained successful working relationship with multiple vendor partners in K–12 education IT sales Nielsen Media Research Sports Product Placement Auditor (2006–2007) Edited and evaluated analysis of sports marketing initiatives of product vendors, athletic teams, sports venues to assist in formulation of appropriate business strategy Sports Product Placement Analyst (2005–2006) Education BBA, Finance, University of Connecticut Awards & Certifications  Cisco Sales Expert  NetApp Accredited Sales Professional  Microsoft Sales Accreditation  EMC Velocity Sales Accreditation Major Projects  Project Name 1 (Project Date), 5-7 word description  Project Name 2 (Project Date), 5-7 word description Mike Clinton Relevant Experience CDW Sales Manager, Higher Education (2015–Present)  Covers higher education sales in Northwest geography  Leads experienced inside and outside sales team to sell best-in-class manufacturers and technology from Cisco, Lenovo, Microsoft, Adobe, VMware, etc. Principal ISA, Unified Communications (2008–2015)  Subject matter expert for CDW’s unified communications portfolio to customers, colleagues, account managers  Assessed customer business goals and technical requirements to develop UC strategies  Leveraged extensive knowledge of CDW’s Professional Services to provide customers with turnkey solutions  Supported Med/Lar, nonprofit, and healthcare teams Senior Account Manager, Med/Lar (2002–2008) Provided IT solutions and services to mid-market and Enterprise clients Education BS, Telecommunications Management, DeVry University Chris Webb Relevant Experience CDW Business Development Manager, Higher Education (2015–Present)  Owns higher-education strategy for contracts, eProcurement, and key OEM partnership in CDW Government LLC  Directs team of five field-based business development resources focuses on higher education market  Builds strategic partnerships with key OEM partners, providers, and third-party service organizations  Drives customer relationships through C-level engagement, partnership reviews, mutually beneficial contracts  Reports to VP, Higher Education Sales Business Development, Higher Education (2008–2015)  Positioned CDW and negotiated contracts for west coast higher education business  Conducted business reviews with executive-level large clients to identify growth opportunities Sales Manager, Higher Education (2007–2008) Led team of 18 account mangers covering higher education in mid-Atlantic and Keystone geographies Inside Account Manager, K–12 Education (2005–2007) Proactively sought new customers and innovative ways to solve the technology needs of K– 12 education Education BS, Information Systems, Wake Forest University Awards & Certifications  CDW Annual Sales Top Performers (2005, 2006, 2007)  CDW #1 Higher Education/Sales Manager (2008) Eric Goff Relevant Experience CDW Sales Manager, Higher Education, Pacific Region (2009–Present)  Manages day-to-day sales team activities to achieve financial plan, interacting with direct reports, coworkers, customers, and partners  Responsible for two territories consisting of 15 states; develops, improves, and maintains customer and partner relationships  Hosts meetings, delivers presentations, conducts onsite visits, develops plans and strategic planning sessions, handles contract negotiation  Works effectively with internal and external stakeholders to achieve business objectives and exceed sales goals  Motivates and coaches sales team, educates and teams with OEM partners, engages customers to provide consultation and value Sales Manager, Corporate 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Furman University Furman Univeristy 11/23/2015 08/16/2016 Garden Grove Unified School District Audio Visual / Technology Bid 11/05/2014 11/17/2016 Georgia State University National IPA Piggyback 11/16/2015 08/15/2016 Grand Prairie Independent School District Technology Equipment, Supplies, Services, Etc.09/06/2014 08/31/2016 Grantham University Grantham University Master Product Sales Agree 05/22/2014 05/21/2017 Harris County Department of Education Harris County Department of Education 04/01/2014 01/22/2016 HealthEast Care System Business Associate Agreement 05/01/2013 08/18/2018 HealthEast Care System Master Services Agreement 09/25/2013 05/10/2016 Hewlett Packard Company HP Los Angeles Community College Data Storage 11/10/2014 02/08/2017 Hewlett Packard Company Los Angeles Community College District Server M 11/10/2014 02/08/2017 Hewlett Packard Company Alaska HP NVP Computer Equipment 08/12/2015 03/31/2017 Hewlett Packard Company HP NVP Computer Equipment 08/12/2015 03/31/2017 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Milwaukee Public Schools Various Electronic Supplies, Blanket Contract 02/01/2013 01/31/2016 Milwaukee Public Schools Chromebook Agreement 05/30/2014 05/29/2016 Milwaukee Public Schools Charging Carts for Chromebooks 08/22/2014 08/21/2016 Minnesota Department of Administration Minnesota Professional and Technical Services S 07/03/2014 04/15/2019 Mississippi Department of Information Technology Services Mississippi IT Hardware EPL 3760 03/11/2015 06/30/2017 Momentum Ventures, LLC Group Purchasing Agreement 05/15/2013 05/14/2016 Montgomery County Department of Technology Services Montgomery County MD IT Commodities 09/16/2014 02/02/2016 National Cooperative Purchasing Alliance Red Hat Software 09/02/2015 12/31/2015 National Joint Powers Alliance Technology Solutions with Related Equipment an 12/01/2014 11/30/2018 NetApp, Inc.Oklahoma State Regents NetApp 03/01/2014 02/28/2016 NetApp, Inc.TX DIR NetApp 08/19/2014 08/19/2016 NetApp, Inc.Alaska NetApp NVP Computer Equipment 10/13/2015 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08/27/2015 05/31/2019 Palo Alto Networks, Inc Colorado Palo Alto NVP Data Communications 08/27/2015 05/31/2019 Palo Alto Networks, Inc Louisiana Palo Alto NVP Data Communications 08/27/2015 05/31/2019 Palo Alto Networks, Inc Utah Palo Alto VALP Data Communications 08/27/2015 05/31/2019 Palo Alto Networks, Inc Florida Palo Alto NVP Data Communications 12/08/2015 05/31/2019 Panasonic Computer Solutions Company TX DIR Panasonic 12/20/2013 12/20/2015 Pemayetv Emahakv Charter School Printer Supplies Management Program 04/16/2015 04/15/2018 Pennsylvania Department of General Services PA Commonwealth- Server Equipment 06/01/2014 05/31/2016 PEPPM General Hardware and Software 01/01/2014 12/31/2016 PEPPM PEPPM 2014 Steelcase Product Line BId 05/28/2014 12/31/2017 PEPPM PEPPM 2015 Ruckus Product Line Bid 01/01/2015 12/31/2017 PEPPM PEPPM Panasonic Product Line Bid 2015 03/09/2015 12/31/2017 PEPPM PEPPM Product Line Bid 03/26/2015 01/01/2018 PEPPM PEPPM 2015 Synnex Product Line Bid 10/12/2015 12/31/2017 Pharr-San Juan-Alamo Independent School District Audio Visual Aids, Videos, Equipment, Services a 09/01/2015 08/31/2016 Pharr-San Juan-Alamo Independent School District Toner & Ink Cartridges for Printers, Equipment, S 09/01/2015 08/31/2016 Pharr-San Juan-Alamo Independent School District Computer and Printer, Equipment, Services and 09/01/2015 08/31/2016 Pima County Community College District National IPA Piggyback Agreement 09/25/2015 08/14/2016 Polycom, Inc.State of Georgia Polycom 07/25/2013 06/30/2016 Prince George County Public Schools MDM Licenses 10/01/2014 09/30/2017 Promark Technology Ohio STS Promark 07/16/2014 09/04/2016 Promethean, Inc.NY OGS Promethean Materials and Equipment 02/13/2013 08/02/2017 Rasmussen, Inc.Rasmussen, Inc. 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Inc.Florida ShoreTel NVP Data Communications 08/28/2015 05/31/2019 ShoreTel Inc.Missouri ShoreTel NVP Data Communications 08/28/2015 05/31/2019 ShoreTel Inc.Washington ShoreTel NVP Data Communication 09/18/2015 05/31/2019 Snohomish County Public Utility District Snohomish County PUD Fireye 10/21/2014 10/21/2019 Socorro Independent School District District Interactive Projectors 11/20/2014 11/19/2016 South Carolina Information Technology Management Office South Carolina Symantec 02/20/2013 02/19/2018 South Carolina Information Technology Management Office South Carolina Aerohive 05/29/2015 05/28/2018 Southeast Kansas Educational Services Cooperative Southeast Kansas Educational Services Cooperat 03/01/2014 02/29/2016 Spectrum Industries, Inc.State of Connecticut Classroom Furniture 07/23/2014 03/31/2017 St. Mary's County Public Schools Promethean Interactive Whiteboards & Related 04/01/2013 03/31/2016 Stanford University Stanford University MPSA 10/27/2015 10/27/2018 State of California, Department of General Services SLP Academic Microsoft 06/27/2013 06/30/2016 State of California, Department of General Services CMAS Cisco 08/07/2013 09/30/2017 State of California, Department of General Services SLP Microsoft 11/15/2013 02/01/2017 State of California, Department of General Services SLP Adobe 01/24/2014 12/31/2015 State of California, Department of General Services SLP Novell 06/09/2014 06/30/2016 State of California, Department of General Services SLP VMware 07/21/2014 07/31/2017 State of California, Department of General Services Cisco PC Servers 06/30/2015 06/29/2017 State of California, Department of General Services SLP Commvault 08/03/2015 07/31/2017 State of California, Department of General Services SLP Symantec 09/19/2014 08/31/2016 State of Connecticut, Dept of Administrative Services Information Processing Systems Agreement 01/17/2014 01/17/2018 State of Connecticut, Dept of Information Technology Audio Visual 05/01/2014 03/31/2019 State of Oregon IT Hardware Value Added Reseller 09/25/2015 09/30/2017 State of Tennessee, Department of General Services Tennessee Cisco Hardware, Software, and Servic 01/01/2013 12/31/2015 State of Tennessee, Department of General Services Tennessee Ultrabooks and Related Peripherals 07/11/2014 07/10/2016 State of Tennessee, Department of General Services Tennessee Multi Manufacturer Software 04/01/2015 03/31/2016 State of Texas, Department of Information Resources TX DIR Networking 09/20/2014 09/19/2016 State of Texas, Department of Information Resources TX DIR Education IT Products 06/18/2015 06/18/2016 Tegile Systems, Inc.Florida Tegile NASPO ValuePoint Computer Equi 07/22/2015 03/31/2017 Tegile Systems, Inc.Tegile NASPO ValuePoint Computer Equipment 07/22/2015 03/31/2017 Texas A&M University TCPN Stretch Agreement 07/01/2013 10/31/2016 Texas Christian University Texas Christian Managed Print Services Contract 08/19/2013 08/19/2016 The Catholic University of America The Catholic University 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11/18/2018 University of Minnesota University of Minnesota Juniper and Powerdsine 07/01/2013 06/30/2016 University of Montana NJPA Stretch Agreement 12/01/2014 11/18/2018 University of Virginia NJPA Stretch Agreement 12/01/2014 11/18/2018 University of Wisconsin Foundation Master Services Sales Agreement 09/11/2015 09/10/2017 US Educational Technology Purchasing Alliance End User Devices 01/01/2015 12/31/2019 US Educational Technology Purchasing Alliance LAN/WAN Security (E-Rate)01/01/2015 12/31/2019 Vanguard University Vanguard University MPSA 12/12/2013 12/13/2015 Victoria Independent School District Audio Visual Equipment & Supplies 01/01/2014 12/31/2015 Victoria Independent School District Technology RFP 03/01/2014 02/28/2016 Village of Lombard MPS-Village of Lombard 10/30/2013 10/30/2016 Village of Lombard Village of Lombard PSMP 10/30/2013 10/29/2016 Virginia Information Technologies Agency VITA Governance, Risk and Compliance Software 02/04/2013 02/04/2017 Virginia Information Technologies Agency VITA Hardware and Maintenance 03/31/2014 03/31/2016 Virginia Information Technologies Agency VITS Software License Contract 04/01/2014 03/31/2016 Wayne-Finger Lakes BOCES Chrome Books & Accessories 06/01/2013 01/31/2016 Western Suffolk BOCES Western Suffolk BOCES Smartboard & Audio Vis 02/24/2015 12/31/2015 LOST OR RESIGNED GOVERNMENT CONTRACTS Issuing Agency Contract Title Start Date Exp Date Reason Montgomery County Public Schools Computer Supplies 01/13/2010 01/12/2013 Unknown reason Arlington Independent School District Computer, AV Equipment, Supplies and Services 11/01/2012 01/15/2013 Agreement rebid and awarded to CDW•G Milwaukee Public Schools Tech Catalog Contract 11/20/2009 01/31/2013 Agreement rebid and awarded to CDW•G Albuquerque Public Schools Audio Visual 03/02/2009 02/28/2013 Moved purchasing to local cooperative agreements New Mexico Cooperative Educational Services Technology Contract 03/01/2010 02/28/2013 Agreement rebid and awarded to CDW•G King County Director's Association Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G Clark County School District Classroom Visual Presentation Equipment and Accessories 03/23/2011 03/22/2013 Unknown reason Irvine Unified School District Irvine Unified School District Product Purchase Agreement 56943 04/15/2008 04/16/2013 Signed a new agreement New Caney Independent School District Special Education Supplies 05/17/2011 05/16/2013 Unknown reason San Francisco Unified School District Interactive Whiteboard Classroom Solution 06/09/2010 06/07/2013 Unknown reason Region 18 Education Service Center Computer Hardware, Software, Supplies and Accessories 06/23/2012 06/22/2013 Unknown reason Socorro Independent School District District Software 06/24/2011 06/25/2013 Agreement rebid and awarded to CDW•G Tuscon Unified School District Computer, Technology, Electrical Parts and Supplies 09/18/2008 06/30/2013 Unknown reason Corona-Norco Unified School District Audio Visual Equipment 07/01/2011 06/30/2013 Unknown reason Garden Grove Unified School District Audio Visual Equipment 09/19/2012 06/30/2013 Unknown reason Orange County Public Schools Projectors 07/01/2011 06/30/2013 Unknown reason Jackson-Madison County School System Slate-Tablet Computers 03/15/2013 06/30/2013 Agreement rebid and awarded to CDW•G Copper Country Intermediate School District 22i SPOT Device 05/23/2013 08/30/2013 Agreement rebid and awarded to CDW•G NORTH ALABAMA COOPERATIVE PURCHASING ASSOCIATION MANUFACTURER SUPPLIED TECHNOLOGY EQUIPMENT WITH PERIPH 09/01/2010 08/31/2013 Agreement rebid and awarded to CDW•G Academy School District 20 Peripherals 09/01/2012 08/31/2013 Agreement rebid and awarded to CDW•G Eagle Pass Independent School District Computer Hardware & Equipment 10/01/2011 08/31/2013 Unknown reason Harlingen Consolidated Independent School District Audio Visual 09/11/2012 08/31/2013 Unknown reason Lone Star College System Technology Solutions 11/20/2012 10/13/2013 Agreement not renewed due to lack of sales School District of Palm Beach County Computer Software, Peripherals, Accessories & Repair Parts 11/20/2009 11/19/2013 Unknown reason Smoky Hill Education Service Center NJPA Stretch Agreement 12/17/2012 11/22/2013 Signed new NJPA Stretch Agreement Associated Colleges of the Twin Cities Technology Catalog 08/08/2012 11/22/2013 Signed new Stretch Agreement under new NJPA Agreement City of Chesapeake Technology Solutions and Related Services 10/11/2012 11/23/2013 Signed new Stretch Agreement under new NJPA Agreement Socorro Independent School District Audio Visual Equipment 12/18/2011 12/17/2013 Agreement rebid and awarded to CDW•G Lake County School Board Catalog Bid for Incidental Supplies 09/25/2006 12/31/2013 Unknown reason Regional Educational Media Center Association of Michigan uipment & Supplies 2013 01/01/2013 12/31/2013 Agreement rebid and awarded to CDW•G School District of Kansas City Missouri Computer Technology and Peripherals 01/01/2013 12/31/2013 Unknown reason Cypress-Fairbanks Independent School District Repair Parts for AV, Computer, Printer & Miscellaneous Office Equip 01/01/2012 12/31/2013 Unknown reason Northside Independent School District Audio, Visual & DVD Software 02/01/2012 01/31/2014 Unknown reason University of Alabama Lenovo Product 03/01/2013 02/28/2014 Agreement rebid and awarded to CDW•G Colorado BOCES Association Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G Panhandle Area Education Consortium Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G Iowa Educators Consortium Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G Indiana Association Educational Service Centers Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G Indiana Association Educational Service Centers - GovPro Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G Oakland Schools Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G Minnesota Service Cooperatives Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G Cooperating School Districts of Greater St Louis Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G Montana Cooperative Services, LLC Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G North Dakota Educators Service Cooperative Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G InterMountain ESD Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G Portland Public Schools Technology Catalog 01/03/2006 02/28/2014 Agreement rebid and awarded to CDW•G Keystone Purchasing Network Technology Catalog 07/01/2013 02/28/2014 Agreement rebid and awarded to CDW•G TexBuy (Region 16 Education Service Center)Technology Catalog 09/27/2010 02/28/2014 Agreement rebid and awarded to CDW•G Fairfax County Public Schools Technology Catalog 03/01/2010 02/28/2014 Agreement rebid and awarded to CDW•G Richmond Public Schools Audio Visual Equipment & Misc Items 03/01/2011 02/28/2014 Unknown reason Regional Education Service Agencies 5 Technology Catalog 05/09/2012 02/28/2014 Agreement rebid and awarded to CDW•G Atlanta Independent School System Instructional Interactive Devices Accessories for Promethean 04/08/2013 03/27/2014 Agreement rebid and awarded to CDW•G Socorro Independent School District District Technology 03/27/2013 03/27/2014 Agreement rebid and awarded to CDW•G City of Mesquite Annual Supply of Miscellaneous PC Components 04/05/2012 04/04/2014 Unknown reason North County Educational Purchasing Corsoritum Audio Visual 04/15/2011 04/15/2014 Agreement rebid and not awarded to CDW•G National Joint Powers Alliance Emergency Response Agreement 04/15/2009 04/15/2014 Agreement rebid and awarded to CDW•G San Bernardino City Unified School District Audio Visual Equipment & Supplies 05/06/2013 05/05/2014 Unknown reason Community Unified School District 300 Replacement Computers 05/13/2013 05/13/2014 Agreement rebid and awarded to CDW•G Douglas County Schools (Omaha Public Schools)Promethean Interactive Whiteboards 05/21/2013 05/20/2014 Unknown reason San Diego County Office of Education Chromebook 08/27/2013 06/30/2014 Unknown reason Hillsborough County Public Schools Audio Visual Equipment, Related Parts and Periodic Services 01/25/2012 06/30/2014 Unknown reason Lenovo (United States) Inc.KETS Instructional Devices Workstations 12/04/2012 06/30/2014 Agreement rebid and awarded to CDW•G Montgomery County Public Schools Chrome-Android-Windows Mobile Devices 07/15/2014 06/30/2014 Unknown reason Jackson-Madison County School System Computer Requirements 08/20/2013 06/30/2014 Agreement rebid and not awarded to CDW•G Arlington Independent School District Computer / Audio Visual Equipment, Supplies and/or Services 08/16/2013 06/30/2014 Agreement rebid and awarded to CDW•G Jefferson County School District No. R-1 AV Equipment & Supplies 08/01/2013 07/31/2014 Agreement rebid and awarded to CDW•G School District of Desoto County Catalog Discount Term Contract 11/13/2012 07/31/2014 Unknown reason Copper Country Intermediate School District 22i SPOT Device 04/23/2014 07/31/2014 Agreement rebid and awarded to CDW•G Desert Sands Unified School District Chromebooks 08/21/2013 08/20/2014 Agreement rebid and awarded to CDW•G Education Service Center Region VII Computer Hardware & Supplies Bid Award 08/22/2013 08/22/2014 Agreement rebid and awarded to CDW•G Amarillo Independent School District Audio Visual 09/01/2013 08/31/2014 Moved purchasing to local cooperative agreements Socorro Independent School District District Interactive Projectors 09/20/2013 09/19/2014 Agreement rebid and awarded to CDW•G Aldine Independent School District Instructional Supplies & Equipment 09/21/2011 09/20/2014 Signed VPA Agreement with CDW•G Mesa Unified School District No. 4 Student Devices 09/24/3013 09/23/2014 Agreement rebid and awarded to CDW•G School Board of Polk County Kindle Fire 04/25/2012 11/27/2014 Unknown reason Hillsborough County Public Schools Classroom Supplies & Equipment Catalog 12/09/2009 12/08/2014 Unknown reason National Joint Powers Alliance Technology Catalog 12/09/2009 12/15/2014 Agreement rebid and awarded to CDW•G Montana State University NJPAStretch Agreement 11/06/2013 12/15/2014 Signed a new NJPA Stretch Agreement Board of Regents of the Nevada System of Higher Education on beh NJPA Stretch Agreement 05/01/2014 12/15/2014 Signed new Stretch Agreement under new NJPA Agreement College of Southern Nevada NJPA Stretch Agreement 06/05/2014 12/15/2014 Signed new Stretch Agreement under new NJPA Agreement Massapequa Union Free School District NJPA Stretch Agreement 09/01/2013 12/15/2014 Signed new Stretch Agreement under new NJPA Agreement West Hempsted Unified Free School District NJPA Stretch Agreement 09/16/2014 12/15/2014 Agreement not renewed Ohio Inter-University Council Purchasing Group Technology Solutions with Related Equipment and Accesories 03/14/2011 12/15/2014 Signed new NJPA Stretch Agreement Fayette County Board of Education LocknCharge Carrier Charging Carts 10/01/2014 12/31/2014 Unknown reason The School Board of Sarasota County Audio Visual & Video Equipment 01/22/2013 01/21/2015 Unknown reason Unified School District 229 Master Services Sales Agreement 01/27/2014 01/26/2015 Unknown reason Adams County School District 14 Microsoft Office 365 08/18/2014 01/30/2015 Unknown reason Fountain Fort Carson School District 8 Laptop & Ultrabook Contract 03/03/2014 03/02/2015 Unknown reason Victoria Independent School District Educational Computer Software 06/01/2013 05/31/2015 Unknown reason Montgomery County Public Schools Televisions for Schools and Offices 06/15/2013 06/14/2015 Unknown reason Region 18 Education Service Center Catalog Bid 06/23/2014 06/22/2015 Agreement rebid and awarded to CDW•G Alum Rock Union Elementary School District Visual and Audio Installation 04/25/2013 06/30/2015 Agreement not rebid Alum Rock Union Elementary School District Installation of Interactive Classroom Promethean Boards 05/07/2013 06/30/2015 Agreement not rebid Pinellas County School Board Audio Visual & Video Equipment/Materials 01/26/2014 06/30/2015 Unknown reason Des Moines Independent Community School District Technology - Electronic Products 07/01/2012 06/30/2015 Unknown reason Rockford Public Schools Lenovo ThinkPads 07/01/2012 06/30/2015 Unknown reason Regional Educational Media Center Association of Michigan Software 2012 07/01/2012 06/30/2015 Agreement rebid and awarded to CDW•G Middlesex Regional Educational Services Commission Technology Catalog 07/01/2013 06/30/2015 Agreement rebid and awarded to CDW•G Metropolitan Nashville Public Schools Nutrition Services Computers/Supplies 06/01/2014 06/30/2015 Unknown reason Birdville Independent School District Birdville ISD 07/01/2014 06/30/2015 Moved purchasing to local cooperative agreements Pearland Independent School District Careet and Technical Education Catalog 07/01/2014 06/30/2015 Unknown reason Arlington Independent School District Computer, AV Equipment, Supplies and Services 07/01/2014 06/30/2015 Agreement rebid and awarded to CDW•G Donna Independent School District Computer Peripherals & IPads 2014-2015 11/19/2014 06/30/2015 Unknown reason Jefferson County Public Schools R-1 Projection, A/V and Charging Carts 09/30/2015 07/31/2015 Unknown reason Pharr-San Juan-Alamo Independent School District Computer Equipment, Servers, Microsoft Licensing, Services and Fina 08/23/2013 08/22/2015 Unknown reason Education Service Center Region VII Computer Hardware & Supplies 08/21/2014 08/22/2015 Agreement rebid and awarded to CDW•G Academy School District 20 District-wide Peripheral Purchase 08/19/2014 08/31/2015 Agreement rebid and awarded to CDW•G Edinburg Consolidated Independent School District Audio Visual Supplies & Equipment 09/01/2013 08/31/2015 Moved purchasing to local cooperative agreements Pharr-San Juan-Alamo Independent School District Toner and Ink Cartridges for Printers, Equipment, Services and Suppl 09/01/2014 08/31/2015 Unknown reason Pharr-San Juan-Alamo Independent School District Computer and Printer Equipment, Services and Supplies Catalog 09/01/2014 08/31/2015 Unknown reason Portland Water District Information Technology Supplies 09/12/2014 09/11/2015 Unknown reason Aldine Independent School District VPA for Technology Devices 09/17/2014 09/16/2015 Moved purchasing to local cooperative agreements School Board of Volusia County IT Hardware and Software - Percent Discount 10/28/2013 09/30/2015 Using other school agreement in Florida El Paso Independent School District iPads, Computer, Telephone & AV Repairs 10/11/2012 10/10/2015 Unknown reason Judson Independent School District Computer and Networking Equipment 10/23/2014 10/22/2015 Unknown reason Clear Creek Independent School District Audio Visual Equipment, Supplies & Discounts 12/01/2011 11/30/2015 Unknown reason Henrico County Public Schools Promethean Interactive White Boards 12/01/2010 11/30/2015 Unknown reason CalSAVE Technology Catalog 04/01/2011 12/31/2015 Agreement out to RFP Education Service Center Region 19 Special Education & Assistive Technology Equipment, Supplies, and C 12/09/2012 12/31/2015 Not renewed for lack of sales Victoria Independent School District Audio Visual Equipment & Supplies 01/01/2014 12/31/2015 Unknown reason National Cooperative Purchasing Alliance Red Hat Software 09/02/2015 12/31/2015 Agreement not renewed Epson America, Inc.Epson Brighter Futures Printers 03/20/2005 03/31/2013 Unknown reason Catholic Purchasing Services Master Service and Product Sales Agreement 06/23/2009 06/22/2013 Not renewed for lack of sales California Charter Schools Association Product Purchase Agreement 06/25/2009 06/25/2013 Moved purchasing to local cooperative agreements Long Beach Unified School District Audio Visual Equipment 09/30/2010 06/30/2013 Unknown reason Education Service Center Region VI Technology Supplies 07/01/2012 06/30/2013 Unknown reason South County Support Service Agency MSPSA 07/07/2009 07/06/2013 Not renewed for lack of sales Chicago Public Schools Software Resale and Support Services 08/01/2010 07/31/2013 Signed new agreement with CDW•G using City of Chicago contract Alabama Joint Purchasing Program ALJP 2012 - Amazon Kindle & ServiceNet Warranty 08/15/2012 08/14/2013 Line item rebid and awarded to CDW•G Alabama Joint Purchasing Program ALJP 2012 - Asus 08/15/2012 08/14/2013 Line item rebid and awarded to CDW•G Alabama Joint Purchasing Program ALJP 2012 - Brocade 08/15/2012 08/14/2013 Line item rebid and awarded to CDW•G Alabama Joint Purchasing Program ALJP 2012 - McAfee 08/15/2012 08/14/2013 Line item rebid and awarded to CDW•G Alabama Joint Purchasing Program ALJP 2012 - Ruckus 08/15/2012 08/14/2013 Line item rebid and not awarded to CDW•G Alabama Joint Purchasing Program ALJP 2012 - Spectrum 08/15/2012 08/14/2013 Line item rebid and awarded to CDW•G Alabama Joint Purchasing Program ALJP 2012 - Trend Micro 08/15/2012 08/14/2013 Line item rebid and awarded to CDW•G Alabama Joint Purchasing Program ALJP 2012 - Xerox 08/15/2012 08/14/2013 Line item rebid and awarded to CDW•G Alabama Joint Purchasing Program ALJP 2012 - Belkin 09/10/2012 08/14/2013 Line item rebid and awarded to CDW•G Alabama Joint Purchasing Program ALJP 2012 - Tripp Lite 11/02/2012 08/14/2013 Line item rebid and awarded to CDW•G Education Service Center Region VII Computer Hardware & Supplies 08/16/2012 08/18/2013 Agreement rebid and awarded to CDW•G Rockwood School District Rockwood School District Product Purchase Agreement 92547 10/01/2008 10/01/2013 Unknown reason Harris County Department of Education Technology Catalog 12/14/2004 12/14/2013 Agreement rebid and awarded to CDW•G Victoria Independent School District Technology RFP 03/01/2011 03/01/2014 Unknown reason McKinney Independent School District Technology & Technical Products & Services 03/25/2009 03/24/2014 Unknown reason Alabama Joint Purchasing Program ALJP 2011 - Planar 05/16/2011 05/15/2014 Line item rebid and not awarded to CDW•G Alabama Joint Purchasing Program ALJP2011-037: AVerMedia 09/25/2012 05/15/2014 Line item rebid and not awarded to CDW•G Washington Learning Source Adobe CLP Software 07/13/2007 07/31/2014 Agreement not rebid Washington Learning Source Aruba Networking Equipment 05/22/2009 07/31/2014 Agreement not rebid Management Council Ohio Education Computer Network MSPSA 41025 02/01/2013 01/31/2015 Unknown reason The Interlocal Purchasing System Computer Equipment, Components and Peripherals 06/28/2012 06/29/2015 Agreement rebid and awarded to CDW•G The Interlocal Purchasing System TIPS-TAPS Software 08/09/2010 07/23/2015 Agreement rebid and awarded to CDW•G Digital Edge Digital Edge Wireless Mobile Devices 05/28/2014 12/31/2015 Agreement rebid and not awarded to CDW•G State of Alabama Department of Finance Blackberry Support 04/22/2010 04/21/2015 Contract expired. No reason on file for why this was not renewed. State of Alabama Department of Finance Alabama Apple PC and Servers 11/01/2013 10/31/2015 CDW•G was named to a new Contract. State of Alabama Department of Finance Alabama Printers and Scanners 12/17/2012 12/16/2015 CDW•G was named to a new Contract. County of Albany Department of General Services Albany County Printers, Accessories and Supplies 08/22/2013 08/21/2015 Contract expired and was not renewed. There was no replacement RFP. Xerox Corporation State of Arkansas Xerox 04/06/2012 04/30/2015 CDW•G was named to a new Contract. Baldwin County Baldwin County Commission Microcomputer 10/21/2014 10/21/2015 CDW•G was named to a new Contract. State of California, Department of General Services SLP Adobe 01/24/2014 12/31/2015 CDW•G was named to a new Contract. City of St. Petersburg City of St. Petersburg Computers, Ruggedized Laptop 03/07/2011 02/28/2014 Contract expired and was not renewed. There was no replacement RFP. Commonwealth of Pennsylvania PA Commonwealth- Networking Equipment 10/01/2013 09/30/2016 Contract was extended until 2016. County of Ventura County of Ventura Cisco 12/12/2013 06/30/2015 Contract expired. No reason on file for why this was not renewed. State of Connecticut, Dept of Information Technology Audio Visual 08/01/2010 05/30/2014 CDW•G was named to a new Contract. American Power Conversion FL APC IT Hardware 09/08/2008 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. Cisco Systems, Inc.Florida Cisco IT Hardware 09/12/2008 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. EMC Corporation State of Florida EMC 09/13/2005 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. Enterasys Networks, Inc.Florida Enterasys 09/08/2008 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. Brocade Communications Systems, Inc.Florida Brocade IT Hardware 09/08/2008 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. Hewlett- Packard Company Florida HP IT Storage, Network 09/12/2008 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. Promark Technology, Inc.FL Promark IT Hardware 12/18/2008 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. Aruba Networks, Inc.Florida Aruba 10/14/2008 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. Trippe Manufacturing Co.Florida Tripp Lite 03/23/2011 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. NetApp Florida NetApp 09/12/2008 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. IBM Corporation Florida IBM 09/08/2008 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. immixGroup, Inc.Florida Immix Riverbed 02/14/2013 09/07/2014 Contract expired and was not renewed. FL wanted to move to WSCA. Cisco Systems, Inc. Florida Cisco Audio and Visual Equipment and Accessories 08/19/2011 02/18/2015 Contract expired and was not renewed. FL wanted to move to WSCA. Cisco Systems, Inc.Florida Cisco Telephony 12/09/2008 09/02/2015 Contract expired and was not renewed. FL wanted to move to WSCA. Carahsoft Technology Corp State of Georgia F5/Carahsoft 12/31/2014 06/30/2015 CDW•G was named to a new Contract. Extreme Networks, Inc.State of Georgia Extreme Networks 07/01/2012 06/30/2015 CDW•G was named to a new Contract. Extreme Networks, Inc.State of Georgia Enterasys 07/01/2012 06/30/2015 CDW•G was named to a new Contract. Pace Microsoft Licenses, Terminal Services CAL and Core CAL Step-up 06/19/2012 12/31/2013 Contract expired and was not renewed. There was no replacement RFP. Illinois Department of Central Management Services IL EMC Capacity Expansion/Maint. Contract 06/27/2013 07/01/2015 Contract expired and was not renewed. There was no replacement RFP. Illinois Department of Central Management Services Illinois Adobe Master Contract 07/14/2008 06/30/2013 Contract expired and was not renewed. There was no replacement RFP. Illinois Department of Central Management Services IL Microsoft EA Agreement 10/01/2011 09/30/2015 CDW•G was named to a new Contract. Illinois Department of Central Management Services Illinois Microsoft LAR Agreement 10/01/2011 09/30/2015 CDW•G was named to a new Contract. Illinois DOT Illinois DOT Microsoft Premier Support Service 11/24/2013 11/23/2014 CDW•G was named to a new Contract. Hewlett- Packard Company Indiana HP QPA 03/05/2014 10/31/2015 Contract expired. No reason on file for why this was not renewed. Kansas Department of Administration Kansas Cisco Contract 07/23/2007 12/31/2015 CDW•G was named to a new Contract. Aruba Wireless Networks, Inc.Louisiana Aruba 08/26/2013 08/25/2015 Contract expired. No reason on file for why this was not renewed. County of Los Angeles Internal Services Department County of Los Angeles Cisco Hardware 07/21/2010 10/20/2015 CDW•G was named to a new Contract. Promethean, Inc.State of Louisiana Promethean 04/05/2012 10/04/2015 Contract expired. No reason on file for why this was not renewed. Trippe Manufacturing Company State of Louisiana Tripp Lite 05/15/2012 11/14/2015 We are still awaiting renewal Epson America, Inc.State of Louisiana Epson 10/01/2014 06/10/2015 CDW•G was named to a new Contract. Lake County Computer Workstation Hardware 12/01/2011 11/30/2015 Contract expired. No reason on file for why this was not renewed. Louisville Jefferson County Metro Government Louisville Jefferson County Metro Government Hardware, Software 05/18/2010 09/30/2015 CDW•G was named to a new Contract. City of Cambridge Misc Computer Hardware & Software for the Police Department 12/10/2014 12/09/2015 Contract expired. No reason on file for why this was not renewed. Mississippi Department of Information Technology Services Mississippi Microsoft EPL 3640 12/01/2010 06/01/2014 CDW•G was named to a new Contract. Mississippi Department of Information Technology Services Software Express Products List 06/23/2009 06/30/2014 CDW•G was named to a new Contract. Mississippi Department of Information Technology Services Mississippi IT Hardware EPL 3658 07/01/2011 02/13/2015 CDW•G was named to a new Contract. Carahsoft Technology Corp North Carolina Carahsoft VMware 11/20/2014 09/11/2015 Contract expired. No reason on file for why this was not renewed. Ricoh Americas Corporation NC Ricoh Printer 204D 08/01/2007 03/31/2013 Contract expired and was not renewed, but Ricoh is looking to award a new cont Hewlett- Packard Company North Carolina HP Thin Client 06/15/2012 06/14/2013 Contract expired. No reason on file for why this was not renewed. North Carolina Department of Administration North Carolina Citrix 08/01/2012 07/31/2013 CDW•G chose not to extend the contract for no sales. North Carolina Department of Administration NC Ruggedized Accessories 204B 06/01/2007 10/31/2013 CDW•G was named to a new Contract. Panasonic Computer Solutions Company NC Panasonic Rugged Computers 06/01/2007 10/31/2013 CDW•G was named to a new Contract. Hewlett- Packard Company North Carolina HP Printer 04/01/2013 03/31/2014 CDW•G was named to a new Contract. Carahsoft Technology Corp.Carahsoft VMWare Software 09/10/2014 09/09/2015 Contract expired. No reason on file for why this was not renewed. North Carolina Department of Administration NC Mass Storage ITS-006498 09/20/2012 03/31/2016 Contract was extended until 2016. NetApp, Inc.NC 204J NetApp Mass Storage 09/20/2012 09/20/2015 Contract expired. No reason on file for why this was not renewed. North Carolina Department of Administration NC Ruggedized Computers and Accessories 11/01/2013 10/31/2015 Contract expired. No reason on file for why this was not renewed. Synnex Corporation North Central EMS Cooperative 04/25/2011 02/09/2014 Contract expired. No reason on file for why this was not renewed. Synnex Corporation North Central EMS Cooperative 04/25/2011 02/09/2014 Contract expired. No reason on file for why this was not renewed. Noble County Clerk Noble County Office Supplies 07/01/2015 12/31/2015 Still awaiting 3M Projection Systems NY OGS-3M Projection Systems Audio Visual 11/01/2008 10/31/2013 Contract expired and was not renewed. NY OGS did not open up for RFP again. Mitsubishi Digital Electronics NY OGS-Mitsubishi Audio Visual 11/01/2008 10/31/2013 Contract expired and was not renewed. NY OGS did not open up for RFP again. Optoma Technology, Inc.NY OGS-Optoma Technology Audio Visual 10/01/2008 10/31/2013 Contract expired and was not renewed. NY OGS did not open up for RFP again. PolyVision Corporation NY OGS-Polyvision Audio Visual 05/06/2010 10/31/2013 Contract expired and was not renewed. NY OGS did not open up for RFP again. Hitachi Data Systems NY OGS-Hitachi Systems & Peripherals Storage 11/25/2009 02/10/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. ExaGrid Systems, Inc.NY OGS-ExaGrid Systems Inc Storage Systems and Peripherals 08/17/2011 02/10/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. Quantum Corporation NY OGS-Quantum Corporation Systems and Peripheral (Storage)02/11/2004 02/11/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. Trend Micro, Inc.NY OGS-Trend Micro Microcomputer Software 03/03/2009 03/02/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. International Business Machines Corporation (IBM)NY OGS-IBM Enterprise Systems Xseries 07/02/2008 07/01/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. Citrix Systems, Inc.NY OGS-Citrix Microcomputer Software 08/09/2004 08/08/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. Epson America, Inc.NY OGS-Epson Audio Visual 11/01/2008 10/31/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. Infocus Corporation NY OGS-Infocus Audio Visual 11/01/2008 10/31/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. NEC Display Solutions of America NY OGS-NEC Audio Visual 11/01/2008 10/31/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. AverMedia Technologies, Inc.NY OGS-AverMedia Technologies Audio Visual 11/01/2008 10/31/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. Elmo USA Corp.NY OGS-Elmo Corp Audio Visual 11/01/2008 10/31/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. Steelcase, Inc.NY OGS-NY OGS Steelcase VID#1000009217 08/29/2005 10/31/2014 Contract expired and was not renewed. NY OGS did not open up for RFP again. EMC Corporation NY OGS-EMC Storage Systems and Peripherals 03/05/2004 08/31/2015 Contract expired and was not renewed. NY OGS did not open up for RFP again. NetApp, Inc.NY OGS-NetApp Inc Systems and Peripheral (Storage)02/11/2004 08/31/2015 Contract expired and was not renewed. NY OGS did not open up for RFP again. Hewlett- Packard Company NY OGS-HP Enterprise Systems 06/17/2011 10/22/2015 Contract expired and was not renewed. NY OGS did not open up for RFP again. Hewlett- Packard Company NY OGS-HP Storage Systems and Peripherals 07/19/2007 12/10/2015 Contract expired and was not renewed. NY OGS did not open up for RFP again. Acer America Corp.NY OGS-Acer Computer Microcomputer Systems 12/29/2010 12/28/2015 Contract may be renewed, pending NY OGS. Fujitsu Computer Systems, Corporation NY OGS-Fujitsu Microcomputer Systems 12/29/2010 12/28/2015 Contract may be renewed, pending NY OGS. Hewlett- Packard Company NY OGS-HP Microcomputer Systems 12/29/2010 12/28/2015 Contract may be renewed, pending NY OGS. Lenovo (United States) Inc.NY OGS-Lenovo Microcomputer Systems 12/29/2010 12/28/2015 Contract may be renewed, pending NY OGS. Panasonic Computer Solutions Company NY OGS-Panasonic Microcomputer Systems 12/29/2010 12/28/2015 Contract may be renewed, pending NY OGS. Seneca Data Distributors, Inc.NY OGS-SenecaData Microcomputer Systems 12/29/2010 12/28/2015 Contract may be renewed, pending NY OGS. Sony Electronics, Inc.NY OGS-Sony Microcomputer Systems 12/29/2010 12/28/2015 Contract may be renewed, pending NY OGS. Toshiba America Information Systems, Inc.NY OGS-Toshiba Microcomputer Systems 02/24/2011 12/28/2015 Contract may be renewed, pending NY OGS. Asus Computer International NY OGS-Asus Microcomputer System 04/21/2011 12/28/2015 Contract may be renewed, pending NY OGS. Department of Information Technology and Telecommunications (DNYC DOITT Panasonic 04/10/2013 12/29/2015 Contract will expire and not being renewed. Oakland County, Michigan Oakland County Microsoft Enterprise 09/01/2010 08/31/2013 Contract expired and was not renewed. There was no replacement RFP. Oakland County, Michigan Oakland County Michigan Fujitsu Tablets 10/01/2010 09/30/2013 Contract expired and was not renewed. There was no replacement RFP. Aruba Wireless Networks, Inc.State of Oklahoma Aruba Networking 02/20/2014 02/19/2015 CDW•G was named to a new Contract. State of Pennsylvania, Department of General Services Costars-3 IT Hardware 09/23/2005 09/08/2015 CDW•G was named to a new Contract. State of Pennsylvania, Department of General Services Costars Software 08/01/2008 11/30/2015 CDW•G was named to a new Contract. Philadelphia Housing Authority Philadelphia Housing Authority Hardware 04/01/2014 03/31/2015 Contract expired and was not renewed. There was no replacement RFP. Philadelphia Housing Authority Philadelphia Housing Authority Software 04/01/2014 03/31/2015 Contract expired and was not renewed. There was no replacement RFP. Pennsylvania Department of General Services PA IT Hardware Rugged Toughbooks 01/15/2009 09/30/2013 CDW•G was named to a new Contract. Pennsylvania Department of General Services PA IT Networking Contract 08/12/2008 09/30/2013 CDW•G was named to a new Contract. South Carolina Information Technology Management Office South Carolina AverMedia 08/03/2011 08/02/2015 CDW•G was named to a new Contract. Mitsubishi Digital Electronics South Carolina Mitsubishi AV 08/11/2006 08/05/2015 CDW•G was named to a new Contract. South Carolina Information Technology Management Office South Carolina Polyvision 08/03/2011 08/05/2015 CDW•G was named to a new Contract. South Carolina Information Technology Management Office South Carolina Enterasys 09/08/2010 09/07/2015 CDW•G was named to a new Contract. Bretford Manufacturing South Carolina Bretford 09/03/2009 12/31/2015 Still awaiting Epson America, Inc.South Carolina Epson AV 07/10/2006 12/31/2015 Still awaiting NEC Display Solutions of America South Carolina NEC Audio Visual 08/02/2006 12/31/2015 Still awaiting State of Tennessee, Department of General Services Tennessee Cisco Hardware, Software, and Services 01/01/2013 12/31/2015 CDW•G was named to a new Contract. EMC Corporation TX DIR EMC Software 05/04/2011 05/04/2015 CDW•G was named to a new Contract. Lexmark International, Inc.TX DIR Lexmark 09/27/2012 05/18/2015 CDW•G was named to a new Contract. Oki Data Americas, Inc.TX DIR Okidata 05/30/2007 06/07/2015 CDW•G was named to a new Contract. Xerox Corporation TX DIR Xerox 03/26/2007 06/07/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation TX DIR Ricoh 08/09/2012 06/10/2015 We are still awaiting renewal Samsung Electronics America, Inc.Texas DIR Samsung 03/17/2014 08/07/2015 CDW•G was named to a new Contract. EMC Corporation TX DIR EMC 09/10/2014 09/10/2015 CDW•G was named to a new Contract. Epson America, Inc.TX DIR Epson Projectors 03/29/2013 12/07/2015 Epson has renewed and is working with DIR to update site soon Panasonic Computer Solutions Company TX DIR Panasonic 12/20/2013 12/20/2015 Not technically expired but we are still awaiting renewal Lenovo (United States) Inc.TX DIR Lenovo 12/28/2012 12/28/2015 CDW•G was named to a new Contract. City of Richmond Department of Procurement Services Richmond Information Technology Supply Schedule 04/16/2008 04/30/2014 CDW•G was named to a new Contract. Virginia Information Technologies Agency VITA Statewide Printer Wide Format Device 10/29/2010 04/30/2013 Contract expired and was not renewed. There was no replacement RFP. Virginia Information Technologies Agency VITA Hardware and Maintenance Contract 02/06/2009 03/31/2014 CDW•G was named to a new Contract. Virginia Information Technologies Agency VITA Software License Contract 02/06/2009 03/31/2014 CDW•G was named to a new Contract. Virginia Information Technologies Agency VITA Server and Maintenance Contract 01/11/2010 03/31/2014 Contract expired and was not renewed. There was no replacement RFP. Virginia Information Technologies Agency VITA Storage 01/13/2011 11/29/2016 Contract was extended until 2016. State of Vermont VT Computer Peripherals 10/12/2011 09/30/2015 Contract expired. No reason on file for why this was not renewed. Wisconsin Department of Administration, Bureau of Procurement Wisconsin Microcomputer Software Contact 09/01/2005 02/28/2013 CDW•G was named to a new Contract. Wisconsin Department of Administration, Bureau of Procurement Wisconsin Microcomputer Software Contact 09/01/2010 08/31/2015 CDW•G was named to a new Contract. Hewlett- Packard Company HP WSCA Data Communications 04/29/2010 05/31/2014 CDW•G was named to a new Contract. Extreme Networks, Inc.Extreme WSCA 08/14/2009 05/31/2014 CDW•G was named to a new Contract. Extreme Networks, Inc.Alaska Extreme WSCA 03/15/2011 05/31/2014 CDW•G was named to a new Contract. Cisco Systems, Inc.California WSCA Cisco 05/23/2008 05/31/2014 CDW•G was named to a new Contract. Hewlett- Packard Company California HP WSCA Data Communications 04/29/2010 05/31/2014 CDW•G was named to a new Contract. Hewlett- Packard Company Colorado HP WSCA Data Communications 04/29/2010 05/31/2014 CDW•G was named to a new Contract. Extreme Networks, Inc.Colorado Extreme WSCA 03/15/2011 05/31/2014 CDW•G was named to a new Contract. Hewlett- Packard Company Hawaii HP WSCA Data Communications 04/29/2010 05/31/2014 CDW•G was named to a new Contract. Cisco Systems, Inc.Iowa WSCA Cisco 08/14/2009 05/31/2014 CDW•G was named to a new Contract. Extreme Networks, Inc.Iowa Extreme WSCA 10/24/2011 05/31/2014 CDW•G was named to a new Contract. Extreme Networks, Inc.Kansas Extreme WSCA 10/24/2011 05/31/2014 CDW•G was named to a new Contract. Cisco Systems, Inc.Kentucky Cisco WSCA 08/01/2011 05/31/2014 CDW•G was named to a new Contract. Cisco Systems, Inc.Louisiana Cisco WSCA 10/23/2012 05/31/2014 CDW•G was named to a new Contract. Cisco Systems, Inc.Michigan Cisco WSCA 05/02/2012 05/31/2014 CDW•G was named to a new Contract. Hewlett- Packard Company Minnesota HP WSCA Data Communications 04/29/2010 05/31/2014 CDW•G was named to a new Contract. Cisco Systems, Inc.New Jersey Cisco WSCA 04/21/2009 05/31/2014 CDW•G was named to a new Contract. Hewlett- Packard Company New Jersey HP WSCA Data Communications 04/29/2010 05/31/2014 CDW•G was named to a new Contract. Extreme Networks, Inc.Nevada Extreme WSCA 08/14/2009 05/31/2014 CDW•G was named to a new Contract. Cisco Systems, Inc.Nevada Cisco WSCA 05/13/2013 05/31/2014 CDW•G was named to a new Contract. Cisco Systems, Inc.Oregon Cisco WSCA 09/01/2009 05/31/2014 CDW•G was named to a new Contract. Extreme Networks, Inc.South Dakota Extreme WSCA 10/24/2011 05/31/2014 CDW•G was named to a new Contract. Hewlett- Packard Company Utah HP WSCA Data Communications 04/29/2010 05/31/2014 CDW•G was named to a new Contract. Cisco Systems, Inc.Washington Cisco WSCA NASPO 02/08/2010 05/31/2014 CDW•G was named to a new Contract. Hewlett- Packard Company Washington HP WSCA Data Communications 04/29/2010 05/31/2014 CDW•G was named to a new Contract. Extreme Networks, Inc.Washington Extreme WSCA 10/24/2011 05/31/2014 CDW•G was named to a new Contract. Cisco Systems, Inc.Wisconsin Cisco WSCA 09/22/2010 05/31/2014 CDW•G was named to a new Contract. Extreme Networks, Inc.California Extreme WSCA 03/15/2011 08/31/2014 CDW•G was named to a new Contract. EMC Corporation Colorado EMC WSCA 10/09/2009 08/31/2014 CDW•G was named to a new Contract. Extreme Networks, Inc.Missouri Extreme WSCA 10/24/2011 08/31/2014 CDW•G was named to a new Contract. Panasonic Systems Communications Company South Carolina Panasonic WSCA NASPO 12/28/2011 08/31/2014 CDW•G was named to a new Contract. Lexmark International, Inc.South Carolina Lexmark WSCA NASPO 09/01/2009 08/31/2014 Lexmark did not sign a new contract. Lexmark International, Inc.South Dakota Lexmark WSCA NASPO 09/01/2009 08/31/2014 Lexmark did not sign a new contract. Lexmark International, Inc.Utah Lexmark WSCA NASPO 09/01/2009 08/31/2014 Lexmark did not sign a new contract. Extreme Networks, Inc.Utah Extreme WSCA 10/24/2011 08/31/2014 CDW•G was named to a new Contract. Lexmark International, Inc.Washington Lexmark WSCA NASPO 09/01/2009 08/31/2014 Lexmark did not sign a new contract. Lexmark International, Inc.Wisconsin Lexmark WSCA NASPO 09/01/2009 08/31/2014 Lexmark did not sign a new contract. EMC Corporation Connecticut EMC WSCA 09/01/2009 12/31/2014 CDW•G was named to a new Contract. NetApp, Inc.Georgia NetApp WSCA 10/20/2010 12/31/2014 CDW•G was named to a new Contract. NetApp, Inc.Minnesota NetApp WSCA 03/29/2012 12/31/2014 CDW•G was named to a new Contract. Lenovo (United States) Inc.Ohio Lenovo WSCA NASPO 09/01/2009 12/31/2014 CDW•G was named to a new Contract. EMC Corporation Rhode Island EMC WSCA 09/01/2009 12/31/2014 CDW•G was named to a new Contract. NetApp, Inc.NetApp WSCA NASPO 09/01/2009 03/31/2015 CDW•G was named to a new Contract. NetApp, Inc.Arizona NetApp WSCA 09/08/2010 03/31/2015 CDW•G was named to a new Contract. EMC Corporation Florida EMC NVP Computer Equipment 11/30/2015 03/31/2015 CDW•G was named to a new Contract. NetApp, Inc.Idaho NetApp WSCA 01/13/2011 03/31/2015 CDW•G was named to a new Contract. Hewlett Packard Company Alaska HP WSCA NASPO 06/04/2013 06/30/2015 CDW•G was named to a new Contract. Hewlett Packard Company Delaware HP WSCA NASPO 06/13/2012 06/30/2015 CDW•G was named to a new Contract. Fujitsu America, Inc.Idaho Fujitsu WSCA NASPO 11/08/2010 06/30/2015 CDW•G was named to a new Contract. Lenovo (United States) Inc.Lenovo WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Panasonic WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. EMC Corporation EMC WSCA/NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Hewlett Packard Company HP WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. Fujitsu America, Inc.Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation Ricoh WSCA NASPO 05/19/2010 09/30/2015 CDW•G was named to a new Contract. Xerox Corporation Xerox WSCA NASPO 03/01/2011 09/30/2015 Xerox did not sign a new contract. Lenovo (United States) Inc.Alaska Lenovo WSCA NASPO 06/30/2010 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Alaska Panasonic WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Alaska EMC WSCA 09/01/2009 09/30/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation Alaska Ricoh WSCA NASPO 05/19/2010 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.Alaska Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Panasonic Systems Communications Company Arkansas Panasonic WSCA NASPO 11/23/2011 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Arkansas NetApp WSCA 03/29/2012 09/30/2015 CDW•G was named to a new Contract. Hewlett Packard Company Arkansas HP WSCA NASPO 11/11/2013 09/30/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation Arizona Ricoh WSCA NASPO 05/19/2010 09/30/2015 CDW•G was named to a new Contract. Lenovo (United States) Inc.California Lenovo WSCA NASPO 08/22/2011 09/30/2015 CDW•G was named to a new Contract. EMC Corporation California EMC WSCA 09/01/2009 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.California NetApp WSCA 10/13/2010 09/30/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation California Ricoh WSCA NASPO 05/19/2010 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.California Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Fujitsu America, Inc.California Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. Hewlett Packard Company California HP WSCA NASPO 05/09/2013 09/30/2015 CDW•G was named to a new Contract. Lenovo (United States) Inc.Colorado Lenovo WSCA NASPO 07/17/2012 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Colorado Panasonic WSCA NASPO 08/01/2009 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Colorado NetApp WSCA 09/08/2010 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.Colorado Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Fujitsu America, Inc.Colorado Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. Hewlett Packard Company Colorado HP WSCA NASPO 06/04/2013 09/30/2015 CDW•G was named to a new Contract. Lenovo (United States) Inc.Delaware Lenovo WSCA NASPO 11/22/2010 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Delaware Panasonic WSCA NASPO 09/02/2009 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Delaware EMC WSCA 09/01/2009 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Delaware NetApp WSCA 01/13/2011 09/30/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation Delaware Ricoh WSCA NASPO 05/19/2010 09/30/2015 CDW•G was named to a new Contract. Fujitsu America, Inc.Delaware Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. Lenovo (United States) Inc.Florida Lenovo WSCA NASPO 06/01/2012 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Florida Panasonic WSCA NASPO 06/14/2012 09/30/2015 CDW•G was named to a new Contract. Hewlett Packard Company Florida HP WSCA NASPO 08/30/2013 09/30/2015 CDW•G was named to a new Contract. Fujitsu America, Inc.Florida Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Florida EMC WSCA 01/27/2015 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Florida NetApp WSCA 03/09/2015 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Georgia EMC WSCA 11/01/2010 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Georgia NetApp WSCA 02/28/2013 09/30/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation Hawaii Ricoh WSCA NASPO 05/19/2010 09/30/2015 CDW•G was named to a new Contract. Lenovo (United States) Inc.Iowa Lenovo WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Iowa Panasonic WSCA NASPO 05/04/2010 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Iowa EMC WSCA 11/03/2010 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Iowa NetApp WSCA 09/28/2010 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.Iowa Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Fujitsu America, Inc.Iowa Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Idaho Panasonic WSCA NASPO 08/31/2009 09/30/2015 CDW•G was named to a new Contract. Lenovo (United States) Inc.Kansas Lenovo WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.Kansas Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Fujitsu America, Inc.Kansas Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. Lenovo (United States) Inc.Louisiana Lenovo WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Louisiana EMC WSCA 12/13/2010 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Louisiana NetApp WSCA 04/18/2011 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.Louisiana Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Hewlett Packard Company Louisiana HP WSCA NASPO 06/05/2013 09/30/2015 CDW•G was named to a new Contract. Lenovo (United States) Inc.Missouri Lenovo WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Missouri Panasonic WSCA NASPO 08/28/2009 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Missouri EMC WSCA 09/01/2009 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Missouri NetApp WSCA 03/29/2012 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.Missouri Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Fujitsu America, Inc.Missouri Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation Missouri Ricoh WSCA NASPO 05/19/2010 09/30/2015 CDW•G was named to a new Contract. Lenovo (United States) Inc.Montana Lenovo WSCA NASPO 09/01/2008 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Montana Panasonic WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Montana EMC WSCA 09/01/2009 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Montana NetApp WSCA 03/29/2012 09/30/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation Montana Ricoh WSCA NASPO 05/19/2010 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.Montana Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Hewlett Packard Company Montana HP WSCA NASPO 06/04/2013 09/30/2015 CDW•G was named to a new Contract. Lenovo (United States) Inc.North Dakota Lenovo WSCA NASPO 12/09/2010 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company North Dakota Panasonic WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.North Dakota Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. EMC Corporation North Dakota EMC WSCA 05/10/2013 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Nebraska Panasonic WSCA NASPO 12/28/2011 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Nebraska NetApp WSCA 01/11/2012 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Nebraska EMC WSCA 10/01/2012 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company New Jersey Panasonic WSCA NASPO 02/10/2010 09/30/2015 CDW•G was named to a new Contract. EMC Corporation New Jersey EMC WSCA 09/01/2009 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.New Jersey NetApp WSCA 03/23/2011 09/30/2015 CDW•G was named to a new Contract. Xerox Corporation New Jersey Xerox WSCA 02/23/2011 09/30/2015 Xerox did not sign a new contract. Hewlett Packard Company New Jersey HP WSCA NASPO 11/16/2011 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.New Jersey Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Ricoh Americas Corporation New Mexico Ricoh WSCA NASPO 05/19/2010 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Nevada Panasonic WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Nevada EMC WSCA 09/01/2009 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Nevada NetApp WSCA 03/29/2012 09/30/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation Nevada Ricoh WSCA NASPO 05/19/2010 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.Nevada Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Fujitsu America, Inc.Nevada Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. Hewlett Packard Company Ohio HP WSCA NASPO 11/16/2011 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Oklahoma Panasonic WSCA NASPO 06/14/2012 09/30/2015 CDW•G was named to a new Contract. Hewlett Packard Company OR PC Peripherals Agreement 07/01/2010 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Oregon Panasonic WSCA NASPO 07/31/2009 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Oregon EMC WSCA 09/01/2009 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Oregon NetApp WSCA 03/29/2012 09/30/2015 CDW•G was named to a new Contract. Xerox Corporation Oregon Xerox WSCA 03/01/2011 09/30/2015 Xerox did not sign a new contract. Hewlett Packard Company Oregon HP WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. Lexmark International, Inc.Oregon Lexmark WSCA NASPO 09/01/2009 09/30/2015 Lexmark did not sign a new contract. Panasonic Systems Communications Company South Dakota Panasonic WSCA NASPO 11/23/2011 09/30/2015 CDW•G was named to a new Contract. EMC Corporation South Dakota EMC WSCA 09/01/2009 09/30/2015 CDW•G was named to a new Contract. Fujitsu America, Inc.South Dakota Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.South Dakota NetApp WSCA 03/29/2012 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Tennessee EMC WSCA 03/22/2013 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Utah Panasonic WSCA NASPO 06/14/2012 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Utah EMC WSCA 09/01/2010 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Utah NetApp WSCA 06/30/2010 09/30/2015 CDW•G was named to a new Contract. Hewlett Packard Company Utah HP WSCA NASPO 06/04/2013 09/30/2015 CDW•G was named to a new Contract. Hewlett Packard Company Vermont HP WSCA NASPO 06/13/2012 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Vermont Panasonic WSCA NASPO 09/01/2009 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Vermont EMC WSCA 09/01/2009 09/30/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation Vermont Ricoh WSCA NASPO 05/19/2010 09/30/2015 CDW•G was named to a new Contract. Fujitsu America, Inc.Vermont Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Washington Panasonic WSCA NASPO 08/10/2011 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Washington NetApp WSCA 09/28/2010 09/30/2015 CDW•G was named to a new Contract. Xerox Corporation Washington Xerox WSCA 04/25/2011 09/30/2015 Xerox did not sign a new contract. EMC Corporation Washington EMC WSCA 09/02/2009 09/30/2015 CDW•G was named to a new Contract. Fujitsu America, Inc.Washington Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. Hewlett Packard Company Washington HP WSCA NASPO 06/26/2013 09/30/2015 CDW•G was named to a new Contract. Panasonic Systems Communications Company Wisconsin Panasonic WSCA NASPO 12/28/2011 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Wisconsin EMC WSCA 09/02/2009 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.Wisconsin NetApp WSCA 03/29/2012 09/30/2015 CDW•G was named to a new Contract. Ricoh Americas Corporation Wisconsin Ricoh WSCA NASPO 05/21/2010 09/30/2015 CDW•G was named to a new Contract. Fujitsu America, Inc.Wisconsin Fujitsu WSCA NASPO 11/08/2010 09/30/2015 CDW•G was named to a new Contract. NetApp, Inc.West Virginia NetApp WSCA 03/29/2012 09/30/2015 CDW•G was named to a new Contract. EMC Corporation Wyoming EMC WSCA 09/01/2009 09/30/2015 CDW•G was named to a new Contract. West Virginia Department of Administration Purchasing Division West Virgina Personal Computers and Peripherals Blanket Order 05/01/2008 06/30/2013 Contract expired and was not renewed. There was no replacement RFP. Wyoming Game and Fish Dept Wyoming Game and Fish Dept. GPS Units 09/02/2011 06/30/2014 Contract expired. No reason on file for why this was not renewed. Samaritan Health Services Master Service Sales Agreement 03/28/2012 03/27/2014 Contract expired. No reason on file for why this was not renewed. Brocade Communications Systems, Inc.Alaska Brocade WSCA Data Communications 11/01/2012 05/31/2014 CDW•G was named to a new Contract. Brocade Communications Systems, Inc.California Brocade WSCA Data Communications 11/02/2012 05/31/2014 CDW•G was named to a new Contract. Brocade Communications Systems, Inc.Delaware Brocade WSCA Data Communications 11/01/2012 05/31/2014 CDW•G was named to a new Contract. Brocade Communications Systems, Inc.Washington Brocade WSCA Data Communications 11/01/2012 05/31/2014 CDW•G was named to a new Contract. Brocade Communications Systems, Inc.Brocade WSCA Data Communications 11/01/2012 08/31/2014 CDW•G was named to a new Contract. Brocade Communications Systems, Inc.Colorado Brocade WSCA Data Communications 11/01/2012 08/31/2014 CDW•G was named to a new Contract. Brocade Communications Systems, Inc.Hawaii Brocade WSCA Data Communications 03/21/2013 08/31/2014 CDW•G was named to a new Contract. Brocade Communications Systems, Inc.Missouri Brocade WSCA Data Communications 11/01/2012 08/31/2014 CDW•G was named to a new Contract. Brocade Communications Systems, Inc.New Jersey Brocade WSCA Data Communications 11/01/2012 08/31/2014 CDW•G was named to a new Contract. Brocade Communications Systems, Inc.Utah Brocade WSCA Data Communications 11/01/2012 08/31/2014 CDW•G was named to a new Contract. Onondaga- Cortland DATA COMMUNICATIONS EQUIPMENT 11/01/2013 10/31/2014 Contract expired. No reason on file for why this was not renewed. Harris County Harris County Virtualization Software Upgrade 10/28/2014 10/27/2015 CDW•G was named to a new Contract. Technical College System of Georgia CISCO Unified Communications Products 04/14/2010 04/13/2013 Unknown reason Ohio Wesleyan University Master Product Sales Agreement 06/21/2010 06/20/2013 Customer is using other contarcts CDW holds University of Minnesota Electronic Commerce Agreement between the University of Minneso 11/15/2008 06/30/2013 New Contract was awarded to CDW City of Tucson Department of Procurement-EXPIRED National IPA Technology Solutions 03/01/2009 08/18/2013 New Contract was awarded to CDW Paine College Master Product Sales Agreement 09/14/2011 09/14/2013 Not Enough contract spend so Agreement was not extended Massachusetts Higher Education Consortium Massachusetts Consortium Contract - Multi-Media Equipment MC10 11/01/2010 09/30/2013 New Contract was awarded to CDW University of Tennssee Microcomputers University of Tennessee 10/01/2008 09/30/2013 CDW was not awarded a new agreement University of Kentucky Cisco Networking Products and Services 03/08/2010 03/09/2014 Unknown reason Toccoa Falls College Managed Print Services 04/13/2011 04/13/2014 Not Enough contract spend so Agreement was not extended University of New Mexico Agreement between University of New Mexico and CDWG for techn 04/17/2006 04/16/2014 Unknown reason Morehouse School of Medicine Master Product Sales Agreement 04/22/2013 04/22/2014 Agreement was not renewed as they became a member of a co-op York College of Pennsylvania York College of Pennsylvania Product Purchase Agreement 09/12/2008 05/20/2014 Spend was not high enough to extend Universal Technical Institute Master Product Sales Agreement between CDW Government LLC an 06/07/2010 06/07/2014 Unknown reason Massachusetts Higher Education Consortium MHEC Contract #F04, Software 07/01/2012 06/30/2014 New Contract was awarded to CDW•G University of Connecticut Invitation to Bid Document B991910-G Network and Security Hardwa 07/10/2009 06/30/2014 Unknown reason University of Connecticut Network and Security Software 06/16/2010 06/30/2014 Unknown reason Massachusetts Higher Education Consortium MHEC Contract #04, Software 07/01/2010 06/30/2014 New Contract was awarded to CDW•G Stratford University MPSA between Stratford University and CDWG 07/13/2010 07/13/2014 Unknown reason Illinois Valley Community College Managed Print Services Agreement 08/04/2009 08/03/2014 Agreement was not renewed as they use other agreements Bay De Noc Community College Managed Print Services 08/19/2009 08/18/2014 Not Enough contract spend so Agreement was not extended Barry University Master Product Sales Agreement 08/22/2011 08/21/2014 Agreement was not renewed as they became a member of a co-op Eastern Illinois University Product Sales and Service Projects Agreement 04/15/2013 04/14/2015 Agreement was not renewed customer uses oterh agreements instead Massachusetts Higher Education Consortium MHEC Contract #F05, Technology 08/06/2011 07/31/2015 New Contract was awarded to CDW•G Broome-Tioga BOCES Broome-Tioga BOCES AV and Related Technology Equipment 01/16/2014 01/15/2015 Unknown reason City of Hartford - Hartford Public Schools City of Hartford - Hartford Public Schools Desktop, Laptop, Tablet Devices, Servers, Deployment/Other Technical Services, Device Parts/Peripherals, and Software Licensing 11/19/2012 08/31/2013 Rebid and CDWG was awarded a new contract Clarkstown Central School District Clarkstown Central School District Chromebooks (as needed)01/24/2014 01/23/2014 Unknown reason Eastern Suffolk BOCES Eastern Suffolk BOCES Wireless Tablets and Notebooks 01/01/2014 11/30/2014 Unknown reason Nassau BOCES Nassau BOCES Computer Hardware, Software, Networking Supplies 01/30/2014 01/29/2015 Unknown reason Nassau BOCES Nassau BOCES NASSAU BOCES iPad Cases 05/01/2014 08/09/2015 Unknown reason New York City Department of Education New York City Department of Education A/V Equipment 11/06/2008 01/31/2014 Rebid and CDWG was awarded a new contract New York City Department of Education New York City Department of Education Interactive Whiteboard 11/06/2008 06/30/2013 Rebid and CDWG was awarded a new contract New York City Department of Education New York City Department of Education Printers, Software, Peripherals, Accessories & Related Services 04/01/2012 03/31/2015 Rebid and CDWG was awarded a new contract Onondaga-Cortland-Madison Board of Cooperative Educational Serv Onondaga-Cortland-Madison Board of Cooperative Educational Services DATA COMMUNICATIONS EQUIPMENT 11/01/2014 11/02/2015 Unknown reason Onondaga-Cortland-Madison Board of Cooperative Educational Serv Onondaga-Cortland-Madison Board of Cooperative Educational Services COMPUTER PERIPHERALS 04/04/2014 03/31/2015 Unknown reason Onondaga-Cortland-Madison Board of Cooperative Educational Serv Onondaga-Cortland-Madison Board of Cooperative Educational Services Computers, Storage Systems, Accessories and Replacement Parts 04/04/2014 03/31/2015 Unknown reason Onondaga-Cortland-Madison Board of Cooperative Educational Serv Onondaga-Cortland-Madison Board of Cooperative Educational Services (BOCES) OCM Data Communications Equip RFB-215-20 11/01/2014 11/02/2015 Unknown reason Orange Ulster BOCES Orange Ulster BOCES Google Chromebooks 10/19/2013 10/18/2014 Unknown reason Patchogue Medford Schools Patchogue Medford Schools AV Supply Bid 03/27/2015 06/30/2015 Unknown reason PEPPM PEPPM General Hardware & Software / Remanufacturered Toner & Ink Cartridges 01/01/2010 12/31/2013 Rebid and CDWG was awarded a new contract PEPPM PEPPM General Hardware and Software 04/21/2011 12/31/2014 Rebid and CDWG was awarded a new contract Southern Westchester Board of Cooperative Educational Services Southern Westchester Board of Cooperative Educational Services Chromebooks 01/17/2013 06/30/2014 Rebid and CDWG was awarded a new contract Southern Westchester Board of Cooperative Educational Services Southern Westchester Board of Cooperative Educational Services Misc. Printers 07/11/2013 12/31/2014 Unknown reason Southern Westchester Board of Cooperative Educational Services Southern Westchester Board of Cooperative Educational Services Microcomputer Hardware 09/05/2014 06/30/2015 Unknown reason Southern Westchester Board of Cooperative Educational Services Southern Westchester Board of Cooperative Educational Services Southern Westchester BOCES AV Pricing 09/01/2014 09/01/2015 Unknown reason Southern Westchester Board of Cooperative Educational Services Southern Westchester Board of Cooperative Educational Services Southern Westchester BOCES Chromebook & Google Software 07/10/2014 07/01/2015 Unknown reason Ulster County BOCES Ulster County BOCES Chromebook & Chromebox 12/20/2012 08/31/2014 Unknown reason Western Suffolk BOCES Western Suffolk BOCES Printer & Toner Cartidges 07/01/2013 06/30/2014 Unknown reason Western Suffolk BOCES Western Suffolk BOCES Samsung Series 3 Chromebook/Google MGT License & config services 01/01/2013 12/30/2013 Unknown reason Western Suffolk BOCES Western Suffolk BOCES Professional Days for Computer Network Support LAN/WAN 07/01/2013 06/30/2014 Unknown reason UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2013 or TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-35985 CDW CORPORATION (Exact name of registrant as specified in its charter) Delaware 26-0273989 (State or other jurisdiction ofincorporation or organization)(I.R.S. EmployerIdentification No.) 200 N. Milwaukee AvenueVernon Hills, Illinois 60061 (Address of principal executive offices)(Zip Code) (847) 465-6000 (Registrant’s telephone number, including area code) None (Former name, former address and former fiscal year, if changed since last report) ____________________________________________ Securities registered pursuant to Section 12(b) of the Act: Title of each class:Name of each exchange on which registered Common stock, par value $0.01 per share NASDAQ Global Select Market Securities registered pursuant to Section 12(g) of the Act: None ____________________________________________ Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10- K. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one): Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company)Smaller reporting company Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No Table of Contents The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant as of June 28, 2013, the last business day of the registrant’s most recently completed second fiscal quarter, was $654,984,661, based on the per share closing sale price of $18.62 on that date (assuming the closing of the registrant's initial public offering). As of February 28, 2014, there were 171,954,277 shares of common stock, $0.01 par value, outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant’s definitive proxy statement for use in connection with its 2014 Annual Meeting of Shareholders, to be filed not later than 120 days after December 31, 2013, are incorporated by reference into Part III of this report. Table of Contents 2 CDW CORPORATION AND SUBSIDIARIES ANNUAL REPORT ON FORM 10-K Year Ended December 31, 2013 TABLE OF CONTENTS Item Page PART I Item 1. Item 1A. Item 1B. Item 2. Item 3. Item 4. PART II Item 5. Item 6. Item 7. Item 7A. Item 8. Item 9. Item 9A. Item 9B. PART III Item 10. Item 11. Item 12. Item 13. Item 14. PART IV Item 15. SIGNATURES Business 4 Risk Factors 9 Unresolved Staff Comments 20 Properties 20 Legal Proceedings 21 Mine Safety Disclosures 21 Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 24 Selected Financial Data 26 Management’s Discussion and Analysis of Financial Condition and Results of Operations 31 Quantitative and Qualitative Disclosures About Market Risk 60 Financial Statements and Supplementary Data 61 Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 109 Controls and Procedures 109 Other Information 111 Directors, Executive Officers and Corporate Governance 112 Executive Compensation 112 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 112 Certain Relationships and Related Transactions, and Director Independence 112 Principal Accountant Fees and Services 112 Exhibits and Financial Statement Schedules 113 114 3 FORWARD-LOOKING STATEMENTS This report contains forward-looking statements within the meaning of the federal securities laws. All statements other than statements of historical fact included in this report are forward-looking statements. These statements relate to analyses and other information, which are based on forecasts of future results and estimates of amounts not yet determinable. These statements also relate to our future prospects, developments and business strategies. We claim the protection of The Private Securities Litigation Reform Act of 1995 for all forward-looking statements in this report. These forward-looking statements are identified by the use of terms and phrases such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “will” and similar terms and phrases, including references to assumptions. However, these words are not the exclusive means of identifying such statements. Although we believe that our plans, intentions and expectations reflected in or suggested by such forward-looking statements are reasonable, we cannot assure you that we will achieve those plans, intentions or expectations. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we expected. Important factors that could cause actual results to differ materially from our expectations, or cautionary statements, are disclosed under the section entitled “Risk Factors” included elsewhere in this report. All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the cautionary statements contained in the section entitled “Risk Factors” included elsewhere in this report as well as other cautionary statements that are made from time to time in our other Securities and Exchange Commission ("SEC") filings and public communications. You should evaluate all forward-looking statements made in this report in the context of these risks and uncertainties. We caution you that the important factors referenced above may not contain all of the factors that are important to you. In addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our operations in the way we expect. The forward-looking statements included in this report are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law. Table of Contents 4 PART I Item 1. Business Our Company CDW is a Fortune 500 company and a leading provider of integrated information technology (“IT”) solutions in the U.S. and Canada. We help our customer base of approximately 250,000 small, medium and large business, government, education and healthcare customers by delivering critical solutions to their increasingly complex IT needs. Our broad array of offerings ranges from discrete hardware and software products to integrated IT solutions such as mobility, security, data center optimization, cloud computing, virtualization and collaboration. We are technology "agnostic," with a product portfolio that includes more than 100,000 products from more than 1,000 brands. We provide our products and solutions through sales force and service delivery teams consisting of more than 4,400 coworkers, including nearly 1,800 field sellers, highly-skilled technology specialists and advanced service delivery engineers. We are a leading U.S. sales channel partner for many original equipment manufacturers (“OEMs”) and software publishers (collectively, our “vendor partners”), whose products we sell or include in the solutions we offer. We believe we are an important extension of our vendor partners' sales and marketing capabilities, providing them with a cost-effective way to reach customers and deliver a consistent brand experience through our established end-market coverage and extensive customer access. We provide value to our customers by simplifying the complexities of technology across design, selection, procurement, integration and management. Our goal is to have our customers, regardless of their size, view us as an indispensable extension of their IT staffs. We seek to achieve this goal by providing our customers with superior service through our large and experienced sales force and service delivery teams. Our multi-brand offering approach enables us to identify the products or combination of products that best address each customer's specific organizational IT requirements and to evolve our offerings as new technologies develop. We believe we offer the following value proposition to our customers and our vendor partners: Our value proposition to our customers Our value proposition to our vendor partners Broad selection of products and multi-branded IT solutions Value-added services with integration capabilities Highly-skilled specialists and engineers Solutions across a very broad IT landscape Access to approximately 250,000 customers throughout the U.S. and Canada Large and established customer channels Strong distribution and implementation capabilities Value-added solutions and marketing programs that generate end-user demand Our customers include private sector businesses that typically employ fewer than 5,000 employees, government agencies and educational and healthcare institutions. We serve our customers through channel-specific sales teams and service delivery teams with extensive technical skills and knowledge of the specific markets they serve. This market segmentation allows us to customize our offerings and to provide enhanced expertise in designing and implementing IT solutions for our customers. We currently have five dedicated customer channels: medium/large business, small business, government, education and healthcare, each of which generated over $1 billion in net sales in 2013. The scale and diversity of our customer channels provide us with multiple avenues for growth and a balanced customer base to weather economic and technology cycles. Table of Contents 5 The following table provides information regarding our reportable segments and our customer channels: Corporate Segment Public Segment CustomerChannels Medium/LargeBusiness SmallBusiness Government Education Healthcare Other TargetCustomers 100 - 5,000employees 10 - 100employees Various federal,state and localagencies Highereducationand K-12 Hospitals,ambulatory serviceproviders and long-term care facilities Advanced services customers plus Canada 2013 Net Sales (in billions) $4.9 $1.1 $1.3 $1.4 $1.5 $0.6 For further information on our segments, including financial results, see Note 16 to the accompanying audited consolidated financial statements included elsewhere in this report. We offer more than 1,000 brands, from well-established companies such as APC, Apple, Cisco, EMC, Hewlett- Packard, IBM, Lenovo, Microsoft, NetApp, Symantec and VMware to emerging vendor partners such as Drobo, Fusion-io, Meraki, Nimble Storage, Salesforce.com, Sophos and Splunk. In 2013, we generated over $1 billion of revenue for each of four of our vendor partners and over $100 million of revenue for each of 11 other vendor partners. We have received the highest level of certification from major vendor partners such as Cisco, EMC and Microsoft, which reflects the extensive product and solution knowledge and capabilities that we bring to our customers' IT challenges. These certifications also provide us with access to favorable pricing, tools and resources, including vendor incentive programs, which we use to provide additional value to our customers. Our vendor partners also regularly recognize us with top awards and select us to develop and grow new customer solutions. History CDW was founded in 1984. In 2003, we purchased selected U.S. assets and the Canadian operations of Micro Warehouse, which extended our growth platform into Canada. In 2006, we acquired Berbee Information Networks Corporation, a regional provider of technology products, solutions and customized engineering services in advanced technologies primarily across Cisco, IBM and Microsoft portfolios. This acquisition increased our capabilities in customized engineering services and managed services. On October 12, 2007, CDW Corporation, an Illinois corporation, was acquired through a merger transaction by an entity controlled by investment funds affiliated with Madison Dearborn Partners, LLC and Providence Equity Partners L.L.C. (the “Acquisition”). CDW Corporation continued as the surviving corporation and same legal entity after the Acquisition, but became a wholly owned subsidiary of VH Holdings, Inc., a Delaware corporation. On December 31, 2009, CDW Corporation merged into CDWC LLC, an Illinois limited liability company owned by VH Holdings, Inc., with CDWC LLC as the surviving entity. This change had no impact on our operations or management. On December 31, 2009, CDWC LLC was renamed CDW LLC (“CDW LLC”). On August 17, 2010, VH Holdings, Inc. was renamed CDW Corporation (“Parent”), a Delaware corporation. Throughout this report, the terms “the Company” and “CDW” refer to Parent and its 100% owned subsidiaries subsequent to the Acquisition. Parent was previously owned directly by CDW Holdings LLC ("CDW Holdings"), a company controlled by investment funds affiliated with Madison Dearborn Partners, LLC and Providence Equity Partners L.L.C. (the "Sponsors"), certain other co-investors and certain members of CDW management. See "Sponsors" below. On July 2, 2013, Parent completed an initial public offering ("IPO") of its common stock. In connection with the IPO, CDW Holdings distributed all of its shares of Parent's common stock to its members in June 2013 in accordance with the members' respective membership interests and was subsequently dissolved in August 2013. See Note 9 to the accompanying audited consolidated financial statements included elsewhere in this report for additional discussion of the IPO. The Sponsors beneficially owned approximately 63.7% of our common stock as of December 31, 2013. Table of Contents 6 Our Market We operate in the U.S. and Canadian IT market, which is a large and growing market. According to IDC, the overall U.S. IT market generated approximately $660 billion in sales in 2013. We believe our addressable market in the U.S. in the indirect sales channel represents more than $200 billion in annual sales and for the year ended December 31, 2013, our U.S. net sales of $10.3 billion represented approximately 5% of that highly diverse and fragmented market. According to IDC, the overall Canadian IT market generated more than $50 billion in sales in 2013. We believe our addressable market in Canada in the indirect sales channel represents more than $10 billion in annual sales and for the year ended December 31, 2013, our net sales of $475 million in Canada represented approximately 4% of that market. We believe we have the largest market share in our addressable market, with our 2013 net sales exceeding the cumulative North American net sales of our four largest publicly traded sales channel competitors, based upon publicly available information for those companies. New technologies, including cloud, virtualization and mobility, coupled with the resulting increase in demand for data as well as aging infrastructure, are increasingly requiring businesses and institutions to seek integrated solutions to their IT needs. We expect this trend to continue for the foreseeable future, with end-user demand for business efficiency and productivity driving future IT spending growth. Our Offerings Our offerings range from discrete hardware and software products and services to complex integrated solutions that include one or more of these elements. We believe our customers increasingly view technology purchases as integrated solutions rather than discrete product and service categories and we estimate that approximately 51% of our net sales in 2013 came from sales of product categories and services typically associated with solutions. Our hardware products include notebooks/mobile devices (including tablets), network communications, enterprise and data storage, video monitors, printers, desktop computers and servers. Our software products include application suites, security, virtualization, operating systems, network management and Software as a Service (“SaaS”) offerings. We also provide a full suite of value-added-services, which range from basic installation, warranty and repair services to custom configuration, data center and network implementation services, as well as managed services that include Infrastructure as a Service (“IaaS”) offerings. We also offer a variety of integrated solutions, such as: • Mobility: We assist our customers with the selection, procurement and integration of mobile security software, hardware devices such as smartphones, tablets and notebooks, and cellular wireless activation systems. We also provide mobile device management applications with policy and security management capabilities across a variety of mobile operating systems and platforms. • Security: We assess our customers' security needs and provide them with threat prevention tools in order to protect their networks, servers and applications, such as anti-virus, anti-spam, content filtering, intrusion prevention, firewall and virtual private network services, and network access control. We also design and implement data loss prevention solutions, using data monitoring and encryption across a wide array of devices to ensure the security of customer information, personal employee information and research and development data. • Data Center Optimization: We help our customers evaluate their data centers for convergence and optimization opportunities. Our data center optimization solutions consist of server virtualization, physical server consolidation, data storage management and energy-efficient power and cooling systems. • Cloud Computing: Cloud computing is a combination of software and computing delivered on demand as a service. We provide SaaS and IaaS solutions that reside in the public cloud, meaning any person or organization interested in porting applications and resources to an external “public” cloud system can do so. Likewise, we provide similar private cloud-based solutions to our customers that prefer to avoid running their infrastructure on a shared public platform but want to obtain the flexibility, scalability and access offered by cloud computing and collaboration. • Virtualization: We design and implement server, storage and desktop virtualization solutions. Virtualization enables our customers to efficiently utilize hardware resources by running multiple, independent, virtual operating systems on a single computer and multiple virtual servers simultaneously on a single server. Virtualization also can separate a desktop environment and associated application software from the hardware device that is used to access it, and provides employees with remote desktop access. Our specialists assist customers with the steps of implementing virtualization solutions, including evaluating network environments, deploying shared storage options and licensing platform software. • Collaboration: We provide our customers with communication tools that allow employees to share knowledge, ideas and information among each other and with clients and partners effectively and quickly. Our collaboration solutions unite communications and applications via the integration of products that facilitate the use of Table of Contents 7 multiple enterprise communication methods including email, instant messaging, presence, social media, voice, video, hardware, software and services. We also host cloud-based collaboration solutions. While we believe customers increasingly view technology purchases as solutions rather than discrete product and service categories, the following table shows our net sales by major category, based upon our internal category classifications. Year Ended December 31, 2013 Year Ended December 31, 2012(1)Year Ended December 31, 2011(1) Dollars inMillions Percentageof Total Net Sales Dollars inMillions Percentageof Total Net Sales Dollars inMillions Percentageof Total Net Sales Notebooks/Mobile Devices $1,706.0 15.8%$1,470.1 14.5%$1,336.9 13.9% NetComm Products 1,489.1 13.8 1,351.1 13.3 1,237.7 12.9 Enterprise and Data Storage(Including Drives)998.1 9.3 979.4 9.7 929.9 9.7 Other Hardware 4,173.3 38.8 4,068.8 40.2 3,988.3 41.5 Software 1,994.7 18.5 1,849.4 18.3 1,767.2 18.4 Services 327.1 3.0 284.6 2.8 254.3 2.6 Other (2)80.3 0.8 124.8 1.2 88.1 1.0 Total net sales $10,768.6 100.0%$10,128.2 100.0%$9,602.4 100.0% (1) Amounts have been reclassified for changes in individual product classifications to conform to the presentation for the year ended December 31, 2013. (2) Includes items such as delivery charges to customers and certain commission revenue. Our Customers We provide integrated IT solutions to approximately 250,000 small, medium and large business, government, education and healthcare customers throughout the U.S. and Canada. Sales to the U.S. federal government, which are diversified across multiple agencies and departments, collectively accounted for approximately 7%, 10% and 10% of total net sales in 2013, 2012 and 2011, respectively. However, there are several independent purchasing decision-makers across these agencies and departments. Excluding these sales to the federal government, we are not reliant on any one customer, as our next five largest customers cumulatively comprised approximately 3% of our net sales in 2013. Inventory Management We utilize our IT systems to manage our inventory in a cost-efficient manner, resulting in a rapid-turn inventory model. We generally only stock items that have attained a minimum sales volume. Our distribution process is highly automated. Once a customer order is received and credit approved, orders are automatically routed to one of our distribution centers for picking and shipping as well as configuration and imaging services. We operate two distribution centers: an approximately 450,000 square foot facility in Vernon Hills, Illinois, and an approximately 513,000 square foot facility in North Las Vegas, Nevada. We ship almost 35 million units annually on an aggregate basis from our two distribution centers. We believe that the location of our distribution centers allows us to efficiently ship products throughout the U.S. and provide timely access to our principal distributors. In addition, in the event of weather-related or other disruptions at one of our distribution centers, we are able to shift order processing and fulfillment from one center to the other quickly and efficiently, enabling us to continue to ship products in a timely manner. We believe that competitive sources of supply are available in substantially all of the product categories we offer. We continue to improve the productivity of our distribution centers as measured by key performance indicators such as units shipped per hour worked and bin accuracy. We also have drop-shipment arrangements with many of our OEMs and wholesale distributors, which permit us to offer products to our customers without having to take physical delivery at either of our distribution centers. These arrangements generally represent approximately 40% to 50% of total net sales, including approximately 10% to 15% related to electronic delivery for software licenses. Information Technology Systems We maintain customized IT and unified communication systems that enhance our ability to provide prompt, efficient and expert service to our customers. In addition, these systems enable centralized management of key functions, including Table of Contents 8 purchasing, inventory management, billing and collection of accounts receivable, sales and distribution. Our systems provide us with thorough, detailed and real-time information regarding key aspects of our business. This capability helps us to continuously enhance productivity, ship customer orders quickly and efficiently, respond appropriately to industry changes and provide high levels of customer service. We believe that our websites, which provide electronic order processing and advanced tools, such as order tracking, reporting and asset management, make it easy for customers to transact business with us and ultimately strengthen our customer relationships. Product Procurement We may purchase all or only some of the products that our vendor partners offer for resale to our customers or for inclusion in the solutions we offer. Each vendor partner agreement provides for specific terms and conditions, which may include one or more of the following: product return privileges, price protection policies, purchase discounts and vendor incentive programs, such as purchase or sales rebates and cooperative advertising reimbursements. We also purchase software from major software publishers for resale to our customers or for inclusion in the solutions we offer. Our agreements with software publishers allow the end-user customer to acquire software or licensed products and services. In addition to purchasing products directly from our vendor partners, we purchase products from wholesale distributors for resale to our customers or for inclusion in the solutions we offer. These wholesale distributors provide logistics management and supply-chain services for us, as well as for our vendor partners. For the year ended December 31, 2013, we purchased 54% of the products we sold as discrete products or as components of a solution directly from our vendor partners and the remaining 46% from wholesale distributors. Purchases from wholesale distributors Tech Data, SYNNEX and Ingram Micro represented 11%, 9% and 9%, respectively, of our total purchases. Sales of products manufactured by Apple, Cisco, EMC, Hewlett-Packard, Lenovo and Microsoft, whether purchased directly from these vendor partners or from a wholesale distributor, represented in the aggregate 56% of our net sales in 2013. Sales of products manufactured by Hewlett-Packard and Cisco represented 20% and 14%, respectively, of our 2013 net sales. Competition The market for technology products and services is highly competitive. Competition is based on the ability to tailor specific solutions to customer needs, quality and breadth of product and service offerings, knowledge and expertise of sales force, customer service, price, product availability, speed of delivery and credit availability. Our competition includes: • resellers such as Dimension Data, ePlus, Insight Enterprises, PC Connection, PCM, Presidio, Softchoice, World Wide Technology and many smaller resellers; • manufacturers who sell directly to customers, such as Dell, Hewlett-Packard and Apple; • large service providers and system integrators, such as IBM, Accenture, Hewlett-Packard and Dell; • e-tailers such as Amazon, Newegg, and TigerDirect.com; • cloud providers such as AT&T, Amazon Web Services and Box; and • retailers (including their e-commerce activities) such as Staples and Office Depot. We expect the competitive landscape in which we compete to continue to change as new technologies are developed. While innovation can help our business as it creates new offerings for us to sell, it can also disrupt our business model and create new and stronger competitors. For a discussion of the risks associated with competition, see “Risk Factors” included elsewhere in this report. Table of Contents 9 Marketing We market the CDW brand to both national and local audiences using a variety of channels that include online, broadcast, print, social and other media. This promotion is supported by integrated communication efforts that target decision- makers, influencers and the general public using a combination of news releases, case studies, media interviews and speaking opportunities. We also market to current and prospective customers through integrated marketing programs that include behaviorally targeted email, print, online media, events and sponsorships, as well as broadcast media. As a result of our relationships with our vendor partners, a significant portion of our advertising and marketing expenses are reimbursed through cooperative advertising reimbursement programs. These programs are at the discretion of our vendor partners and are typically tied to sales or purchasing volumes or other commitments to be met by us within a specified period of time. We believe that our national scale and analytical techniques that measure the efficacy of our marketing programs differentiate us from our competitors. Coworkers As of December 31, 2013, we employed nearly 7,000 coworkers, none of whom is covered by collective bargaining agreements. We consider our coworker relations to be good. Intellectual Property The CDW trademark and certain variations thereon are registered or subject to pending trademark applications in the U.S., Canada and certain other jurisdictions. We believe our trademarks have significant value and are important factors in our marketing programs. In addition, we own registrations for domain names, including cdw.com and cdwg.com, for certain of our primary trademarks. We also have unregistered copyrights in our website content. Sponsors Madison Dearborn Partners, LLC is a leading private equity investment firm based in Chicago, Illinois that has raised over $18 billion of equity capital. Since its formation in 1992, it has invested in approximately 125 companies across a broad spectrum of industries, including basic industries, business and government services, consumer, financial and transaction services, healthcare and telecom, media and technology services. Madison Dearborn's objective is to invest in companies in partnership with outstanding management teams to achieve significant long-term appreciation in equity value. Providence Equity Partners L.L.C. ("Providence") is a leading global private equity firm focused on media, communications, education and information investments. Providence manages funds with $39 billion of commitments and has invested in more than 130 companies over its 25-year history. Providence is headquartered in Providence, Rhode Island and has offices in New York, London, Hong Kong, Beijing and New Delhi. Providence's objective is to build extraordinary companies that will shape the future of the media, communications, education and information industries. Item 1A. Risk Factors There are many factors that affect our business and the results of operations, some of which are beyond our control. The following is a description of some important factors that may cause the actual results of operations in future periods to differ materially from those currently expected or desired. Risks Related to Our Business General economic conditions could negatively affect technology spending by our customers and put downward pressure on prices, which may have an adverse impact on our business, results of operations or cash flows. Weak economic conditions generally, sustained uncertainty about global economic conditions, U.S. federal government spending cuts and the impact of new government programs, or a tightening of credit markets could cause our customers and potential customers to postpone or reduce spending on technology products or services or put downward pressure on prices, which could have an adverse effect on our business, results of operations or cash flows. Table of Contents 10 Our financial performance could be adversely affected by decreases in spending on technology products and services by our Public segment customers. Our sales to our Public segment customers are impacted by government spending policies, budget priorities and revenue levels. Although our sales to the federal government are diversified across multiple agencies and departments, they collectively accounted for approximately 7% of 2013 net sales. An adverse change in government spending policies (including ongoing budget cuts at the federal level), budget priorities or revenue levels could cause our Public segment customers to reduce their purchases or to terminate or not renew their contracts with us, which could adversely affect our business, results of operations or cash flows. For example, in 2013, as a result of sequestration and related budget uncertainty and the partial shutdown of the federal government for 16 days, we experienced significantly reduced Federal sales in our Public segment. Our business depends on our vendor partner relationships and the availability of their products. We purchase products for resale from vendor partners, which include OEMs and software publishers, and wholesale distributors. For the year ended December 31, 2013, we purchased approximately 54% of the products we sold directly from vendor partners and the remaining amount from wholesale distributors. We are authorized by vendor partners to sell all or some of their products via direct marketing activities. Our authorization with each vendor partner is subject to specific terms and conditions regarding such things as sales channel restrictions, product return privileges, price protection policies, purchase discounts and vendor partner programs and funding, including purchase rebates, sales volume rebates, purchasing incentives and cooperative advertising reimbursements. However, we do not have any long-term contracts with our vendor partners and many of these arrangements are terminable upon notice by either party. A reduction in vendor partner programs or funding or our failure to timely react to changes in vendor partner programs or funding could have an adverse effect on our business, results of operations or cash flows. In addition, a reduction in the amount of credit granted to us by our vendor partners could increase our need for, and the cost of, working capital and could have an adverse effect on our business, results of operations or cash flows, particularly given our substantial indebtedness. From time to time, vendor partners may terminate or limit our right to sell some or all of their products or change the terms and conditions or reduce or discontinue the incentives that they offer us. For example, there is no assurance that, as our vendor partners continue to sell directly to end users and through resellers, they will not limit or curtail the availability of their products to solutions providers like us. Any such termination or limitation or the implementation of such changes could have a negative impact on our business, results of operations or cash flows. Although we purchase from a diverse vendor base, in 2013, products we purchased from distributors Tech Data, SYNNEX and Ingram Micro represented 11%, 9% and 9%, respectively, of our total purchases. In addition, sales of Apple, Cisco, EMC, Hewlett-Packard, Lenovo and Microsoft products comprise a substantial portion of our sales, representing approximately 56% of net sales in 2013. Sales of products manufactured by Hewlett-Packard and Cisco represented approximately 20% and 14%, respectively, of our 2013 net sales. The loss of, or change in business relationship with, any of these or any other key vendor partners, the diminished availability of their products, or backlogs for their products leading to manufacturer allocation, could reduce the supply and increase the cost of products we sell and negatively impact our competitive position. Additionally, the relocation of key distributors utilized in our purchasing model could increase our need for, and the cost of, working capital and have an adverse effect on our business, results of operations or cash flows. Further, the sale, spin- off or combination of any of our vendor partners and/or certain of their business units, including any such sale to or combination with a vendor with whom we do not currently have a commercial relationship or whose products we do not sell, could have an adverse impact on our business, results of operations or cash flows. Our sales are dependent on continued innovations in hardware, software and services offerings by our vendor partners and the competitiveness of their offerings, and our ability to partner with new and emerging technology providers. The technology industry is characterized by rapid innovation and the frequent introduction of new and enhanced hardware, software and services offerings, such as cloud-based solutions, including SaaS, IaaS and Platform as a Service ("PaaS"). We have been and will continue to be dependent on innovations in hardware, software and services offerings, as well as the acceptance of those innovations by customers. A decrease in the rate of innovation, or the lack of acceptance of innovations by customers, could have an adverse effect on our business, results of operations or cash flows. In addition, if we are unable to keep up with changes in technology and new hardware, software and services offerings, for example by providing the appropriate training to our account managers, sales technology specialists and engineers to enable them to effectively sell and deliver such new offerings to customers, our business, results of operations or cash flows could be adversely affected. Table of Contents 11 We also are dependent upon our vendor partners for the development and marketing of hardware, software and services to compete effectively with hardware, software and services of vendors whose products and services we do not currently offer or that we are not authorized to offer in one or more customer channels. In addition, our success is dependent on our ability to develop relationships with and sell hardware, software and services from new emerging vendors and vendors that we have not historically represented in the marketplace. To the extent that a vendor's offering that is highly in demand is not available to us for resale in one or more customer channels, and there is not a competitive offering from another vendor that we are authorized to sell in such customer channels, or we are unable to develop relationships with new technology providers or companies that we have not historically represented, our business, results of operations or cash flows could be adversely impacted. Substantial competition could reduce our market share and significantly harm our financial performance. Our current competition includes: • resellers, such as Dimension Data, ePlus, Insight Enterprises, PC Connection, PCM, Presidio, Softchoice, World Wide Technology and many smaller resellers; • manufacturers who sell directly to customers, such as Dell, Hewlett-Packard and Apple; • large service providers and system integrators, such as IBM, Accenture, Hewlett-Packard and Dell; • e-tailers, such as Amazon, Newegg and TigerDirect.com; • cloud providers, such as AT&T, Amazon Web Services and Box; and • retailers (including their e-commerce activities), such as Staples and Office Depot. We expect the competitive landscape in which we compete to continue to change as new technologies are developed. While innovation can help our business as it creates new offerings for us to sell, it can also disrupt our business model and create new and stronger competitors. For instance, technologies that deliver technology solutions as a service, such as cloud- based solutions, could increase the amount of sales directly to customers rather than through solutions providers like us, or could lead to a reduction in our profitability. In addition, some of our hardware and software vendor partners sell, and could intensify their efforts to sell, their products directly to our customers. Moreover, traditional OEMs have increased their services capabilities through mergers and acquisitions with service providers, which could potentially increase competition in the market to provide comprehensive technology solutions to customers. If any of these trends becomes more prevalent, it could adversely affect our business, results of operations or cash flows. We focus on offering a high level of service to gain new customers and retain existing customers. To the extent we face increased competition to gain and retain customers, we may be required to reduce prices, increase advertising expenditures or take other actions which could adversely affect our business, results of operations or cash flows. Additionally, some of our competitors may reduce their prices in an attempt to stimulate sales, which may require us to reduce prices. This would require us to sell a greater number of products to achieve the same level of net sales and gross profit. If such a reduction in prices occurs and we are unable to attract new customers and sell increased quantities of products, our sales growth and profitability could be adversely affected. The success of our business depends on the continuing development, maintenance and operation of our information technology systems. Our success is dependent on the accuracy, proper utilization and continuing development of our information technology systems, including our business systems, such as our sales, customer management, financial and accounting, marketing, purchasing, warehouse management, e-commerce and mobile systems, as well as our operational platforms, including voice and data networks and power systems. The quality and our utilization of the information generated by our information technology systems, and our success in implementing new systems and upgrades, affects, among other things, our ability to: • conduct business with our customers, including delivering services and solutions to them; • manage our inventory and accounts receivable; • purchase, sell, ship and invoice our hardware and software products and provide and invoice our services efficiently and on a timely basis; and Table of Contents 12 • maintain our cost-efficient operating model while scaling our business. The integrity of our information technology systems is vulnerable to disruption due to forces beyond our control. While we have taken steps to protect our information technology systems from a variety of threats, including computer viruses, malware, phishing, social engineering, unauthorized access and other malicious attacks, both internal and external, and human error, there can be no guarantee that those steps will be effective. Furthermore, although we have redundant systems at a separate location to back up our primary systems, there can be no assurance that these redundant systems will operate properly if and when required. Any disruption to or infiltration of our information technology systems could significantly harm our business and results of operations. Breaches of data security could adversely impact our business. Our business involves the storage and transmission of proprietary information and sensitive or confidential data, including personal information of coworkers, customers and others. In addition, we operate data centers for our customers which host their technology infrastructure and may store and transmit both business-critical data and confidential information. In connection with our services business, our coworkers also have access to our customers' confidential data and other information. We have privacy and data security policies in place that are designed to prevent security breaches; however, as newer technologies evolve, we could be exposed to increased risk of breaches in security. Breaches in security could expose us, our customers or other individuals to a risk of public disclosure, loss or misuse of this information, resulting in legal claims or proceedings, liability or regulatory penalties under laws protecting the privacy of personal information, as well as the loss of existing or potential customers and damage to our brand and reputation. In addition, the cost and operational consequences of implementing further data protection measures could be significant. Such breaches, costs and consequences could adversely affect our business, results of operations or cash flows. The failure to comply with our Public segment contracts or applicable laws and regulations could result in, among other things, termination, fines or other liabilities, and changes in procurement regulations could adversely impact our business, results of operations or cash flows. Revenues from our Public segment customers are derived from sales to governmental departments and agencies, educational institutions and healthcare customers, through various contracts and open market sales of products and services. Sales to Public segment customers are highly regulated. Noncompliance with contract provisions, government procurement regulations or other applicable laws or regulations (including but not limited to the False Claims Act and the Medicare and Medicaid Anti-Kickback Statute) could result in civil, criminal and administrative liability, including substantial monetary fines or damages, termination of government contracts or other Public segment customer contracts, and suspension, debarment or ineligibility from doing business with the government and other customers in the Public segment. In addition, generally contracts in the Public segment are terminable at any time for convenience of the contracting agency or group purchasing organization (“GPO”) or upon default. Furthermore, our inability to enter into or retain contracts with GPOs may threaten our ability to sell to customers in those GPOs and compete. The effect of any of these possible actions could adversely affect our business, results of operations or cash flows. In addition, the adoption of new or modified procurement regulations and other requirements may increase our compliance costs and reduce our gross margins, which could have a negative effect on our business, results of operations or cash flows. If we fail to provide high-quality services to our customers, or if our third-party service providers fail to provide high-quality services to our customers, our reputation, business, results of operations or cash flows could be adversely affected. Our service offerings include field services, managed services, warranties, configuration services, partner services and telecom services. Additionally, we deliver and manage mission critical software, systems and network solutions for our customers. We also offer certain services, such as implementation and installation services and repair services, to our customers through various third-party service providers engaged to perform these services on our behalf. If we or our third-party service providers fail to provide high quality services to our customers or such services result in a disruption of our customers' businesses, this could, among other things, result in legal claims and proceedings and liability. Moreover, as we expand our services and solutions business, we may be exposed to additional operational, regulatory and other risks. We also could incur liability for failure to comply with the rules and regulations applicable to the new services and solutions we provide to our customers. If any of the foregoing were to occur, our reputation with our customers, our brand and our business, results of operations or cash flows could be adversely affected. If we lose any of our key personnel, or are unable to attract and retain the talent required for our business, our business could be disrupted and our financial performance could suffer. Our success is heavily dependent upon our ability to attract, develop, engage and retain key personnel to manage and grow our business, including our key executive, management, sales, services and technical coworkers. Table of Contents 13 Our future success will depend to a significant extent on the efforts of Thomas E. Richards, our Chairman and Chief Executive Officer, as well as the continued service and support of our other executive officers. Our future success also will depend on our ability to retain our customer-facing coworkers, who have been given critical CDW knowledge regarding, and the opportunity to develop strong relationships with, many of our customers. In addition, as we seek to expand our offerings of value-added services and solutions, our success will even more heavily depend on attracting and retaining highly skilled technology specialists and engineers, for whom the market is extremely competitive. Our inability to attract, develop and retain key personnel could have an adverse effect on our relationships with our vendor partners and customers and adversely affect our ability to expand our offerings of value-added services and solutions. Moreover, our inability to train our sales, services and technical personnel effectively to meet the rapidly changing technology needs of our customers could cause a decrease in the overall quality and efficiency of such personnel. Such consequences could adversely affect our business, results of operations or cash flows. The interruption of the flow of products from suppliers could disrupt our supply chain. A significant portion of the products we sell are manufactured or purchased by our vendor partners outside of the U.S., primarily in Asia. Political, social or economic instability in Asia, or in other regions in which our vendor partners purchase or manufacture the products we sell, could cause disruptions in trade, including exports to the U.S. Other events that could also cause disruptions to our supply chain include: • the imposition of additional trade law provisions or regulations; • the imposition of additional duties, tariffs and other charges on imports and exports; • foreign currency fluctuations; • natural disasters or other adverse occurrences at, or affecting, any of our suppliers' facilities; • restrictions on the transfer of funds; • the financial instability or bankruptcy of manufacturers; and • significant labor disputes, such as strikes. We cannot predict whether the countries in which the products we sell are purchased or manufactured, or may be purchased or manufactured in the future, will be subject to new or additional trade restrictions or sanctions imposed by the U.S. or foreign governments, including the likelihood, type or effect of any such restrictions. Trade restrictions, including new or increased tariffs or quotas, embargoes, sanctions, safeguards and customs restrictions against the products we sell, as well as foreign labor strikes and work stoppages or boycotts, could increase the cost or reduce the supply of product available to us and adversely affect our business, results of operations or cash flows. A natural disaster or other adverse occurrence at one of our primary facilities or customer data centers could damage our business. Substantially all of our corporate, warehouse and distribution functions are located at our Vernon Hills, Illinois facilities and our second distribution center in North Las Vegas, Nevada. If the warehouse and distribution equipment at one of our distribution centers were to be seriously damaged by a natural disaster or other adverse occurrence, we could utilize the other distribution center or third-party distributors to ship products to our customers. However, this may not be sufficient to avoid interruptions in our service and may not enable us to meet all of the needs of our customers and would cause us to incur incremental operating costs. In addition, we operate three customer data centers and numerous sales offices which may contain both business-critical data and confidential information of our customers. A natural disaster or other adverse occurrence at any of the customer data centers or at any of our major sales offices could negatively impact our business, results of operations or cash flows. We are heavily dependent on commercial delivery services. We generally ship hardware products to our customers by FedEx, United Parcel Service and other commercial delivery services and invoice customers for delivery charges. If we are unable to pass on to our customers future increases in the cost of commercial delivery services, our profitability could be adversely affected. Additionally, strikes, inclement weather, natural disasters or other service interruptions by such shippers could adversely affect our ability to deliver products on a timely basis. Table of Contents 14 We are exposed to accounts receivable and inventory risks. We extend credit to our customers for a significant portion of our net sales, typically on 30-day payment terms. We are subject to the risk that our customers may not pay for the products they have purchased, or may pay at a slower rate than we have historically experienced, the risk of which is heightened during periods of economic downturn or uncertainty or, in the case of Public segment customers, during periods of budget constraints. We are also exposed to inventory risks as a result of the rapid technological changes that affect the market and pricing for the products we sell. We seek to minimize our inventory exposure through a variety of inventory management procedures and policies, including our rapid-turn inventory model, as well as vendor price protection and product return programs. However, if we were unable to maintain our rapid-turn inventory model, if there were unforeseen product developments that created more rapid obsolescence or if our vendor partners were to change their terms and conditions, our inventory risks could increase. We also from time to time take advantage of cost savings associated with certain opportunistic bulk inventory purchases offered by our vendor partners or we may decide to carry high inventory levels of certain products that have limited or no return privileges due to customer demand or request. These bulk purchases could increase our exposure to inventory obsolescence. We could be exposed to additional risks if we make acquisitions or enter into alliances. We may pursue transactions, including acquisitions or alliances, in an effort to extend or complement our existing business. These types of transactions involve numerous business risks, including finding suitable transaction partners and negotiating terms that are acceptable to us, the diversion of management's attention from other business concerns, extending our product or service offerings into areas in which we have limited experience, entering into new geographic markets, the potential loss of key coworkers or business relationships and successfully integrating acquired businesses, any of which could adversely affect our operations. In addition, our financial results could be adversely affected by financial adjustments required by accounting principles generally accepted in the United States of America (“GAAP”) in connection with these types of transactions where significant goodwill or intangible assets are recorded. To the extent the value of goodwill or identifiable intangible assets with indefinite lives becomes impaired, we may be required to incur material charges relating to the impairment of those assets. Our future operating results may fluctuate significantly. We may experience significant variations in our future quarterly results of operations. These fluctuations may cause the market price of our common stock to be volatile and may result from many factors, including the condition of the technology industry in general, shifts in demand and pricing for hardware, software and services and the introduction of new products or upgrades. Our operating results are also highly dependent on our level of gross profit as a percentage of net sales. Our gross profit percentage fluctuates due to numerous factors, some of which may be outside of our control, including general macroeconomic conditions; pricing pressures; changes in product costs from our vendor partners; the availability of price protection, purchase discounts and incentive programs from our vendor partners; changes in product, order size and customer mix; the risk of some items in our inventory becoming obsolete; increases in delivery costs that we cannot pass on to customers; and general market and competitive conditions. In addition, our cost structure is based, in part, on anticipated sales and gross margins. Therefore, we may not be able to adjust our cost structure quickly enough to compensate for any unexpected sales or gross margin shortfall, and any such inability could have an adverse effect on our business, results of operations or cash flows. We are exposed to risks from legal proceedings and audits. We are party to various legal proceedings that arise in the ordinary course of our business, which include commercial, employment, tort and other litigation. We are subject to intellectual property infringement claims against us in the ordinary course of our business, either because of the products and services we sell or the business systems and processes we use to sell such products and services, in the form of cease-and-desist letters, licensing inquiries, lawsuits and other communications and demands. In our industry, such intellectual property claims have become more frequent as the complexity of technological products and the intensity of competition in our industry have increased. Increasingly, many of these assertions are brought by non-practicing entities whose principal business model is to secure patent licensing revenue, but we may also be subject to suits from inventors, competitors or other patent holders who may seek licensing revenue, lost profits and/or an injunction preventing us from engaging in certain activities, including selling certain products and services. Table of Contents 15 Because of our significant sales to governmental entities, we also are subject to audits by federal, state and local authorities. We also are subject to audits by various vendor partners and large customers, including government agencies, relating to purchases and sales under various contracts. In addition, we are subject to indemnification claims under various contracts. Current and future litigation, infringement claims, governmental proceedings, audits or indemnification claims that we face may result in substantial costs and expenses and significantly divert the attention of our management regardless of the outcome. In addition, current and future litigation, infringement claims, governmental proceedings, audits or indemnification claims could lead to increased costs or interruptions of our normal business operations. Litigation, infringement claims, governmental proceedings, audits or indemnification claims involve uncertainties and the eventual outcome of any litigation, infringement claim, governmental proceeding, audit or indemnification claim could adversely affect our business, results of operations or cash flows. We have significant deferred cancellation of debt income. As a result of a 2009 debt modification, we realized $395.5 million of cancellation of debt income (“CODI”). We made an election under Code Section 108(i) to defer this CODI from taxable income, pursuant to which we are also required to defer certain original issue discount (“OID”) deductions as they accrue. As of December 31, 2013, we had already deferred approximately $114.5 million of OID deductions. Starting in 2014, we will be required to include the deferred CODI into taxable income ratably over a five-year period ending in 2018. During this same period, we will also be permitted to benefit from our deferred OID deductions. Because we have more CODI than the aggregate of our deferred and unaccrued OID on the relevant remaining debt instruments, we will have a future cash tax liability associated with our significant deferred CODI. We have reflected the associated cash tax liability in our deferred taxes for financial accounting purposes. All of our deferred CODI will be accelerated into current taxable income if, prior to 2018, we engage in a so-called “impairment transaction” and the gross value of our assets immediately afterward is less than 110% of the sum of our total liabilities and the tax on the net amount of our deferred CODI and OID (the “110% test”) as determined under the applicable Treasury Regulations. An “impairment transaction” is any transaction that impairs our ability to pay the tax on our deferred CODI, and includes dividends or distributions with respect to our equity and charitable contributions, in each case in a manner that is not consistent with our historical practice within the meaning of the applicable Treasury Regulations. Prior to 2018, our willingness to pay dividends or make distributions with respect to our equity could be adversely affected if, at the time, we do not meet the 110% test and, as a result, the payment of a dividend or the making of a distribution would accelerate the tax payable with respect to our deferred CODI. We believe that, based on our interpretation of applicable Treasury Regulations, the gross value of our assets exceeds 110% of the sum of our total liabilities and the tax on the net amount of our deferred CODI and OID as of the filing date of this Annual Report on Form 10-K. However, we cannot assure you that this will continue to be true in the future. Risks Related to Our Indebtedness We have a substantial amount of indebtedness, which could have important consequences to our business. We have a substantial amount of indebtedness. As of December 31, 2013, we had $3.3 billion of total long-term debt outstanding, as defined by GAAP, and $256.6 million of obligations outstanding under our inventory financing agreements, and the ability to borrow an additional $641.1 million under our senior secured asset-based revolving credit facility (the “Revolving Loan”). Our substantial indebtedness could have important consequences, including the following: • making it more difficult for us to satisfy our obligations with respect to our indebtedness; • requiring us to dedicate a substantial portion of our cash flow from operations to debt service payments on our and our subsidiaries' debt, which reduces the funds available for working capital, capital expenditures, acquisitions and other general corporate purposes; • requiring us to comply with restrictive covenants in our senior credit facilities and indentures, which limit the manner in which we conduct our business; • making it more difficult for us to obtain vendor financing from our vendor partners; • limiting our flexibility in planning for, or reacting to, changes in the industry in which we operate; • placing us at a competitive disadvantage compared to any of our less-leveraged competitors; Table of Contents 16 • increasing our vulnerability to both general and industry-specific adverse economic conditions; and • limiting our ability to obtain additional debt or equity financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements and increasing our cost of borrowing. Restrictive covenants under our senior credit facilities and indentures may adversely affect our operations and liquidity. Our senior credit facilities and our indentures contain, and any future indebtedness of ours may contain, various covenants that limit our ability to, among other things: • incur or guarantee additional debt; • pay dividends or make distributions to holders of our capital stock or to make certain other restricted payments or investments; • repurchase or redeem capital stock; • make loans, capital expenditures or investments or acquisitions; • receive dividends or other payments from our subsidiaries; • enter into transactions with affiliates; • create liens; • merge or consolidate with other companies or transfer all or substantially all of our assets; • transfer or sell assets, including capital stock of subsidiaries; and • prepay, repurchase or redeem debt. As a result of these covenants, we are limited in the manner in which we conduct our business and we may be unable to engage in favorable business activities or finance future operations or capital needs. A breach of any of these covenants or any of the other restrictive covenants would result in a default under our senior credit facilities. Upon the occurrence of an event of default under our senior credit facilities, the lenders: • will not be required to lend any additional amounts to us; • could elect to declare all borrowings outstanding thereunder, together with accrued and unpaid interest and fees, to be due and payable; • could require us to apply all of our available cash to repay these borrowings; or • could prevent us from making payments on our senior subordinated notes due 2017; • any of which could result in an event of default under the indentures. If we were unable to repay those amounts, the lenders under our senior credit facilities could proceed against the collateral granted to them to secure our borrowings thereunder. We have pledged a significant portion of our assets as collateral under our senior credit facilities and our senior secured notes due 2018. If the lenders under our senior credit facilities or the holders of our senior secured notes due 2018 accelerate the repayment of borrowings, we cannot assure you that we will have sufficient assets to repay our senior credit facilities and our other indebtedness or the ability to borrow sufficient funds to refinance such indebtedness. Even if we were able to obtain new financing, it may not be on commercially reasonable terms, or terms that are acceptable to us. In addition, under our Revolving Loan, we are permitted to borrow an aggregate amount of up to $900 million; however, our ability to borrow under our Revolving Loan is limited by a borrowing base and a liquidity condition. The borrowing base at any time equals the sum of up to 85% of CDW LLC and its subsidiary guarantors’ eligible accounts receivable (net of accounts reserves) (up to 30% of such eligible accounts receivable which can consist of federal government accounts receivable) plus the lesser of (i) 70% of CDW LLC and its subsidiary guarantors’ eligible inventory (valued at cost and net of inventory reserves) and (ii) the product of 85% multiplied by the net orderly liquidation value percentage multiplied by eligible inventory (valued at cost and net of inventory reserves), less reserves (other than accounts reserves and inventory reserves). The borrowing base in effect as of December 31, 2013 was $1,065.5 million. Table of Contents 17 Our ability to borrow under our Revolving Loan is also limited by a minimum liquidity condition, which provides that, if excess cash availability is less than the lesser of (i) $90 million or (ii) the greater of (A) 10% of the borrowing base or (B) $60 million, the lenders are not required to lend any additional amounts under our Revolving Loan unless the consolidated fixed charge coverage ratio (as defined in the credit agreement for our Revolving Loan) is at least 1.0 to 1.0. Moreover, our Revolving Loan provides discretion to the agent bank acting on behalf of the lenders to impose additional availability reserves, which could materially impair the amount of borrowings that would otherwise be available to us. We cannot assure you that the agent bank will not impose such reserves or, were it to do so, that the resulting impact of this action would not materially and adversely impair our liquidity. We will be required to generate sufficient cash to service our indebtedness and, if not successful, we may be forced to take other actions to satisfy our obligations under our indebtedness. Our ability to make scheduled payments on or to refinance our debt obligations depends on our financial and operating performance, which is subject to prevailing economic and competitive conditions and to certain financial, business and other factors beyond our control. Our outstanding long-term debt will impose significant cash interest payment obligations on us in 2014 and subsequent years and, accordingly, we will have to generate significant cash flow from operating activities to fund our debt service obligations. We cannot assure you that we will maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Liquidity and Capital Resources” included elsewhere in this report. If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay capital expenditures, sell assets or operations, seek additional debt or equity capital, restructure or refinance our indebtedness, or revise or delay our strategic plan. We cannot assure you that we would be able to take any of these actions, that these actions would be successful and permit us to meet our scheduled debt service obligations or satisfy our capital requirements, or that these actions would be permitted under the terms of our existing or future debt agreements, including our senior credit facilities and indentures. In the absence of such operating results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations. Our senior credit facilities and indentures restrict our ability to dispose of assets and use the proceeds from the disposition. We may not be able to consummate those dispositions or to obtain the proceeds which we could realize from them and these proceeds may not be adequate to meet any debt service obligations then due. Furthermore, the Sponsors have no obligation to provide us with debt or equity financing. If we cannot make scheduled payments on our debt, we will be in default and, as a result: • our debt holders could declare all outstanding principal and interest to be due and payable; • the lenders under our senior credit facilities could foreclose against the assets securing the borrowings from them and the lenders under our term loan facility could terminate their commitments to lend us money; and • we could be forced into bankruptcy or liquidation. Despite our indebtedness levels, we and our subsidiaries may be able to incur substantially more debt, including secured debt. This could further increase the risks associated with our leverage. We and our subsidiaries may be able to incur substantial additional indebtedness in the future. The terms of our senior credit facilities and indentures do not fully prohibit us or our subsidiaries from doing so. To the extent that we incur additional indebtedness or such other obligations, the risks associated with our substantial indebtedness described above, including our possible inability to service our debt, will increase. As of December 31, 2013, we had approximately $641.1 million available for additional borrowing under our Revolving Loan after taking into account borrowing base limitations (net of $2.2 million of issued and undrawn letters of credit and $256.7 million of reserves related to our floorplan sub-facility). Variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly. Certain of our borrowings, primarily borrowings under our senior credit facilities, are at variable rates of interest and expose us to interest rate risk. As of December 31, 2013, we had $1,528.9 million of variable rate debt outstanding. If interest rates increase, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income would decrease. Although we have entered into interest rate cap agreements on our term loan facility to reduce interest rate volatility, we cannot assure you we will be able to do so in the future on acceptable terms or that such caps or the caps we have in place now will be effective. Table of Contents 18 Risks Related to Ownership of Our Common Stock Our common stock price may be volatile and may decline regardless of our operating performance, and holders of our common stock could lose a significant portion of their investment. The market price for our common stock may be volatile. Our stockholders may not be able to resell their shares of common stock at or above the price at which they purchased such shares, due to fluctuations in the market price of our common stock, which may be caused by a number of factors, many of which we cannot control, including the risk factors described in this Annual Report on Form 10-K and the following: • changes in financial estimates by any securities analysts who follow our common stock, our failure to meet these estimates or failure of securities analysts to initiate or maintain coverage of our common stock; • downgrades by any securities analysts who follow our common stock; • future sales of our common stock by our officers, directors and significant stockholders, including the Sponsors; • market conditions or trends in our industry or the economy as a whole; • investors’ perceptions of our prospects; • announcements by us or our competitors of significant contracts, acquisitions, joint ventures or capital commitments; • changes in key personnel; and • our limited public float in light of the Sponsors’ beneficial ownership of a majority of our common stock, which may result in the trading of relatively small quantities of shares by our stockholders having a disproportionate positive or negative influence on the market price of our common stock. In addition, the stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies, including companies in our industry. In the past, securities class action litigation has followed periods of market volatility. If we were involved in securities litigation, we could incur substantial costs, and our resources and the attention of management could be diverted from our business. The Sponsors have the ability to control significant corporate activities and their interests may not align with yours. The Sponsors beneficially own approximately 63.7% of our common stock as of February 28, 2014. As a result of their ownership, the Sponsors, so long as they hold a majority of our outstanding common stock, will have the ability to control the outcome of matters submitted to a vote of stockholders and, through our board of directors, the ability to control decision- making with respect to our business direction and policies. Matters over which the Sponsors will, directly or indirectly, exercise control include: • the election of our board of directors and the appointment and removal of our officers; • mergers and other business combination transactions, including proposed transactions that would result in our stockholders receiving a premium price for their shares; • other acquisitions or dispositions of businesses or assets; • incurrence of indebtedness and the issuance of equity securities; • repurchase of stock and payment of dividends; and • the issuance of shares to management under our equity incentive plans. Even if the Sponsors’ ownership of our shares falls below a majority, they may continue to be able to strongly influence or effectively control our decisions. Under our amended and restated certificate of incorporation, the Sponsors and their affiliates do not have any obligation to present to us, and the Sponsors may separately pursue, corporate opportunities of which they become aware, even if those opportunities are ones that we would have pursued if granted the opportunity. Table of Contents 19 Future sales of our common stock, or the perception in the public markets that these sales may occur, may depress our stock price. Sales of substantial amounts of our common stock in the public market, or the perception that these sales could occur, could adversely affect the price of our common stock and could impair our ability to raise capital through the sale of additional shares. As of February 28, 2014, there were 171,954,277 shares of our common stock outstanding. The shares of our common stock sold in our initial public offering and secondary offering in 2013 are freely tradable without restriction under the Securities Act of 1933, as amended (the “Securities Act”), except that any shares of our common stock that may be acquired by our directors, executive officers and other affiliates may be sold only in compliance with certain volume limitations and other restrictions of Rule 144 of the Securities Act. The remaining shares of our common stock, to the extent not previously sold pursuant to an exemption from registration, will continue to be “restricted shares” within the meaning of Rule 144 of the Securities Act and subject to certain restrictions on resale. Restricted shares may be sold in the public market only if they are registered under the Securities Act or are sold pursuant to an exemption from registration such as Rule 144 or Rule 701 under the Securities Act. As of February 28, 2014, approximately 119,000,000 shares of our common stock will continue to have the right to require us to register the sales of their shares under the Securities Act, under the terms of an agreement between us and the holders of these securities. In the future, we may also issue our securities in connection with investments or acquisitions. The number of shares of our common stock issued in connection with an investment or acquisition could constitute a material portion of our then- outstanding shares of our common stock. Anti-takeover provisions in our charter documents and Delaware law might discourage or delay acquisition attempts for us that you might consider favorable. Our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that may make the acquisition of the Company more difficult without the approval of our board of directors. These provisions: • authorize the issuance of undesignated preferred stock, the terms of which may be established and the shares of which may be issued without stockholder approval, and which may include super voting, special approval, dividend, or other rights or preferences superior to the rights of the holders of common stock; • establish a classified board of directors so that not all members of our board of directors are elected at one time; • generally prohibit stockholder action by written consent, requiring all stockholder actions be taken at a meeting of our stockholders, except that any action required or permitted to be taken by our stockholders may be effected by written consent until such time as the Sponsors cease to beneficially own 50% or more of our common stock; • provide that special meetings of the stockholders can only be called by or at the direction of (i) our board of directors pursuant to a written resolution adopted by the affirmative vote of the majority of the total number of directors that the Company would have if there were no vacancies or (ii) until such time as the Sponsors cease to beneficially own 50% or more of our common stock (a) the chairman or vice chairman of our board of directors, (b) our chief executive officer, (c) a majority of our board of directors through a special resolution or (d) the holders of at least 10% of our common stock; • establish advance notice requirements for nominations for elections to our board of directors or for proposing matters that can be acted upon by stockholders at stockholder meetings; and • provide that our board of directors is expressly authorized to make, alter or repeal our amended and restated bylaws. Our amended and restated certificate of incorporation also contains a provision that provides us with protections similar to Section 203 of the Delaware General Corporation Law, and will prevent us from engaging in a business combination with a person who acquires at least 15% of our common stock for a period of three years from the date such person acquired such common stock, unless board or stockholder approval is obtained prior to the acquisition. These anti-takeover provisions and other provisions under Delaware law could discourage, delay or prevent a transaction involving a change in control of the Company, even if doing so would benefit our stockholders. These provisions could also discourage proxy contests and make it more difficult for our stockholders to elect directors of their choosing and to cause us to take other corporate actions our stockholders desire. Table of Contents 20 Conflicts of interest may arise because some of our directors are principals of our largest stockholders. Paul Finnegan and Robin Selati, who are principals of Madison Dearborn, and Glenn Creamer and Michael Dominguez, who are managing directors of Providence Equity, serve on our board of directors. As of February 28, 2014, the Sponsors continue to hold a majority of our outstanding common stock. The Sponsors and the entities respectively controlled by them may hold equity interests in entities that directly or indirectly compete with us, and companies in which they currently invest may begin competing with us. As a result of these relationships, when conflicts arise between the interests of Madison Dearborn or Providence Equity, on the one hand, and of other stockholders, on the other hand, these directors may not be disinterested. Although our directors and officers have a duty of loyalty to us under Delaware law and our amended and restated certificate of incorporation, transactions that we enter into in which a director or officer has a conflict of interest are generally permissible so long as (1) the material facts relating to the director’s or officer’s relationship or interest as to the transaction are disclosed to our board of directors and a majority of our disinterested directors approves the transaction, (2) the material facts relating to the director’s or officer’s relationship or interest as to the transaction are disclosed to our stockholders and a majority of our disinterested stockholders approve the transaction or (3) the transaction is otherwise fair to us. Our amended and restated certificate of incorporation also provides that any principal, officer, member, manager and/or employee of a Sponsor or any entity that controls, is controlled by or under common control with a Sponsor (other than us or any company that is controlled by us) or a Sponsor-managed investment fund will not be required to offer any transaction opportunity of which they become aware to us and could take any such opportunity for themselves or offer it to other companies in which they have an investment, unless such opportunity is offered to them solely in their capacities as our directors. We cannot assure you that we will continue to pay dividends on our common stock, and our indebtedness and certain tax considerations could limit our ability to continue to pay dividends on our common stock. If we do not continue to pay dividends, you may not receive any return on investment unless you are able to sell your common stock for a price greater than your purchase price. In each of the fourth quarter of 2013 and the first quarter of 2014, our board of directors declared a quarterly cash dividend of $0.0425 per share of common stock. We expect to continue to pay a cash dividend on our common stock of $0.0425 per share per quarter, or $0.17 per share per annum. Any determination to pay dividends in the future will be at the discretion of our board of directors and will depend upon our results of operations, financial condition, business prospects, capital requirements, contractual restrictions, including those under our senior credit facilities and indentures, any potential indebtedness we may incur, restrictions imposed by applicable law, tax considerations and other factors our board of directors deems relevant. There can be no assurance that we will continue to pay a dividend at the current rate or at all. Accordingly, if we do not pay dividends in the future, realization of a gain on your investment will depend entirely on the appreciation of the price of our common stock, which may never occur. See “-Risks Related to Our Business-We have significant deferred cancellation of debt income” for a discussion of certain tax considerations that could affect our willingness to pay dividends in the future. We are a holding company and rely on dividends, distributions and other payments, advances and transfers of funds from our subsidiaries to meet our obligations. We are a holding company that does not conduct any business operations of our own. As a result, we are largely dependent upon cash dividends and distributions and other transfers from our subsidiaries to meet our obligations. The agreements governing the indebtedness of our subsidiaries impose restrictions on our subsidiaries’ ability to pay dividends or other distributions to us. The deterioration of the earnings from, or other available assets of, our subsidiaries for any reason could also limit or impair their ability to pay dividends or other distributions to us. Item 1B. Unresolved Staff Comments None. Item 2. Properties As of December 31, 2013, we owned or leased a total of approximately 2.0 million square feet of space throughout the U.S. and Canada. We own two properties: a combined office and an approximately 450,000 square foot distribution center in Vernon Hills, Illinois, and an approximately 513,000 square foot distribution center in North Las Vegas, Nevada. In addition, we conduct sales, services and administrative activities in various leased locations throughout the U.S. and Canada, including data centers in Madison, Wisconsin and Minneapolis, Minnesota. We believe that our facilities are well maintained, suitable for our business and occupy sufficient space to meet our operating needs. As part of our normal business, we regularly evaluate sales center performance and site suitability. Leases Table of Contents 21 covering our currently occupied leased properties expire at varying dates, generally within the next ten years. We anticipate no difficulty in retaining occupancy through lease renewals, month-to-month occupancy or replacing the leased properties with equivalent properties. We believe that suitable additional or substitute leased properties will be available as required. Item 3. Legal Proceedings We are party to various legal proceedings that arise in the ordinary course of our business, which include commercial, intellectual property, employment, tort and other litigation matters. We are also subject to audit by federal, state and local authorities, and by various partners and large customers, including government agencies, relating to purchases and sales under various contracts. In addition, we are subject to indemnification claims under various contracts. From time to time, certain of our customers file voluntary petitions for reorganization or liquidation under the U.S. bankruptcy laws. In such cases, certain pre-petition payments received by us could be considered preference items and subject to return to the bankruptcy administrator. As of December 31, 2013, we do not believe that there is a reasonable possibility that any material loss exceeding the amounts already recognized for these proceedings and matters, if any, has been incurred. However, the ultimate resolutions of these proceedings and matters are inherently unpredictable. As such, our financial condition and results of operations could be adversely affected in any particular period by the unfavorable resolution of one or more of these proceedings or matters. We previously filed a claim as part of a class action settlement in a case alleging price fixing during the period of January 1, 1996 through December 31, 2006, by certain manufacturers of thin-film liquid crystal display panels. On July 13, 2013, the United Stated District Court for the Northern District of California approved distribution of the settlement proceeds, including a net payment to us of $10.4 million after fees and expenses. We have recognized a pre-tax benefit of $10.4 million within selling and administrative expenses in the consolidated statement of operations for the year ended December 31, 2013. The first of two settlement payments was received by us on July 29, 2013 in the amount of $8.5 million. The balance of $1.9 million was received in February 2014. Item 4. Mine Safety Disclosures Not applicable. Table of Contents 22 Executive Officers Name Age Position Thomas E. Richards 59 Chairman, President and Chief Executive Officer, and Director Dennis G. Berger 49 Senior Vice President and Chief Coworker Services Officer Neal J. Campbell 52 Senior Vice President and Chief Marketing Officer Christina M. Corley 46 Senior Vice President - Corporate Sales Douglas E. Eckrote 49 Senior Vice President - Strategic Solutions and Services Christine A. Leahy 49 Senior Vice President, General Counsel and Corporate Secretary Christina V. Rother 50 Senior Vice President - Public and Advanced Technology Sales Jonathan J. Stevens 44 Senior Vice President - Operations and Chief Information Officer Matthew A. Troka 43 Senior Vice President - Product and Partner Management Ann E. Ziegler 55 Senior Vice President and Chief Financial Officer Thomas E. Richards serves as our Chairman, President and Chief Executive Officer, as a member of our board of directors and as a manager of CDW LLC. From October 2011 to December 31, 2012, Mr. Richards served as our Chief Executive Officer. From September 2009 to October 2011, Mr. Richards served as our President and Chief Operating Officer. Prior to joining CDW, Mr. Richards held leadership positions with Qwest Communications, a telecommunications carrier. From 2008 to 2009, he served as Executive Vice President and Chief Operating Officer, where he was responsible for the day-to-day operation and performance of Qwest Communications, and before assuming that role, was the Executive Vice President of the Business Markets Group from 2005 to 2008. Mr. Richards also has served as Chairman and Chief Executive Officer of Clear Communications Corporation and as Executive Vice President of Ameritech Corporation. He currently serves as a board member of Junior Achievement of Chicago, Rush University Medical Center and the University of Pittsburgh. Mr. Richards is also a member of the Economic Club of Chicago and the Executives’ Club of Chicago. Mr. Richards is a graduate of the University of Pittsburgh where he earned a bachelor’s degree and a graduate of Massachusetts Institute of Technology where he earned a Master of Science in Management as a Sloan Fellow. As a result of these and other professional experiences, Mr. Richards possesses particular knowledge and experience in technology industries, strategic planning and leadership of complex organizations that strengthen the board’s collective qualifications, skills and experience. Dennis G. Berger serves as our Senior Vice President and Chief Coworker Services Officer. Mr. Berger joined CDW in September 2005 as Vice President-Coworker Services. In January 2007, he was named Senior Vice President and Chief Coworker Services Officer. Mr. Berger is responsible for leading CDW’s programs in coworker learning and development, benefits, compensation, performance management, coworker relations and talent acquisition. Prior to joining CDW, he served as Vice President of Human Resources at PepsiAmericas, a beverage company, from 2002 to 2005. Mr. Berger has also held human resources positions of increasing responsibility at Pepsi Bottling Group, Inc., Pepsico, Inc. and GTE Corporation. Mr. Berger serves on the board of directors of Glenwood Academy, Anti-Defamation League of Chicago and Skills for Chicagoland’s Future. Mr. Berger is a graduate of Northeastern University where he earned a bachelor’s degree and a graduate of John M. Olin School of Business at Washington University in St. Louis where he earned a Master of Business Administration. Neal J. Campbell serves as our Senior Vice President and Chief Marketing Officer. Mr. Campbell joined CDW in January 2011, and is responsible for the strategy and development of CDW’s advertising, public relations, channel marketing, marketing intelligence and research, merchandising, microsites, creative services and direct marketing content, along with relationship marketing, corporate communications and e-commerce initiatives including content development, online marketing and e-procurement. Prior to joining CDW, Mr. Campbell served as Chief Executive Officer of TrafficCast, a provider of real- time and predictive traffic information to Google, Yahoo and others from 2008 to 2011. From 2006 to 2008, he served as Executive Vice President and General Manager-Strategic Marketing and Next Generation Products for ISCO International, a manufacturer of wireless telecommunications components. Mr. Campbell also spent 17 years with Motorola, most recently as Vice President and General Manager, GSM Portfolio Marketing and Planning for the company’s mobile device business. He currently serves as a board member of TrafficCast and Junior Achievement of Chicago, and is on the Executive Advisory Council of Bradley University. Mr. Campbell is a graduate of Bradley University where he earned a bachelor’s degree and a graduate of Northwestern University’s Kellogg School of Management where he earned a Master of Business Administration. Christina M. Corley serves as our Senior Vice President of Corporate Sales and is responsible for managing all aspects of our corporate sales force, including sales force strategy, structure, goals, operations, revenue generation and training and development. Prior to joining CDW in September 2011, Ms. Corley served as President and Chief Operating Officer of Zones, Inc., a provider of IT products and solutions, from 2006 to 2011. She served as Executive Vice President of Purchasing Table of Contents 23 and Operations for Zones, Inc. from April 2005 to October 2006. She served as President of Corporate PC Source (“CPCS”), a wholly owned subsidiary of Zones, Inc., from March 2003 to April 2005. Prior to its acquisition by Zones, Inc., Ms. Corley served as Chief Executive Officer of CPCS from 1999 to 2003. Ms. Corley began her career in sales and marketing, holding various positions at IBM, Dataflex and VisionTek. She currently serves as a board member of the Boys and Girls Club of Chicago. Ms. Corley is a graduate of the University of Illinois at Urbana-Champaign where she earned a bachelor’s degree and a graduate of Northwestern University’s Kellogg School of Management where she earned a Master of Business Administration in management and strategy. Douglas E. Eckrote serves as our Senior Vice President of Strategic Solutions and Services and is responsible for our technology specialist teams focusing on servers and storage, unified communications, security, wireless, power and cooling, networking, software licensing and mobility solutions. He also holds responsibility for CDW Canada, Inc. Mr. Eckrote joined CDW in 1989 as an account manager. Mr. Eckrote was appointed Director of Operations in 1996, Vice President of Operations in 1999 and Senior Vice President of Purchasing in April 2001. In October 2001, he was named Senior Vice President of Purchasing and Operations. He was named Senior Vice President of Operations, Services and Canada in 2006 and assumed his current role in 2009. Prior to joining CDW, Eckrote worked in outside sales for Arrow Electronics and Cintas Uniform Company. From 2003 to 2009, Mr. Eckrote served on the board of directors of the Make-A-Wish Foundation of Illinois, completing the last two years as board chair, and currently serves on the Make-A-Wish Foundation of America National Chapter Performance Committee. Mr. Eckrote also served on the board of directors of the Center for Enriched Living from 2002-2011, serving as Vice President from 2004-2005, President from 2006-2008, board emeritus from 2009-2011 and currently serves as a trustee. Mr. Eckrote is a graduate of Purdue University where he earned a bachelor’s degree and a graduate of Northwestern University’s Kellogg School of Management where he earned an Executive Master of Business Administration. Christine A. Leahy serves as our Senior Vice President, General Counsel and Corporate Secretary and is responsible for our legal, corporate governance, enterprise risk management and compliance functions. Ms. Leahy joined CDW in January 2002 as Vice President, General Counsel and Corporate Secretary. In January of 2007, she was named Senior Vice President. Before joining CDW, Ms. Leahy served as a corporate partner in the Chicago office of Sidley Austin LLP where she specialized in corporate governance, securities law, mergers and acquisitions and strategic counseling. Ms. Leahy serves on the board of trustees of Children’s Home and Aid. Ms. Leahy is a graduate of Brown University where she earned a bachelor’s degree and a graduate of Boston College Law School where she earned her Juris Doctor. She also completed the CEO Perspective and Women’s Director Development Programs at Northwestern University’s Kellogg School of Management. Christina V. Rother serves as our Senior Vice President of Public and Advanced Technology Sales and is responsible for managing all aspects of our public sector and advanced technology sales forces, including sales force strategy, structure, goals, operations, revenue generation and training and development. Ms. Rother joined CDW in 1991 as an account manager. In 2002, she was appointed Vice President for Education and State and Local Sales. In 2005, she was chosen to lead our newly formed healthcare sales team. Beginning in 2006, Ms. Rother has held various positions ranging from Group Vice President of CDW Government LLC, President of CDW Government LLC and Senior Vice President of Sales. In September 2011, Ms. Rother assumed her current role as Senior Vice President of Public and Advanced Technology Sales. Prior to joining CDW, Ms. Rother held a number of sales positions with technology companies including Laser Computers and Price Electronics. Ms. Rother currently serves as chair of the board of directors of the Make-A-Wish Foundation of Illinois. Ms. Rother is a graduate of the University of Illinois at Chicago where she earned a bachelor’s degree. Jonathan J. Stevens serves as our Senior Vice President of Operations and Chief Information Officer. Mr. Stevens joined CDW in June 2001 as Vice President-Information Technology, was named Chief Information Officer in January 2002 and Vice President-International and Chief Information Officer from 2005 until December 2006. In January 2007, he was named Senior Vice President and Chief Information Officer and assumed his current role in November 2009. Mr. Stevens is responsible for the strategic direction of our information technology. Additionally, he holds responsibility for our distribution centers, transportation, facilities, customer relations, operational excellence and the business technology center. Prior to joining CDW, Mr. Stevens served as regional technology director for Avanade, an international technology integration company formed through a joint venture between Microsoft and Accenture from 2000 to 2001. Prior to that, Mr. Stevens was a principal with Microsoft Consulting Services and led an information technology group for a corporate division of AT&T/NCR. He currently serves on the board of directors of SingleWire Software, LLC and Northeast Illinois Council: Boy Scouts of America. Mr. Stevens is a graduate of the University of Dayton where he earned a bachelor’s degree. Matthew A. Troka serves as our Senior Vice President of Product and Partner Management. Mr. Troka is responsible for managing our relationships with all of our vendor partners. In addition, he directs the day-to-day operations of our purchasing department. Mr. Troka joined CDW in 1992 as an account manager and became a sales manager in 1995. From 1998 to 2001, he served as Corporate Sales Director. From 2001 to 2004, Mr. Troka was Senior Director of Purchasing. From 2004 to 2006, Mr. Troka served as Vice President of Purchasing. From 2006 to 2011, Mr. Troka was Vice President of Product and Partner Management. On March 3, 2011, Mr. Troka was elected Senior Vice President of Product and Partner Management. Table of Contents 24 Mr. Troka serves as a member of the board of directors of Encompass Championship Charities. Mr. Troka is a graduate of the University of Illinois where he earned a bachelor’s degree. Ann E. Ziegler joined CDW in April 2008 as Senior Vice President and Chief Financial Officer. Prior to joining CDW, Ms. Ziegler spent 15 years at Sara Lee Corporation (“Sara Lee”), a global consumer goods company, in a number of executive roles including finance, mergers and acquisitions, strategy and general management positions in both U.S. and international businesses. Most recently, from 2005 until April 2008, Ms. Ziegler served as Chief Financial Officer and Senior Vice President of Administration for Sara Lee Food and Beverage. Prior to joining Sara Lee, Ms. Ziegler was a corporate attorney at Skadden, Arps, Slate, Meagher & Flom. Ms. Ziegler serves on the board of directors of Hanesbrands, Inc. During the previous five years, Ms. Ziegler also served on the board of directors of Unitrin, Inc. Ms. Ziegler is a graduate of The College of William and Mary where she earned a bachelor’s degree and a graduate of the University of Chicago Law School where she earned her Juris Doctor. PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock has been listed on the NASDAQ Global Select Market since June 27, 2013 under the symbol “CDW.” Prior to that date, there was no public market for our common stock. Shares sold in our initial public offering ("IPO") were priced at $17.00 per share on June 26, 2013. The following table sets forth the ranges of high and low sales prices per share of our common stock as reported on the NASDAQ Global Select Market for the periods indicated. Year ended December 31, 2013 High Low Second quarter (beginning June 27, 2013).......................................................................................................$19.17 $17.38 Third quarter.....................................................................................................................................................$24.51 $18.26 Fourth quarter...................................................................................................................................................$23.56 $20.50 Holders As of February 28, 2014, there were 143 holders of record of our common stock. The number of beneficial stockholders is substantially greater than the number of holders of record because a portion of our common stock is held through brokerage firms. Dividends We expect to continue to pay a quarterly cash dividend on our common stock of $0.0425 per share, or $0.17 per annum. The initial quarterly cash dividend of $0.0425 per share was paid on December 2, 2013 to all common stockholders of record as of the close of business on November 15, 2013. On February 13, 2014, we announced that our board of directors declared a quarterly cash dividend on our common stock of $0.0425 per share. The dividend will be paid on March 10, 2014 to all stockholders of record as of the close of business on February 25, 2014. The payment of dividends in quarters beyond the first quarter of 2014 remains at the discretion of our board of directors and will depend upon our results of operations, financial condition, business prospects, capital requirements, contractual restrictions, any potential indebtedness we may incur, restrictions imposed by applicable law, tax considerations and other factors that our board of directors deems relevant. In addition, our ability to pay dividends on our common stock will be limited by restrictions on our ability to pay dividends or make distributions to our stockholders and on the ability of our subsidiaries to pay dividends or make distributions to us, in each case, under the terms of our current and any future agreements governing our indebtedness. For a discussion of our cash resources and needs and restrictions on our ability to pay dividends, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources” included elsewhere in this report. For additional discussion of restrictions on our ability to pay dividends, see Note 7 "Long-Term Debt", to the accompanying audited consolidated financial statements included elsewhere in this report. Stock Performance Graph The information contained in this Stock Performance Graph section shall not be deemed to be "soliciting material" or "filed" or incorporated by reference in future filings with the SEC, or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, except to the extent that CDW specifically incorporates it by reference into a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934. Table of Contents 25 The following graph compares the cumulative total shareholder return, calculated on a dividend reinvested basis, on $100.00 invested at the opening of the market on June 27, 2013, the date our common stock first traded on the NASDAQ Global Select Market, through and including the market close on December 31, 2013, with the cumulative total return for the same time period of the same amount invested in the S&P MidCap 400 index and a peer group index. The Company's peer group index for 2013 consists of the following companies: Accenture plc, Anixter International, Inc., Arrow Electronics, Inc., Avnet, Inc., CGI Group Inc., Genuine Parts Company, Henry Schein, Inc., Insight Enterprises, Inc., Owens & Minor, Inc., Patterson Companies, Inc., SYNNEX Corporation, United Stationers Inc., W.W. Grainger, Inc. and Wesco International, Inc. This peer group was selected based on a review of publicly available information about these companies and the Company’s determination that they met one or more of the following criteria: (i) similar size in terms of revenue and/or enterprise value (one-third to three times the Company’s revenue or enterprise value); (ii) operates in a business-to-business distribution environment; (iii) members of the technology industry; (iv) similar customers (i.e., business, government, healthcare, and education); (v) companies that provide services and/or solutions; and (vi) similar EBITDA and gross margins. Shareholder returns over the indicated period are based on historical data and should not be considered indicative of future shareholder returns. June 27, 2013 December 31, 2013 CDW Corp $100 $138 S&P MidCap 400 index 100 118 CDW Peers 100 113 Use of Proceeds from Registered Securities On July 2, 2013, the Company completed an IPO of its common stock in which it issued and sold 23,250,000 shares of common stock. On July 31, 2013, the Company completed the sale of an additional 3,487,500 shares of common stock to the underwriters of the IPO pursuant to the underwriters' July 26, 2013 exercise in full of the overallotment option granted to them in connection with the IPO. Such shares were registered under the Securities Act of 1933, as amended, pursuant to the Company's Registration Statement on Form S-1 (File 333-187472), which was declared effective by the SEC on June 26, 2013. Table of Contents 26 The shares of common stock are listed on the NASDAQ Global Select Market under the symbol “CDW.” The Company's shares of common stock were sold to the underwriters at a price of $17.00 per share in the IPO and upon the exercise of the overallotment option, which together, generated aggregate net proceeds of $424.7 million to the Company after deducting $29.8 million in underwriting discounts, expenses and transaction costs. Using a portion of the net proceeds from the IPO (exclusive of proceeds from the exercise of the overallotment option), the Company paid a $24.4 million termination fee to affiliates of Madison Dearborn Partners, LLC and Providence Equity Partners, L.L.C. in connection with the termination of the management services agreement with such entities that was effective upon completion of the IPO, redeemed $175.0 million aggregate principal amount of senior secured notes due 2018, and redeemed $146.0 million aggregate principal amount of senior subordinated notes due 2017. The redemption price of the senior secured notes due 2018 was 108.0% of the principal amount redeemed, plus accrued and unpaid interest to the date of redemption. The Company used cash on hand to pay such accrued and unpaid interest. The redemption price of the senior subordinated notes due 2017 was 106.268% of the principal amount redeemed, plus accrued and unpaid interest to the date of redemption. The Company used cash on hand to pay such accrued and unpaid interest. On October 18, 2013, proceeds from the overallotment option exercise of $56.0 million and cash on hand were used to redeem $155.0 million aggregate principal amount of senior subordinated notes due 2017. The redemption price of the senior subordinated notes due 2017 was 104.178% of the principal amount redeemed, plus accrued and unpaid interest to the date of redemption. The Company used cash on hand to pay such redemption premium and accrued and unpaid interest. J.P. Morgan Securities LLC, Barclays Capital Inc. and Goldman, Sachs & Co. acted as joint book-running managers of the IPO and as representatives of the underwriters. Deutsche Bank Securities Inc. and Morgan Stanley & Co. LLC acted as additional book-running managers in the IPO. Robert W. Baird & Co. Incorporated, Raymond James & Associates, Inc., William Blair & Company, L.L.C., Needham & Company, LLC, Stifel, Nicolaus & Company, Incorporated, Loop Capital Markets LLC and The Williams Capital Group, L.P. acted as managing underwriters in the IPO. Item 6. Selected Financial Data The selected financial data set forth below are not necessarily indicative of the results of future operations and should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our audited consolidated financial statements and the related notes included elsewhere in this report. We have derived the selected financial data presented below as of December 31, 2013 and December 31, 2012 and for the years ended December 31, 2013, 2012, and 2011 from our audited consolidated financial statements and related notes, which are included elsewhere in this report. The selected financial data as of December 31, 2010 and December 31, 2009 have been derived from our audited consolidated financial statements as of and for those periods, which are not included in this report. The following are some of the items affecting comparability of the selected financial data for the periods presented: • During the year ended December 31, 2013, we recorded IPO- and secondary-offering related expenses of $75.0 million. • During the years ended December 31, 2013, 2012, and 2011, we recorded net losses on extinguishments of long-term debt of $64.0 million, $17.2 million, and $118.9 million, respectively. The losses represented the difference between the amount paid upon extinguishment, including call premiums and expenses paid to the debt holders and agents, and the net carrying amount of the extinguished debt, adjusted for a portion of the unamortized deferred financing costs. • During the year ended December 31, 2009, we recorded goodwill impairment charges of $241.8 million. This impairment was primarily attributable to deterioration in macroeconomic conditions and overall declines in net sales. Table of Contents 27 Years Ended December 31, (dollars and shares in millions, except per share amounts)2013 2012 2011 2010 2009 Statement of Operations Data: Net sales $10,768.6 $10,128.2 $9,602.4 $8,801.2 $7,162.6 Cost of sales 9,008.3 8,458.6 8,018.9 7,410.4 6,029.7 Gross profit 1,760.3 1,669.6 1,583.5 1,390.8 1,132.9 Selling and administrative expenses 1,120.9 1,029.5 990.1 932.1 821.1 Advertising expense 130.8 129.5 122.7 106.0 101.9 Goodwill impairment ————241.8 Income (loss) from operations 508.6 510.6 470.7 352.7 (31.9) Interest expense, net (250.1)(307.4)(324.2)(391.9)(431.7) Net (loss) gain on extinguishments of long-term debt (64.0)(17.2)(118.9)2.0 — Other income, net 1.0 0.1 0.7 0.2 2.4 Income (loss) before income taxes 195.5 186.1 28.3 (37.0)(461.2) Income tax (expense) benefit (62.7)(67.1)(11.2)7.8 87.8 Net income (loss)$132.8 $119.0 $17.1 $(29.2)$(373.4) Net income (loss) per common share: Basic $0.85 $0.82 $0.12 $(0.20)$(2.60) Diluted $0.84 $0.82 $0.12 $(0.20)$(2.60) Weighted-average common shares outstanding: Basic 156.6 145.1 144.8 144.4 143.8 Diluted 158.7 145.8 144.9 144.4 143.8 Balance Sheet Data (at period end): Cash and cash equivalents $188.1 $37.9 $99.9 $36.6 $88.0 Working capital 810.9 666.5 538.1 675.4 923.2 Total assets 5,924.6 5,720.0 5,967.7 5,943.8 5,976.0 Total debt and capitalized lease obligations (1)3,251.2 3,771.0 4,066.0 4,290.0 4,621.9 Total shareholders’ equity (deficit)711.7 136.5 (7.3)(43.5)(44.7) Other Financial Data: Capital expenditures $47.1 $41.4 $45.7 $41.5 $15.6 Depreciation and amortization 208.2 210.2 204.9 209.4 218.2 Gross profit as a percentage of net sales 16.3%16.5%16.5%15.8%15.8% Ratio of earnings to fixed charges (2)1.8 1.6 1.1 (a)(a) EBITDA (3)$653.8 $703.7 $557.4 $564.3 $188.7 Adjusted EBITDA (3)808.5 766.6 717.3 601.8 465.4 Non-GAAP net income (loss) (4)314.3 247.1 198.8 85.7 (14.5) Statement of Cash Flows Data: Net cash provided by (used in): Operating activities $366.3 $317.4 $214.7 $423.7 $107.6 Investing activities (47.1)(41.7)(56.0)(125.4)(82.6) Financing activities (168.3)(338.0)(95.4)(350.1)(31.9) (1) Excludes borrowings of $256.6 million, $249.2 million, $278.7 million, $28.2 million and $25.0 million, as of December 31, 2013, 2012, 2011, 2010 and 2009, respectively, under our inventory financing agreements. We do not include these borrowings in total debt because we have not in the past incurred, and in the future do not expect to incur, any interest expense or late fees under these agreements. Table of Contents 28 (2) For purposes of calculating the ratio of earnings to fixed charges, earnings consist of earnings before income taxes minus income from equity investees plus fixed charges. Fixed charges consist of interest expense and the portion of rental expense we believe is representative of the interest component of rental expense. (a) For the years ended December 31, 2010 and 2009, earnings available for fixed charges were inadequate to cover fixed charges by $37.0 million and $461.2 million, respectively. (3) EBITDA is defined as consolidated net income (loss) before interest expense, income tax expense (benefit), depreciation, and amortization. Adjusted EBITDA, which is a measure defined in our credit agreements, is calculated by adjusting EBITDA for certain items of income and expense including (but not limited to) the following: (a) non- cash equity-based compensation; (b) goodwill impairment charges; (c) sponsor fees; (d) certain consulting fees; (e) debt-related legal and accounting costs; (f) equity investment income and losses; (g) certain severance and retention costs; (h) gains and losses from the early extinguishment of debt; (i) gains and losses from asset dispositions outside the ordinary course of business; and (j) non-recurring, extraordinary or unusual gains or losses or expenses. We have included a reconciliation of EBITDA and Adjusted EBITDA in the table below. Both EBITDA and Adjusted EBITDA are considered non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that EBITDA and Adjusted EBITDA provide helpful information with respect to our operating performance and cash flows including our ability to meet our future debt service, capital expenditures and working capital requirements. Adjusted EBITDA also provides helpful information as it is the primary measure used in certain financial covenants contained in our credit agreements. The following unaudited table sets forth reconciliations of net income (loss) to EBITDA and EBITDA to Adjusted EBITDA for the periods presented: Years Ended December 31, (in millions)2013 2012 2011 2010 2009 Net income (loss)$132.8 $119.0 $17.1 $(29.2)$(373.4) Depreciation and amortization 208.2 210.2 204.9 209.4 218.2 Income tax expense (benefit)62.7 67.1 11.2 (7.8)(87.8) Interest expense, net 250.1 307.4 324.2 391.9 431.7 EBITDA 653.8 703.7 557.4 564.3 188.7 Non-cash equity-based compensation 8.6 22.1 19.5 11.5 15.9 Sponsor fees 2.5 5.0 5.0 5.0 5.0 Consulting and debt-related professional fees 0.1 0.6 5.1 15.1 14.1 Goodwill impairment ————241.8 Net loss (gain) on extinguishments of long-term debt 64.0 17.2 118.9 (2.0)— Litigation, net (i)(4.1)4.3 ——— IPO- and secondary-offering related expenses 75.0 ———— Other adjustments (ii)8.6 13.7 11.4 7.9 (0.1) Adjusted EBITDA $808.5 $766.6 $717.3 $601.8 $465.4 (i) Relates to unusual, non-recurring litigation matters. (ii) Includes certain retention costs and equity investment income, certain severance costs in 2009 and a gain related to the sale of the Informacast software and equipment in 2009. Table of Contents 29 The following unaudited table sets forth a reconciliation of EBITDA to net cash provided by operating activities for the periods presented: Years Ended December 31, (in millions)2013 2012 2011 2010 2009 EBITDA $653.8 $703.7 $557.4 $564.3 $188.7 Depreciation and amortization (208.2)(210.2)(204.9)(209.4)(218.2) Income tax (expense) benefit (62.7)(67.1)(11.2)7.8 87.8 Interest expense, net (250.1)(307.4)(324.2)(391.9)(431.7) Net income (loss)132.8 119.0 17.1 (29.2)(373.4) Depreciation and amortization 208.2 210.2 204.9 209.4 218.2 Goodwill impairment ————241.8 Equity-based compensationexpense 46.6 22.1 19.5 11.5 15.9 Amortization of deferredfinancing costs, debt premium,and debt discount, net 8.8 13.6 15.7 18.0 16.2 Deferred income taxes (48.7)(56.3)(10.2)(4.3)(94.4) Allowance for doubtful accounts ——0.4 (1.3)(0.2) Realized loss on interest rate swapagreements ——2.8 51.5 103.2 Mark to market loss on interestrate derivatives 0.1 0.9 4.2 4.7 — Net loss (gain) onextinguishments of long-term debt 64.0 17.2 118.9 (2.0)— Net loss (gain) on sale anddisposal of assets —0.1 0.3 0.7 (1.7) Changes in assets and liabilities (47.1)(9.4)(158.3)165.3 (18.0) Other non-cash items 1.6 —(0.6)(0.6)— Net cash provided by operatingactivities $366.3 $317.4 $214.7 $423.7 $107.6 Table of Contents 30 (4) Non-GAAP net income (loss) is considered a non-GAAP financial measure. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that non-GAAP net income (loss) provides meaningful information regarding our operating performance and our prospects for the future. This supplemental measure excludes, among other things, charges related to the amortization of Acquisition-related intangibles, non-cash equity-based compensation and gains and losses from the early extinguishment of debt. The following unaudited table sets forth a reconciliation of net income (loss) to non-GAAP net income (loss) for the periods presented: Years Ended December 31, (in millions)2013 2012 2011 2010 2009 Net income (loss)$132.8 $119.0 $17.1 $(29.2)$(373.4) Amortization of intangibles (i)161.2 163.7 165.7 166.8 168.9 Non-cash equity-based compensation 8.6 22.1 19.5 11.5 15.9 Litigation, net (ii)(6.3)———— Net loss on extinguishments of long-term debt 64.0 17.2 118.9 (2.0)— Interest expense adjustment related to extinguishments of long-term debt (iii)(7.5)(3.3)(19.4)(0.7)— IPO- and secondary-offering related expenses (iv)75.0 ———— Debt-related refinancing costs (v)——3.8 5.6 — Goodwill impairment ————241.8 Severance expense ————1.4 Aggregate adjustment for income taxes (vi)(113.5)(71.6)(106.8)(66.3)(69.1) Non-GAAP net income (loss)$314.3 $247.1 $198.8 $85.7 $(14.5) (i) Includes amortization expense for Acquisition-related intangible assets, primarily customer relationships and trade names. (ii) Relates to unusual, non-recurring litigation matters. (iii) Reflects adjustments to interest expense resulting from debt extinguishments. Represents the difference between interest expense previously recognized under the effective interest method and actual interest paid. (iv) IPO- and secondary-offering related expenses consist of the following: (in millions)Year Ended December 31, 2013 Acceleration charge for certain equity awards andrelated employer payroll taxes $40.7 RDU Plan cash retention pool accrual 7.5 Management services agreement termination fee 24.4 Other expenses 2.4 IPO- and secondary-offering related expenses $75.0 (v) Represents fees and costs expensed related to the December 2010 and March 2011 amendments to our prior senior secured term loan facility. (vi) Based on a normalized effective tax rate of 39.0%. Table of Contents 31 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Unless otherwise indicated or the context otherwise requires, as used in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the terms “we,” “us,” “the Company,” “our,” “CDW” and similar terms refer to CDW Corporation and its subsidiaries. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” should be read in conjunction with the audited consolidated financial statements and the related notes included elsewhere in this report. This discussion contains forward-looking statements that are subject to numerous risks and uncertainties. Actual results may differ materially from those contained in any forward-looking statements. See “Forward- Looking Statements” above. Overview CDW is a Fortune 500 company and a leading provider of integrated information technology (“IT”) solutions in the U.S. and Canada. We help our customer base of approximately 250,000 small, medium and large business, government, education and healthcare customers by delivering critical solutions to their increasingly complex IT needs. Our broad array of offerings ranges from discrete hardware and software products to integrated IT solutions such as mobility, security, data center optimization, cloud computing, virtualization and collaboration. We are technology "agnostic," with a product portfolio that includes more than 100,000 products from more than 1,000 brands. We provide our products and solutions through sales force and service delivery teams consisting of more than 4,400 coworkers, including nearly 1,800 field sellers, highly-skilled technology specialists and advanced service delivery engineers. We are a leading U.S. sales channel partner for many original equipment manufacturers (“OEMs”) and software publishers (collectively, our “vendor partners”), whose products we sell or include in the solutions we offer. We believe we are an important extension of our vendor partners' sales and marketing capabilities, providing them with a cost-effective way to reach customers and deliver a consistent brand experience through our established end-market coverage and extensive customer access. We have two reportable segments: Corporate, which is comprised primarily of private sector business customers, and Public, which is comprised of government agencies and education and healthcare institutions. Our Corporate segment is divided into a medium/large business customer channel, primarily serving customers with more than 100 employees, and a small business customer channel, primarily serving customers with up to 100 employees. We also have two other operating segments, CDW Advanced Services and Canada, which do not meet the reportable segment quantitative thresholds and, accordingly, are combined together as “Other.” The CDW Advanced Services business consists primarily of customized engineering services delivered by technology specialists and engineers, and managed services that include Infrastructure as a Service (“IaaS”) offerings. Revenues from the sale of hardware, software, custom configuration and third-party provided services are recorded within our Corporate and Public segments. We may sell all or only select products that our vendor partners offer. Each vendor partner agreement provides for specific terms and conditions, which may include one or more of the following: product return privileges, price protection policies, purchase discounts and vendor incentive programs, such as purchase or sales rebates and cooperative advertising reimbursements. We also resell software for major software publishers. Our agreements with software publishers allow the end- user customer to acquire software or licensed products and services. In addition to helping our customers determine the best software solutions for their needs, we help them manage their software agreements, including warranties and renewals. A significant portion of our advertising and marketing expenses is reimbursed through cooperative advertising reimbursement programs with our vendor partners. These programs are at the discretion of our vendor partners and are typically tied to sales or purchasing volumes or other commitments to be met by us within a specified period of time. Trends and Key Factors Affecting our Financial Performance We believe the following trends may have an important impact on our financial performance: • Our Public segment sales are impacted by government spending policies, budget priorities and revenue levels. An adverse change in any of these factors could cause our Public segment customers to reduce their purchases or to terminate or not renew contracts with us, which could adversely affect our business, results of operations or cash flows. Although our sales to the federal government are diversified across multiple agencies and departments, they collectively accounted for approximately 7%, 10% and 10% of our net sales for the years ended December 31, 2013, 2012 and 2011, respectively. Second half 2013 Public segment results were negatively impacted by federal government budget uncertainty, sequestration and the partial shutdown of the federal government for 16 days. Table of Contents 32 • An important factor affecting our ability to generate sales and achieve our targeted operating results is the impact of general economic conditions on our customers’ willingness to spend on information technology. In the second quarter of 2012, we began to see customers take a more cautious approach to spending as increased macroeconomic uncertainty impacted decision-making and led to some customers delaying purchases. As we moved through 2013, we saw improvements in operating results for certain sales channels. We will continue to closely monitor macroeconomic conditions during 2014. Uncertainties related to potential reductions in government spending, requirements associated with implementation of the Affordable Care Act, potential changes in tax and regulatory policy, weakening consumer and business confidence or increased unemployment could result in reduced or deferred spending on information technology products and services by our customers and result in increased competitive pricing pressures. • We believe that our customers’ transition to more complex technology solutions will continue to be an important growth area for us in the future. However, because the market for technology products and services is highly competitive, our success at capitalizing on this transition will be based on our ability to tailor specific solutions to customer needs, the quality and breadth of our product and service offerings, the knowledge and expertise of our sales force, price, product availability and speed of delivery. 2013 Initial Public Offering On July 2, 2013, we completed an initial public offering ("IPO") of 23,250,000 shares of common stock. On July 31, 2013, we completed the sale of an additional 3,487,500 shares of common stock to the underwriters of the IPO pursuant to the underwriters' July 26, 2013 exercise in full of the overallotment option granted to them in connection with the IPO. Our shares of common stock were sold to the underwriters at a price of $17.00 per share in the IPO and upon the exercise of the overallotment option, which together, generated aggregate net proceeds of $424.7 million to the Company after deducting underwriting discounts, expenses and transaction costs. On November 19, 2013, we completed a secondary public offering, whereby certain selling stockholders sold 15,000,000 shares of common stock. On December 18, 2013, such selling stockholders sold an additional 2,250,000 shares of common stock to the underwriters of the secondary public offering pursuant to the underwriters' December 13, 2013 exercise in full of the overallotment option granted to them in connection with the secondary public offering. We did not receive any proceeds from the sale of shares in the secondary public offering or upon the exercise of the overallotment option. The consolidated statement of operations for the year ended December 31, 2013 included pre-tax IPO- and secondary- offering related expenses of $75.0 million. See Note 9 of the accompanying audited consolidated financial statements for additional discussion of our IPO and secondary offering. Key Business Metrics Our management monitors a number of financial and non-financial measures and ratios on a regular basis in order to track the progress of our business and make adjustments as necessary. We believe that the most important of these measures and ratios include average daily sales, gross margin, operating margin, net income, Non-GAAP net income, net income per common share, Non-GAAP net income per diluted share, EBITDA and Adjusted EBITDA, return on invested capital, cash and cash equivalents, net working capital, cash conversion cycle (defined to be days of sales outstanding in accounts receivable plus days of supply in inventory minus days of purchases outstanding in accounts payable, based on a rolling three-month average), debt levels including available credit and leverage ratios, sales per coworker and coworker turnover. These measures and ratios are compared to standards or objectives set by management, so that actions can be taken, as necessary, in order to achieve the standards and objectives. Non-GAAP net income and Adjusted EBITDA are non-GAAP financial measures. We believe these measures provide helpful information with respect to the company’s operating performance and cash flows including our ability to meet our future debt service, capital expenditures, dividend payments, and working capital requirements, Adjusted EBITDA also provides helpful information as it is the primary measure used in certain financial covenants contained in our senior credit facilities. See "Selected Financial Data" included elsewhere in this report for the definitions of Non-GAAP net income and Adjusted EBITDA and reconciliations to net income. Table of Contents 33 The results of certain key business metrics are as follows: (dollars in millions)Years Ended December 31, 2013 2012 2011 Net sales $10,768.6 $10,128.2 $9,602.4 Gross profit 1,760.3 1,669.6 1,583.5 Income from operations 508.6 510.6 470.7 Net income 132.8 119.0 17.1 Non-GAAP net income 314.3 247.1 198.8 Adjusted EBITDA 808.5 766.6 717.3 Average daily sales 42.4 39.9 37.7 Net debt (defined as total debt minus cash and cash equivalents)3,063.1 3,733.1 3,966.1 Cash conversion cycle (in days) (1)24 24 28 (1) Cash conversion cycle is defined as days of sales outstanding in accounts receivable plus days of supply in inventory minus days of purchases outstanding in accounts payable, based on a rolling three-month average. Results of Operations Year Ended December 31, 2013 Compared to Year Ended December 31, 2012 The following table presents our results of operations, in dollars and as a percentage of net sales, for the years ended December 31, 2013 and 2012: Year Ended December 31, 2013 Year Ended December 31, 2012 Dollars inMillions Percentage ofNet Sales Dollars inMillions Percentage ofNet Sales Net sales $10,768.6 100.0%$10,128.2 100.0% Cost of sales 9,008.3 83.7 8,458.6 83.5 Gross profit 1,760.3 16.3 1,669.6 16.5 Selling and administrative expenses 1,120.9 10.4 1,029.5 10.2 Advertising expense 130.8 1.2 129.5 1.3 Income from operations 508.6 4.7 510.6 5.0 Interest expense, net (250.1)(2.3)(307.4)(3.0) Net loss on extinguishments of long-term debt (64.0)(0.6)(17.2)(0.2) Other income, net 1.0 —0.1 — Income before income taxes 195.5 1.8 186.1 1.8 Income tax expense (62.7)(0.6)(67.1)(0.7) Net income $132.8 1.2%$119.0 1.1% Table of Contents 34 Net sales The following table presents our net sales by segment, in dollars and as a percentage of total net sales, and the year- over-year dollar and percentage change in net sales for the years ended December 31, 2013 and 2012: Years Ended December 31, 2013 2012 Dollars inMillions Percentage ofTotal Net Sales Dollars inMillions Percentage ofTotal Net Sales DollarChange PercentChange (1) Corporate $5,960.1 55.3%$5,512.8 54.4%$447.3 8.1% Public 4,164.5 38.7 4,023.0 39.7 141.5 3.5 Other 644.0 6.0 592.4 5.9 51.6 8.7 Total net sales $10,768.6 100.0%$10,128.2 100.0%$640.4 6.3% (1) There were 254 selling days in both the years ended December 31, 2013 and 2012. The following table presents our net sales by customer channel for our Corporate and Public segments and the year- over-year dollar and percentage change in net sales for the years ended December 31, 2013 and 2012: (dollars in millions)Years Ended December 31, 2013 2012 Dollar Change Percent Change Corporate: Medium / Large $4,902.6 $4,448.5 $454.1 10.2 % Small Business 1,057.5 1,064.3 (6.8)(0.6) Total Corporate $5,960.1 $5,512.8 $447.3 8.1 % Public: Government $1,250.6 $1,394.1 $(143.5)(10.3)% Education 1,449.0 1,192.3 256.7 21.5 Healthcare 1,464.9 1,436.6 28.3 2.0 Total Public $4,164.5 $4,023.0 $141.5 3.5 % Total net sales in 2013 increased $640.4 million, or 6.3%, to $10,768.6 million, compared to $10,128.2 million in 2012. There were 254 selling days for both the years ended December 31, 2013 and 2012. The increase in total net sales was primarily the result of growth in hardware and software, a more tenured sales force, a continued focus on seller productivity across all areas of the organization and the addition of nearly 120 customer-facing coworkers, the majority in pre- and post-sale technical positions such as technical specialists and service delivery roles. Our total net sales growth for the year ended December 31, 2013 reflected growth in notebooks/mobile devices, netcomm products and software. Software gains were driven by growth in security, document management software and network management software, partially offset by a decline in application suites. Corporate segment net sales in 2013 increased $447.3 million, or 8.1%, compared to 2012, driven by sales growth in the medium/large customer channel. Within our Corporate segment, net sales to medium/large customers increased 10.2% between years primarily due to certain of these customers increasing their IT spending, a more tenured sales force, a continued focus on seller productivity and additional customer-facing coworkers, the majority in pre- and post-sale technical positions such as technical specialists and service delivery roles. This increase was led by unit volume growth in netcomm products and growth in notebooks/mobile devices and software. Partially offsetting the growth in the medium/large customer channel was a 0.6% decline in net sales to small business customers, due to certain of these customers taking a more cautious approach to spending as macroeconomic and regulatory uncertainty impacted decision-making. This decrease was led by unit volume declines in notebooks/mobile devices, partially offset by growth in netcomm products. Public segment net sales in 2013 increased $141.5 million, or 3.5%, between years, driven by strong performance in the education customer channel. Net sales to education customers increased $256.7 million, or 21.5%, between years, led by growth in net sales to K-12 customers, reflecting increased sales of notebooks/mobile devices to support new standardized digital testing requirements that will take effect in 2014. Net sales to government customers decreased $143.5 million, or Table of Contents 35 10.3%, in 2013 compared to 2012 due to reductions and delays in federal government spending following sequestration, uncertainty over future budget negotiations and the partial shutdown of the federal government. The government customer channel net sales decline was led by decreases in sales of enterprise storage and notebooks/mobile devices, partially offset by growth in software. Net sales to healthcare customers increased $28.3 million, or 2.0%, between years, driven by growth in notebooks/mobile devices and desktop computers. Gross profit Gross profit increased $90.7 million, or 5.4%, to $1,760.3 million in 2013, compared to $1,669.6 million in 2012. As a percentage of total net sales, gross profit decreased 20 basis points to 16.3% in 2013, down from 16.5% in 2012. Gross profit margin was negatively impacted 30 basis points by unfavorable price/mix changes within product margin, as we experienced product margin compression in transactional product categories such as desktops and notebooks. Partially offsetting this decrease was an increase of 10 basis points due to a higher mix of net service contract revenue. Net service contract revenue, including items such as third-party services and warranties, has a positive impact on gross profit margin as our cost paid to the vendor or third-party service provider is recorded as a reduction to net sales, resulting in net sales being equal to the gross profit on the transaction. The gross profit margin may fluctuate based on various factors, including vendor incentive and inventory price protection programs, cooperative advertising funds classified as a reduction of cost of sales, product mix, net service contract revenue, commission revenue, pricing strategies, market conditions and other factors, any of which could result in changes in gross profit margins. Selling and administrative expenses Selling and administrative expenses increased $91.4 million, or 8.9%, to $1,120.9 million in 2013, compared to $1,029.5 million in 2012. As a percentage of total net sales, selling and administrative expenses increased 20 basis points to 10.4% in 2013, up from 10.2% in 2012. Sales payroll, including sales commissions and other variable compensation costs, increased $28.9 million, or 6.4%, between years, consistent with higher sales and gross profit. Additionally, selling and administrative expenses for 2013 included IPO- and secondary-offering related expenses of $75.0 million, as follows: • Pre-tax charges of $36.7 million related to the acceleration of the expense recognition for certain equity awards and $4.0 million for the related employer payroll taxes. See Note 10 of the accompanying audited consolidated financial statements for additional discussion of the impact of the IPO on our equity awards. • A pre-tax charge of $24.4 million related to the payment of a termination fee to affiliates of the Sponsors in connection with the termination of the management services agreement with such entities. • A pre-tax charge of $7.5 million related to compensation expense in connection with the Restricted Debt Unit Plan. See Note 12 of the accompanying audited consolidated financial statements for additional discussion of this charge. • Other IPO- and secondary-offering related expenses of $2.4 million. We did not record any IPO- or secondary-offering related expenses during 2012. Partially offsetting these increases in 2013, was the favorable resolution of a class action legal proceeding in which we were a claimant, which reduced selling and administrative expenses by $10.4 million in 2013 compared to 2012. Total coworker count increased by 163 coworkers, from 6,804 at December 31, 2012, to 6,967 at December 31, 2013. Advertising expense Advertising expense increased $1.3 million, or 0.9%, to $130.8 million in 2013, compared to $129.5 million in 2012. As a percentage of net sales, advertising expense was 1.2% in 2013, compared to 1.3% in 2012. The dollar increase in advertising expense was due to a continued focus on advertising our solutions and products, which reinforces our reputation as a leading IT solutions provider. Table of Contents 36 Income from operations The following table presents income (loss) from operations by segment, in dollars and as a percentage of net sales, and the year-over-year percentage change in income (loss) from operations for the years ended December 31, 2013 and 2012: Year Ended December 31, 2013 Year Ended December 31, 2012 Dollars inMillions OperatingMarginPercentage Dollars inMillions OperatingMarginPercentage Percent Changein Income (Loss)from Operations Segments: (1) Corporate $363.3 6.1%$349.0 6.3%4.1 % Public 246.5 5.9 246.7 6.1 (0.1) Other 27.2 4.2 18.6 3.1 46.3 Headquarters (2)(128.4)nm*(103.7)nm*(23.8) Total income from operations $508.6 4.7%$510.6 5.0%(0.4)% * Not meaningful (1) Segment income (loss) from operations includes the segment’s direct operating income (loss) and allocations for Headquarters’ costs, allocations for income and expenses from logistics services, certain inventory adjustments and volume rebates and cooperative advertising from vendors. (2) Includes certain Headquarters’ function costs that are not allocated to the segments. Income from operations was $508.6 million in 2013, a decrease of $2.0 million, or 0.4%, compared to $510.6 million in 2012. The decrease in income from operations was driven by higher selling and administrative expenses primarily resulting from $75.0 million of IPO- and secondary-offering related expenses recorded during 2013, mostly offset by higher net sales and gross profit. Total operating margin percentage decreased 30 basis points to 4.7% in 2013, from 5.0% in 2012. Operating margin percentage was negatively impacted by the increase in selling and administrative expenses as a percentage of net sales and gross profit margin compression, partially offset by a decrease in advertising expense as a percentage of net sales. Corporate segment income from operations was $363.3 million in 2013, an increase of $14.3 million, or 4.1%, compared to $349.0 million in 2012. Corporate segment operating margin percentage decreased 20 basis points to 6.1% in 2013, from 6.3% in 2012. Results for 2013 included $26.4 million of IPO- and secondary-offering related expenses, which reduced Corporate segment operating margin by 40 basis points. Higher sales and gross profit dollars offset the effect of IPO- and secondary-offering related expenses on income from operations for 2013. Public segment income from operations was $246.5 million in 2013, a decrease of $0.2 million, or 0.1%, compared to $246.7 million in 2012. Public segment operating margin percentage decreased 20 basis points to 5.9% in 2013, from 6.1% in 2012. Results for 2013 included $14.4 million of IPO- and secondary-offering related expenses, which reduced Public segment operating margin by 30 basis points. Higher sales and gross profit dollars nearly offset the effect of IPO- and secondary- offering related expenses on income from operations for 2013. Interest expense, net At December 31, 2013, our outstanding long-term debt totaled $3,251.2 million, compared to $3,771.0 million at December 31, 2012. We reduced long-term debt throughout the year primarily through the use of a portion of the net proceeds from the IPO and cash flows provided by operating activities. Net interest expense in 2013 was $250.1 million, a decrease of $57.3 million compared to $307.4 million in 2012. This decrease was primarily due to lower debt balances and effective interest rates for 2013 compared to 2012 as a result of debt repayments and refinancing activities completed during 2012 and 2013. See "Liquidity and Capital Resources" below. Net loss on extinguishments of long-term debt During 2013, we recorded a net loss on extinguishments of long-term debt of $64.0 million compared to $17.2 million in 2012. In October 2013, we redeemed $155.0 million aggregate principal amount of senior subordinated notes. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $8.5 million, representing the difference Table of Contents 37 between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In August 2013, we redeemed $324.0 million aggregate principal amount of senior subordinated notes. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $24.6 million, representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In July 2013, we redeemed $175.0 million aggregate principal amount of senior secured notes. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $16.7 million, representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In April 2013, we entered into a new seven-year, $1,350.0 million aggregate principal amount senior secured term loan facility. Substantially all of the proceeds were used to repay the $1,299.5 million outstanding aggregate principal amount of the prior senior secured term loan facility. In connection with this refinancing, we recorded a loss on extinguishment of long-term debt of $10.3 million, representing a write-off of the remaining unamortized deferred financing costs related to the prior senior secured term loan facility. In March 2013, we redeemed $50.0 million aggregate principal amount of senior subordinated notes. We recorded a loss on extinguishment of long-term debt of $3.9 million, representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In December 2012, we redeemed $100.0 million aggregate principal amount of senior subordinated notes. We recorded a loss on extinguishment of long-term debt of $7.8 million representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In February and March 2012, we purchased or redeemed the remaining $129.0 million of senior notes due 2015, funded with the issuance of an additional $130.0 million of senior notes due 2019. As a result, we recorded a loss on extinguishment of long-term debt of $9.4 million, representing the difference between the purchase or redemption price of the senior notes due 2015 and the net carrying amount of the purchased debt, adjusted for the remaining unamortized deferred financing costs. Income tax expense Income tax expense was $62.7 million in 2013, compared to $67.1 million in 2012. The effective income tax rate, expressed by calculating income tax expense or benefit as a percentage of income before income taxes, was 32.1% and 36.0% for 2013 and 2012, respectively. For 2013, the effective tax rate differed from the U.S. federal statutory rate primarily due to state income taxes, including current year state income tax credits and an adjustment to deferred state income taxes due to changes in apportionment factors. For 2012, the effective tax rate differed from the U.S. federal statutory rate primarily due to favorable adjustments to state tax credits which were partially offset by the unfavorable impact of adjustments to deferred state income taxes due to changes in state tax laws and non-deductible expenses, primarily equity-based compensation and meals and entertainment. The lower effective tax rate for 2013 as compared to 2012 was primarily driven by the favorable impact of adjustments to deferred state income taxes due to changes in state tax apportionment factors and lower non-deductible expenses. Net income Net income was $132.8 million in 2013, compared to $119.0 million in 2012. Significant factors and events causing the net changes between the periods are discussed above. Non-GAAP net income Non-GAAP net income was $314.3 million for the year ended December 31, 2013, an increase of $67.2 million, or 27.2%, compared to $247.1 million for the year ended December 31, 2012. Table of Contents 38 We have included a reconciliation of Non-GAAP net income for the years ended December 31, 2013 and 2012 below. Non-GAAP net income excludes, among other things, charges related to the amortization of acquisition-related intangibles, non-cash equity-based compensation, IPO- and secondary-offering related expenses and gains and losses from the early extinguishment of debt. Non-GAAP net income is considered a non-GAAP financial measure. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that Non-GAAP net income provides helpful information with respect to our operating performance and cash flows including our ability to meet our future debt service, capital expenditures and working capital requirements. (in millions)Years Ended December 31, 2013 2012 Net income $132.8 $119.0 Amortization of intangibles (1)161.2 163.7 Non-cash equity-based compensation 8.6 22.1 Litigation, net (2)(6.3)— Net loss on extinguishments of long-term debt 64.0 17.2 Interest expense adjustment related to extinguishments of long-term debt (3)(7.5)(3.3) IPO- and secondary-offering related expenses (4)75.0 — Aggregate adjustment for income taxes (5)(113.5)(71.6) Non-GAAP net income $314.3 $247.1 (1) Includes amortization expense for acquisition-related intangible assets, primarily customer relationships and trade names. (2) Relates to unusual, non-recurring litigation matters. (3) Reflects adjustments to interest expense resulting from debt extinguishments. Represents the difference between interest expense previously recognized under the effective interest method and actual interest paid. (4) IPO- and secondary-offering related expenses consist of the following: (in millions)Years Ended December 31, 2013 2012 Acceleration charge for certain equity awards andrelated employer payroll taxes $40.7 $— RDU Plan cash retention pool accrual 7.5 — Management services agreement termination fee 24.4 — Other expenses 2.4 — IPO- and secondary-offering related expenses $75.0 $— (5) Based on a normalized effective tax rate of 39.0%. Adjusted EBITDA Adjusted EBITDA was $808.5 million in 2013, an increase of $41.9 million, or 5.5%, compared to $766.6 million in 2012. As a percentage of net sales, Adjusted EBITDA was 7.5% and 7.6% in 2013 and 2012, respectively. We have included a reconciliation of EBITDA and Adjusted EBITDA for 2013 and 2012 in the table below. EBITDA is defined as consolidated net income before interest expense, income tax expense, depreciation and amortization. Adjusted EBITDA, which is a measure defined in our credit agreements, means EBITDA adjusted for certain items which are described in the table below. Both EBITDA and Adjusted EBITDA are considered non-GAAP financial measures. Generally, a non- GAAP financial measure is a numerical measure of a company's performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used Table of Contents 39 by other companies, even when similar terms are used to identify such measures. We believe that EBITDA and Adjusted EBITDA provide helpful information with respect to our operating performance and cash flows including our ability to meet our future debt service, capital expenditures and working capital requirements. Adjusted EBITDA also provides helpful information as it is the primary measure used in certain financial covenants contained in our credit agreements. (in millions)Years Ended December 31, 2013 2012 Net income $132.8 $119.0 Depreciation and amortization 208.2 210.2 Income tax expense 62.7 67.1 Interest expense, net 250.1 307.4 EBITDA 653.8 703.7 Adjustments: Non-cash equity-based compensation 8.6 22.1 Sponsor fee 2.5 5.0 Consulting and debt-related professional fees 0.1 0.6 Net loss on extinguishments of long-term debt 64.0 17.2 Litigation, net (1)(4.1)4.3 IPO- and secondary-offering related expenses (2)75.0 — Other adjustments (3)8.6 13.7 Total adjustments 154.7 62.9 Adjusted EBITDA $808.5 $766.6 (1) Relates to unusual, non-recurring litigation matters. (2) As defined under Non-GAAP net income above. (3) Other adjustments primarily include certain retention costs and equity investment income. The following table sets forth a reconciliation of EBITDA to net cash provided by operating activities for the years ended December 31, 2013 and 2012. Years Ended December 31, (in millions)2013 2012 EBITDA $653.8 $703.7 Depreciation and amortization (208.2)(210.2) Income tax expense (62.7)(67.1) Interest expense, net (250.1)(307.4) Net income 132.8 119.0 Depreciation and amortization 208.2 210.2 Equity-based compensation expense 46.6 22.1 Deferred income taxes (48.7)(56.3) Amortization of deferred financing costs, debt premium, anddebt discount, net 8.8 13.6 Net loss on extinguishments of long-term debt 64.0 17.2 Other 1.7 1.0 Changes in assets and liabilities (47.1)(9.4) Net cash provided by operating activities $366.3 $317.4 Table of Contents 40 Year Ended December 31, 2012 Compared to Year Ended December 31, 2011 The following table presents our results of operations, in dollars and as a percentage of net sales, for the years ended December 31, 2012 and 2011: Year Ended December 31, 2012 Year Ended December 31, 2011 Dollars inMillions Percentage ofNet Sales Dollars inMillions Percentage ofNet Sales Net sales $10,128.2 100.0%$9,602.4 100.0% Cost of sales 8,458.6 83.5 8,018.9 83.5 Gross profit 1,669.6 16.5 1,583.5 16.5 Selling and administrative expenses 1,029.5 10.2 990.1 10.3 Advertising expense 129.5 1.3 122.7 1.3 Income from operations 510.6 5.0 470.7 4.9 Interest expense, net (307.4)(3.0)(324.2)(3.4) Net loss on extinguishments of long-term debt (17.2)(0.2)(118.9)(1.2) Other income, net 0.1 —0.7 — Income before income taxes 186.1 1.8 28.3 0.3 Income tax expense (67.1)(0.7)(11.2)(0.1) Net income $119.0 1.1%$17.1 0.2% Net sales The following table presents our net sales by segment, in dollars and as a percentage of total net sales, and the year- over-year dollar and percentage change in net sales for the years ended December 31, 2012 and 2011: Years Ended December 31, 2012 2011 Dollars inMillions Percentage ofTotal Net Sales Dollars inMillions Percentage ofTotal Net Sales DollarChange PercentChange (1) Corporate $5,512.8 54.4%$5,334.4 55.6%$178.4 3.3% Public 4,023.0 39.7 3,757.2 39.1 265.8 7.1 Other 592.4 5.9 510.8 5.3 81.6 16.0 Total net sales $10,128.2 100.0%$9,602.4 100.0%$525.8 5.5% (1) There were 254 and 255 selling days in the years ended December 31, 2012 and 2011, respectively. On an average daily basis, total net sales increased 5.9%. Table of Contents 41 The following table presents our net sales by customer channel for our Corporate and Public segments and the year- over-year dollar and percentage change in net sales for the years ended December 31, 2012 and 2011: (in millions)Years Ended December 31, 2012 2011 Dollar Change Percent Change Corporate: Medium / Large $4,448.5 $4,287.1 $161.4 3.8% Small Business 1,064.3 1,047.3 17.0 1.6 Total Corporate $5,512.8 $5,334.4 $178.4 3.3% Public: Government $1,394.1 $1,343.5 $50.6 3.8% Education 1,192.3 1,197.7 (5.4)(0.4) Healthcare 1,436.6 1,216.0 220.6 18.1 Total Public $4,023.0 $3,757.2 $265.8 7.1% Total net sales in 2012 increased $525.8 million, or 5.5%, to $10,128.2 million, compared to $9,602.4 million in 2011. There were 254 and 255 selling days in the years ended December 31, 2012 and 2011, respectively. On an average daily basis, total net sales increased 5.9%. The increase in total net sales was the result of general volume growth, market share gains, a more tenured sales force, and a continued focus on seller productivity across all areas of the organization. Our net sales growth for the year ended December 31, 2012 reflected growth in notebooks/mobile devices, netcomm products, software products, desktop computers and enterprise storage. Corporate segment net sales in 2012 increased $178.4 million, or 3.3%, compared to 2011. Within our Corporate segment, net sales to medium/large customers increased 3.8% between years, and net sales to small business customers increased 1.6% between years. Customers within the Corporate segment continued to take a more cautious approach to spending as increased macroeconomic uncertainty impacted decision-making and led to some customers delaying purchases. The increases in Corporate segment net sales were primarily a result of hardware growth, most notably in netcomm products, and unit volume growth in desktop computers. Software product growth, led by network management and security software, also contributed to the increase in net sales. Partially offsetting the growth was a decline in net sales of memory products due to several large orders in the second and third quarters of 2011 that did not recur. Public segment net sales in 2012 increased $265.8 million, or 7.1%, between years, driven by continued strong performance in the healthcare customer channel. Net sales to healthcare customers increased $220.6 million, or 18.1%, between years, led by hardware growth, most notably in enterprise storage, and unit volume growth in netcomm products, desktop computers and point of care technology carts. Software product growth also contributed to the increase in net sales in healthcare. The healthcare customer channel growth was primarily the result of deeper relationships with several group purchasing organizations and increased healthcare industry demand for IT products, as the healthcare industry continued its adoption of electronic medical records and point of care technologies. Net sales to government customers increased $50.6 million, or 3.8%, in 2012 compared to 2011 led by unit volume increases in sales of notebooks/mobile devices, partially offset by a decline in net sales of netcomm products. Net sales to education customers decreased $5.4 million, or 0.4%, between years, reflecting budget constraints. A decline in sales to K-12 customers was partially offset by growth in sales to higher education customers that was led by increased sales of netcomm products, as higher education customers refreshed and added additional enterprise technology. Gross profit Gross profit increased $86.1 million, or 5.4%, to $1,669.6 million in 2012, compared to $1,583.5 million in 2011. As a percentage of total net sales, gross profit was 16.5% in both 2012 and 2011. Gross profit margin was positively impacted 10 basis points by a higher mix of commission and net service contract revenue. Fully offsetting these increases in gross profit margin were declines in vendor funding primarily due to program changes for certain vendors. Commission revenue, including agency fees earned on sales of software licenses and software assurance under enterprise agreements, has a positive impact on our gross profit margin, as we record the fee or commission as a component of net sales when earned and there is no corresponding cost of sales. Net service contract revenue, including items such as third-party services and warranties, also has a positive impact on gross profit margin as our cost paid to the vendor or third-party service provider is recorded as a reduction to net sales, resulting in net sales being equal to the gross profit on the transaction. Vendor funding includes purchase discounts, volume rebates and cooperative advertising. Table of Contents 42 The gross profit margin may fluctuate based on various factors, including vendor incentive and inventory price protection programs, cooperative advertising funds classified as a reduction of cost of sales, product mix, net service contract revenue, commission revenue, pricing strategies, market conditions, and other factors, any of which could result in changes in gross profit margins. Selling and administrative expenses Selling and administrative expenses increased $39.4 million, or 4.0%, to $1,029.5 million in 2012, compared to $990.1 million in 2011. As a percentage of total net sales, selling and administrative expenses decreased 10 basis points to 10.2% in 2012, down from 10.3% in 2011. The dollar increase in selling and administrative expenses was primarily due to higher payroll costs (excluding bonus compensation tied to Adjusted EBITDA) of $43.0 million. The higher payroll costs reflected in selling and administrative expenses were driven by increased sales commissions and other variable compensation costs consistent with higher sales and gross profit. While total coworker count increased by 59 coworkers, from 6,745 coworkers at December 31, 2011 to 6,804 coworkers at December 31, 2012, the increase was primarily comprised of service delivery coworkers, the cost of which is reflected in cost of sales. Other factors that increased selling and administrative expenses included a $5.8 million increase in health benefits due to higher claims costs and a higher average number of participants in 2012 compared to 2011, a $5.3 million increase in depreciation and amortization expense related primarily to additional capital expenditures for information technology systems, and a $2.6 million increase in stock compensation expense, primarily due to incremental expense related to a modified Class B Common Unit grant agreement with our former chief executive officer. Partially offsetting these increases was an $11.8 million decline in bonus compensation tied to Adjusted EBITDA, as performance fell below target, $3.8 million of expenses related to the modification of our senior secured term loan facility in 2011 that did not recur in 2012, and a $3.3 million decline in litigation expenses between years. The decrease in selling and administrative expenses as a percentage of sales of 10 basis points between years was driven by the decline in incentive compensation tied to Adjusted EBITDA performance. Advertising expense Advertising expense increased $6.8 million, or 5.6%, to $129.5 million in 2012, compared to $122.7 million in 2011. As a percentage of net sales, advertising expense was 1.3% in both 2012 and 2011. The increase in advertising expense was due to a focus on continuing to advertise our solutions and products and to build our reputation as a leading IT solutions provider, primarily through targeted digital advertising, partially offset by decreases in expenditures for print advertising. Income from operations The following table presents income (loss) from operations by segment, in dollars and as a percentage of net sales, and the year-over-year percentage change in income (loss) from operations for the years ended December 31, 2012 and 2011: Year Ended December 31, 2012 Year Ended December 31, 2011 Dollars inMillions OperatingMarginPercentage Dollars inMillions OperatingMarginPercentage Percent Changein Income (Loss)from Operations Segments: (1) Corporate $349.0 6.3%$331.6 6.2%5.2% Public 246.7 6.1 233.3 6.2 5.7 Other 18.6 3.1 17.5 3.4 6.5 Headquarters (2)(103.7)nm*(111.7)nm*7.2 Total income from operations $510.6 5.0%$470.7 4.9%8.5% * Not meaningful (1) Segment income (loss) from operations includes the segment’s direct operating income (loss) and allocations for Headquarters’ costs, allocations for logistics services, certain inventory adjustments, and volume rebates and cooperative advertising from vendors. (2) Includes Headquarters’ function costs that are not allocated to the segments. Income from operations was $510.6 million in 2012, an increase of $39.9 million, or 8.5%, compared to $470.7 million in 2011. This increase was driven by higher net sales and gross profit, partially offset by higher selling and administrative expenses and advertising expense. Total operating margin percentage increased 10 basis points to 5.0% in 2012, Table of Contents 43 compared to 4.9% in 2011. Operating margin percentage was positively impacted by the decrease in selling and administrative expenses as a percentage of net sales. Corporate segment income from operations was $349.0 million in 2012, an increase of $17.4 million, or 5.2%, compared to $331.6 million in 2011. This increase was primarily driven by higher net sales and gross profit margin, partially offset by higher selling and administrative expenses, resulting in a net increase in segment operating income before allocations of $14.4 million in 2012 compared to 2011. In addition, Corporate segment income from operations benefited from an increase of $2.5 million in income allocations from our logistics operations and a decrease of $0.5 million in Headquarters' expense allocations in 2012 compared to 2011. The improved profitability of our logistics operations was driven by stronger operating leverage given higher purchase volumes while support costs remained flat. Public segment income from operations was $246.7 million in 2012, an increase of $13.4 million, or 5.7%, compared to $233.3 million in 2011. This increase reflected higher segment operating income before allocations of $4.0 million as a result of increased net sales and gross profit dollars, partially offset by higher selling and administrative costs. In addition, Public segment income from operations benefited from an increase of $5.7 million in income allocations from our logistics operations and a decrease in Headquarters’ expense allocations of $3.7 million in 2012 compared to 2011. Interest expense, net At December 31, 2012, our outstanding long-term debt totaled $3,771.0 million, compared to $4,066.0 million at December 31, 2011. Net interest expense in 2012 was $307.4 million, a decrease of $16.8 million compared to $324.2 million in 2011. Interest expense in 2011 included a benefit of $19.4 million, due to an adjustment to the long-term accrued interest liability associated with the extinguishment of $1,078.0 million of senior notes due 2015. The long-term accrued interest liability represents the difference between interest expense previously recognized under the effective interest method and actual interest paid. Of the remaining net decrease of $36.2 million, $27.2 million was due to lower effective interest rates and lower debt balances in 2012 compared to the prior year as a result of debt repayment and refinancing activities completed during 2011 and 2012. The remaining net decrease was primarily attributable to additional interest expense in 2011 related to the interest rate swaps that terminated in January 2011, higher 2011 mark-to-market losses on interest rate caps, higher amortization of deferred financing costs in 2011 compared to 2012 and a 2012 benefit related to an adjustment to the long-term accrued interest liability associated with the extinguishment of $100.0 million of senior subordinated notes due 2017. Net loss on extinguishments of long-term debt During 2012, we recorded a net loss on extinguishments of long-term debt of $17.2 million compared to $118.9 million in 2011. In February and March 2012, we purchased or redeemed the remaining $129.0 million of senior notes due 2015, funded with the issuance of an additional $130.0 million of senior notes due 2019. As a result, we recorded a loss on extinguishment of long-term debt of $9.4 million, representing the difference between the purchase or redemption price of the senior notes due 2015 and the net carrying amount of the purchased debt, adjusted for the remaining unamortized deferred financing costs. In December 2012, we redeemed $100.0 million aggregate principal amount of senior subordinated notes. We recorded a loss on extinguishment of long-term debt of $7.8 million representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In March 2011, we amended our senior secured term loan facility and recorded a loss on extinguishment of long-term debt of $3.2 million, representing a write-off of a portion of the unamortized deferred financing costs on this facility. In April and May 2011, we purchased $1,078.0 million of senior notes due 2015, funded with the issuance of $1,175.0 million of senior notes due 2019. As a result, we recorded a loss on extinguishment of long-term debt of $114.1 million, representing the difference between the purchase price of the senior notes due 2015 at 109% of principal amount and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In June 2011, we entered into a new $900.0 million senior secured asset-based revolving credit facility, replacing the existing $800.0 million facility. As a result, we recorded a loss on extinguishment of long-term debt of $1.6 million representing a write-off of a portion of the unamortized deferred financing costs related to the previous facility. Income tax expense Income tax expense was $67.1 million in 2012, compared to $11.2 million in 2011. The effective income tax rate was 36.0% and 39.7% for 2012 and 2011, respectively. Table of Contents 44 For 2012, the effective tax rate differed from the U.S. federal statutory rate primarily due to favorable adjustments to state tax credits which are partially offset by the unfavorable impact of adjustments to deferred taxes due to changes in state tax laws and permanent differences. For 2011, the effective tax rate differed from the U.S. federal statutory rate primarily due to the unfavorable impact of permanent differences offset by a benefit for state income taxes. The lower effective tax rate for 2012 as compared to 2011 was primarily driven by the impact of favorable adjustments to state tax credits in 2012 and the lower rate impact of permanent differences in 2012 due to the significantly greater amount of pre-tax income. Net income Net income was $119.0 million in 2012, compared to $17.1 million in 2011. The 2012 and 2011 results included after tax losses on extinguishments of long-term debt of $10.5 million and $72.5 million, respectively. Other significant factors and events causing the net changes from 2011 to 2012 are discussed above. Non-GAAP net income Non-GAAP net income was $247.1 million for the year ended December 31, 2012, an increase of $48.3 million, or 24.3%, compared to $198.8 million for the year ended December 31, 2011. We have included a reconciliation of Non-GAAP net income for the years ended December 31, 2012 and 2011 below. Non-GAAP net income excludes, among other things, charges related to the amortization of acquisition-related intangibles, non-cash equity-based compensation and gains and losses from the early extinguishment of debt. Non-GAAP net income is considered a non-GAAP financial measure. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that Non-GAAP net income provides helpful information with respect to our operating performance and cash flows including our ability to meet our future debt service, capital expenditures and working capital requirements. (in millions)Years Ended December 31, 2012 2011 Net income $119.0 $17.1 Amortization of intangibles (1)163.7 165.7 Non-cash equity-based compensation 22.1 19.5 Net loss on extinguishments of long-term debt 17.2 118.9 Interest expense adjustment related to extinguishments of long-term debt (2)(3.3)(19.4) Debt related refinancing costs (3)—3.8 Aggregate adjustment for income taxes (4)(71.6)(106.8) Non-GAAP net income $247.1 $198.8 (1) Includes amortization expense for acquisition-related intangible assets, primarily customer relationships and trade names. (2) Reflects adjustments to interest expense resulting from debt extinguishments. Represents the difference between interest expense previously recognized under the effective interest method and actual interest paid. (3) Reflects expenses for the March 2011 amendment to the prior term loan facility. (4) Based on a normalized effective tax rate of 39.0%. Adjusted EBITDA Adjusted EBITDA was $766.6 million in 2012, an increase of $49.3 million, or 6.9%, compared to $717.3 million in 2011. As a percentage of net sales, Adjusted EBITDA was 7.6% and 7.5% in 2012 and 2011, respectively. We have included a reconciliation of EBITDA and Adjusted EBITDA for 2012 and 2011 in the table below. EBITDA is defined as consolidated net income before interest expense, income tax expense, depreciation and amortization. Adjusted EBITDA, which is a measure defined in our credit agreements, means EBITDA adjusted for certain items which are described in the table below. Both EBITDA and Adjusted EBITDA are considered non-GAAP financial measures. Generally, a non- GAAP financial measure is a numerical measure of a company's performance, financial position or cash flows that either Table of Contents 45 excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that EBITDA and Adjusted EBITDA provide helpful information with respect to our operating performance and cash flows including our ability to meet our future debt service, capital expenditures and working capital requirements. Adjusted EBITDA also provides helpful information as it is the primary measure used in certain financial covenants contained in our credit agreements. See “Selected Financial Data” included elsewhere in this report for a reconciliation of EBITDA to cash flows from operating activities. (in millions)Years Ended December 31, 2012 2011 Net income $119.0 $17.1 Depreciation and amortization 210.2 204.9 Income tax expense 67.1 11.2 Interest expense, net 307.4 324.2 EBITDA 703.7 557.4 Adjustments: Non-cash equity-based compensation 22.1 19.5 Sponsor fee 5.0 5.0 Consulting and debt-related professional fees 0.6 5.1 Net loss on extinguishments of long-term debt 17.2 118.9 Litigation, net (1)4.3 — Other adjustments (2)13.7 11.4 Total adjustments 62.9 159.9 Adjusted EBITDA $766.6 $717.3 (1) Relates to unusual, non-recurring litigation matters. (2) Other adjustments include certain retention costs and equity investment income. The following table sets forth a reconciliation of EBITDA to net cash provided by operating activities for the years ended December 31, 2012 and 2011. Years Ended December 31, (in millions)2012 2011 EBITDA $703.7 $557.4 Depreciation and amortization (210.2)(204.9) Income tax expense (67.1)(11.2) Interest expense, net (307.4)(324.2) Net income 119.0 17.1 Depreciation and amortization 210.2 204.9 Equity-based compensation expense 22.1 19.5 Deferred income taxes (56.3)(10.2) Allowance for doubtful accounts —0.4 Amortization of deferred financing costs and debt premium 13.6 15.7 Net loss on extinguishments of long-term debt 17.2 118.9 Other 1.0 6.7 Changes in assets and liabilities (9.4)(158.3) Net cash provided by operating activities $317.4 $214.7 Table of Contents 46 Seasonality While we have not historically experienced significant seasonality throughout the year, sales in our Corporate segment, which primarily serves private sector business customers, are typically higher in the fourth quarter than in other quarters due to customers spending their remaining technology budget dollars at the end of the year. Additionally, sales in our Public segment have historically been higher in the third quarter than in other quarters primarily due to the buying patterns of the federal government and education customers. Liquidity and Capital Resources Overview We finance our operations and capital expenditures through a combination of internally generated cash from operations and from borrowings under our senior secured asset-based revolving credit facility. We believe that our current sources of funds will be sufficient to fund our cash operating requirements for the next year. In addition, we believe that, in spite of the uncertainty of future macroeconomic conditions, we have adequate sources of liquidity and funding available to meet our longer-term needs. However, there are a number of factors that may negatively impact our available sources of funds. The amount of cash generated from operations will be dependent upon factors such as the successful execution of our business plan and general economic conditions. On July 2, 2013, we completed an IPO of 23,250,000 shares of common stock. On July 31, 2013, we completed the sale of an additional 3,487,500 shares of common stock to the underwriters of the IPO pursuant to the underwriters' July 26, 2013 exercise in full of the overallotment option granted to them in connection with the IPO. Such shares were registered under the Securities Act of 1933, as amended, pursuant to our Registration Statement on Form S-1, which was declared effective by the SEC on June 26, 2013. Our shares of common stock are listed on the NASDAQ Global Select Market under the symbol “CDW.” Our shares of common stock were sold to the underwriters at a price of $17.00 per share in the IPO and upon the exercise of the overallotment option, which together generated aggregate net proceeds of $424.7 million to us after deducting underwriting discounts, expenses and transaction costs. Using a portion of the net proceeds from the IPO, we paid a $24.4 million termination fee to affiliates of the Sponsors in connection with the termination of the management services agreement with such entities that was effective upon completion of the IPO and redeemed $175.0 million aggregate principal amount of senior secured notes due 2018. The redemption price of the senior secured notes due 2018 was 108.0% of the principal amount redeemed, plus $0.7 million of accrued and unpaid interest to the date of redemption. We used cash on hand to pay such accrued and unpaid interest. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $16.7 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented $14.0 million in redemption premium and $2.7 million for the write-off of a portion of the remaining deferred financing costs related to the senior secured notes due 2018. On August 1, 2013, we redeemed $324.0 million aggregate principal amount of senior subordinated notes due 2017. We used a portion of the net proceeds from the IPO to redeem $146.0 million aggregate principal amount of senior subordinated notes due 2017 and incremental borrowings of $190.0 million under the senior secured term loan facility to redeem $178.0 million aggregate principal amount of senior subordinated notes due 2017. The redemption price of the senior subordinated notes due 2017 was 106.268% of the principal amount redeemed, plus $12.0 million of accrued and unpaid interest to the date of redemption. We used cash on hand to pay such accrued and unpaid interest. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $24.6 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented $20.3 million in redemption premium and $4.3 million for the write-off of a portion of the remaining deferred financing costs related to the senior subordinated notes due 2017. On October 18, 2013, we redeemed $155.0 million aggregate principal amount of senior subordinated notes due 2017 at a redemption price that was 104.178% of the principal amount redeemed plus $0.2 million in accrued and unpaid interest to the date of redemption. We used a combination of cash on hand and the net proceeds from the sale of shares of common stock related to the underwriters' July 26, 2013 exercise in full of the overallotment option granted to them in connection with the IPO, in the amount of $56.0 million, to redeem the $155.0 million aggregate principal amount of senior subordinated notes due 2017, including the redemption premium and accrued and unpaid interest. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $8.5 million in the consolidated statement of operations during the year ended December 31, 2013. This loss represented $6.5 million in redemption premium and $2.0 million for the write-off of a portion of the remaining deferred financing costs related to the senior subordinated notes due 2017. See "Subsequent Events" below for a description of refinancing transactions completed during 2014. Table of Contents 47 On December 2, 2013, we paid a cash dividend on our common stock of $0.0425 per share to all stockholders of record as of the close of business on November 15, 2013. On February 13, 2014, we announced that our board of directors declared a quarterly cash dividend on our common stock of $0.0425 per share. The dividend will be paid on March 10, 2014 to all stockholders of record as of the close of business on February 25, 2014. The payment of any future dividends will be at the discretion of our board of directors and will depend upon our results of operations, financial condition, business prospects, capital requirements, contractual restrictions, any potential indebtedness we may incur, restrictions imposed by applicable law, tax considerations and other factors that our board of directors deems relevant. In addition, our ability to pay dividends on our common stock will be limited by restrictions on our ability to pay dividends or make distributions to our stockholders and on the ability of our subsidiaries to pay dividends or make distributions to us, in each case, under the terms of our current and any future agreements governing our indebtedness. In connection with the establishment of the MPK Incentive Plan II (the “MPK Plan”) in 2007, we agreed to make charitable contributions in amounts equal to the net income tax benefits derived from payouts to participants under the MPK Plan (net of any related employer payroll tax costs). As of December 31, 2013, we have accrued approximately $21 million related to this arrangement within other current liabilities. We expect to make the related cash contribution during the first quarter of 2014. See Note 10 of the accompanying audited consolidated financial statements for additional discussion of this arrangement. Cash Flows Cash flows from operating, investing and financing activities were as follows: (in millions)Years Ended December 31, 2013 2012 2011 Net cash provided by (used in): Operating activities $366.3 $317.4 $214.7 Investing activities (47.1)(41.7)(56.0) Net change in accounts payable - inventory financing 7.4 (29.5)250.5 Other financing activities (175.7)(308.5)(345.9) Financing activities (168.3)(338.0)(95.4) Effect of exchange rate changes on cash and cash equivalents (0.7)0.3 — Net increase (decrease) in cash and cash equivalents $150.2 $(62.0)$63.3 Operating Activities Net cash provided by operating activities for 2013 increased $48.9 million compared to 2012. Net income adjusted for the impact of non-cash items such as depreciation and amortization, equity-based compensation expense and net loss on extinguishments of long-term debt was $413.4 million during 2013, compared to $326.8 million during 2012, an increase of $86.6 million. The increase in cash of $86.6 million reflected stronger operating results in 2013 compared to 2012. Net changes in assets and liabilities reduced cash by $47.1 million in 2013 compared to a reduction of $9.4 million in 2012, resulting in a change of $37.7 million between periods. While changes in assets and liabilities were relatively flat during 2012, during 2013, accounts receivable and accounts payable balances decreased and increased cash by $170.8 million and $146.1 million, respectively, primarily as a result of accelerated sales growth during the final month of 2013. Merchandise inventory also increased during 2013 to support strong sales order volume near the end of 2013. Net cash provided by operating activities for 2012 increased $102.7 million compared to 2011. The increase was primarily driven by changes in assets and liabilities, resulting in a $148.9 million increase in net cash provided by operating activities between periods. Despite a 2012 fourth quarter increase in net sales of 4.9% between years, accounts receivable remained relatively flat from the prior year end driven by improved collection results, particularly within the Public segment. Accounts receivable in 2011 represented a use of cash of $183.4 million, primarily due to a 2011 fourth quarter increase in net sales of 9.3% from the same period in the prior year. Merchandise inventory also contributed $36.1 million of the increase in cash between years driven by a return to more normalized inventory levels in 2012 following the build-up at the end of 2011 related to the hard drive shortage from the Thailand floods, along with a higher percentage of drop shipments from vendor partners and distributors in 2012 compared to 2011. Partially offsetting these factors in 2012 was a $54.1 million decrease in other assets as we collected $53.3 million in income tax refunds in 2011 that did not repeat in 2012. Net income adjusted for the impact of non-cash items such as losses on extinguishment of long-term debt was $326.8 million in 2012 compared to $373.0 million in 2011, or a decrease of $46.2 million. Improved operating performance in 2012 drove higher net income between years, but also higher net cash income taxes paid. Net cash income taxes paid in 2012 were $123.2 million compared to a net Table of Contents 48 cash tax refund of $20.9 million in 2011. In addition to the $53.3 million in cash tax refunds received in 2011, we also fully utilized our remaining federal net operating tax loss carryforwards during 2011. In order to manage our working capital and operating cash needs, we monitor our cash conversion cycle, defined as days of sales outstanding in accounts receivable plus days of supply in inventory minus days of purchases outstanding in accounts payable, based on a rolling three-month average. The following table presents the components of our cash conversion cycle: (in days)December 31, 2013 2012 2011 Days of sales outstanding (DSO) (1)44 42 45 Days of supply in inventory (DIO) (2)15 14 15 Days of purchases outstanding (DPO) (3)(35)(32)(32) Cash conversion cycle 24 24 28 (1) Represents the rolling three-month average of the balance of trade accounts receivable, net at the end of the period divided by average daily net sales for the same three-month period. Also incorporates components of other miscellaneous receivables. (2) Represents the rolling three-month average of the balance of inventory at the end of the period divided by average daily cost of goods sold for the same three-month period. (3) Represents the rolling three-month average of the combined balance of accounts payable-trade, excluding cash overdrafts, and accounts payable-inventory financing at the end of the period divided by average daily cost of goods sold for the same three-month period. The cash conversion cycle remained flat at 24 days for both December 31, 2013 and 2012. The increase in DSO was primarily driven by an increase in receivables for third-party services such as software assurance and warranties. These services have an unfavorable impact on DSO as the receivable is recognized on the balance sheet on a gross basis while the corresponding sales amount in the statement of operations is recorded on a net basis. The DPO increase was primarily due to an increase in payables for third-party services, which offsets the related increase in DSO discussed above. These services have a favorable impact on DPO as the payable is recognized on the balance sheet without a corresponding cost of sales in the statement of operations because the cost paid to the vendor or third-party service provider is recorded as a reduction to net sales. The timing of quarter-end payments also had a favorable impact on DPO at December 31, 2013. The increase in DIO was primarily due to an increase in inventory to support strong sales order volume near the end of 2013. The cash conversion cycle decreased to 24 days at December 31, 2012 compared to 28 days at December 31, 2011, driven by improvements in DSO and DIO. The DSO decline was primarily related to improved collections in the Public segment. The DIO decline was primarily related to an increase in the percentage of products delivered to customers via drop- shipment in 2012 compared to 2011, which had the effect of increasing cost of sales without a corresponding increase in inventory-related working capital. Investing Activities Net cash used in investing activities increased $5.4 million in 2013 compared to 2012. Capital expenditures were $47.1 million and $41.4 million for 2013 and 2012, respectively, primarily for improvements to our information technology systems during both years. Net cash used in investing activities in 2012 decreased $14.3 million compared to 2011. This decline was primarily due to a reduction in cash payments between years of $6.6 million related to interest rate swap agreements, as the $6.6 million paid in 2011 reflected the final payment upon termination of the swap agreements on January 14, 2011. Capital expenditures were $41.4 million and $45.7 million for 2012 and 2011, respectively, primarily for improvements to our information technology systems during both years. During 2012 and 2011, we paid $0.3 million and $3.7 million, respectively, for new interest rate cap agreements. Financing Activities Net cash used in financing activities decreased $169.7 million in 2013 compared to 2012. The decrease was primarily driven by various debt transactions during each period and our July 2013 IPO, which generated net proceeds of $424.7 million after deducting underwriting discounts, expenses and transaction costs. The net impact of our debt transactions resulted in cash outflows of $569.4 million and $310.6 million during 2013 and 2012, respectively, as cash was used in each period to reduce Table of Contents 49 our total long-term debt. Debt transactions impacting each period presented are described below under "Long-Term Debt and Financing Arrangements." Net cash used in financing activities increased $242.6 million in 2012 compared to 2011. This change was primarily driven by 2011 net inflows from accounts payable-inventory financing of $250.5 million compared to 2012 outflows of $29.5 million, resulting in a total impact on the change in cash used in financing activities of $280.0 million from accounts payable- inventory financing. The reduction in cash during 2012 from accounts payable-inventory financing was primarily due to the termination of one of our inventory financing agreements in the first quarter of 2012, with amounts owed for subsequent purchases being included in accounts payable-trade on the consolidated balance sheet and classified as cash flows from operating activities on the consolidated statement of cash flows. As discussed below under “Inventory Financing Arrangements,” in June 2011 we entered into a new inventory financing agreement with a financial intermediary to facilitate the purchase of inventory from a certain vendor. Inventory purchases from this vendor under the June 2011 inventory financing agreement are included in accounts payable-inventory financing and reported as cash flows from financing activities. The net impact of our debt transactions resulted in cash outflows of $310.6 million during 2012 and $346.5 million during 2011 as cash was used in each period to reduce our total long-term debt. Debt transactions impacting each period presented are described below under "Long-Term Debt and Financing Arrangements." Long-Term Debt and Financing Arrangements Long-term debt was as follows: (dollars in millions)December 31, Interest Rate (1)2013 2012 Senior secured asset-based revolving credit facility —%$—$— Senior secured term loan facility 3.25%1,528.9 1,339.5 Unamortized discount on senior secured term loan facility (4.4)— Senior secured notes due 2018 8.0%325.0 500.0 Senior notes due 2019 8.5%1,305.0 1,305.0 Unamortized premium on senior notes due 2019 4.2 5.0 Senior subordinated notes due 2017 12.535%92.5 621.5 Total long-term debt 3,251.2 3,771.0 Less current maturities of long-term debt (45.4)(40.0) Long-term debt, excluding current maturities $3,205.8 $3,731.0 (1) Interest rate at December 31, 2013. At December 31, 2013, we were in compliance with the covenants under our various credit agreements and indentures as described below. Under the indentures governing the 8.5% Senior Notes due 2019 and 8.0% Senior Secured Notes due 2018, which contain the most restrictive restricted payment provisions in our various credit agreements and indentures, CDW LLC and its restricted subsidiaries are generally restricted from paying dividends and making other restricted payments unless CDW LLC could incur an additional dollar of indebtedness under its fixed charges ratio covenant and the amount of such dividend or other restricted payment, together with the amount of all other dividends and restricted payments made from January 1, 2011 through the end of the most recently ended fiscal quarter, is less than the sum of 50% of cumulative consolidated net income or 100% of any consolidated net loss incurred over the period plus the amount of certain other items occurring during that period that increase (and in some cases decrease) the amounts available for such payments. For the purpose of determining restricted payment capacity, consolidated net income or loss includes certain adjustments that are defined in the indentures. At December 31, 2013, the amount of cumulative consolidated net income free of restrictions under the credit agreements and indentures ("Restricted Payment Capacity") was $148.0 million. However, the transactions described below under "Subsequent Events" have since reduced the Restricted Payment Capacity to approximately $89 million. Senior Secured Asset-Based Revolving Credit Facility (“Revolving Loan”) At December 31, 2013, we had no outstanding borrowings under the Revolving Loan, $2.2 million of undrawn letters of credit and $256.7 million reserved related to the floorplan sub-facility. On June 24, 2011, we entered into the Revolving Loan, a five-year $900.0 million senior secured asset-based revolving credit facility, with the facility being available to us for borrowings, issuance of letters of credit and floorplan financing for certain vendor products. The Revolving Loan matures on June 24, 2016. The Revolving Loan replaced our previous revolving loan credit facility that was to mature on October 12, 2012. In connection with the termination of the Table of Contents 50 previous facility, we recorded a loss on extinguishment of long-term debt of $1.6 million in the consolidated statement of operations for the year ended December 31, 2011, representing a write-off of a portion of unamortized deferred financing costs. Fees of $7.2 million related to the Revolving Loan were capitalized as deferred financing costs and are being amortized over the term of the facility on a straight-line basis. As described in Note 5 to the consolidated financial statements, we have entered into agreements with certain financial intermediaries to facilitate the purchase of inventory from various suppliers. In connection with the floorplan sub-facility, we entered into the Revolving Loan inventory financing agreement. Amounts outstanding under the Revolving Loan inventory financing agreement are unsecured and noninterest bearing. We will either pay the outstanding Revolving Loan inventory financing agreement amounts when they become due, or the Revolving Loan's administrative agent will automatically initiate an advance on the Revolving Loan and use the proceeds to pay the balance on the due date. At December 31, 2013, the financial intermediary reported an outstanding balance of $246.8 million under the Revolving Loan inventory financing agreement. The total amount reported on the consolidated balance sheet as accounts payable-inventory financing related to the Revolving Loan inventory financing agreement is $9.3 million more than the $246.8 million owed to the financial intermediary due to differences in the timing of reporting activity under the Revolving Loan inventory financing agreement. The outstanding balance reported by the financial intermediary excludes $9.9 million in reserves for open orders that reduce the availability under the Revolving Loan. Changes in cash flows from the Revolving Loan inventory financing agreement are reported in financing activities on the consolidated statements of cash flows. Borrowings under the Revolving Loan bear interest at a variable interest rate plus an applicable margin. The variable interest rate is based on one of two indices, either (i) LIBOR, or (ii) the Alternate Base Rate (“ABR”) with the ABR being the greatest of (a) the prime rate, (b) the federal funds effective rate plus 50 basis points or (c) the one-month LIBOR plus 1.00%. The applicable margin varies (2.00% to 2.50% for LIBOR borrowings and 1.00% to 1.50% for ABR borrowings) depending upon our average daily excess cash availability under the agreement and is subject to a reduction of 0.25% if, and for as long as, the senior secured leverage ratio is less than 3.0. The senior secured leverage ratio is defined as the ratio of senior secured debt (including amounts owed under certain inventory floorplan arrangements) less cash and cash equivalents, to Adjusted EBITDA, a non-GAAP measure, for the four most recently ended fiscal quarters. For the four quarters ended December 31, 2013, the senior secured leverage ratio was 2.1. Availability under the Revolving Loan is limited to (a) the lesser of the revolving commitment of $900.0 million and the amount of the borrowing base less (b) outstanding borrowings, letters of credit, and amounts outstanding under the Revolving Loan inventory financing agreement plus a reserve of 15% of open orders. The borrowing base is (a) the sum of the products of the applicable advance rates on eligible accounts receivable and on eligible inventory as defined in the agreement less (b) any reserves. At December 31, 2013, the borrowing base was $1,065.5 million based on the amount of eligible inventory and accounts receivable balances as of November 30, 2013. We could have borrowed up to an additional $641.1 million under the Revolving Loan at December 31, 2013. The fee on the unused portion of the Revolving Loan ranges from 25 basis points to either 37.5 or 50 basis points, depending on the amount of utilization. CDW LLC is the borrower under the Revolving Loan. All obligations under the Revolving Loan are guaranteed by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. Borrowings under the Revolving Loan are collateralized by a first priority interest in inventory (excluding inventory collateralized under the inventory floorplan arrangements as described in Note 5), deposits, and accounts receivable, and a second priority interest in substantially all other assets. The Revolving Loan contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. The Revolving Loan also includes maintenance of a minimum average daily excess cash availability requirement. Should we fall below the minimum average daily excess cash availability requirement for five consecutive business days, we become subject to a fixed charge coverage ratio until such time as the daily excess cash availability requirement is met for 30 consecutive business days. Senior Secured Term Loan Facility On April 29, 2013, we entered into a new seven-year, $1,350.0 million aggregate principal amount senior secured term loan facility (the "Term Loan"). The Term Loan was issued at a price that was 99.75% of par, which resulted in a discount of $3.4 million. Substantially all of the proceeds from the Term Loan were used to repay the $1,299.5 million outstanding aggregate principal amount of the prior senior secured term loan facility (the "Prior Term Loan Facility"). In connection with this refinancing, we recorded a loss on extinguishment of long-term debt of $10.3 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented a write-off of the remaining unamortized deferred financing costs related to the Prior Term Loan Facility. Table of Contents 51 On July 31, 2013, we borrowed an additional $190.0 million aggregate principal amount under the Term Loan at a price that was 99.25% of par, which resulted in a discount of $1.4 million. Such proceeds were used to redeem a portion of outstanding Senior Subordinated Notes. The discounts are reported on the consolidated balance sheet as a reduction to the face amount of the Term Loan and are being amortized to interest expense over the term of the related debt. Fees of $6.1 million related to the Term Loan were capitalized as deferred financing costs and are being amortized over the term of the facility using the effective interest method. Borrowings under the Term Loan bear interest at either (a) the alternate base rate ("ABR") plus a margin or (b) LIBOR plus a margin; provided that for the purposes of the Term Loan, LIBOR shall not be less than 1.00% per annum at any time ("LIBOR Floor"). The margin is based upon a net leverage ratio as defined in the agreement governing the Term Loan, ranging from 1.25% to 1.50% for ABR borrowings and 2.25% to 2.50% for LIBOR borrowings. An interest rate of 3.25%, LIBOR Floor plus a 2.25% margin, was in effect during the three-month period ended December 31, 2013. Unlike the Prior Term Loan Facility, the Term Loan does not include a senior secured leverage ratio requirement or a hedging requirement. Additionally, the definition of debt under the Term Loan was revised to exclude amounts outstanding under our inventory financing agreements. The Term Loan is subject to certain requirements as was the Prior Term Loan Facility to make mandatory annual excess cash flow prepayments under designated circumstances, including (i) a prepayment in an amount equal to 50% of our excess cash flow for a fiscal year (the percentage rate of which decreases to 25% when the total net leverage ratio, as defined in the governing agreement, is less than or equal to 5.5 but greater than 4.5; and decreases to 0% when the total net leverage ratio is less than or equal to 4.5), and (ii) the net cash proceeds from the incurrence of certain additional indebtedness by us or our subsidiaries. The total net leverage ratio was 3.8 at December 31, 2013. We are required to pay quarterly principal installments equal to 0.25% of the original principal amount of the Term Loan, with the remaining principal amount payable on the maturity date of April 29, 2020. The quarterly principal installment payments commenced during the quarter ended June 30, 2013. At December 31, 2013, the outstanding principal amount of the Term Loan was $1,528.9 million, excluding $4.4 million in unamortized discount. We have interest rate cap agreements in effect through January 14, 2015 with a combined notional amount of $1,150.0 million. These cap agreements have not been designated as cash flow hedges of interest rate risk for GAAP accounting purposes. Of the total $1,150.0 million notional amount, $500.0 million entitle us to payments from the counterparty of the amount, if any, by which three-month LIBOR exceeds 3.5% during the agreement period. The remaining cap agreements with a notional amount of $650.0 million entitle us to payments from the counterparty of the amount, if any, by which the three-month LIBOR exceeds 1.5% during the agreement period. The fair value of our interest rate cap agreements was zero at December 31, 2013 and $0.1 million at December 31, 2012. During the first quarters of 2013, 2012 and 2011, we made principal prepayments totaling $40.0 million, $201.0 million and $132.0 million, respectively, under the Prior Term Loan Facility. These prepayments satisfied the excess cash flow payment provision of the Prior Term Loan Facility with respect to the years ended December 31, 2012, 2011 and 2010, respectively. On March 11, 2011, we entered into an amendment to the Prior Term Loan Facility, which became effective on March 14, 2011. In connection with this amendment, we recorded a loss on extinguishment of long-term debt of $3.2 million in the consolidated statement of operations for the year ended December 31, 2011. This loss represented a write-off of a portion of the unamortized deferred financing costs related to the Prior Term Loan Facility. CDW LLC is the borrower under the Term Loan. All obligations under the Term Loan are guaranteed by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. The Term Loan is collateralized by a second priority interest in substantially all inventory (excluding inventory collateralized under the inventory floorplan arrangements as described in Note 5 to the consolidated financial statements), deposits, and accounts receivable, and by a first priority interest in substantially all other assets. The Term Loan contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. 8.0% Senior Secured Notes due 2018 (“Senior Secured Notes”) The Senior Secured Notes were issued on December 17, 2010 and will mature on December 15, 2018. At December 31, 2013, the outstanding principal amount of the Senior Secured Notes was $325.0 million. Table of Contents 52 On July 2, 2013, we used a portion of the net proceeds from the IPO to redeem $175.0 million aggregate principal amount of Senior Secured Notes. The redemption price of the Senior Secured Notes was 108.0% of the principal amount redeemed, plus $0.7 million of accrued and unpaid interest to the date of redemption. We used cash on hand to pay such accrued and unpaid interest. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $16.7 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented $14.0 million in redemption premium and $2.7 million for the write-off of a portion of the remaining deferred financing costs related to the Senior Secured Notes. CDW LLC and CDW Finance Corporation are the co-issuers of the Senior Secured Notes and the obligations under the notes are guaranteed by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. The Senior Secured Notes are secured on a pari passu basis with the Term Loan by a second priority interest in substantially all inventory (excluding inventory collateralized under the inventory floorplan arrangements as described in Note 5 to the consolidated financial statements), deposits, and accounts receivable, and by a first priority interest in substantially all other assets. The Senior Secured Note indenture contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. The Senior Secured Note indenture does not contain any financial covenants. 11.0% Senior Exchange Notes due 2015 (“Senior Exchange Notes”); 11.5% / 12.25% Senior PIK Election Exchange Notes due 2015 (“PIK Election Notes” together with the Senior Exchange Notes, the “Senior Notes due 2015”) At December 31, 2013, there were no outstanding Senior Notes due 2015. On April 13, 2011, we completed a cash tender offer (the “Initial Senior Notes due 2015 Tender Offer”) and purchased $665.1 million aggregate principal amount of Senior Notes due 2015 comprised of $519.2 million of the Senior Exchange Notes and $145.9 million of the PIK Election Notes. We concurrently issued $725.0 million aggregate principal amount of Senior Notes (as defined below). The proceeds from this offering, together with cash on hand and borrowings under the then- outstanding revolving loan credit facility, were used to fund the purchase of the tendered Senior Notes due 2015, including $665.1 million aggregate principal amount of Senior Notes due 2015, $59.9 million in tender offer premium and $36.5 million of accrued and unpaid interest, along with transaction fees and expenses. On May 20, 2011, we completed a follow-on cash tender offer (the “Follow-on Senior Notes due 2015 Tender Offer,” and together with the Initial Senior Notes due 2015 Tender Offer, the “Senior Notes due 2015 Tender Offers”) and purchased an additional $412.8 million aggregate principal amount of Senior Notes due 2015 comprised of $321.4 million of the Senior Exchange Notes and $91.4 million of the PIK Election Notes. We concurrently issued $450.0 million in aggregate principal amount of additional Senior Notes. The proceeds from this offering, together with cash on hand and borrowings under the then- outstanding revolving loan credit facility, were used to fund the purchase of the tendered Senior Notes due 2015, including $412.8 million aggregate principal amount of Senior Notes due 2015, $37.2 million in tender offer premium and $4.5 million of accrued and unpaid interest, along with transaction fees and expenses. In connection with the Senior Notes due 2015 Tender Offers, we recorded a loss on extinguishment of long-term debt of $114.1 million in the consolidated statement of operations for the year ended December 31, 2011. This loss represented $97.0 million in tender offer premiums and $17.1 million for the write-off of a portion of the unamortized deferred financing costs related to the Senior Notes due 2015. In connection with the issuance of Senior Notes, fees of $19.1 million were capitalized as deferred financing costs and are being amortized over the term of the notes using the effective interest method. On February 2, 2012, we commenced a tender offer to purchase any and all of the remaining $129.0 million aggregate principal amount of Senior Notes due 2015. On February 17, 2012, we accepted for purchase $120.6 million aggregate principal amount of the outstanding Senior Notes due 2015 that were tendered. On March 5, 2012, we accepted for purchase an additional $0.1 million aggregate principal amount of the outstanding Senior Notes due 2015 that were tendered prior to the expiration of the tender offer on March 2, 2012. On March 19, 2012, we redeemed the remaining $8.3 million aggregate principal amount that was not tendered. We funded the purchases and redemptions of the Senior Notes due 2015 with the issuance of $130.0 million aggregate principal amount of additional Senior Notes on February 17, 2012. The proceeds from this issuance, together with cash on hand and borrowings under the Revolving Loan, funded the payment of $129.0 million aggregate principal amount of Senior Notes due 2015, $7.9 million in tender and redemption premiums and $5.0 million of accrued and unpaid interest, along with transaction fees and expenses. Table of Contents 53 In connection with these transactions, we recorded a loss on extinguishment of long-term debt of $9.4 million in the consolidated statement of operations for the year ended December 31, 2012. This loss represented $7.9 million in tender and redemption premiums and $1.5 million for the write-off of the remaining unamortized deferred financing costs related to the Senior Notes due 2015. 8.5% Senior Notes due 2019 (“Senior Notes”) At December 31, 2013, the outstanding principal amount of Senior Notes was $1,305.0 million, excluding $4.2 million in unamortized premium. The Senior Notes mature on April 1, 2019. On February 17, 2012, we issued $130.0 million aggregate principal amount of additional Senior Notes at an issue price of 104.375% of par. The $5.7 million premium received is reported on the consolidated balance sheet as an addition to the face amount of the Senior Notes and is being amortized as a reduction of interest expense over the term of the related debt. As discussed above, on April 13, 2011, we issued $725.0 million aggregate principal amount of Senior Notes and on May 20, 2011, we issued an additional $450.0 million aggregate principal amount of Senior Notes. The proceeds from these issuances together with cash on hand and borrowings under the then-outstanding revolving loan credit facility were used to fund the Senior Notes due 2015 Tender Offers. CDW LLC and CDW Finance Corporation are the co-issuers of the Senior Notes. Obligations under the Senior Notes are guaranteed on an unsecured senior basis by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. The Senior Note indenture contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. The Senior Notes do not contain any financial covenants. 12.535% Senior Subordinated Exchange Notes due 2017 (“Senior Subordinated Notes”) At December 31, 2013, the outstanding principal amount of the Senior Subordinated Notes was $92.5 million. The Senior Subordinated Notes have a maturity date of October 12, 2017. On October 18, 2013, we redeemed $155.0 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 104.178% of the principal amount redeemed. A combination of cash on hand and the net proceeds from the sale of shares of common stock related to the underwriters' July 26, 2013 exercise in full of the overallotment option granted to them in connection with the IPO, in the amount of $56.0 million, was used to fund the redemption of $155.0 million aggregate principal amount, $6.5 million of redemption premium and $0.2 million in accrued and unpaid interest to the date of redemption. See Note 9 in the consolidated financial statements for additional discussion of the underwriters' overallotment option. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $8.5 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented $6.5 million in redemption premium and $2.0 million for the write-off of a portion of the remaining unamortized deferred financing costs related to the Senior Subordinated Notes. On August 1, 2013, we redeemed $324.0 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 106.268% of the principal amount redeemed. We used a portion of the net proceeds from the IPO to redeem $146.0 million aggregate principal amount of Senior Subordinated Notes and incremental borrowings of $190.0 million under the Term Loan to redeem $178.0 million aggregate principal amount of Senior Subordinated Notes. We used cash on hand to pay $12.0 million of accrued and unpaid interest to the date of redemption. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $24.6 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented $20.3 million in redemption premium and $4.3 million for the write-off of a portion of the remaining deferred financing costs related to the Senior Subordinated Notes. On March 8, 2013, we redeemed $50.0 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 106.268% of the principal amount redeemed. Cash on hand was used to fund the redemption of $50.0 million aggregate principal amount, $3.1 million of redemption premium and $2.5 million in accrued and unpaid interest to the date of redemption. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $3.9 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented $3.1 million in redemption premium and $0.8 million for the write-off of a portion of the remaining unamortized deferred financing costs related to the Senior Subordinated Notes. Table of Contents 54 On December 21, 2012, we redeemed $100.0 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 106.268% of the principal amount redeemed. Cash on hand was used to fund the redemption of $100.0 million aggregate principal amount, $6.3 million of redemption premium and $2.3 million in accrued and unpaid interest to the date of redemption. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $7.8 million in the consolidated statement of operations for the year ended December 31, 2012. This loss represented $6.3 million in redemption premium and $1.5 million for the write-off of a portion of the remaining unamortized deferred financing costs related to the Senior Subordinated Notes. CDW LLC and CDW Finance Corporation are the co-issuers of the Senior Subordinated Notes. Obligations under the Senior Subordinated Notes are guaranteed on an unsecured senior basis by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. The Senior Subordinated Note indenture contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. The Senior Subordinated Notes do not contain any financial covenants. Inventory Financing Agreements We have entered into agreements with certain financial intermediaries to facilitate the purchase of inventory from various suppliers under certain terms and conditions, as described below. These amounts are classified separately as accounts payable-inventory financing on the consolidated balance sheets. We do not incur any interest expense associated with these agreements as balances are paid when they are due. The following table presents the amounts included in accounts payable-inventory financing: (in millions)December 31, 2013 2012 Revolving Loan inventory financing agreement $256.1 $248.3 Other inventory financing agreements 0.5 0.9 Accounts payable-inventory financing $256.6 $249.2 We maintain a senior secured asset-based revolving credit facility as described in Note 7 to our consolidated financial statements, which incorporates a $400.0 million floorplan sub-facility to facilitate the purchase of inventory from a certain vendor. In connection with the floorplan sub-facility, we maintain the Revolving Loan inventory financing agreement. Amounts outstanding under the Revolving Loan inventory financing agreement are unsecured and non-interest bearing. At December 31, 2013 and 2012, we reported $256.1 million and $248.3 million, respectively, for this agreement within accounts payable- inventory financing on the consolidated balance sheets. We also maintain other inventory financing agreements with financial intermediaries to facilitate the purchase of inventory from certain vendors. At December 31, 2013 and 2012, amounts owed under other inventory financing agreements of $0.5 million and $0.9 million, respectively, were collateralized by the inventory purchased under these financing agreements and a second lien on the related accounts receivable. Contractual Obligations We have future obligations under various contracts relating to debt and interest payments, operating leases and asset retirement obligations. The following table presents our estimated future payments under contractual obligations that existed as of December 31, 2013, based on undiscounted amounts. Table of Contents 55 (in millions)Payments Due by Period Total < 1 year 1-3 years 4-5 years > 5 years Revolving Loan (1)$—$—$—$—$— Term Loan (2)1,832.7 64.9 128.3 126.3 1,513.2 Senior Secured Notes (3)455.0 26.0 52.0 377.0 — Senior Notes (3)1,915.1 110.9 221.9 221.9 1,360.4 Senior Subordinated Notes (3)124.8 38.8 15.7 70.3 — Operating leases (4)89.2 17.9 30.9 19.7 20.7 Asset retirement obligations (5)0.5 —0.5 —— Total $4,417.3 $258.5 $449.3 $815.2 $2,894.3 (1) Includes only principal payments. Excludes interest payments and fees related to this facility because of variability with respect to the timing of advances and repayments. (2) Includes future principal and cash interest payments on long-term borrowings through scheduled maturity dates. Interest payments for variable rate debt were calculated using interest rates as of December 31, 2013. Excluded from these amounts are the amortization of debt issuance and other costs related to indebtedness. (3) Includes future principal and cash interest payments on long-term borrowings through scheduled maturity dates. Interest on the Senior Secured Notes, Senior Notes and Senior Subordinated Notes is calculated using the stated interest rate. Excluded from these amounts are the amortization of debt issuance and other costs related to indebtedness. See "Subsequent Events" for a description of refinancing transactions completed during 2014. (4) Includes the minimum lease payments for non-cancelable leases of properties and equipment used in our operations. (5) Represent commitments to return property subject to operating leases to original condition upon lease termination. Off-Balance Sheet Arrangements We have no off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. Inflation Inflation has not had a material impact on our operating results. We generally have been able to pass along price increases to our customers, though certain economic factors and technological advances in recent years have tended to place downward pressure on pricing. We also have been able to generally offset the effects of inflation on operating costs by continuing to emphasize productivity improvements and by accelerating our overall cash conversion cycle. There can be no assurances, however, that inflation would not have a material impact on our sales or operating costs in the future. Commitments and Contingencies We are party to various legal proceedings that arise in the ordinary course of our business, which include commercial, intellectual property, employment, tort and other litigation matters. We are also subject to audit by federal, state and local authorities, and by various partners and large customers, including government agencies, relating to purchases and sales under various contracts. In addition, we are subject to indemnification claims under various contracts. From time to time, certain of our customers file voluntary petitions for reorganization or liquidation under the U.S. bankruptcy laws. In such cases, certain pre-petition payments received by us could be considered preference items and subject to return to the bankruptcy administrator. As of December 31, 2013, we do not believe that there is a reasonable possibility that any material loss exceeding the amounts already recognized for these proceedings and matters, if any, has been incurred. However, the ultimate resolutions of these proceedings and matters are inherently unpredictable. As such, our financial condition and results of operations could be adversely affected in any particular period by the unfavorable resolution of one or more of these proceedings or matters. We previously filed a claim as part of a class action settlement in a case alleging price fixing during the period of January 1, 1996 through December 31, 2006, by certain manufacturers of thin-film liquid crystal display panels. On July 13, 2013, the United Stated District Court for the Northern District of California approved distribution of the settlement proceeds, including a net payment to us of $10.4 million after fees and expenses. We have recognized a pre-tax benefit of $10.4 million within selling and administrative expenses in the consolidated statement of operations for the year ended December 31, 2013. Table of Contents 56 The first of two settlement payments was received by us on July 29, 2013 in the amount of $8.5 million. The balance of $1.9 million was received in February 2014. Critical Accounting Policies and Estimates The preparation of financial statements in accordance with GAAP requires management to make use of certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reported periods. We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. In Note 1 to the accompanying audited consolidated financial statements, we include a discussion of the significant accounting policies used in the preparation of our consolidated financial statements. We believe the following are the most critical accounting policies and estimates that include significant judgments used in the preparation of our financial statements. We consider an accounting policy or estimate to be critical if it requires assumptions to be made that were uncertain at the time they were made, and if changes in these assumptions could have a material impact on our financial condition or results of operations. Revenue Recognition We are a primary distribution channel for a large group of vendors and suppliers, including OEMs, software publishers and wholesale distributors. We record revenue from sales transactions when title and risk of loss are passed to our customer, there is persuasive evidence of an arrangement for sale, delivery has occurred and/or services have been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. Our shipping terms typically specify F.O.B. destination, at which time title and risk of loss have passed to the customer. Revenues from the sales of hardware products and software products and licenses are generally recognized on a gross basis with the selling price to the customer recorded as sales and the acquisition cost of the product recorded as cost of sales. These items can be delivered to customers in a variety of ways, including (i) as physical product shipped from our warehouse, (ii) via drop-shipment by the vendor or supplier, or (iii) via electronic delivery for software licenses. At the time of sale, we record an estimate for sales returns and allowances based on historical experience. Our vendor partners warrant most of the products we sell. We leverage drop-shipment arrangements with many of our vendors and suppliers to deliver products to our customers without having to physically hold the inventory at our warehouses, thereby increasing efficiency and reducing costs. We recognize revenue for drop-shipment arrangements on a gross basis upon delivery to the customer with contract terms that typically specify F.O.B. destination. We recognize revenue on a gross basis as the principal in the transaction because we are the primary obligor in the arrangement, we assume inventory risk if the product is returned by the customer, we set the price of the product charged to the customer, we assume credit risk for the amounts invoiced, and we work closely with our customers to determine their hardware and software specifications. These arrangements generally represent approximately 40% to 50% of total net sales, including approximately 10% to 15% related to electronic delivery for software licenses. Revenue from professional services is either recognized as provided for services billed at an hourly rate or recognized using a proportional performance model for services provided at a fixed fee. Revenue from cloud computing solutions including Software as a Service ("SaaS") and Infrastructure as a Service ("IaaS") arrangements, as well as data center services such as managed and remote managed services, server co-location, internet connectivity and data backup and storage, is recognized over the period service is provided. We also sell certain products for which we act as an agent. Products in this category include the sale of third-party services, warranties, software assurance (“SA”) and third-party hosted SaaS and IaaS arrangements. SA is a product that allows customers to upgrade, at no additional cost, to the latest technology if new applications are introduced during the period that the SA is in effect. These sales do not meet the criteria for gross sales recognition, and thus are recognized on a net basis at the time of sale. Under net sales recognition, the cost paid to the vendor or third-party service provider is recorded as a reduction to sales, resulting in net sales being equal to the gross profit on the transaction. Our larger customers are offered the opportunity by certain of our vendors to purchase software licenses and SA under enterprise agreements (“EAs”). Under EAs, customers are considered to be compliant with applicable license requirements for the ensuing year, regardless of changes to their employee base. Customers are charged an annual true-up fee for changes in the number of users over the year. With most EAs, our vendors will transfer the license and bill the customer directly, paying resellers such as us an agency fee or commission on these sales. We record these fees as a component of net sales as earned and Table of Contents 57 there is no corresponding cost of sales amount. In certain instances, we bill the customer directly under an EA and account for the individual items sold based on the nature of the item. Our vendors typically dictate how the EA will be sold to the customer. From time to time, we sell some of our products and services as part of bundled contract arrangements containing multiple deliverables, which may include a combination of the products and services. For each deliverable that represents a separate unit of accounting, total arrangement consideration is allocated based upon the relative selling prices of each element. The allocated arrangement consideration is recognized as revenue in accordance with the principles described above. Selling prices are determined by using vendor specific objective evidence (“VSOE”) if it exists. Otherwise, selling prices are determined using third party evidence (“TPE”). If neither VSOE or TPE is available, we use our best estimate of selling prices. We record freight billed to our customers as net sales and the related freight costs as a cost of sales. Deferred revenue includes (1) payments received from customers in advance of providing the product or performing services, and (2) amounts deferred if other conditions of revenue recognition have not been met. We perform an analysis of the estimated number of days of sales in-transit to customers at the end of each period based on a weighted-average analysis of commercial delivery terms that includes drop-shipment arrangements. This analysis is the basis upon which we estimate the amount of sales in-transit at the end of the period and adjust revenue and the related costs to reflect only what has been received by the customer. Changes in delivery patterns may result in a different number of business days used in making this adjustment and could have a material impact on our revenue recognition for the period. Inventory Valuation Inventory is valued at the lower of cost or market value. Cost is determined using a weighted-average cost method. Price protection is recorded when earned as a reduction to the cost of inventory. We decrease the value of inventory for estimated obsolescence equal to the difference between the cost of inventory and the estimated market value, based upon an aging analysis of the inventory on hand, specifically known inventory-related risks, and assumptions about future demand and market conditions. If future demand or actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required. Vendor Programs We receive incentives from certain of our vendors related to cooperative advertising allowances, volume rebates, bid programs, price protection and other programs. These incentives generally relate to written agreements with specified performance requirements with the vendors and are recorded as adjustments to cost of sales or inventory, depending on the nature of the incentive. Vendors may change the terms of some or all of these programs, which could have an impact on our results of operations. We record receivables from vendors related to these programs when the amounts are probable and reasonably estimable. Some programs are based on the achievement of specific targets, and we base our estimates on information provided by our vendors and internal information to assess our progress toward achieving those targets. If actual performance does not match our estimates, we may be required to adjust our receivables. We record reserves for vendor receivables for estimated losses due to vendors’ inability to pay or rejections by vendors of claims; however, if actual collections differ from our estimates, we may incur additional losses that could have a material impact on gross margin and operating income. Table of Contents 58 Goodwill and Other Intangible Assets Goodwill is not amortized but is subject to periodic testing for impairment at the reporting unit level. Our reporting units used to assess potential goodwill impairment are the same as our operating segments. We are required to perform an evaluation of goodwill on an annual basis or more frequently if circumstances indicate a potential impairment. The annual test for impairment is conducted as of December 1. We have the option of performing a qualitative assessment of a reporting unit's fair value from the last quantitative assessment to determine if it is more likely than not that the reporting unit's goodwill is impaired or performing a quantitative assessment by comparing a reporting unit's estimated fair value to its carrying amount. Under the quantitative assessment, testing for impairment of goodwill is a two-step process. The first step compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill to determine the amount of impairment loss. Fair value of a reporting unit is determined by using a weighted combination of an income approach and a market approach, as this combination is considered the most indicative of the reporting units’ fair value in an orderly transaction between market participants. Under the income approach, we determine fair value based on estimated future cash flows of a reporting unit, discounted by an estimated weighted-average cost of capital, which reflects the overall level of inherent risk of a reporting unit and the rate of return an outside investor would expect to earn. Under the market approach, we utilize valuation multiples derived from publicly available information for peer group companies to provide an indication of how much a knowledgeable investor in the marketplace would be willing to pay for a company. We have weighted the income approach and the market approach at 75% and 25%, respectively. Determining the fair value of a reporting unit (and the allocation of that fair value to individual assets and liabilities within the reporting unit to determine the implied fair value of goodwill in the event a step two analysis is required) is judgmental in nature and requires the use of significant estimates and assumptions. These estimates and assumptions include primarily, but are not limited to, discount rate, terminal growth rate, selection of appropriate peer group companies and control premium applied, and forecasts of revenue growth rates, gross margins, operating margins, and working capital requirements. The allocation requires analysis to determine the fair value of assets and liabilities including, among others, customer relationships, trade names, and property and equipment. Any changes in the judgments, estimates, or assumptions used could produce significantly different results. Although we believe our assumptions are reasonable, actual results may vary significantly and may expose us to material impairment charges in the future. Intangible assets include customer relationships, trade names, internally developed software and other intangibles. Intangible assets with determinable lives are amortized on a straight-line basis over the estimated useful lives of the assets. The cost of software developed or obtained for internal use is capitalized and amortized on a straight-line basis over the estimated useful life of the software. These intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. If the carrying amount of an asset exceeds its estimated future undiscounted cash flows, an impairment loss is recorded for the excess of the asset’s carrying amount over its fair value. Allowance for Doubtful Accounts We record an allowance for doubtful accounts related to trade accounts receivable for estimated losses resulting from the inability of our customers to make required payments. We take into consideration historical loss experience, the overall quality of the receivable portfolio and specifically identified customer risks. If actual collections of customer receivables differ from our estimates, additional allowances may be required which could have an impact on our results of operations. Income Taxes Deferred income taxes are provided to reflect the differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements using enacted tax rates in effect for the year in which the differences are expected to reverse. We perform an evaluation of the realizability of our deferred tax assets on a quarterly basis. This evaluation requires us to use estimates and make assumptions and considers all positive and negative evidence and factors, such as the scheduled reversal of temporary differences, the mix of earnings in the jurisdictions in which we operate, and prudent and feasible tax planning strategies. We account for unrecognized tax benefits based upon our assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. We report a liability for unrecognized tax benefits resulting from unrecognized tax benefits taken or expected to be taken in a tax return and recognize interest and penalties, if any, related to unrecognized tax benefits in income tax expense. Table of Contents 59 Recent Accounting Pronouncements Disclosure of the Effects of Reclassifications from Accumulated Other Comprehensive Income In February 2013, the Financial Accounting Standards Board issued Accounting Standards Update 2013-02, which required that the effects of significant reclassifications from accumulated other comprehensive income to net income be shown parenthetically on the face of the consolidated financial statements or disclosed in a note. The adoption of this new guidance on January 1, 2013 did not have an impact on our consolidated financial position, results of operations or cash flows. Subsequent Events We redeemed $30.0 million and $20.0 million aggregate principal amounts of Senior Subordinated Notes on January 22, 2014 and February 21, 2014, respectively. The redemption prices were 104.178% of the principal amounts redeemed plus $1.0 million and $0.9 million in accrued and unpaid interest to the date of each redemption, respectively. Following these redemptions, $42.5 million aggregate principal amount of the Senior Subordinated Notes remain outstanding, which we expect to fully redeem during the next six months. In connection with these redemptions, we expect to record a loss on extinguishment of long-term debt of $2.7 million in the consolidated statement of operations during the first quarter of 2014. This loss represents $2.1 million in redemption premiums and $0.6 million for the write-off of a portion of the remaining deferred financing costs related to the Senior Subordinated Notes. On February 13, 2014, we announced that our board of directors declared a cash dividend on our common stock of $0.0425 per share. The dividend will be paid on March 10, 2014 to all stockholders of record as of the close of business on February 25, 2014. Future dividends will be subject to the approval of our board of directors. Table of Contents 60 Item 7A. Quantitative and Qualitative Disclosures of Market Risks Our market risks relate primarily to changes in interest rates. The interest rates on borrowings under our senior secured asset-based revolving credit facility and our senior secured term loan facility are floating and, therefore, are subject to fluctuations. In order to manage the risk associated with changes in interest rates on borrowings under our senior secured term loan facility, we have entered into interest rate derivative agreements to economically hedge a portion of the cash flows associated with the facility. Our objectives in using interest rate derivatives are to add stability to interest expense and to manage our exposure to interest rate fluctuations. We utilize interest rate caps for the purpose of limiting current and future exposure to interest rate risk on our floating- rate debt under the senior secured term loan facility. We have interest rate cap agreements in effect through January 14, 2015 with a combined notional amount of $1,150.0 million. These cap agreements have not been designated as cash flow hedges of interest rate risk for GAAP accounting purposes. Of the total $1,150.0 million notional amount, $500.0 million entitle us to payments from the counterparty of the amount, if any, by which three-month LIBOR exceeds 3.5% during the agreement period. The remaining cap agreements with a notional amount of $650.0 million entitle us to payments from the counterparty of the amount, if any, by which the three-month LIBOR exceeds 1.5% during the agreement period. See “Management's Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources - Contractual Obligations” for information on cash flows, interest rates and maturity dates of our debt obligations. Table of Contents 61 Item 8. Financial Statements and Supplementary Data Index to Consolidated Financial Statements Page Table of Contents Report of Independent Registered Public Accounting Firm 62 Consolidated Balance Sheets as of December 31, 2013 and 2012 63 Consolidated Statements of Operations for the years ended December 31, 2013, 2012 and 2011 64 Consolidated Statements of Comprehensive Income for the years ended December 31, 2013, 2012 and 2011 65 Consolidated Statements of Shareholders’ Equity (Deficit) for the years ended December 31, 2013, 2012 and 2011 66 Consolidated Statements of Cash Flows for the years ended December 31, 2013, 2012 and 2011 67 Notes to Consolidated Financial Statements 68 62 Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholders of CDW Corporation We have audited the accompanying consolidated balance sheets of CDW Corporation and subsidiaries as of December 31, 2013 and 2012, and the related consolidated statements of operations, comprehensive income, shareholders' equity (deficit) and cash flows for each of the three years in the period ended December 31, 2013. Our audits also included the financial statement schedule listed in the Index at Item 15(a)(2). These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of CDW Corporation and subsidiaries at December 31, 2013 and 2012, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2013, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), CDW Corporation and subsidiaries’ internal control over financial reporting as of December 31, 2013, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (1992 framework) and our report dated March 5, 2014 expressed an unqualified opinion thereon. /s/ Ernst & Young LLP Chicago, Illinois March 5, 2014 Table of Contents 63 CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in millions, except per-share amounts) December 31, 2013 2012 Assets Current assets: Cash and cash equivalents $188.1 $37.9 Accounts receivable, net of allowance for doubtful accounts of $5.4 and $5.4, respectively 1,451.0 1,285.0 Merchandise inventory 382.0 314.6 Miscellaneous receivables 146.3 148.5 Deferred income taxes —14.1 Prepaid expenses and other 46.1 34.6 Total current assets 2,213.5 1,834.7 Property and equipment, net 131.1 142.7 Goodwill 2,220.3 2,209.3 Other intangible assets, net 1,328.0 1,478.5 Deferred financing costs, net 30.1 53.2 Other assets 1.6 1.6 Total assets $5,924.6 $5,720.0 Liabilities and Shareholders’ Equity Current liabilities: Accounts payable-trade $662.8 $518.6 Accounts payable-inventory financing 256.6 249.2 Current maturities of long-term debt 45.4 40.0 Deferred revenue 94.8 57.8 Accrued expenses: Compensation 112.2 99.4 Interest 31.8 50.7 Sales taxes 29.2 22.6 Advertising 33.2 33.9 Income taxes 6.3 0.2 Other 130.3 95.8 Total current liabilities 1,402.6 1,168.2 Long-term liabilities: Debt 3,205.8 3,731.0 Deferred income taxes 563.5 624.3 Other liabilities 41.0 60.0 Total long-term liabilities 3,810.3 4,415.3 Commitments and contingencies Shareholders’ equity: Preferred shares, $0.01 par value, 100.0 and no shares authorized, respectively; no shares issued or outstanding for bothperiods —— Common shares, $0.01 par value, 1,000.0 and 286.1 shares authorized, respectively; 172.0 and 145.2 shares issued,respectively; 172.0 and 145.1 shares outstanding, respectively 1.7 1.4 Paid-in capital 2,688.1 2,207.7 Accumulated deficit (1,971.8)(2,073.0) Accumulated other comprehensive (loss) income (6.3)0.4 Total shareholders’ equity 711.7 136.5 Total liabilities and shareholders’ equity $5,924.6 $5,720.0 The accompanying notes are an integral part of the consolidated financial statements. Table of Contents 64 CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per-share amounts) Years Ended December 31, 2013 2012 2011 Net sales $10,768.6 $10,128.2 $9,602.4 Cost of sales 9,008.3 8,458.6 8,018.9 Gross profit 1,760.3 1,669.6 1,583.5 Selling and administrative expenses 1,120.9 1,029.5 990.1 Advertising expense 130.8 129.5 122.7 Income from operations 508.6 510.6 470.7 Interest expense, net (250.1)(307.4)(324.2) Net loss on extinguishments of long-term debt (64.0)(17.2)(118.9) Other income, net 1.0 0.1 0.7 Income before income taxes 195.5 186.1 28.3 Income tax expense (62.7)(67.1)(11.2) Net income $132.8 $119.0 $17.1 Net income per common share: Basic $0.85 $0.82 $0.12 Diluted $0.84 $0.82 $0.12 Weighted-average number of common shares outstanding: Basic 156.6 145.1 144.8 Diluted 158.7 145.8 144.9 Cash dividends declared per common share $0.0425 $—$— The accompanying notes are an integral part of the consolidated financial statements. Table of Contents 65 CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in millions) Years Ended December 31, 2013 2012 2011 Net income $132.8 $119.0 $17.1 Reclassification of realized loss on interest rate swap agreements from accumulated other comprehensive (loss) income to net income, net of tax ——1.9 Foreign currency translation adjustment (6.7)2.5 (1.8) Other comprehensive (loss) income, net of tax (6.7)2.5 0.1 Comprehensive income $126.1 $121.5 $17.2 The accompanying notes are an integral part of the consolidated financial statements. Table of Contents 66 CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (DEFICIT) (in millions) Preferred Stock Common Stock Shares Amount Shares Amount Paid-inCapital AccumulatedDeficit AccumulatedOtherComprehensive (Loss) Income TotalShareholders’Equity(Deficit) Balance at December 31, 2010 —$—144.6 $1.4 $2,165.3 $(2,208.0)$(2.2)$(43.5) Equity-based compensation expense ————19.5 ——19.5 Investment from CDW Holdings LLC ————1.0 ——1.0 Repurchase of common shares —————(0.4)—(0.4) Accrued charitable contribution related to theMPK Coworker Incentive Plan II, net of tax ——0.3 —(1.1)——(1.1) Net income —————17.1 —17.1 Reclassification of realized loss on interest rateswap agreements from accumulated othercomprehensive loss to net income, net of tax ——————1.9 1.9 Foreign currency translation adjustment ——————(1.8)(1.8) Balance at December 31, 2011 —$—144.9 $1.4 $2,184.7 $(2,191.3)$(2.1)$(7.3) Equity-based compensation expense ————22.1 ——22.1 Investment from CDW Holdings LLC ————2.8 ——2.8 Repurchase of common shares —————(0.7)—(0.7) Accrued charitable contribution related to theMPK Coworker Incentive Plan II, net of tax ——0.3 —(1.4)——(1.4) Incentive compensation plan units withheld fortaxes ————(0.5)——(0.5) Net income —————119.0 —119.0 Foreign currency translation adjustment ——————2.5 2.5 Balance at December 31, 2012 —$—145.2 $1.4 $2,207.7 $(2,073.0)$0.4 $136.5 Equity-based compensation expense ————46.6 ——46.6 Issuance of common shares ——26.8 0.3 424.4 ——424.7 Repurchase of common shares —————(0.2)—(0.2) Dividends declared —————(7.3)—(7.3) Reclassification to goodwill for accruedcharitable contributions ————9.4 ——9.4 Incentive compensation plan units withheld fortaxes —————(24.1)—(24.1) Net income —————132.8 —132.8 Foreign currency translation adjustment ——————(6.7)(6.7) Balance at December 31, 2013 —$—172.0 $1.7 $2,688.1 $(1,971.8)$(6.3)$711.7 The accompanying notes are an integral part of the consolidated financial statements. Table of Contents 67 CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) Years Ended December 31, 2013 2012 2011 Cash flows from operating activities: Net income $132.8 $119.0 $17.1 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 208.2 210.2 204.9 Equity-based compensation expense 46.6 22.1 19.5 Deferred income taxes (48.7)(56.3)(10.2) Allowance for doubtful accounts ——0.4 Amortization of deferred financing costs, debt premium, and debt discount, net 8.8 13.6 15.7 Net loss on extinguishments of long-term debt 64.0 17.2 118.9 Realized loss on interest rate swap agreements ——2.8 Mark to market loss on interest rate derivatives 0.1 0.9 4.2 Net loss on sale and disposals of assets —0.1 0.3 Other 1.6 —(0.6) Changes in assets and liabilities: Accounts receivable (170.8)(10.4)(183.4) Merchandise inventory (67.5)7.1 (29.0) Other assets (10.1)(3.8)50.3 Accounts payable-trade 146.1 0.8 (19.8) Other current liabilities 64.1 (2.1)39.6 Long-term liabilities (8.9)(1.0)(16.0) Net cash provided by operating activities 366.3 317.4 214.7 Cash flows from investing activities: Capital expenditures (47.1)(41.4)(45.7) Cash settlements on interest rate swap agreements ——(6.6) Premium payments on interest rate cap agreements —(0.3)(3.7) Net cash used in investing activities (47.1)(41.7)(56.0) Cash flows from financing activities: Proceeds from borrowings under revolving credit facility 63.0 289.0 1,295.0 Repayments of borrowings under revolving credit facility (63.0)(289.0)(1,483.2) Repayments of long-term debt (51.1)(201.0)(132.0) Proceeds from issuance of long-term debt 1,535.2 135.7 1,175.0 Payments to extinguish long-term debt (2,047.4)(243.2)(1,175.0) Payments of debt financing costs (6.1)(2.1)(26.3) Investment from CDW Holdings LLC, net —2.8 1.0 Net change in accounts payable-inventory financing 7.4 (29.5)250.5 Payment of incentive compensation plan withholding taxes (24.1)—— Net proceeds from issuance of common shares 424.7 —— Repurchase of common shares (0.2)(0.7)(0.4) Dividends paid (7.3)—— Excess tax benefits from equity-based compensation 0.6 —— Net cash used in financing activities (168.3)(338.0)(95.4) Effect of exchange rate changes on cash and cash equivalents (0.7)0.3 — Net increase (decrease) in cash and cash equivalents 150.2 (62.0)63.3 Cash and cash equivalents – beginning of period 37.9 99.9 36.6 Cash and cash equivalents – end of period $188.1 $37.9 $99.9 Supplementary disclosure of cash flow information: Interest paid $(267.6)$(302.7)$(332.9) Taxes (paid) refunded, net $(82.5)$(123.2)$20.9 Non-cash investing and financing activities: Capital expenditures accrued in accounts payable-trade $0.2 $0.5 $1.1 The accompanying notes are an integral part of the consolidated financial statements. Table of Contents 68 1. Description of Business and Summary of Significant Accounting Policies Description of Business CDW is a Fortune 500 company and a leading provider of integrated information technology (“IT”) solutions to small, medium and large business, government, education and healthcare customers in the U.S. and Canada. The Company's offerings range from discrete hardware and software products to integrated IT solutions such as mobility, security, data center optimization, cloud computing, virtualization and collaboration. Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). On October 12, 2007, CDW Corporation, an Illinois corporation, was acquired through a merger transaction by an entity controlled by investment funds affiliated with Madison Dearborn Partners, LLC and Providence Equity Partners L.L.C. (the “Acquisition”). CDW Corporation continued as the surviving corporation and same legal entity after the Acquisition, but became a wholly owned subsidiary of VH Holdings, Inc., a Delaware corporation. On December 31, 2009, CDW Corporation merged into CDWC LLC, an Illinois limited liability company owned by VH Holdings, Inc., with CDWC LLC as the surviving entity. This change had no impact on the operations or management of the Company. On December 31, 2009, CDWC LLC was renamed CDW LLC (“CDW LLC”). On August 17, 2010, VH Holdings, Inc. was renamed CDW Corporation (“Parent”). Parent has two 100% owned subsidiaries, CDW LLC and CDW Finance Corporation. CDW LLC is an Illinois limited liability company that, together with its 100% owned subsidiaries, holds all material assets and conducts all business activities and operations of the Company. On August 6, 2010, CDW Finance Corporation, a Delaware corporation, was formed for the sole purpose of acting as co-issuer of certain debt obligations as described in Note 17 and does not hold any material assets or engage in any business activities or operations. Throughout this report, the terms “the Company” and “CDW” refer to Parent and its 100% owned subsidiaries. Parent was previously owned directly by CDW Holdings LLC ("CDW Holdings"), a company controlled by investment funds affiliated with Madison Dearborn Partners, LLC ("Madison Dearborn") and Providence Equity Partners L.L.C. ("Providence Equity," and together with Madison Dearborn, the "Sponsors"), certain other co- investors and certain members of CDW management. On July 2, 2013, Parent completed an initial public offering ("IPO") of its common stock. In connection with the IPO, CDW Holdings distributed all of its shares of Parent's common stock to its members in June 2013 in accordance with the members’ respective membership interests and was subsequently dissolved in August 2013. See Note 9 for additional discussion of the IPO. Principles of Consolidation The accompanying consolidated financial statements include the accounts of Parent and its 100% owned subsidiaries. All intercompany transactions and accounts are eliminated in consolidation. Use of Estimates The preparation of the consolidated financial statements in accordance with GAAP requires management to make use of certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported periods. The Company bases its estimates on historical experience and on various other assumptions that management believes are reasonable under the circumstances, the results of which form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. Reclassifications Certain reclassifications have been made to the prior period consolidated financial statements to conform to the current period presentation. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 69 Cash and Cash Equivalents Cash and cash equivalents include all deposits in banks and short-term (original maturities of three months or less), highly liquid investments that are readily convertible to known amounts of cash and are so near maturity that there is insignificant risk of changes in value due to interest rate changes. Accounts Receivable Trade accounts receivable are recorded at the invoiced amount and typically do not bear interest. The Company provides allowances for doubtful accounts related to accounts receivable for estimated losses resulting from the inability of its customers to make required payments. The Company takes into consideration the overall quality of the receivable portfolio along with specifically-identified customer risks. Merchandise Inventory Inventory is valued at the lower of cost or market value. Cost is determined using a weighted-average cost method. Price protection is recorded when earned as a reduction to the cost of inventory. The Company decreases the value of inventory for estimated obsolescence equal to the difference between the cost of inventory and the estimated market value, based upon an aging analysis of the inventory on hand, specifically known inventory-related risks, and assumptions about future demand and market conditions. Miscellaneous Receivables Miscellaneous receivables generally consist of amounts due from vendors. The Company receives incentives from vendors related to cooperative advertising allowances, volume rebates, bid programs, price protection and other programs. These incentives generally relate to written vendor agreements with specified performance requirements and are recorded as adjustments to cost of sales or inventory, depending on the nature of the incentive. Property and Equipment Property and equipment are stated at cost. The Company calculates depreciation expense using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of their useful lives or the initial lease term. Expenditures for major renewals and improvements that extend the useful life of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. The following table shows estimated useful lives of property and equipment: Classification EstimatedUseful Lives Machinery and equipment 5 to 10 years Building and leasehold improvements 5 to 25 years Computer and data processing equipment 3 to 5 years Computer software 3 to 5 years Furniture and fixtures 5 to 10 years The Company has asset retirement obligations associated with commitments to return property subject to operating leases to its original condition upon lease termination. The Company’s asset retirement liability was $0.5 million as of December 31, 2013 and 2012. Goodwill and Other Intangible Assets The Company is required to perform an evaluation of goodwill on an annual basis or more frequently if circumstances indicate a potential impairment. The annual test for impairment is conducted as of December 1. The Company’s reporting units used to assess potential goodwill impairment are the same as its operating segments. The Company has the option of performing a qualitative assessment of a reporting unit's fair value from the last quantitative assessment to determine if it is more likely than not that the reporting unit's goodwill is impaired or performing a quantitative assessment by comparing a reporting unit's estimated fair value to its carrying amount. Under the quantitative assessment, testing for impairment of goodwill is a two-step process. The first step compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill to determine the amount of impairment loss. Fair value of a reporting unit is determined by using a weighted Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 70 combination of an income approach and a market approach, as this combination is considered the most indicative of the Company’s fair value in an orderly transaction between market participants. This assessment uses significant accounting judgments, estimates and assumptions. Any changes in the judgments, estimates or assumptions used could produce significantly different results. During the years ended December 31, 2013, 2012 and 2011, the Company recorded no goodwill impairment charges. See Note 4 for more information on the Company’s evaluations of goodwill for impairment. Intangible assets with determinable lives are amortized on a straight-line basis over their respective estimated useful lives. The cost of computer software developed or obtained for internal use is capitalized and amortized on a straight- line basis over the estimated useful life of the software. These intangible assets are reviewed for impairment when indicators are present using undiscounted cash flows. The Company uses the undiscounted cash flows, excluding interest charges, to assess the recoverability of the carrying value of such assets. To the extent carrying value exceeds the undiscounted cash flows, an impairment loss is recorded based upon the excess of the carrying value over fair value. In addition, each quarter, the Company evaluates whether events and circumstances warrant a revision to the remaining estimated useful life of each of these intangible assets. If the Company were to determine that a change to the remaining estimated useful life of an intangible asset was necessary, then the remaining carrying amount of the intangible asset would be amortized prospectively over that revised remaining useful life. During the years ended December 31, 2013, 2012 and 2011, no impairment existed with respect to the Company’s intangible assets with determinable lives and no significant changes to the remaining useful lives were necessary. The following table shows estimated useful lives of definite-lived intangible assets: Classification Estimated Useful Lives Customer relationships 11 to 14 years Trade name 20 years Internally developed software 3 to 5 years Other 1 to 10 years Deferred Financing Costs Deferred financing costs, such as underwriting, financial advisory, professional fees and other similar fees are capitalized and recognized in interest expense over the estimated life of the related debt instrument using the effective interest method or straight-line method, as applicable. Derivatives The Company has entered into interest rate cap agreements for the purpose of economically hedging its exposure to fluctuations in interest rates. These derivatives are recorded at fair value in the Company’s consolidated balance sheets. The Company’s interest rate cap agreements are not designated as cash flow hedges of interest rate risk. Changes in fair value of the derivatives are recorded directly to interest expense, net in the Company’s consolidated statements of operations. Fair Value Measurements Fair value is defined under GAAP as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy has been established for valuation inputs to prioritize the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are: Level 1 – observable inputs such as quoted prices for identical instruments traded in active markets. Level 2 – inputs are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 71 Level 3 – inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models and similar techniques. Accumulated Other Comprehensive (Loss) Income Foreign currency translation adjustments are included in shareholders’ equity under accumulated other comprehensive (loss) income. The components of accumulated other comprehensive (loss) income are as follows: (in millions)December 31, 2013 2012 2011 Foreign currency translation adjustment $(6.3)$0.4 $(2.1) Accumulated other comprehensive (loss) income $(6.3)$0.4 $(2.1) Revenue Recognition The Company is a primary distribution channel for a large group of vendors and suppliers, including original equipment manufacturers (“OEMs”), software publishers and wholesale distributors. The Company records revenue from sales transactions when title and risk of loss are passed to the customer, there is persuasive evidence of an arrangement for sale, delivery has occurred and/or services have been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. The Company's shipping terms typically specify F.O.B. destination, at which time title and risk of loss have passed to the customer. Revenues from the sales of hardware products and software products and licenses are generally recognized on a gross basis with the selling price to the customer recorded as sales and the acquisition cost of the product recorded as cost of sales. These items can be delivered to customers in a variety of ways, including (i) as physical product shipped from the Company's warehouse, (ii) via drop-shipment by the vendor or supplier, or (iii) via electronic delivery for software licenses. At the time of sale, the Company records an estimate for sales returns and allowances based on historical experience. The Company's vendor partners warrant most of the products the Company sells. The Company leverages drop-shipment arrangements with many of its vendors and suppliers to deliver products to its customers without having to physically hold the inventory at its warehouses, thereby increasing efficiency and reducing costs. The Company recognizes revenue for drop-shipment arrangements on a gross basis upon delivery to the customer with contract terms that typically specify F.O.B. destination. Revenue from professional services is either recognized as provided for services billed at an hourly rate or recognized using a proportional performance model for services provided at a fixed fee. Revenue from cloud computing solutions including Software as a Service ("SaaS") and Infrastructure as a Service ("IaaS") arrangements, as well as data center services such as managed and remote managed services, server co-location, internet connectivity and data backup and storage, is recognized over the period service is provided. The Company also sells certain products for which it acts as an agent. Products in this category include the sale of third-party services, warranties, software assurance (“SA”) and third-party hosted SaaS and IaaS arrangements. SA is a product that allows customers to upgrade, at no additional cost, to the latest technology if new applications are introduced during the period that the SA is in effect. These sales do not meet the criteria for gross sales recognition, and thus are recognized on a net basis at the time of sale. Under net sales recognition, the cost paid to the vendor or third-party service provider is recorded as a reduction to sales, resulting in net sales being equal to the gross profit on the transaction. The Company's larger customers are offered the opportunity by certain of its vendors to purchase software licenses and SA under enterprise agreements (“EAs”). Under EAs, customers are considered to be compliant with applicable license requirements for the ensuing year, regardless of changes to their employee base. Customers are charged an annual true-up fee for changes in the number of users over the year. With most EAs, the Company's vendors will transfer the license and bill the customer directly, paying resellers such as the Company an agency fee or commission on these sales. The Company records these fees as a component of net sales as earned and there is no corresponding cost of sales amount. In certain instances, the Company bills the customer directly under an EA and accounts for the individual items sold based on the nature of the item. The Company's vendors typically dictate how the EA will be sold to the customer. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 72 From time to time, the Company sells some of its products and services as part of bundled contract arrangements containing multiple deliverables, which may include a combination of products and services. For each deliverable that represents a separate unit of accounting, total arrangement consideration is allocated based upon the relative selling prices of each element. The allocated arrangement consideration is recognized as revenue in accordance with the principles described above. Selling prices are determined by using vendor specific objective evidence (“VSOE”) if it exists. Otherwise, selling prices are determined using third party evidence (“TPE”). If neither VSOE or TPE is available, the Company uses its best estimate of selling prices. The Company records freight billed to its customers as net sales and the related freight costs as a cost of sales. Deferred revenue includes (1) payments received from customers in advance of providing the product or performing services, and (2) amounts deferred if other conditions of revenue recognition have not been met. The Company performs an analysis of the estimated number of days of sales in-transit to customers at the end of each period based on a weighted-average analysis of commercial delivery terms that includes drop-shipment arrangements. This analysis is the basis upon which the Company estimates the amount of sales in-transit at the end of the period and adjusts revenue and the related costs to reflect only what has been received by the customer. Changes in delivery patterns may result in a different number of business days used in making this adjustment and could have a material impact on the Company's revenue recognition for the period. Sales Taxes Sales tax amounts collected from customers for remittance to governmental authorities are presented on a net basis in the Company’s consolidated statements of operations. Advertising Advertising costs are generally charged to expense in the period incurred. Cooperative reimbursements from vendors are recorded in the period the related advertising expenditure is incurred. The Company classifies vendor consideration as a reduction to cost of sales. Equity-Based Compensation The Company measures all equity-based payments using a fair-value-based method and records compensation expense over the requisite service period in its consolidated financial statements. Forfeiture rates have been developed based upon historical experience. Interest Expense Interest expense is typically recognized in the period incurred at the applicable interest rate in effect. For increasing- rate debt, the Company determines the periodic interest cost using the effective interest method over the estimated outstanding term of the debt. The difference between interest expense recorded and cash interest paid is reflected as short-term or long-term accrued interest in the Company’s consolidated balance sheets. Foreign Currency Translation The Company’s functional currency is the U.S. dollar. The functional currency of the Company’s Canadian subsidiary is the local currency, the Canadian dollar. Assets and liabilities of this subsidiary are translated at the spot rate in effect at the applicable reporting date and the consolidated results of operations are translated at the average exchange rates in effect during the applicable period. The resulting foreign currency translation adjustment is recorded as accumulated other comprehensive (loss) income, which is reflected as a separate component of shareholders’ equity. Income Taxes Deferred income taxes are provided to reflect the differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements using enacted tax rates in effect for the year in which the differences are expected to reverse. The Company performs an evaluation of the realizability of deferred tax assets on a quarterly basis. This evaluation requires management to make use of estimates and assumptions and considers all positive and negative evidence and factors, such as the scheduled reversal of temporary differences, the mix of earnings in the jurisdictions in which the Company operates, and prudent and feasible tax planning strategies. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 73 The Company accounts for unrecognized tax benefits based upon its assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. The Company reports a liability for unrecognized tax benefits resulting from unrecognized tax benefits taken or expected to be taken in a tax return and recognizes interest and penalties, if any, related to its unrecognized tax benefits in income tax expense. 2. Recent Accounting Pronouncements Disclosure of the Effects of Reclassifications from Accumulated Other Comprehensive Income In February 2013, the Financial Accounting Standards Board issued Accounting Standards Update 2013-02, which required that the effects of significant reclassifications from accumulated other comprehensive income to net income be shown parenthetically on the face of the consolidated financial statements or disclosed in a note. The adoption of this new guidance on January 1, 2013 did not have an impact on the Company's consolidated financial position, results of operations or cash flows. 3. Property and Equipment Property and equipment consisted of the following: (in millions)December 31, 2013 2012 Land $27.7 $27.7 Machinery and equipment 53.0 50.9 Building and leasehold improvements 104.8 104.0 Computer and data processing equipment 61.2 56.4 Computer software 30.9 30.2 Furniture and fixtures 21.6 21.6 Construction in progress 10.9 11.9 Total property and equipment 310.1 302.7 Less accumulated depreciation 179.0 160.0 Net property and equipment $131.1 $142.7 During 2013, 2012 and 2011, the Company recorded disposals of $7.9 million, $12.2 million and $10.5 million, respectively, to remove assets that were no longer in use from property and equipment. The Company recorded a pre- tax loss of $0.0 million, $0.1 million and $0.3 million in 2013, 2012 and 2011, respectively, for certain disposed assets that were not fully depreciated. Depreciation expense for the years ended December 31, 2013, 2012 and 2011 was $27.2 million, $32.0 million and $31.3 million, respectively. 4. Goodwill and Other Intangible Assets As described in Note 1, the Company is required to perform an evaluation of goodwill on an annual basis or more frequently if circumstances indicate a potential impairment. The annual test for impairment is conducted as of December 1. The Company’s reporting units used to assess potential goodwill impairment are the same as its operating segments. The Company has two reportable segments: Corporate, which is comprised primarily of business customers, and Public, which is comprised of government entities and education and healthcare institutions. The Company also has two other operating segments, CDW Advanced Services and Canada, which do not meet the reportable segment quantitative thresholds and, accordingly, are combined together as “Other” for segment reporting purposes. The Company has the option of performing a qualitative assessment of a reporting unit's fair value from the last quantitative assessment to determine if it is more likely than not that the reporting unit's goodwill is impaired or performing a quantitative assessment by comparing a reporting unit's estimated fair value to its carrying amount. Under the quantitative assessment, testing for impairment of goodwill is a two-step process. The first step compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill to determine the amount of impairment loss. Fair value of a reporting unit is determined by using a weighted combination of an income approach and a market approach, as this combination is considered the most indicative of the Company’s fair value in an orderly transaction between market participants. Under the income Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 74 approach, the Company determined fair value based on estimated future cash flows of a reporting unit, discounted by an estimated weighted-average cost of capital, which reflects the overall level of inherent risk of a reporting unit and the rate of return an outside investor would expect to earn. Under the market approach, the Company utilized valuation multiples derived from publicly available information for guideline companies to provide an indication of how much a knowledgeable investor in the marketplace would be willing to pay for a company. The valuation multiples were applied to the reporting units. Determining the fair value of a reporting unit is judgmental in nature and requires the use of significant estimates and assumptions, including revenue growth rates, gross margins, operating margins, discount rates and future market conditions, among others. December 1, 2013 Evaluation The Company performed its annual evaluation of goodwill as of December 1, 2013 by utilizing a quantitative assessment for all reporting units. All reporting units passed the first step of the goodwill evaluation (with the fair value exceeding the carrying value by 107%, 82%, 167% and 168% for the Corporate, Public, Canada and CDW Advanced Services reporting units, respectively) and, accordingly, the Company was not required to perform the second step of the goodwill evaluation. To determine the fair value of the reporting units, the Company used a 75%/25% weighting of the income approach and market approach, respectively. Under the income approach, the Company estimated future cash flows of each reporting unit based on internally generated forecasts for the remainder of 2013 and the next six years. The Company used a 3.5% long-term assumed consolidated annual revenue growth rate for periods after the six-year forecast. The estimated future cash flows for the Corporate and Public reporting units were discounted at 10.0%; cash flows for the Canada and CDW Advanced Services reporting units were discounted at 10.3% and 10.5%, respectively, based on the future growth rates assumed in the discounted cash flows. Discount rates utilized during the 2013 goodwill evaluation declined compared to those used in 2012 as a result of the market performance of the Company's common stock and a lower equity risk premium. December 1, 2012 Evaluation The Company performed its annual evaluation of goodwill as of December 1, 2012 by utilizing a quantitative assessment for all reporting units. All reporting units passed the first step of the goodwill evaluation (with the fair value exceeding the carrying value by 49%, 44%, 104% and 17% for the Corporate, Public, Canada and CDW Advanced Services reporting units, respectively) and, accordingly, the Company was not required to perform the second step of the goodwill evaluation. To determine the fair value of the reporting units, the Company used a 75%/25% weighting of the income approach and market approach, respectively. Under the income approach, the Company estimated future cash flows of each reporting unit based on internally generated forecasts for the remainder of 2012 and the next six years. The Company used a 3.5% long-term assumed consolidated annual revenue growth rate for periods after the six-year forecast. The estimated future cash flows for the Corporate and Public reporting units were discounted at 11.5%; cash flows for the Canada and CDW Advanced Services reporting units were discounted at 11.8% and 12.0%, respectively, based on the future growth rates assumed in the discounted cash flows. December 1, 2011 Evaluation The Company performed its annual evaluation of goodwill as of December 1, 2011 by utilizing a quantitative assessment for all reporting units. All reporting units passed the first step of the goodwill evaluation (with the fair value exceeding the carrying value by 43%, 27%, 159% and 17%, for the Corporate, Public, Canada and CDW Advanced Services reporting units, respectively) and, accordingly, the Company was not required to perform the second step of the goodwill evaluation. To determine the fair value of the reporting units, the Company used a 75%/25% weighting of the income approach and market approach, respectively. Under the income approach, the Company estimated future cash flows of each reporting unit based on internally generated forecasts for the remainder of 2011 and the next six years. The Company used a 3.5% long-term assumed consolidated annual revenue growth rate for periods after the six-year forecast. The estimated future cash flows for the Corporate, Public and CDW Advanced Services reporting units were discounted at 11.5%; cash flows for the Canada reporting unit were discounted at 12.0% given inherent differences in the business model and risk profile. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 75 The following table presents the change in goodwill by segment for the years ended December 31, 2013 and 2012: (in millions)Corporate Public Other (1)Consolidated Balances as of December 31, 2011: Goodwill $2,794.4 $1,261.4 $106.4 $4,162.2 Accumulated impairment charges (1,571.4)(354.1)(28.3)(1,953.8) $1,223.0 $907.3 $78.1 $2,208.4 2012 Activity: Translation adjustment $—$—$0.9 $0.9 $—$—$0.9 $0.9 Balances as of December 31, 2012: Goodwill $2,794.4 $1,261.4 $107.3 $4,163.1 Accumulated impairment charges (1,571.4)(354.1)(28.3)(1,953.8) $1,223.0 $907.3 $79.0 $2,209.3 2013 Activity: Translation adjustment $—$—$(2.1)$(2.1) Contingent consideration (2)8.8 4.0 0.3 13.1 $8.8 $4.0 $(1.8)$11.0 Balances as of December 31, 2013: Goodwill $2,803.2 $1,265.4 $105.5 $4,174.1 Accumulated impairment charges (1,571.4)(354.1)(28.3)(1,953.8) $1,231.8 $911.3 $77.2 $2,220.3 (1) Other is comprised of CDW Advanced Services and Canada reporting units. (2) During 2013, the Company recorded a $13.1 million net-of-tax addition to goodwill in connection with the settlement of the MPK Coworker Incentive Plan II and related charitable contribution. The charitable contribution was accounted for as additional purchase price (goodwill) in accordance with pre-2009 business combinations accounting guidance. See Note 10 for additional discussion of this transaction. The following table presents a summary of intangible assets at December 31, 2013 and 2012: (in millions) December 31, 2013 GrossCarryingAmount AccumulatedAmortization Net CarryingAmount Customer relationships $1,860.8 $872.8 $988.0 Trade name 421.0 130.9 290.1 Internally developed software 128.5 79.8 48.7 Other 3.1 1.9 1.2 Total $2,413.4 $1,085.4 $1,328.0 December 31, 2012 Customer relationships $1,861.7 $733.3 $1,128.4 Trade name 421.0 109.9 311.1 Internally developed software 97.4 60.1 37.3 Other 3.3 1.6 1.7 Total $2,383.4 $904.9 $1,478.5 Amortization expense related to intangible assets for the years ended December 31, 2013, 2012 and 2011 was $181.0 million, $178.2 million and $173.5 million, respectively. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 76 Estimated future amortization expense related to intangible assets for the next five years is as follows: (in millions) Years ending December 31, 2014 $179.0 2015 171.7 2016 163.9 2017 161.5 2018 161.3 5. Inventory Financing Agreements The Company has entered into agreements with certain financial intermediaries to facilitate the purchase of inventory from various suppliers under certain terms and conditions, as described below. These amounts are classified separately as accounts payable-inventory financing on the accompanying consolidated balance sheets. The Company does not incur any interest expense associated with these agreements as balances are paid when they are due. The following table presents the amounts included in accounts payable-inventory financing: (in millions)December 31, 2013 2012 Revolving Loan inventory financing agreement $256.1 $248.3 Other inventory financing agreements 0.5 0.9 Accounts payable-inventory financing $256.6 $249.2 The Company maintains a senior secured asset-based revolving credit facility as described in Note 7, which incorporates a $400.0 million floorplan sub-facility to facilitate the purchase of inventory from a certain vendor. In connection with the floorplan sub-facility, the Company maintains an inventory financing agreement on an unsecured basis with a financial intermediary to facilitate the purchase of inventory from this vendor (the “Revolving Loan inventory financing agreement”). Amounts outstanding under the Revolving Loan inventory financing agreement are unsecured and non-interest bearing. At December 31, 2013 and 2012, the Company reported $256.1 million and $248.3 million, respectively, for this agreement within accounts payable-inventory financing on the consolidated balance sheets. The Company also maintains other inventory financing agreements with financial intermediaries to facilitate the purchase of inventory from certain vendors. At December 31, 2013 and 2012, amounts owed under other inventory financing agreements of $0.5 million and $0.9 million, respectively, were collateralized by the inventory purchased under these financing agreements and a second lien on the related accounts receivable. 6. Lease Commitments The Company is obligated under various non-cancelable operating lease agreements for office facilities that generally provide for minimum rent payments and a proportionate share of operating expenses and property taxes and include certain renewal and expansion options. For the years ended December 31, 2013, 2012 and 2011, rent expense under these lease arrangements was $20.7 million, $22.4 million and $21.6 million, respectively. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 77 Future minimum lease payments are as follows: (in millions) Years ending December 31, 2014 $17.9 2015 17.7 2016 13.2 2017 10.7 2018 9.0 Thereafter 20.7 Total future minimum lease payments $89.2 7. Long-Term Debt Long-term debt was as follows: (dollars in millions)December 31, Interest Rate (1)2013 2012 Senior secured asset-based revolving credit facility —%$—$— Senior secured term loan facility 3.25%1,528.9 1,339.5 Unamortized discount on senior secured term loan facility (4.4)— Senior secured notes due 2018 8.0%325.0 500.0 Senior notes due 2019 8.5%1,305.0 1,305.0 Unamortized premium on senior notes due 2019 4.2 5.0 Senior subordinated notes due 2017 12.535%92.5 621.5 Total long-term debt 3,251.2 3,771.0 Less current maturities of long-term debt (45.4)(40.0) Long-term debt, excluding current maturities $3,205.8 $3,731.0 (1) Interest rate at December 31, 2013. At December 31, 2013, the Company was in compliance with the covenants under its various credit agreements and indentures as described below. Under the indentures governing the 8.5% Senior Notes due 2019 and 8.0% Senior Secured Notes due 2018, which contain the most restrictive restricted payment provisions in the Company’s various credit agreements and indentures, CDW LLC and its restricted subsidiaries are generally restricted from paying dividends and making other restricted payments unless CDW LLC could incur an additional dollar of indebtedness under its fixed charges ratio covenant and the amount of such dividend or other restricted payment, together with the amount of all other dividends and restricted payments made from January 1, 2011 through the end of the most recently ended fiscal quarter, is less than the sum of 50% of cumulative consolidated net income or 100% of any consolidated net loss incurred over the period plus the amount of certain other items occurring during that period that increase (and in some cases decrease) the amounts available for such payments. For the purpose of determining restricted payment capacity, consolidated net income or loss includes certain adjustments that are defined in the indentures. At December 31, 2013, the amount of cumulative consolidated net income free of restrictions under the credit agreements and indentures ("Restricted Payment Capacity") was $148.0 million. However, the subsequent events transactions described in Note 19 have since reduced the Restricted Payment Capacity to approximately $89 million. Senior Secured Asset-Based Revolving Credit Facility (“Revolving Loan”) At December 31, 2013, the Company had no outstanding borrowings under the Revolving Loan, $2.2 million of undrawn letters of credit and $256.7 million reserved related to the floorplan sub-facility. On June 24, 2011, the Company entered into the Revolving Loan, a five-year $900.0 million senior secured asset- based revolving credit facility, with the facility being available to the Company for borrowings, issuance of letters of credit and floorplan financing for certain vendor products. The Revolving Loan matures on June 24, 2016. The Revolving Loan replaced the Company's previous revolving loan credit facility that was to mature on October 12, 2012. In connection with the termination of the previous facility, the Company recorded a loss on extinguishment of Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 78 long-term debt of $1.6 million in the Company's consolidated statement of operations for the year ended December 31, 2011, representing a write-off of a portion of unamortized deferred financing costs. Fees of $7.2 million related to the Revolving Loan were capitalized as deferred financing costs and are being amortized over the term of the facility on a straight-line basis. As described in Note 5, the Company has entered into agreements with certain financial intermediaries to facilitate the purchase of inventory from various suppliers. In connection with the floorplan sub-facility, the Company entered into the Revolving Loan inventory financing agreement. Amounts outstanding under the Revolving Loan inventory financing agreement are unsecured and noninterest bearing. The Company will either pay the outstanding Revolving Loan inventory financing agreement amounts when they become due, or the Revolving Loan's administrative agent will automatically initiate an advance on the Revolving Loan and use the proceeds to pay the balance on the due date. At December 31, 2013, the financial intermediary reported an outstanding balance of $246.8 million under the Revolving Loan inventory financing agreement. The total amount reported on the Company's consolidated balance sheet as accounts payable-inventory financing related to the Revolving Loan inventory financing agreement is $9.3 million more than the $246.8 million owed to the financial intermediary due to differences in the timing of reporting activity under the Revolving Loan inventory financing agreement. The outstanding balance reported by the financial intermediary excludes $9.9 million in reserves for open orders that reduce the availability under the Revolving Loan. Changes in cash flows from the Revolving Loan inventory financing agreement are reported in financing activities on the Company's consolidated statements of cash flows. Borrowings under the Revolving Loan bear interest at a variable interest rate plus an applicable margin. The variable interest rate is based on one of two indices, either (i) LIBOR, or (ii) the Alternate Base Rate (“ABR”) with the ABR being the greatest of (a) the prime rate, (b) the federal funds effective rate plus 50 basis points or (c) the one-month LIBOR plus 1.00%. The applicable margin varies (2.00% to 2.50% for LIBOR borrowings and 1.00% to 1.50% for ABR borrowings) depending upon the Company's average daily excess cash availability under the agreement and is subject to a reduction of 0.25% if, and for as long as, the senior secured leverage ratio is less than 3.0. The senior secured leverage ratio is defined as the ratio of senior secured debt (including amounts owed under certain inventory floorplan arrangements) less cash and cash equivalents, to Adjusted EBITDA, a non-GAAP measure, for the four most recently ended fiscal quarters. For the four quarters ended December 31, 2013, the senior secured leverage ratio was 2.1. Availability under the Revolving Loan is limited to (a) the lesser of the revolving commitment of $900.0 million and the amount of the borrowing base less (b) outstanding borrowings, letters of credit, and amounts outstanding under the Revolving Loan inventory financing agreement plus a reserve of 15% of open orders. The borrowing base is (a) the sum of the products of the applicable advance rates on eligible accounts receivable and on eligible inventory as defined in the agreement less (b) any reserves. At December 31, 2013, the borrowing base was $1,065.5 million based on the amount of eligible inventory and accounts receivable balances as of November 30, 2013. The Company could have borrowed up to an additional $641.1 million under the Revolving Loan at December 31, 2013. The fee on the unused portion of the Revolving Loan ranges from 25 basis points to either 37.5 or 50 basis points, depending on the amount of utilization. CDW LLC is the borrower under the Revolving Loan. All obligations under the Revolving Loan are guaranteed by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. Borrowings under the Revolving Loan are collateralized by a first priority interest in inventory (excluding inventory collateralized under the inventory floorplan arrangements as described in Note 5), deposits, and accounts receivable, and a second priority interest in substantially all other assets. The Revolving Loan contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. The Revolving Loan also includes maintenance of a minimum average daily excess cash availability requirement. Should the Company fall below the minimum average daily excess cash availability requirement for five consecutive business days, the Company becomes subject to a fixed charge coverage ratio until such time as the daily excess cash availability requirement is met for 30 consecutive business days. Senior Secured Term Loan Facility On April 29, 2013, the Company entered into a new seven-year, $1,350.0 million aggregate principal amount senior secured term loan facility (the "Term Loan"). The Term Loan was issued at a price that was 99.75% of par, which Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 79 resulted in a discount of $3.4 million. Substantially all of the proceeds from the Term Loan were used to repay the $1,299.5 million outstanding aggregate principal amount of the prior senior secured term loan facility (the "Prior Term Loan Facility"). In connection with this refinancing, the Company recorded a loss on extinguishment of long-term debt of $10.3 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented a write-off of the remaining unamortized deferred financing costs related to the Prior Term Loan Facility. On July 31, 2013, the Company borrowed an additional $190.0 million aggregate principal amount under the Term Loan at a price that was 99.25% of par, which resulted in a discount of $1.4 million. Such proceeds were used to redeem a portion of outstanding Senior Subordinated Notes. The discounts are reported on the consolidated balance sheet as a reduction to the face amount of the Term Loan and are being amortized to interest expense over the term of the related debt. Fees of $6.1 million related to the Term Loan were capitalized as deferred financing costs and are being amortized over the term of the facility using the effective interest method. Borrowings under the Term Loan bear interest at either (a) the alternate base rate ("ABR") plus a margin or (b) LIBOR plus a margin; provided that for the purposes of the Term Loan, LIBOR shall not be less than 1.00% per annum at any time ("LIBOR Floor"). The margin is based upon a net leverage ratio as defined in the agreement governing the Term Loan, ranging from 1.25% to 1.50% for ABR borrowings and 2.25% to 2.50% for LIBOR borrowings. An interest rate of 3.25%, LIBOR Floor plus a 2.25% margin, was in effect during the three-month period ended December 31, 2013. Unlike the Prior Term Loan Facility, the Term Loan does not include a senior secured leverage ratio requirement or a hedging requirement. Additionally, the definition of debt under the Term Loan was revised to exclude amounts outstanding under the Company's inventory financing agreements. The Term Loan is subject to certain requirements as was the Prior Term Loan Facility to make mandatory annual excess cash flow prepayments under designated circumstances, including (i) a prepayment in an amount equal to 50% of the Company's excess cash flow for a fiscal year (the percentage rate of which decreases to 25% when the total net leverage ratio, as defined in the governing agreement, is less than or equal to 5.5 but greater than 4.5; and decreases to 0% when the total net leverage ratio is less than or equal to 4.5), and (ii) the net cash proceeds from the incurrence of certain additional indebtedness by the Company or its subsidiaries. The total net leverage ratio was 3.8 at December 31, 2013. The Company is required to pay quarterly principal installments equal to 0.25% of the original principal amount of the Term Loan, with the remaining principal amount payable on the maturity date of April 29, 2020. The quarterly principal installment payments commenced during the quarter ended June 30, 2013. At December 31, 2013, the outstanding principal amount of the Term Loan was $1,528.9 million, excluding $4.4 million in unamortized discount. The Company has interest rate cap agreements in effect through January 14, 2015 with a combined notional amount of $1,150.0 million. These cap agreements have not been designated as cash flow hedges of interest rate risk for GAAP accounting purposes. Of the total $1,150.0 million notional amount, $500.0 million entitle the Company to payments from the counterparty of the amount, if any, by which three-month LIBOR exceeds 3.5% during the agreement period. The remaining cap agreements with a notional amount of $650.0 million entitle the Company to payments from the counterparty of the amount, if any, by which the three-month LIBOR exceeds 1.5% during the agreement period. The fair value of the Company's interest rate cap agreements was zero at December 31, 2013 and $0.1 million at December 31, 2012. During the first quarters of 2013, 2012 and 2011, the Company made principal prepayments totaling $40.0 million, $201.0 million and $132.0 million, respectively, under the Prior Term Loan Facility. These prepayments satisfied the excess cash flow payment provision of the Prior Term Loan Facility with respect to the years ended December 31, 2012, 2011 and 2010, respectively. On March 11, 2011, the Company entered into an amendment to the Prior Term Loan Facility, which became effective on March 14, 2011. In connection with this amendment, the Company recorded a loss on extinguishment of long-term debt of $3.2 million in the Company's consolidated statement of operations for the year ended December 31, 2011. This loss represented a write-off of a portion of the unamortized deferred financing costs related to the Prior Term Loan Facility. CDW LLC is the borrower under the Term Loan. All obligations under the Term Loan are guaranteed by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. The Term Loan is collateralized by a second priority interest in substantially all inventory (excluding inventory collateralized under the inventory floorplan arrangements as described in Note 5), deposits, and accounts receivable, and by a first priority interest in substantially all other assets. The Term Loan contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 80 assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. 8.0% Senior Secured Notes due 2018 (“Senior Secured Notes”) The Senior Secured Notes were issued on December 17, 2010 and will mature on December 15, 2018. At December 31, 2013, the outstanding principal amount of the Senior Secured Notes was $325.0 million. On July 2, 2013, the Company used a portion of the net proceeds from the IPO to redeem $175.0 million aggregate principal amount of Senior Secured Notes. The redemption price of the Senior Secured Notes was 108.0% of the principal amount redeemed, plus $0.7 million of accrued and unpaid interest to the date of redemption. The Company used cash on hand to pay such accrued and unpaid interest. In connection with this redemption, the Company recorded a loss on extinguishment of long-term debt of $16.7 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented $14.0 million in redemption premium and $2.7 million for the write- off of a portion of the remaining deferred financing costs related to the Senior Secured Notes. CDW LLC and CDW Finance Corporation are the co-issuers of the Senior Secured Notes and the obligations under the notes are guaranteed by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. The Senior Secured Notes are secured on a pari passu basis with the Term Loan by a second priority interest in substantially all inventory (excluding inventory collateralized under the inventory floorplan arrangements as described in Note 5), deposits, and accounts receivable, and by a first priority interest in substantially all other assets. The Senior Secured Note indenture contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. The Senior Secured Note indenture does not contain any financial covenants. 11.0% Senior Exchange Notes due 2015 (“Senior Exchange Notes”); 11.5% / 12.25% Senior PIK Election Exchange Notes due 2015 (“PIK Election Notes” together with the Senior Exchange Notes, the “Senior Notes due 2015”) At December 31, 2013, there were no outstanding Senior Notes due 2015. On April 13, 2011, the Company completed a cash tender offer (the “Initial Senior Notes due 2015 Tender Offer”) and purchased $665.1 million aggregate principal amount of Senior Notes due 2015 comprised of $519.2 million of the Senior Exchange Notes and $145.9 million of the PIK Election Notes. The Company concurrently issued $725.0 million aggregate principal amount of Senior Notes (as defined below). The proceeds from this offering, together with cash on hand and borrowings under the then-outstanding revolving loan credit facility, were used to fund the purchase of the tendered Senior Notes due 2015, including $665.1 million aggregate principal amount of Senior Notes due 2015, $59.9 million in tender offer premium and $36.5 million of accrued and unpaid interest, along with transaction fees and expenses. On May 20, 2011, the Company completed a follow-on cash tender offer (the “Follow-on Senior Notes due 2015 Tender Offer,” and together with the Initial Senior Notes due 2015 Tender Offer, the “Senior Notes due 2015 Tender Offers”) and purchased an additional $412.8 million aggregate principal amount of Senior Notes due 2015 comprised of $321.4 million of the Senior Exchange Notes and $91.4 million of the PIK Election Notes. The Company concurrently issued $450.0 million in aggregate principal amount of additional Senior Notes. The proceeds from this offering, together with cash on hand and borrowings under the then-outstanding revolving loan credit facility, were used to fund the purchase of the tendered Senior Notes due 2015, including $412.8 million aggregate principal amount of Senior Notes due 2015, $37.2 million in tender offer premium and $4.5 million of accrued and unpaid interest, along with transaction fees and expenses. In connection with the Senior Notes due 2015 Tender Offers, the Company recorded a loss on extinguishment of long- term debt of $114.1 million in the Company's consolidated statement of operations for the year ended December 31, 2011. This loss represented $97.0 million in tender offer premiums and $17.1 million for the write-off of a portion of the unamortized deferred financing costs related to the Senior Notes due 2015. In connection with the issuance of Senior Notes, fees of $19.1 million were capitalized as deferred financing costs and are being amortized over the term of the notes using the effective interest method. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 81 On February 2, 2012, the Company commenced a tender offer to purchase any and all of the remaining $129.0 million aggregate principal amount of Senior Notes due 2015. On February 17, 2012, the Company accepted for purchase $120.6 million aggregate principal amount of the outstanding Senior Notes due 2015 that were tendered. On March 5, 2012, the Company accepted for purchase an additional $0.1 million aggregate principal amount of the outstanding Senior Notes due 2015 that were tendered prior to the expiration of the tender offer on March 2, 2012. On March 19, 2012, the Company redeemed the remaining $8.3 million aggregate principal amount that was not tendered. The Company funded the purchases and redemptions of the Senior Notes due 2015 with the issuance of $130.0 million aggregate principal amount of additional Senior Notes on February 17, 2012. The proceeds from this issuance, together with cash on hand and borrowings under the Revolving Loan, funded the payment of $129.0 million aggregate principal amount of Senior Notes due 2015, $7.9 million in tender and redemption premiums and $5.0 million of accrued and unpaid interest, along with transaction fees and expenses. In connection with these transactions, the Company recorded a loss on extinguishment of long-term debt of $9.4 million in the Company's consolidated statement of operations for the year ended December 31, 2012. This loss represented $7.9 million in tender and redemption premiums and $1.5 million for the write-off of the remaining unamortized deferred financing costs related to the Senior Notes due 2015. 8.5% Senior Notes due 2019 (“Senior Notes”) At December 31, 2013, the outstanding principal amount of Senior Notes was $1,305.0 million, excluding $4.2 million in unamortized premium. The Senior Notes mature on April 1, 2019. On February 17, 2012, the Company issued $130.0 million aggregate principal amount of additional Senior Notes at an issue price of 104.375% of par. The $5.7 million premium received is reported on the consolidated balance sheet as an addition to the face amount of the Senior Notes and is being amortized as a reduction of interest expense over the term of the related debt. As discussed above, on April 13, 2011, the Company issued $725.0 million aggregate principal amount of Senior Notes and on May 20, 2011, the Company issued an additional $450.0 million aggregate principal amount of Senior Notes. The proceeds from these issuances together with cash on hand and borrowings under the then-outstanding revolving loan credit facility were used to fund the Senior Notes due 2015 Tender Offers. CDW LLC and CDW Finance Corporation are the co-issuers of the Senior Notes. Obligations under the Senior Notes are guaranteed on an unsecured senior basis by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. The Senior Note indenture contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. The Senior Notes do not contain any financial covenants. 12.535% Senior Subordinated Exchange Notes due 2017 (“Senior Subordinated Notes”) At December 31, 2013, the outstanding principal amount of the Senior Subordinated Notes was $92.5 million. The Senior Subordinated Notes have a maturity date of October 12, 2017. On October 18, 2013, the Company redeemed $155.0 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 104.178% of the principal amount redeemed. A combination of cash on hand and the net proceeds from the sale of shares of common stock related to the underwriters' July 26, 2013 exercise in full of the overallotment option granted to them in connection with the IPO, in the amount of $56.0 million, was used to fund the redemption of $155.0 million aggregate principal amount, $6.5 million of redemption premium and $0.2 million in accrued and unpaid interest to the date of redemption. See Note 9 for additional discussion of the underwriters' overallotment option. In connection with this redemption, the Company recorded a loss on extinguishment of long- term debt of $8.5 million in the Company's consolidated statement of operations for the year ended December 31, 2013. This loss represented $6.5 million in redemption premium and $2.0 million for the write-off of a portion of the remaining unamortized deferred financing costs related to the Senior Subordinated Notes. On August 1, 2013, the Company redeemed $324.0 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 106.268% of the principal amount redeemed. The Company used a portion of the net Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 82 proceeds from the IPO to redeem $146.0 million aggregate principal amount of Senior Subordinated Notes and incremental borrowings of $190.0 million under the Term Loan to redeem $178.0 million aggregate principal amount of Senior Subordinated Notes. The Company used cash on hand to pay $12.0 million of accrued and unpaid interest to the date of redemption. In connection with this redemption, the Company recorded a loss on extinguishment of long- term debt of $24.6 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented $20.3 million in redemption premium and $4.3 million for the write-off of a portion of the remaining deferred financing costs related to the Senior Subordinated Notes. On March 8, 2013, the Company redeemed $50.0 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 106.268% of the principal amount redeemed. Cash on hand was used to fund the redemption of $50.0 million aggregate principal amount, $3.1 million of redemption premium and $2.5 million in accrued and unpaid interest to the date of redemption. In connection with this redemption, the Company recorded a loss on extinguishment of long-term debt of $3.9 million in the Company's consolidated statement of operations for the year ended December 31, 2013. This loss represented $3.1 million in redemption premium and $0.8 million for the write-off of a portion of the remaining unamortized deferred financing costs related to the Senior Subordinated Notes. On December 21, 2012, the Company redeemed $100.0 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 106.268% of the principal amount redeemed. Cash on hand was used to fund the redemption of $100.0 million aggregate principal amount, $6.3 million of redemption premium and $2.3 million in accrued and unpaid interest to the date of redemption. In connection with this redemption, the Company recorded a loss on extinguishment of long-term debt of $7.8 million in the Company's consolidated statement of operations for the year ended December 31, 2012. This loss represented $6.3 million in redemption premium and $1.5 million for the write-off of a portion of the remaining unamortized deferred financing costs related to the Senior Subordinated Notes. CDW LLC and CDW Finance Corporation are the co-issuers of the Senior Subordinated Notes. Obligations under the Senior Subordinated Notes are guaranteed on an unsecured senior basis by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. The Senior Subordinated Note indenture contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. The Senior Subordinated Notes do not contain any financial covenants. Long-Term Debt Maturities As of December 31, 2013, the maturities of long-term debt were as follows: (in millions) Years ending December 31, 2014 $45.4 2015 15.4 2016 15.4 2017 77.9 2018 340.4 Thereafter 2,756.9 $3,251.4 See Note 19 for a description of refinancing transactions completed during 2014. Fair Value The fair value of the Company's long-term debt instruments at December 31, 2013 was $3,415.2 million. The fair value of the Senior Secured Notes, Senior Notes and Senior Subordinated Notes is estimated using quoted market prices for identical assets or liabilities that are traded in over-the-counter secondary markets that are not considered active. The fair value of the Term Loan is estimated using dealer quotes for identical assets or liabilities in markets that are not considered active. Consequently, the Company's long-term debt is classified as Level 2 within the fair value hierarchy. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 83 At December 31, 2013, the carrying value of the Company's long-term debt was $3,251.4 million, excluding $4.2 million in unamortized premium and $4.4 million in unamortized discount. Deferred Financing Costs The following table summarizes the deferred financing costs activity for the years ended December 31, 2013 and 2012: (in millions)December 31, 2013 2012 Beginning balance $53.2 $68.5 Additional costs capitalized 6.1 2.1 Recognized in interest expense (9.1)(14.4) Write-off of unamortized deferred financing costs (20.1)(3.0) Ending balance $30.1 $53.2 As of December 31, 2013 and December 31, 2012, the weighted-average remaining life of unamortized deferred financing costs was 4.9 and 5.1 years, respectively. 8. Income Taxes Income before income taxes was taxed under the following jurisdictions: (in millions)Years Ended December 31, 2013 2012 2011 Domestic $179.4 $170.3 $11.4 Foreign 16.1 15.8 16.9 Total $195.5 $186.1 $28.3 Components of the income tax expense (benefit) consisted of the following: (in millions)Years Ended December 31, 2013 2012 2011 Current: Federal $96.7 $110.3 $17.9 State 10.1 8.0 (0.6) Foreign 4.6 5.1 4.1 Total current 111.4 123.4 21.4 Deferred: Domestic (48.6)(56.2)(9.9) Foreign (0.1)(0.1)(0.3) Total deferred (48.7)(56.3)(10.2) Income tax expense $62.7 $67.1 $11.2 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 84 The reconciliation between the statutory tax rate expressed as a percentage of income before income taxes and the effective tax rate is as follows: (dollars in millions)Years Ended December 31, 2013 2012 2011 Statutory federal income tax rate $68.4 35.0%$65.1 35.0%$9.9 35.0% State taxes, net of federal effect (5.0)(2.6)0.4 0.2 (3.4)(11.8) Equity-based compensation 1.5 0.7 5.7 3.1 5.1 17.9 Effect of rates different than statutory (1.4)(0.7)(1.4)(0.8)(1.1)(4.0) Valuation allowance ————(0.9)(3.1) Other (0.8)(0.3)(2.7)(1.5)1.6 5.7 Effective tax rate $62.7 32.1%$67.1 36.0%$11.2 39.7% The tax effect of temporary differences that give rise to the net deferred income tax liability is presented below: (in millions)December 31, 2013 2012 Deferred Tax Assets: Deferred interest $42.5 $58.3 State net operating loss and credit carryforwards, net 20.6 18.0 Payroll and benefits 16.2 16.7 Rent 6.4 1.2 Accounts receivable 5.4 4.2 Equity compensation plans 1.6 10.3 Trade credits 1.5 1.8 Interest rate caps 0.8 1.8 Charitable contribution carryforward 0.5 4.1 Deferred financing costs 0.2 2.3 Other 7.1 7.2 Total deferred tax assets 102.8 125.9 Deferred Tax Liabilities: Software and intangibles 486.2 551.4 Deferred income 145.5 146.3 Property and equipment 25.0 29.3 Other 11.6 9.1 Total deferred tax liabilities 668.3 736.1 Deferred tax asset valuation allowance —— Net deferred tax liability $565.5 $610.2 The Company has state income tax net operating loss carryforwards of $202.8 million, which will expire at various dates from 2014 through 2033 and state tax credit carryforwards of $17.0 million, which expire at various dates from 2016 through 2018. The Company has not provided for U.S. federal income taxes or tax benefits on the undistributed earnings of its international subsidiary because such earnings are reinvested and it is currently intended that they will continue to be reinvested indefinitely. At December 31, 2013, the Company has not provided for federal income taxes on earnings of approximately $52.5 million from its international subsidiary. The Company had no unrecognized tax benefits at December 31, 2013, 2012 and 2011. In the ordinary course of business, the Company is subject to review by domestic and foreign taxing authorities, including the Internal Revenue Service (“IRS”). In general, the Company is no longer subject to audit by the IRS for Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 85 tax years through 2010 and state, local or foreign taxing authorities for tax years through 2008. Various other taxing authorities are in the process of auditing income tax returns of the Company and its subsidiaries. The Company does not anticipate that any adjustments from the audits would have a material impact on its consolidated financial position, results of operations or cash flows. The Company accrues net interest and penalties related to unrecognized tax benefits in income tax expense in its consolidated statements of operations. For the years ended December 31, 2013, 2012 and 2011, the Company had no liability recorded for the payment of interest and penalties on unrecognized tax benefits and did not recognize any such interest and penalty expense. 9. Shareholders' Equity On July 2, 2013, the Company completed an IPO of 23,250,000 shares of common stock. On July 31, 2013, the Company completed the sale of an additional 3,487,500 shares of common stock to the underwriters of the IPO pursuant to the underwriters' July 26, 2013 exercise in full of the overallotment option granted to them in connection with the IPO. Such shares were registered under the Securities Act of 1933, as amended, pursuant to the Company's Registration Statement on Form S-1, which was declared effective by the SEC on June 26, 2013. The shares of common stock are listed on the NASDAQ Global Select Market under the symbol “CDW.” The Company's shares of common stock were sold to the underwriters at a price of $17.00 per share in the IPO and upon the exercise of the overallotment option, which together, generated aggregate net proceeds of $424.7 million to the Company after deducting underwriting discounts, expenses and transaction costs. On November 19, 2013, the Company completed a secondary public offering, whereby certain selling stockholders sold 15,000,000 shares of common stock. On December 18, 2013, such selling stockholders sold an additional 2,250,000 shares of common stock to the underwriters of the secondary public offering pursuant to the underwriters' December 13, 2013 exercise in full of the overallotment option granted to them in connection with the secondary public offering. The Company did not receive any proceeds from the sale of shares in the secondary public offering or upon the exercise of the overallotment option. The following pre-tax IPO- and secondary-offering related expenses were included within selling and administrative expenses in the consolidated statement of operations for the year ended December 31, 2013: (in millions)Year EndedDecember 31, 2013 Acceleration charge for certain equity awards and related employer payroll taxes(1)$40.7 RDU Plan cash retention pool accrual(2)7.5 Management services agreement termination fee(3)24.4 Other expenses 2.4 IPO- and secondary-offering related expenses $75.0 (1) See Note 10 for additional discussion of the impact of the IPO on the Company's equity awards. (2) See Note 12 for additional discussion of this transaction. (3) Represents the payment of a termination fee to affiliates of the Sponsors in connection with the termination of the management services agreement with such entities. In June 2013, the Company’s Board of Directors and the Company's sole shareholder at that time, CDW Holdings, approved the reclassification of the Company’s Class A common shares and Class B common shares into a single class of common shares and a 143.0299613-for-1 stock split, effective immediately. The par value of the common shares was maintained at $0.01 per share. All references to common shares and per share amounts in the accompanying consolidated financial statements have been adjusted to reflect the reclassification and stock split on a retroactive basis. In June 2013, the Company amended and restated its certificate of incorporation to authorize the issuance of 100,000,000 shares of preferred stock with a par value of $0.01. No shares of preferred stock have been issued or are outstanding as of December 31, 2013. Additionally, the amended and restated certificate of incorporation increased the number of authorized common shares to 1,000,000,000. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 86 On December 2, 2013, the Company paid a cash dividend on the Company's common stock of $0.0425 per share, or $7.3 million, to all stockholders of record as of the close of business on November 15, 2013. See Note 19 for a discussion of the dividend declared during the first quarter of 2014. Future dividends will be subject to the approval of the Company's board of directors. 10. Equity-Based Compensation Equity-Based Compensation Plan Descriptions CDW has established certain equity-based compensation plans for the benefit of the Company’s coworkers and senior management. Pre-IPO Equity Awards Prior to the IPO, the Company had the following equity-based compensation plans in place: Class B Common Units The Board of Managers of CDW Holdings adopted the CDW Holdings LLC 2007 Incentive Equity Plan (the “Plan”) for coworkers, managers, consultants and advisors of the Company and its subsidiaries. The Plan permitted a committee designated by the Board of Managers of CDW Holdings (the “Committee”) to grant or sell to any participant Class A Common Units or Class B Common Units of CDW Holdings in such quantity, at such price, on such terms and subject to such conditions that were consistent with the Plan and as established by the Committee. The Class B Common Units that were granted vested daily on a pro rata basis between the date of grant and the fifth anniversary thereof and were subject to repurchase by, with respect to vested units, or forfeiture to, with respect to unvested units, the Company upon the coworker's separation from service as was set forth in each holder’s Class B Common Unit Grant Agreement. On June 30, 2011, the Board of Managers approved the terms of a modified Class B Common Unit grant agreement with the Company's former Chief Executive Officer, who retired as the Company's Chief Executive Officer effective October 1, 2011 but continued to serve as Chairman of the Board through December 31, 2012. As a result of this modification, the Company recorded incremental equity-based compensation expense of $6.6 million and $3.3 million during the years ended December 31, 2012 and 2011, respectively. MPK II Units Contemporaneous with the Acquisition, the Company agreed with Michael P. Krasny, CDW Corporation founder, former chairman and CEO and significant selling shareholder, to establish the MPK Coworker Incentive Plan II (the “MPK Plan”) for the benefit of all of the coworkers of the Company other than members of senior management who received incentive equity awards under the Plan. The MPK Plan established an “account” for each eligible participant which was notionally credited with a number of Class A Common Units of CDW Holdings LLC on October 15, 2007, the day the plan was established. The notional units credited to participants' accounts were to cliff-vest at the end of ten years, subject to acceleration upon the occurrence of certain events. On July 2, 2013, the Company completed an IPO of its common shares. Under the terms of the MPK Plan, vesting accelerated for all unvested units upon completion of the IPO. The Company recorded a pre-tax charge of $36.7 million for compensation expense related to the acceleration of the expense recognition for MPK Plan units in the year ended December 31, 2013. In connection with the completion of the IPO, the Company distributed common stock to each participant and withheld the number of shares of common stock equal to the required tax withholding for each participant. The Company paid required withholding taxes of $24.0 million to federal, state and foreign taxing authorities. This amount is reported as a financing activity in the consolidated statement of cash flows and as an increase to accumulated deficit in the consolidated statement of shareholders' equity for the year ended December 31, 2013. In addition, the Company paid $4.0 million of employer payroll taxes that are included as an operating activity in the consolidated statement of cash flows for the year ended December 31, 2013. In connection with the establishment of the MPK Plan, the Company agreed to make charitable contributions in amounts equal to the net income tax benefits derived from payouts to participants under the MPK Plan (net of any related employer payroll tax costs). The contributions of these amounts are due by March 15 of the calendar year Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 87 following the year in which the Company realizes the benefits of the deductions. This arrangement has been accounted for as contingent consideration. Pre-2009 business combinations were accounted for under a former accounting standard which, among other aspects, precluded the recognition of certain contingent consideration as of the business combination date. Instead, under the former accounting standard, contingent consideration is accounted for as additional purchase price (goodwill) at the time the contingency is resolved. As of December 31, 2013, the Company has accrued approximately $21 million related to this arrangement within other current liabilities, as the Company expects to realize the tax benefit of the compensation deductions during the 2013 tax year. The Company expects to make the related cash contribution during the first quarter of 2014. Post-IPO Equity Awards 2013 Long-Term Incentive Plan (the "2013 LTIP") In June 2013, the Company adopted the 2013 Long-Term Incentive Plan (the "2013 LTIP"). The 2013 LTIP provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, bonus stock and performance awards. The maximum aggregate number of shares that may be issued under the 2013 LTIP is 11,700,000 shares of the Company's common stock, in addition to the 3,798,508 shares of restricted stock granted in exchange for unvested Class B Common Units in connection with the Company's IPO, as discussed below. Restricted Stock In connection with the IPO, CDW Holdings distributed all of its shares of the Company's common stock to its existing members in accordance with their respective membership interests. Common stock received by holders of Class B Common Units in connection with the distribution is subject to any vesting provisions previously applicable to the holder's Class B Common Units. Class B Common Unit holders received 3,798,508 shares of restricted stock with respect to Class B Common Units that had not yet vested at the time of the distribution. For the year ended December 31, 2013, 1,200,544 shares of such restricted stock vested/settled and 5,931 shares were forfeited. As of December 31, 2013, 2,592,033 shares of restricted stock were outstanding. Stock Options In addition, in connection with the IPO, the Company issued 1,268,986 stock options to the Class B Common Unit holders to preserve their fully diluted equity ownership percentage. These options were issued with a per-share exercise price equal to the IPO price of $17.00 and are also subject to the same vesting provisions as the Class B Common Units to which they relate. The Company also granted 19,412 stock options under the 2013 LTIP during the year ended December 31, 2013. Restricted Stock Units ("RSUs") In connection with the IPO, the Company granted 1,416,543 RSUs under the 2013 LTIP at a weighted-average grant- date fair value of $17.03 per unit. The RSUs cliff-vest at the end of four years. Valuation Information The Company attributes the value of equity-based compensation awards to the various periods during which the recipient must perform services in order to vest in the award using the straight-line method. Post-IPO Equity Awards The Company has elected to use the Black-Scholes option pricing model to estimate the fair value of stock options granted. The Black-Scholes option pricing model incorporates various assumptions including volatility, expected term, risk-free interest rates and dividend yields. The assumptions used to value the stock options granted during the year ended December 31, 2013 are presented below. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 88 Year Ended December 31, Assumptions 2013 Weighted-average grant date fair value $4.75 Weighted-average volatility (1)35.00% Weighted-average risk-free rate (2)1.58% Dividend yield 1.00% Expected term (in years) (3)5.4 (1) Based upon an assessment of the two-year, five-year and implied volatility for the Company’s selected peer group, adjusted for the Company’s leverage. (2) Based on a composite U.S. Treasury rate. (3) The expected term is calculated using the simplified method. The simplified method defines the expected term as the average of the option’s contractual term and the option’s weighted-average vesting period. The Company utilizes this method as it has limited historical stock option data that is sufficient to derive a reasonable estimate of the expected stock option term. The following table sets forth a summary of the Company's stock option activity for the year ended December 31, 2013: Options Number ofOptions Weighted-AverageExercise Price Weighted-AverageRemainingContractualTerm AggregateIntrinsic Value(millions) Outstanding at January 1, 2013 —$— Granted 1,288,398 $17.00 Forfeited/Expired (8,143)$17.00 Exercised —$—N/A Outstanding at December 31, 2013 1,280,255 $17.00 8.4 $8.1 Vested at December 31, 2013 393,517 $17.00 8.0 $2.5 Exercisable at December 31, 2013 393,517 $17.00 8.0 $2.5 Expected to vest at December 31, 2013 852,713 $17.00 8.6 $5.4 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 89 The following table sets forth a summary of the Company's RSU activity for the year ended December 31, 2013: Number ofUnits Weighted-AverageGrant-DateFair Value Nonvested at January 1, 2013 —$— Granted 1,416,543 17.03 Vested/Settled (1,844)17.00 Forfeited (63,127)17.01 Nonvested at December 31, 2013 1,351,572 $17.04 The aggregate fair value of restricted stock and RSUs that vested during the year ended December 31, 2013, was $26.7 million. Pre-IPO Equity Awards The grant date fair value of Class B Common Unit grants was calculated using the Option-Pricing Method. This method considered Class A Common Units and Class B Common Units as call options on the total equity value, giving consideration to liquidation preferences and conversion of the preferred units. Such Class A Common Units and Class B Common Units were modeled as call options that gave their owners the right, but not the obligation, to buy the underlying equity value at a predetermined (or exercise) price. Class B Common Units were considered to be call options with a claim on equity value at an exercise price equal to the remaining value immediately after the Class A Common Units and Class B Common Units with a lower participation threshold were liquidated. The Option-Pricing Method is highly sensitive to key assumptions, such as the volatility assumption. As such, the use of this method can be applied when the range of possible future outcomes is difficult to predict. The following table summarizes the assumptions and resulting fair value of the Class B Common Unit grants for the years ended December 31, 2013, 2012 and 2011: Class B Common Units Years Ended December 31, Assumptions 2013 2012 2011 Weighted-average grant date fair value $119.00 $125.65 $148.89 Weighted-average volatility 65.50%65.26%82.87% Weighted-average risk-free rate 0.18%0.19%0.84% Dividend yield 0.00%0.00%0.00% The Company calculated the expected future volatility based upon an assessment of the two-year, five-year and implied volatility for the Company’s selected peer group, adjusted for the Company’s leverage. The risk-free interest rate of return used is based on a composite U.S. Treasury rate. Notional units granted under the MPK Plan were valued on the grant date at $1,000 per unit, the fair value equivalent of the Class A Common Units at the time the awards were granted. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 90 The following table sets forth a summary of equity plan activity for the year ended December 31, 2013: Class BCommon Units MPK PlanUnits Outstanding at January 1, 2013 216,483 66,137 Granted 400 — Forfeited (860)(2,228) Converted/Settled (1)(216,023)(63,909) Outstanding at December 31, 2013 —— Vested at December 31, 2013 —— (1) As discussed above, the Class B Common Units and MPK Plan Units were converted/settled into shares of the Company's common stock upon completion of the IPO. The converted Class B Common Units, to the extent unvested at the time of the IPO, relate to the grants of restricted stock disclosed above. Expense Information The Company’s net income included $46.6 million, $22.1 million and $19.5 million of compensation cost and $16.5 million, $2.3 million and $1.9 million of income tax benefits related to the Company’s equity-based compensation arrangements for the years ended December 31, 2013, 2012 and 2011, respectively. No portion of equity-based compensation was capitalized. Equity-based compensation expense for the year ended December 31, 2013 included incremental expense of $36.7 million related to the acceleration of the expense recognition for MPK units as discussed above. Equity-based compensation expense included incremental expense of $6.6 million and $3.3 million related to the Class B Common Unit modification for the Company's former Chief Executive Officer for the years ended December 31, 2012 and 2011, respectively. As of December 31, 2013, the Company estimated there was $24.9 million of total unrecognized compensation cost to be recognized over the next 3.3 years. 11. Earnings per Share The numerator for both basic and diluted earnings per share is net income. The denominator for basic earnings per share is the weighted-average number of common shares outstanding during the period. The 2013 denominator was impacted by the common shares issued during both the IPO and the underwriters' exercise in full of the overallotment option granted to them in connection with the IPO. Because such common shares were issued on July 2, 2013 and July 31, 2013, respectively, they are only partially reflected in the 2013 denominator. Such shares will be fully reflected in the 2014 denominator. See Note 9 for additional discussion of the IPO. The dilutive effect of outstanding restricted stock, restricted stock units, stock options and MPK Plan units is reflected in the denominator for diluted earnings per share using the treasury stock method. The following is a reconciliation of basic shares to diluted shares: Years Ended December 31, (in millions)2013 2012 2011 Weighted-average shares - basic 156.6 145.1 144.8 Effect of dilutive securities 2.1 0.7 0.1 Weighted-average shares - diluted 158.7 145.8 144.9 For the years ended December 31, 2013, 2012 and 2011, diluted earnings per share excludes the impact of 0.0 million, 0.0 million, and 4.3 million potential common shares, respectively, as their inclusion would have had an anti-dilutive effect. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 91 12. Deferred Compensation Plan On March 10, 2010, in connection with the Company’s purchase of $28.5 million principal amount of its outstanding senior subordinated debt, the Company established the Restricted Debt Unit Plan (the “RDU Plan”), an unfunded nonqualified deferred compensation plan. The total number of RDUs that can be granted under the RDU Plan is 28,500. At December 31, 2013, 28,500 RDUs were outstanding. RDUs that are outstanding vest daily on a pro rata basis over the three-year period from January 1, 2012 (or, if later, the date of hire or the date of a subsequent RDU grant) through December 31, 2014. Participants have no rights to the underlying debt. The total amount of compensation available to be paid under the RDU Plan was initially to be based on two components, a principal component and an interest component. The principal component credits the RDU Plan with a notional amount equal to the $28.5 million face value of the Senior Subordinated Notes (the "Debt Pool"), together with certain redemption premium equivalents as noted below. The interest component credits the RDU Plan with amounts equal to the interest that would have been earned on the Debt Pool from March 10, 2010 through maturity on October 12, 2017, except as discussed below. Interest amounts for 2010 and 2011 were deferred until 2012, and thereafter, interest amounts were paid to participants semi-annually on the interest payment due dates. Payments totaling $1.7 million and $1.3 million were made to participants under the RDU Plan in April and October 2013, respectively, in connection with the semi-annual interest payments due. The Company used a portion of the IPO proceeds together with incremental borrowings to redeem $324.0 million of the total Senior Subordinated Notes outstanding on August 1, 2013. In connection with the IPO and the partial redemption of the Senior Subordinated Notes, the Company amended the RDU Plan to increase the retentive value of the plan. In accordance with the original terms of the RDU Plan, the principal component of the RDUs converted to a cash-denominated pool upon the redemption of the Senior Subordinated Notes. In addition, the Company added $1.4 million to the principal component in the year ended December 31, 2013 as redemption premium equivalents in accordance with the terms of the RDU plan. Under the terms of the amended RDU Plan, upon the partial redemption of outstanding Senior Subordinated Notes, the RDUs ceased to accrue the proportionate related interest component credits. The amended RDU Plan provides participants the opportunity to share on a pro rata basis in cash retention pools payable to participants who satisfy certain retention requirements. The aggregate amount of the retention pools was determined to be $15.0 million based upon the amount of interest component credits that would have been allocated to the RDU Plan if the Senior Subordinated Notes had remained outstanding from August 1, 2013 through maturity. The Company recorded a pre-tax charge of $7.5 million in the year ended December 31, 2013 for payment of the first cash retention pool. The second cash retention pool payment is expected to be made to participants who remain employed through December 31, 2015 in the first quarter of 2016. Participants continue to accrue an interest component credit for the proportionate amount of Senior Subordinated Notes still outstanding, payable on the aforementioned semi-annual due dates; such payments, however, will be deducted from the second retention pool payment amount of $7.5 million. Unrecognized compensation expense as of December 31, 2013 of approximately $9 million is expected to be recognized through 2014 and approximately $7 million in 2015 through 2017. Payments under the RDU Plan may be impacted if certain significant events occur or circumstances change that would impact the financial condition or structure of the Company. Compensation expense of $16.8 million, $8.4 million, and $8.1 million related to the RDU Plan was recognized in the years ended December 31, 2013, 2012 and 2011, respectively. At December 31, 2013 and 2012, the Company had $21.8 million and $15.5 million of liabilities related to the RDU Plan recorded on the consolidated balance sheets, respectively. Payment of the principal component of the RDU Plan is expected to be made on October 12, 2017, unless accelerated due to a sale of the Company. 13. Profit Sharing and 401(k) Plan The Company has a profit sharing plan that includes a salary reduction feature established under the Internal Revenue Code Section 401(k) covering substantially all coworkers. Company contributions to the profit sharing plan are made in cash and determined at the discretion of the Board of Directors. For the years ended December 31, 2013, 2012 and 2011, the amounts charged to expense for this plan totaled $17.3 million, $14.6 million and $15.3 million, respectively. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 92 14. Commitments and Contingencies The Company is party to various legal proceedings that arise in the ordinary course of its business, which include commercial, intellectual property, employment, tort and other litigation matters. The Company is also subject to audit by federal, state and local authorities, and by various partners and large customers, including government agencies, relating to purchases and sales under various contracts. In addition, the Company is subject to indemnification claims under various contracts. From time to time, certain customers of the Company file voluntary petitions for reorganization or liquidation under the U.S. bankruptcy laws. In such cases, certain pre-petition payments received by the Company could be considered preference items and subject to return to the bankruptcy administrator. As of December 31, 2013, the Company does not believe that there is a reasonable possibility that any material loss exceeding the amounts already recognized for these proceedings and matters, if any, has been incurred. However, the ultimate resolutions of these proceedings and matters are inherently unpredictable. As such, the Company’s financial condition and results of operations could be adversely affected in any particular period by the unfavorable resolution of one or more of these proceedings or matters. The Company previously filed a claim as part of a class action settlement in a case alleging price fixing during the period of January 1, 1996 through December 31, 2006, by certain manufacturers of thin-film liquid crystal display panels. On July 13, 2013, the United Stated District Court for the Northern District of California approved distribution of the settlement proceeds, including a net payment to the Company of $10.4 million after fees and expenses. The Company has recognized a pre-tax benefit of $10.4 million within selling and administrative expenses in the consolidated statement of operations for the year ended December 31, 2013. The first of two settlement payments was received by the Company on July 29, 2013 in the amount of $8.5 million. The balance of $1.9 million was received in February 2014. 15. Related Party Transactions The Company had previously entered into a management services agreement with the Sponsors pursuant to which they had agreed to provide it with management and consulting services and financial and other advisory services. Pursuant to such agreement, the Sponsors received an annual management fee of $5.0 million and reimbursement of out-of- pocket expenses incurred in connection with the provision of such services. Such amounts were classified as selling and administrative expenses within the consolidated statements of operations. The management services agreement included customary indemnification and provisions in favor of the Sponsors. On July 2, 2013, the Company completed an IPO of its common stock. Using a portion of the net proceeds from the IPO, the Company paid a $24.4 million termination fee to affiliates of the Sponsors in connection with the termination of the management services agreement with such entities that was effective upon completion of the IPO. The Company paid an annual management fee of $2.5 million, $5.0 million and $5.0 million in the years ended December 31, 2013, 2012 and 2011, respectively. 16. Segment Information Segment information is presented in accordance with a “management approach,” which designates the internal reporting used by the chief operating decision-maker for making decisions and assessing performance as the source of the Company's reportable segments. The Company's segments are organized in a manner consistent with which separate financial information is available and evaluated regularly by the chief operating decision-maker in deciding how to allocate resources and in assessing performance. The Company has two reportable segments: Corporate, which is comprised primarily of business customers, and Public, which is comprised of government entities and education and healthcare institutions. The Company also has two other operating segments, CDW Advanced Services and Canada, which do not meet the reportable segment quantitative thresholds and, accordingly, are combined together as “Other.” The Company has centralized logistics and headquarters functions that provide services to the segments. The logistics function includes purchasing, distribution and fulfillment services to support both the Corporate and Public segments. As a result, costs and intercompany charges associated with the logistics function are fully allocated to both of these segments based on a percent of sales. The centralized headquarters function provides services in areas such as accounting, information technology, marketing, legal and coworker services. Headquarters' function costs that are not allocated to the segments are included under the heading of “Headquarters” in the tables below. Depreciation expense is included in Headquarters as it is not allocated among segments or used in measuring segment performance. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 93 IPO- and secondary-offering related expenses primarily relating to coworker compensation were included within operating segment results for the year ended December 31, 2013. See Note 9 for additional discussion of IPO- and secondary-offering related expenses. The Company allocates resources to and evaluates performance of its segments based on net sales, income (loss) from operations and Adjusted EBITDA, a non-GAAP measure as defined in the Company's credit agreements. However, the Company has concluded that income (loss) from operations is the more useful measure in terms of discussion of operating results, as it is a GAAP measure. Segment information for total assets and capital expenditures is not presented, as such information is not used in measuring segment performance or allocating resources between segments. Selected Segment Financial Information The following table presents information about the Company’s segments for the years ended December 31, 2013, 2012 and 2011: (in millions)Corporate Public Other Headquarters Total 2013: Net sales $5,960.1 $4,164.5 $644.0 $—$10,768.6 Income (loss) from operations 363.3 246.5 27.2 (128.4)508.6 Depreciation and amortization expense (97.3)(44.0)(8.6)(58.3)(208.2) IPO- and secondary-offering related expenses (26.4)(14.4)(3.6)(30.6)(75.0) 2012: Net sales $5,512.8 $4,023.0 $592.4 $—$10,128.2 Income (loss) from operations 349.0 246.7 18.6 (103.7)510.6 Depreciation and amortization expense (97.6)(44.0)(9.3)(59.3)(210.2) IPO- and secondary-offering related expenses ————— 2011: Net sales $5,334.4 $3,757.2 $510.8 $—$9,602.4 Income (loss) from operations 331.6 233.3 17.5 (111.7)470.7 Depreciation and amortization expense (97.4)(43.9)(8.7)(54.9)(204.9) IPO- and secondary-offering related expenses ————— Major Customers, Geographic Areas, and Product Mix Net sales to the federal government were $764.4 million, $964.7 million and $953.6 million and accounted for approximately 7%, 10% and 10% of total net sales in 2013, 2012 and 2011, respectively. Net sales to customers outside of the U.S., primarily in Canada, were approximately 4% of the Company's total net sales in 2013, 2012 and 2011. Approximately 1% and 2% of the Company’s long-lived assets were located outside of the U.S. as of December 31, 2013 and 2012, respectively. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 94 The following table presents net sales by major category for the years ended December 31, 2013, 2012 and 2011. Categories are based upon internal classifications. Amounts for the years ended December 31, 2012 and 2011 have been reclassified for certain changes in individual product classifications to conform to the presentation for the year ended December 31, 2013. Year EndedDecember 31, 2013 Year EndedDecember 31, 2012 Year EndedDecember 31, 2011 Dollars inMillions Percentageof Total NetSales Dollars inMillions Percentageof Total NetSales Dollars inMillions Percentageof Total NetSales Notebooks/Mobile Devices $1,706.0 15.8%$1,470.1 14.5%$1,336.9 13.9% NetComm Products 1,489.1 13.8 1,351.1 13.3 1,237.7 12.9 Enterprise and Data Storage(Including Drives)998.1 9.3 979.4 9.7 929.9 9.7 Other Hardware 4,173.3 38.8 4,068.8 40.2 3,988.3 41.5 Software 1,994.7 18.5 1,849.4 18.3 1,767.2 18.4 Services 327.1 3.0 284.6 2.8 254.3 2.6 Other (1)80.3 0.8 124.8 1.2 88.1 1.0 Total net sales $10,768.6 100.0%$10,128.2 100.0%$9,602.4 100.0% (1) Includes items such as delivery charges to customers and certain commission revenue. 17. Supplemental Guarantor Information As described in Note 7, the Senior Secured Notes, Senior Subordinated Notes and Senior Notes are guaranteed by Parent and each of CDW LLC’s direct and indirect, 100% owned, domestic subsidiaries (the “Guarantor Subsidiaries”). All guarantees by Parent and Guarantor Subsidiaries are joint and several, and full and unconditional; provided that each guarantee by the Guarantor Subsidiaries is subject to certain customary release provisions contained in the indentures governing the Senior Secured Notes, Senior Subordinated Notes and Senior Notes. CDW LLC’s Canada subsidiary (the “Non-Guarantor Subsidiary”) does not guarantee the debt obligations. CDW LLC and CDW Finance Corporation, as co-issuers, are 100% owned by Parent, and each of the Guarantor Subsidiaries and the Non-Guarantor Subsidiary is 100% owned by CDW LLC. The following tables set forth condensed consolidating balance sheets as of December 31, 2013 and 2012, consolidating statements of operations for the years ended December 31, 2013, 2012 and 2011, condensed consolidating statements of comprehensive income for the years ended December 31, 2013, 2012 and 2011, and condensed consolidating statements of cash flows for the years ended December 31, 2013, 2012 and 2011, in accordance with Rule 3-10 of Regulation S-X. The consolidating financial information includes the accounts of CDW Corporation (the “Parent Guarantor”), which has no independent assets or operations, the accounts of CDW LLC (the “Subsidiary Issuer”), the combined accounts of the Guarantor Subsidiaries, the accounts of the Non-Guarantor Subsidiary, and the accounts of CDW Finance Corporation (the “Co-Issuer”) for the periods indicated. The information was prepared on the same basis as the Company’s consolidated financial statements. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 95 Condensed Consolidating Balance Sheet December 31, 2013 (in millions)ParentGuarantor SubsidiaryIssuer GuarantorSubsidiaries Non-GuarantorSubsidiary Co-Issuer ConsolidatingAdjustments Consolidated Assets Current assets: Cash and cash equivalents $—$196.5 $—$14.0 $—$(22.4)$188.1 Accounts receivable, net ——1,375.9 75.1 ——1,451.0 Merchandise inventory ——378.9 3.1 ——382.0 Miscellaneous receivables —49.9 91.0 5.4 ——146.3 Prepaid expenses and other —10.7 33.4 5.1 —(3.1)46.1 Total current assets —257.1 1,879.2 102.7 —(25.5)2,213.5 Property and equipment, net —69.7 59.6 1.8 ——131.1 Goodwill —751.9 1,439.0 29.4 ——2,220.3 Other intangible assets, net —338.5 982.8 6.7 ——1,328.0 Deferred financing costs, net —30.1 ————30.1 Other assets 4.9 1.4 0.1 0.9 —(5.7)1.6 Investment in and advances to subsidiaries 706.8 2,909.4 ———(3,616.2)— Total assets $711.7 $4,358.1 $4,360.7 $141.5 $—$(3,647.4)$5,924.6 Liabilities and Shareholders’Equity Current liabilities: Accounts payable-trade $—$21.4 $637.3 $26.5 $—$(22.4)$662.8 Accounts payable- inventory financing ——256.6 ———256.6 Current maturities of long- term debt —45.4 ————45.4 Deferred revenue ——89.9 4.9 ——94.8 Accrued expenses —163.5 175.1 7.5 —(3.1)343.0 Total current liabilities —230.3 1,158.9 38.9 —(25.5)1,402.6 Long-term liabilities: Debt —3,205.8 ————3,205.8 Deferred income taxes —178.3 388.4 1.6 —(4.8)563.5 Other liabilities —36.9 3.6 1.4 —(0.9)41.0 Total long-term liabilities —3,421.0 392.0 3.0 —(5.7)3,810.3 Total shareholders’ equity 711.7 706.8 2,809.8 99.6 —(3,616.2)711.7 Total liabilities andshareholders' equity $711.7 $4,358.1 $4,360.7 $141.5 $—$(3,647.4)$5,924.6 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 96 Condensed Consolidating Balance Sheet December 31, 2012 (in millions)ParentGuarantor SubsidiaryIssuer GuarantorSubsidiaries Non-GuarantorSubsidiary Co-Issuer ConsolidatingAdjustments Consolidated Assets Current assets: Cash and cash equivalents $—$48.0 $—$9.8 $—$(19.9)$37.9 Accounts receivable, net ——1,217.7 67.3 ——1,285.0 Merchandise inventory ——313.2 1.4 ——314.6 Miscellaneous receivables —61.7 82.0 4.8 ——148.5 Deferred income taxes —8.7 5.5 (0.1)——14.1 Prepaid expenses and other —10.1 24.4 0.1 ——34.6 Total current assets —128.5 1,642.8 83.3 —(19.9)1,834.7 Property and equipment, net —73.9 66.2 2.6 ——142.7 Goodwill —749.4 1,428.5 31.4 ——2,209.3 Other intangible assets, net —348.6 1,121.7 8.2 ——1,478.5 Deferred financing costs, net —53.2 ————53.2 Other assets 5.4 1.1 0.4 0.6 —(5.9)1.6 Investment in and advances to subsidiaries 131.1 2,946.0 ———(3,077.1)— Total assets $136.5 $4,300.7 $4,259.6 $126.1 $—$(3,102.9)$5,720.0 Liabilities and Shareholders'Equity Current liabilities: Accounts payable-trade $—$16.5 $500.3 $21.7 $—$(19.9)$518.6 Accounts payable- inventory financing ——249.2 ———249.2 Current maturities of long- term debt —40.0 ————40.0 Deferred revenue ——57.8 ———57.8 Accrued expenses —139.3 157.4 5.9 ——302.6 Total current liabilities —195.8 964.7 27.6 —(19.9)1,168.2 Long-term liabilities: Debt —3,731.0 ————3,731.0 Deferred income taxes —188.1 440.0 1.7 —(5.5)624.3 Accrued interest —8.0 ————8.0 Other liabilities —46.7 4.0 1.7 —(0.4)52.0 Total long-term liabilities —3,973.8 444.0 3.4 —(5.9)4,415.3 Total shareholders’ equity 136.5 131.1 2,850.9 95.1 —(3,077.1)136.5 Total liabilities andshareholders’ equity $136.5 $4,300.7 $4,259.6 $126.1 $—$(3,102.9)$5,720.0 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 97 Consolidating Statement of Operations Year Ended December 31, 2013 (in millions)ParentGuarantor SubsidiaryIssuer GuarantorSubsidiaries Non-GuarantorSubsidiary Co-Issuer ConsolidatingAdjustments Consolidated Net sales $—$—$10,293.3 $475.3 $—$—$10,768.6 Cost of sales ——8,592.1 416.2 ——9,008.3 Gross profit ——1,701.2 59.1 ——1,760.3 Selling and administrative expenses 24.4 103.9 957.3 35.3 ——1,120.9 Advertising expense ——126.8 4.0 ——130.8 (Loss) income from operations (24.4)(103.9)617.1 19.8 ——508.6 Interest (expense) income, net —(250.6)0.2 0.3 ——(250.1) Net loss on extinguishments oflong-term debt —(64.0)————(64.0) Management fee —4.3 —(4.3)——— Other (expense) income, net —(0.5)1.2 0.3 ——1.0 (Loss) income before income taxes (24.4)(414.7)618.5 16.1 ——195.5 Income tax benefit (expense)9.2 142.2 (209.5)(4.6)——(62.7) (Loss) income before equity inearnings of subsidiaries (15.2)(272.5)409.0 11.5 ——132.8 Equity in earnings of subsidiaries 148.0 420.5 ———(568.5)— Net income $132.8 $148.0 $409.0 $11.5 $—$(568.5)$132.8 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 98 Consolidating Statement of Operations Year Ended December 31, 2012 (in millions)ParentGuarantor SubsidiaryIssuer GuarantorSubsidiaries Non-GuarantorSubsidiary Co-Issuer ConsolidatingAdjustments Consolidated Net sales $—$—$9,683.0 $445.2 $—$—$10,128.2 Cost of sales ——8,071.5 387.1 ——8,458.6 Gross profit ——1,611.5 58.1 ——1,669.6 Selling and administrative expenses —103.7 891.6 34.2 ——1,029.5 Advertising expense ——125.1 4.4 ——129.5 (Loss) income from operations —(103.7)594.8 19.5 ——510.6 Interest (expense) income, net —(308.0)0.4 0.2 ——(307.4) Net loss on extinguishments oflong-term debt —(17.2)————(17.2) Management fee —3.8 —(3.8)——— Other income (expense), net ——0.2 (0.1)——0.1 (Loss) income before income taxes —(425.1)595.4 15.8 ——186.1 Income tax benefit (expense)—210.6 (272.6)(5.1)——(67.1) (Loss) income before equity inearnings of subsidiaries —(214.5)322.8 10.7 ——119.0 Equity in earnings of subsidiaries 119.0 333.5 ———(452.5)— Net income $119.0 $119.0 $322.8 $10.7 $—$(452.5)$119.0 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 99 Consolidating Statement of Operations Year Ended December 31, 2011 (in millions)ParentGuarantor SubsidiaryIssuer GuarantorSubsidiaries Non-GuarantorSubsidiary Co-Issuer ConsolidatingAdjustments Consolidated Net sales $—$—$9,222.4 $380.0 $—$—$9,602.4 Cost of sales ——7,688.8 330.1 ——8,018.9 Gross profit ——1,533.6 49.9 ——1,583.5 Selling and administrative expenses —111.7 849.2 29.2 ——990.1 Advertising expense ——119.0 3.7 ——122.7 (Loss) income from operations —(111.7)565.4 17.0 ——470.7 Interest (expense) income, net —(324.5)0.2 0.1 ——(324.2) Net loss on extinguishments oflong-term debt —(118.9)————(118.9) Management fee —9.2 —(9.2)——— Other income (expense), net —0.4 0.5 (0.2)——0.7 (Loss) income before income taxes —(545.5)566.1 7.7 ——28.3 Income tax benefit (expense)—215.1 (222.4)(3.9)——(11.2) (Loss) income before equity inearnings of subsidiaries —(330.4)343.7 3.8 ——17.1 Equity in earnings of subsidiaries 17.1 347.5 ———(364.6)— Net income $17.1 $17.1 $343.7 $3.8 $—$(364.6)$17.1 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 100 Condensed Consolidating Statement of Comprehensive Income Year Ended December 31, 2013 (in millions)ParentGuarantor SubsidiaryIssuer GuarantorSubsidiaries Non-GuarantorSubsidiary Co-Issuer ConsolidatingAdjustments Consolidated Comprehensive income $126.1 $141.3 $409.0 $4.8 $—$(555.1)$126.1 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 101 Condensed Consolidating Statement of Comprehensive Income Year Ended December 31, 2012 (in millions)ParentGuarantor SubsidiaryIssuer GuarantorSubsidiaries Non-GuarantorSubsidiary Co-Issuer ConsolidatingAdjustments Consolidated Comprehensive income $121.5 $121.5 $322.8 $13.2 $—$(457.5)$121.5 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 102 Condensed Consolidating Statement of Comprehensive Income Year Ended December 31, 2011 (in millions)ParentGuarantor SubsidiaryIssuer GuarantorSubsidiaries Non-GuarantorSubsidiary Co-Issuer ConsolidatingAdjustments Consolidated Comprehensive income $17.2 $17.2 $343.7 $2.0 $—$(362.9)$17.2 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 103 Condensed Consolidating Statement of Cash Flows Year Ended December 31, 2013 (in millions)ParentGuarantor SubsidiaryIssuer GuarantorSubsidiaries Non-GuarantorSubsidiary Co-Issuer ConsolidatingAdjustments Consolidated Net cash (used in) provided by operating activities $(15.2)$(130.3)$508.8 $5.5 $—$(2.5)$366.3 Cash flows from investing activities: Capital expenditures —(40.8)(6.2)(0.1)——(47.1) Net cash used in investing activities —(40.8)(6.2)(0.1)——(47.1) Cash flows from financing activities: Proceeds from borrowings under revolving credit facility —63.0 ————63.0 Repayments of borrowings under revolving credit facility —(63.0)————(63.0) Repayments of long-term debt —(51.1)————(51.1) Proceeds from issuance of long-term debt —1,535.2 ————1,535.2 Payments to extinguish long- term debt —(2,047.4)————(2,047.4) Payment of debt financing costs —(6.1)————(6.1) Net change in accounts payable-inventory financing ——7.4 ———7.4 Payment of incentive compensation plan withholding taxes —(4.0)(19.6)(0.5)——(24.1) Net proceeds from issuance of common shares 424.7 —————424.7 Dividends paid (7.3)—————(7.3) Advances to/from affiliates (402.2)892.6 (490.4)———— Other financing activities —0.4 ————0.4 Net cash provided by (used in) financing activities 15.2 319.6 (502.6)(0.5)——(168.3) Effect of exchange rate changes on cash and cash equivalents ———(0.7)——(0.7) Net increase in cash and cash equivalents —148.5 —4.2 —(2.5)150.2 Cash and cash equivalents – beginning of period —48.0 —9.8 —(19.9)37.9 Cash and cash equivalents – end of period $—$196.5 $—$14.0 $—$(22.4)$188.1 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 104 Condensed Consolidating Statement of Cash Flows Year Ended December 31, 2012 (in millions)ParentGuarantor SubsidiaryIssuer GuarantorSubsidiaries Non-GuarantorSubsidiary Co-Issuer ConsolidatingAdjustments Consolidated Net cash (used in) provided by operating activities $—$(204.3)$514.2 $1.3 $—$6.2 $317.4 Cash flows from investing activities: Capital expenditures —(27.0)(14.0)(0.4)——(41.4) Premium payments on interest rate cap agreements —(0.3)————(0.3) Net cash used in investing activities —(27.3)(14.0)(0.4)——(41.7) Cash flows from financing activities: Proceeds from borrowings under revolving credit facility —289.0 ————289.0 Repayments of borrowings under revolving credit facility —(289.0)————(289.0) Repayments of long-term debt —(201.0)————(201.0) Proceeds from issuance of long-term debt —135.7 ————135.7 Payments to extinguish long- term debt —(243.2)————(243.2) Payment of debt financing costs —(2.1)————(2.1) Net change in accounts payable-inventory financing ——(29.5)———(29.5) Advances to/from affiliates —486.0 (486.5)0.5 ——— Other financing activities —2.1 ————2.1 Net cash provided by (used in) financing activities —177.5 (516.0)0.5 ——(338.0) Effect of exchange rate changes on cash and cash equivalents ———0.3 ——0.3 Net (decrease) increase in cash and cash equivalents —(54.1)(15.8)1.7 —6.2 (62.0) Cash and cash equivalents – beginning of period —102.1 15.8 8.1 —(26.1)99.9 Cash and cash equivalents – end of period $—$48.0 $—$9.8 $—$(19.9)$37.9 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 105 Condensed Consolidating Statement of Cash Flows Year Ended December 31, 2011 (in millions)ParentGuarantor SubsidiaryIssuer GuarantorSubsidiaries Non-GuarantorSubsidiary Co-Issuer ConsolidatingAdjustments Consolidated Net cash (used in) provided by operating activities $—$(93.8)$327.5 $(0.3)$—$(18.7)$214.7 Cash flows from investing activities: Capital expenditures —(33.4)(10.6)(1.7)——(45.7) Cash settlements on interest rate swap agreements —(6.6)————(6.6) Premium payments on interest rate cap agreements —(3.7)————(3.7) Net cash used in investing activities —(43.7)(10.6)(1.7)——(56.0) Cash flows from financingactivities: Proceeds from borrowings under revolving credit facility —1,295.0 ————1,295.0 Repayments of borrowings under revolving credit facility —(1,483.2)————(1,483.2) Repayments of long-term debt —(132.0)————(132.0) Proceeds from issuance of long-term debt —1,175.0 ————1,175.0 Payments to extinguish long- term debt —(1,175.0)————(1,175.0) Payment of debt financing costs —(26.3)————(26.3) Net change in accounts payable-inventory financing ——250.5 ———250.5 Advances to/from affiliates —552.6 (552.7)0.1 ——— Other financing activities —0.6 ————0.6 Net cash provided by (used in) financing activities —206.7 (302.2)0.1 ——(95.4) Effect of exchange rate changes on cash and cash equivalents ——————— Net increase (decrease) in cash and cash equivalents —69.2 14.7 (1.9)—(18.7)63.3 Cash and cash equivalents – beginning of period —32.9 1.1 10.0 —(7.4)36.6 Cash and cash equivalents – end of period $—$102.1 $15.8 $8.1 $—$(26.1)$99.9 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 106 18. Selected Quarterly Financial Results (unaudited) (in millions, except per-share amounts)2013 First Quarter Second Quarter Third Quarter Fourth Quarter Net Sales Detail: Corporate: Medium/Large $1,146.2 $1,271.4 $1,203.4 $1,281.6 Small Business 257.7 266.0 262.4 271.4 Total Corporate 1,403.9 1,537.4 1,465.8 1,553.0 Public: Government 252.3 295.7 375.3 327.3 Education 232.2 420.6 513.4 282.8 Healthcare 362.3 366.3 355.9 380.4 Total Public 846.8 1,082.6 1,244.6 990.5 Other 161.0 159.3 153.9 169.8 Net sales $2,411.7 $2,779.3 $2,864.3 $2,713.3 Gross profit $402.0 $451.6 $458.4 $448.3 Income from operations (1)$120.1 $153.6 $92.9 $142.0 Net income (loss) (1)$28.3 $46.7 $(2.2)$60.0 Net income (loss) per common share (1) (2): Basic $0.19 $0.32 $(0.01)$0.35 Diluted $0.19 $0.32 $(0.01)$0.35 (in millions, except per-share amounts)2012 First Quarter Second Quarter Third Quarter Fourth Quarter Net Sales Detail: Corporate: Medium/Large $1,089.6 $1,124.7 $1,055.7 $1,178.5 Small Business 273.2 269.7 257.1 264.3 Total Corporate 1,362.8 1,394.4 1,312.8 1,442.8 Public: Government 262.6 318.0 408.6 404.9 Education 221.7 349.5 394.7 226.4 Healthcare 333.3 372.9 360.4 370.0 Total Public 817.6 1,040.4 1,163.7 1,001.3 Other 138.8 149.9 146.8 156.9 Net sales $2,319.2 $2,584.7 $2,623.3 $2,601.0 Gross profit $384.6 $426.9 $432.7 $425.4 Income from operations $103.6 $136.4 $139.7 $130.9 Net income $10.9 $36.8 $38.0 $33.3 Net income per common share (2): Basic $0.08 $0.25 $0.26 $0.23 Diluted $0.07 $0.25 $0.26 $0.23 (1) The third quarter of 2013 included pre-tax IPO-related charges of $74.1 million. See Note 9 for additional discussion of the IPO. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 107 (2) Basic and diluted net income (loss) per share are computed independently for each of the quarters presented. Therefore, the sum of quarterly basic and diluted per share information may not equal annual basic and diluted net income (loss) per share. 19. Subsequent Events The Company redeemed $30.0 million and $20.0 million aggregate principal amounts of Senior Subordinated Notes on January 22, 2014 and February 21, 2014, respectively. The redemption prices were 104.178% of the principal amounts redeemed plus $1.0 million and $0.9 million in accrued and unpaid interest to the date of each redemption, respectively. Following these redemptions, $42.5 million aggregate principal amount of the Senior Subordinated Notes remain outstanding. In connection with these redemptions, the Company expects to record a loss on extinguishment of long-term debt of $2.7 million in the consolidated statement of operations during the first quarter of 2014. This loss represents $2.1 million in redemption premiums and $0.6 million for the write-off of a portion of the remaining deferred financing costs related to the Senior Subordinated Notes. On February 13, 2014, the Company announced that its board of directors declared a cash dividend on the Company's common stock of $0.0425 per share. The dividend will be paid on March 10, 2014 to all stockholders of record as of the close of business on February 25, 2014. Future dividends will be subject to the approval of the Company's board of directors. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 108 SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS Years ended December 31, 2013, 2012 and 2011 (in millions) Balance atBeginningof Period Charged toCosts andExpenses Deductions Balance atEnd ofPeriod Allowance for doubtful accounts: Year Ended December 31, 2013 $5.4 $2.8 $(2.8)$5.4 Year Ended December 31, 2012 5.4 3.9 (3.9)5.4 Year Ended December 31, 2011 5.0 3.6 (3.2)5.4 Reserve for sales returns: Year Ended December 31, 2013 $4.4 $35.0 $(34.3)$5.1 Year Ended December 31, 2012 4.5 33.2 (33.3)4.4 Year Ended December 31, 2011 3.2 32.0 (30.7)4.5 Table of Contents 109 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None. Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rule13a-15(e) or Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end of the period covered by this report. Based on such evaluation, the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, has concluded that, as of the end of such period, the Company’s disclosure controls and procedures were effective in recording, processing, summarizing, and reporting, on a timely basis, information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act, and that information is accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely discussions regarding required disclosure. Management’s Annual Report on Internal Control over Financial Reporting Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange Act. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements and can provide only reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate. Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2013. Management based this assessment on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in “Internal Control — Integrated Framework (1992 framework).” Based on its assessment, management concluded that, as of December 31, 2013, the Company’s internal control over financial reporting is effective. Ernst & Young LLP, independent registered public accounting firm, has audited the consolidated financial statements of the Company and the Company's internal control over financial reporting and has included their reports herein. Changes in Internal Control over Financial Reporting There were no changes in the Company’s internal control over financial reporting during the fiscal quarter ended December 31, 2013 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. Table of Contents 110 Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholders of CDW Corporation We have audited CDW Corporation and subsidiaries’ internal control over financial reporting as of December 31, 2013, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (1992 framework) (the COSO criteria). CDW Corporation and subsidiaries’ management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the company’s internal control over financial reporting based on our audit. We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. In our opinion, CDW Corporation and subsidiaries maintained, in all material respects, effective internal control over financial reporting as of December 31, 2013, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of CDW Corporation and subsidiaries as of December 31, 2013 and 2012, and the related consolidated statements of operations, comprehensive income, shareholders’ equity (deficit) and cash flows for each of the three years in the period ended December 31, 2013 of CDW Corporation and subsidiaries and our report dated March 5, 2014 expressed an unqualified opinion thereon. /s/ Ernst & Young LLP Chicago, Illinois March 5, 2014 Table of Contents 111 Item 9B. Other Information None. Table of Contents 112 PART III Item 10. Directors, Managers, Executive Officers and Corporate Governance We have adopted The CDW Way Code, our code of business conduct and ethics, that is applicable to all of our coworkers. Additionally, within The CDW Way Code is a Financial Integrity Code of Ethics that sets forth an even higher standard applicable to our executives, officers, members of our internal disclosure committee and all managers and above in our finance department. A copy of this code is available on our corporate website at www.cdw.com. If we make any substantive amendments to this code or grant any waiver from a provision to our chief executive officer, principal financial officer or principal accounting officer, we will disclose the nature of such amendment or waiver on our website or in a report on Form 8- K. See Part I - “Executive Officers” for information about our executive officers, which is incorporated by reference in this Item 10. Other information required under this Item 10 is incorporated herein by reference to our definitive proxy statement for our 2014 annual meeting of stockholders on May 22, 2014 (“2014 proxy statement”), which we will file with the SEC on or before 120 days after our 2013 fiscal year-end. Item 11. Executive Compensation Information required under this Item 11 is incorporated herein by reference to the 2014 proxy statement. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Information required under this Item 12 is incorporated herein by reference to the 2014 proxy statement. Item 13. Certain Relationships and Related Transactions, and Director Independence Information required under this Item 13 is incorporated herein by reference to the 2014 proxy statement. Item 14. Principal Accountant Fees and Services Information required under this Item 14 is incorporated herein by reference to the 2014 proxy statement. Table of Contents 113 PART IV Item 15. Exhibits and Financial Statement Schedules (a) Financial Statements and Schedules The following documents are filed as part of this report: (1) Consolidated Financial Statements: Page (2) Financial Statement Schedules: Page All other schedules are omitted since the required information is not present or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the consolidated financial statements or notes thereto. (b) Exhibits The information required by this Item is set forth on the exhibit index that follows the signature page of this report. Table of Contents Report of Independent Registered Public Accounting Firm 62 Consolidated Balance Sheets as of December 31, 2013 and 2012 63 Consolidated Statements of Operations for the years ended December 31, 2013, 2012 and 2011 64 Consolidated Statements of Comprehensive Income for the years ended December 31, 2013, 2012 and 2011 65 Consolidated Statements of Shareholders’ Equity (Deficit) for the years ended December 31, 2013, 2012 and 2011 66 Consolidated Statements of Cash Flows for the years ended December 31, 2013, 2012 and 2011 67 Notes to Consolidated Financial Statements 68 Schedule II – Valuation and Qualifying Accounts 108 114 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CDW CORPORATION Date:March 5, 2014 By:/s/ Thomas E. Richards Thomas E. Richards Chairman, President and Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Thomas E. Richards Chairman, President and Chief Executive Officer(principal executive officer) and Director March 5, 2014 Thomas E. Richards /s/ Ann E. Ziegler Senior Vice President and Chief Financial Officer(principal financial officer) March 5, 2014 Ann E. Ziegler /s/ Virginia L. Seggerman Vice President and Controller(principal accounting officer) March 5, 2014 Virginia L. Seggerman /s/ Steven W. Alesio Director March 5, 2014 Steven W. Alesio /s/ Barry K. Allen Director March 5, 2014 Barry K. Allen /s/ Benjamin D. Chereskin Director March 5, 2014 Benjamin D. Chereskin /s/ Glenn M. Creamer Director March 5, 2014 Glenn M. Creamer /s/ Michael J. Dominguez Director March 5, 2014 Michael J. Dominguez /s/ Paul J. Finnegan Director March 5, 2014 Paul J. Finnegan /s/ David W. Nelms Director March 5, 2014 David W. Nelms /s/ Robin P. Selati Director March 5, 2014 Robin P. Selati /s/ Donna F. Zarcone Director March 5, 2014 Donna F. Zarcone Table of Contents 115 EXHIBIT INDEX ExhibitNumber Description 3.1 Fifth Amended and Restated Certificate of Incorporation of CDW Corporation, previously filed as Exhibit 3.1 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 3.2 Amended and Restated By-Laws of CDW Corporation, previously filed as Exhibit 3.2 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 3.3 Articles of Organization of CDW LLC, previously filed as Exhibit 3.3 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.4 Amended and Restated Limited Liability Company Agreement of CDW LLC, previously filed as Exhibit 3.4 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.5 Certificate of Incorporation of CDW Finance Corporation, previously filed as Exhibit 3.5 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.6 By-Laws of CDW Finance Corporation, previously filed as Exhibit 3.6 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.7 Amended and Restated Articles of Incorporation of CDW Technologies, Inc., previously filed as Exhibit 3.7 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.8 Amended and Restated By-Laws of CDW Technologies, Inc., previously filed as Exhibit 3.8 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.9 Articles of Organization of CDW Direct, LLC, previously filed as Exhibit 3.9 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.10 Amended and Restated Limited Liability Company Agreement of CDW Direct, LLC, previously filed as Exhibit 3.10 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.11 Articles of Organization of CDW Government LLC, previously filed as Exhibit 3.11 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.12 Amended and Restated Limited Liability Company Agreement of CDW Government LLC, previously filed as Exhibit 3.12 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.13 Articles of Incorporation of CDW Logistics, Inc., previously filed as Exhibit 3.13 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.14 By-Laws of CDW Logistics, Inc., previously filed as Exhibit 3.14 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 4.1 Specimen Common Stock Certificate, previously filed as Exhibit 4.1 with CDW Corporation’s Amendment No. 3 to Form S-1 filed on June 25, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 4.2 Senior Secured Note Indenture, dated as of December 17, 2010, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.1 with CDW Corporation's Form 8-K filed on December 21, 2010 and incorporated herein by reference. Table of Contents 116 ExhibitNumber Description 4.3 Senior Secured Note Supplemental Indenture, dated as of March 29, 2011, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.1 with CDW Corporation's Form 8-K filed on March 30, 2011 and incorporated herein by reference. 4.4 Second Senior Secured Note Supplemental Indenture, dated as of May 10, 2012, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.1 with CDW Corporation's Form 8-K filed on May 11, 2012 and incorporated herein by reference. 4.5 Form of Senior Secured Note (included as Exhibit A to Exhibit 4.1), previously filed as Exhibit 4.2 with CDW Corporation's Form 8-K filed on December 21, 2010 and incorporated herein by reference. 4.6 Senior Note Indenture, dated as of April 13, 2011, between CDW Escrow Corporation and U.S. Bank National Association as trustee, previously filed as Exhibit 4.1 with CDW Corporation's Form 8-K filed on April 14, 2011 and incorporated herein by reference. 4.7 Senior Note Supplemental Indenture, dated as of April 13, 2011, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.2 with CDW Corporation's Form 8-K filed on April 14, 2011 and incorporated herein by reference. 4.8 Second Senior Note Supplemental Indenture, dated as of May 20, 2011, by and among CDW LLC, CDW Finance Corporation, CDW Escrow Corporation, the guarantors party thereto and U.S. Bank National Association as Trustee, previously filed as Exhibit 4.1 with CDW Corporation's Form 8-K filed on May 23, 2011 and incorporated herein by reference. 4.9 Third Senior Note Supplemental Indenture, dated as of February 17, 2012, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association as Trustee, previously filed as Exhibit 4.5 with CDW Corporation's Form 8-K filed on February 17, 2012 and incorporated herein by reference. 4.10 Fourth Senior Note Supplemental Indenture, dated as of May 10, 2012, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.3 with CDW Corporation's Form 8-K filed on May 11, 2012 and incorporated herein by reference. 4.11 Form of Senior Note (included as Exhibit A to Exhibit 4.5), previously filed as Exhibit 4.3 with CDW Corporation's Form 8-K filed on April 14, 2011 and incorporated herein by reference. 4.12 Senior Notes Registration Rights Agreement, dated as of February 17, 2012, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and Barclays Capital Inc. as initial purchaser, previously filed as Exhibit 4.7 with CDW Corporation's Form 8-K filed on February 17, 2012 and incorporated herein by reference. 4.13 Senior Subordinated Exchange Note Indenture, dated as of October 10, 2008, by and among CDW Corporation, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.6 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 4.14 Senior Subordinated Exchange Note Supplemental Indenture, dated as of May 10, 2010, by and among CDW LLC, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.7 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 4.15 Second Senior Subordinated Exchange Note Supplemental Indenture, dated as of August 23, 2010, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.8 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 4.16 Third Senior Subordinated Exchange Note Supplemental Indenture, dated as of May 10, 2012, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.2 with CDW Corporation's Form 8-K filed on May 11, 2012 and incorporated herein by reference. Table of Contents 117 ExhibitNumber Description 4.17 Form of Fixed Rate Senior Subordinated Exchange Note due 2017 (included as Exhibit B to Exhibit 4.12), previously filed as Exhibit 4.10 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 4.18 Form of Global Fixed Rate Senior Subordinated Exchange Note due 2017, Series B, previously filed as Exhibit 4.11 with CDW Corporation's Form 10-K for the fiscal year ended December 31, 2010 and incorporated herein by reference. 10.1 Revolving Loan Credit Agreement, dated as of June 24, 2011, by and among CDW LLC, the lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, GE Commercial Distribution Finance Corporation, as floorplan funding agent, and the joint lead arrangers, joint bookrunners, co-collateral agents and other agents party thereto, previously filed as Exhibit 10.1 with CDW Corporation's Amendment No. 1 to Form S-4 filed on September 26, 2011 (Reg. No. 333-175597) and incorporated herein by reference. 10.2 Term Loan Agreement, dated as of April 29, 2013, by and among CDW LLC, the lenders from time to time party thereto, Barclays Bank PLC, as administrative agent and collateral agent, and the joint lead arrangers, joint bookrunners, co-syndication agents and co-documentation agents party thereto, previously filed as Exhibit 10.1 with CDW Corporation’s Form 8-K filed on May 1, 2013 and incorporated herein by reference. 10.3 First Amendment to Term Loan Agreement, dated as of May 30, 2013, by and among CDW LLC, the lenders from time to time party thereto, and Barclays Bank PLC, as administrative agent and collateral agent, previously filed as Exhibit 10.3 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.4 Incremental Amendment, dated as of July 31, 2013, by and among CDW LLC, the lenders party thereto and Barclays Bank PLC, as administrative agent, previously filed as Exhibit 10.1 with CDW Corporation’s Form 8-K filed on August 1, 2013 and incorporated herein by reference. 10.5 Third Amendment to the Term Loan Agreement, dated as of September 12, 2013, by and among CDW LLC, the lenders from time to time party thereto and Barclays Bank PLC, as administrative agent and collateral agent, previously filed as Exhibit 10.2 with CDW Corporation's Form 10-Q filed on November 7, 2013 and incorporated herein by reference. 10.6 Second Amended and Restated Guarantee and Collateral Agreement, dated April 29, 2013, by and among CDW LLC, the guarantors party thereto and Barclays Bank PLC, as collateral agent, previously filed as Exhibit 10.2 with CDW Corporation’s Form 8-K filed on May 1, 2013 and incorporated herein by reference. 10.7 Management Services Agreement, dated as of October 12, 2007, by and between CDW Corporation, Madison Dearborn Partners V-B, L.P. and Providence Equity Partners L.L.C., previously filed as Exhibit 10.9 with CDW Corporation’s Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.8 Termination Agreement, dated as of June 12, 2013, by and among CDW Corporation, Madison Dearborn Partners V-B, L.P. and Providence Equity Partners L.L.C., previously filed as Exhibit 10.6 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.9 Registration Agreement, dated as of October 12, 2007, by and among VH Holdings, Inc., CDW Holdings LLC, Madison Dearborn Capital Partners V-A, L.P., Madison Dearborn Capital Partners V-C, L.P., Madison Dearborn Partners V Executive-A, L.P., Providence Equity Partners VI L.P., Providence Equity Partners VI- A L.P., and the other securityholders party thereto, previously filed as Exhibit 10.10 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.10* Withdrawal from Registration Agreement, dated as of November 12, 2013, by and between CDW Corporation and Paul S. Shain. 10.11* Withdrawal from Registration Agreement, dated as of November 20, 2013, by and among CDW Corporation, James R. Shanks and BOS Holdings, LLC. 10.12§ CDW Holdings LLC 2007 Incentive Equity Plan, adopted as of October 12, 2007, previously filed as Exhibit 10.11 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. Table of Contents 118 ExhibitNumber Description 10.13§Form of CDW Holdings LLC Class A Common Unit Purchase and Exchange Agreement under the CDW Holdings LLC 2007 Incentive Equity Plan (executed by Thomas E. Richards, John A. Edwardson, Dennis G. Berger, Douglas E. Eckrote, Christine A. Leahy, Jonathan J. Stevens and Ann E. Ziegler), previously filed as Exhibit 10.12 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.14§ Form of CDW Holdings LLC Class A Common Unit Purchase and Exchange Agreement under the CDW Holdings LLC 2007 Incentive Equity Plan (executed by Neal J. Campbell, Christina M. Corley, Christina V. Rother and Matthew A. Troka and to be used for certain future investors), previously filed as Exhibit 10.13 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.15§ Form of CDW Holdings LLC Class B Common Unit Grant Agreement under the CDW Holdings LLC 2007 Incentive Equity Plan (executed by Thomas E. Richards, John A. Edwardson, Dennis G. Berger, Douglas E. Eckrote, Christine A. Leahy, Jonathan J. Stevens and Ann E. Ziegler), previously filed as Exhibit 10.12 with CDW Corporation's Form 10-K filed on March 8, 2013 and incorporated herein by reference. 10.16§ Form of CDW Holdings LLC Class B Common Unit Grant Agreement under the CDW Holdings LLC 2007 Incentive Equity Plan (executed by Neal J. Campbell, Christina M. Corley, Christina V. Rother and Matthew A. Troka and to be used for certain future grantees), previously filed as Exhibit 10.13 with CDW Corporation's Form 10-K filed on March 8, 2013 and incorporated herein by reference. 10.17§ Form of Compensation Protection Agreement (executed by Dennis G. Berger, Douglas E. Eckrote, Christine A. Leahy, Jonathan J. Stevens and Ann E. Ziegler), previously filed as Exhibit 10.18 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.18§ CDW Compensation Protection Plan, adopted as of December 10, 2002 and amended and restated effective as of January 1, 2009 (applicable to Neal J. Campbell, Christina M. Corley, Christina V. Rother and Matthew A. Troka), previously filed as Exhibit 10.19 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.19§ First Amendment to CDW Compensation Protection Plan, adopted as of December 10, 2002 and amended and restated effective as of January 1, 2009, dated as of January 3, 2012, previously filed as Exhibit 10.18 with CDW Corporation's Form 10-K filed on March 9, 2012 and incorporated herein by reference. 10.20§ Form of Noncompetition Agreement under the Compensation Protection Agreement, previously filed as Exhibit 10.20 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.21§ Form of Noncompetition Agreement under the CDW Compensation Protection Plan, previously filed as Exhibit 10.21 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.22§ CDW Restricted Debt Unit Plan, adopted as of March 10, 2010, previously filed as Exhibit 10.22 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.23§ Form of CDW Restricted Debt Unit Grant Notice and Agreement (executed by Thomas E. Richards, Dennis G. Berger, Douglas E. Eckrote, Christine A. Leahy, Jonathan J. Stevens and Ann E. Ziegler), previously filed as Exhibit 10.23 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.24§ Form of CDW Restricted Debt Unit Grant Notice and Agreement (executed by Neal J. Campbell, Christina M. Corley, Christina V. Rother and Matthew A. Troka and to be used for certain future grantees), previously filed as Exhibit 10.24 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.25§ Senior Management Incentive Plan, as amended and restated effective January 1, 2010, previously filed as Exhibit 10.1 with CDW Corporation's Form 8-K filed on November 15, 2010 and incorporated herein by reference. 10.26§Amended and Restated Compensation Protection Agreement, dated as of June 30, 2011, by and between CDW LLC and Thomas E. Richards, previously filed as Exhibit 10.3 with CDW Corporation's Form 8-K filed on July 1, 2011 and incorporated herein by reference. Table of Contents 119 ExhibitNumber Description 10.27§Letter Agreement, dated as of September 13, 2011, by and between CDW Direct, LLC and Christina M. Corley, previously filed as Exhibit 10.31 with CDW Corporation's Form 10-K filed on March 9, 2012 and incorporated herein by reference. 10.28§Form of CDW Holdings LLC (Director) Class A Common Unit Purchase Agreement (executed by Steven W. Alesio, Barry K. Allen, Benjamin D. Chereskin and Chereskin Dynasty Trust and Donna F. Zarcone), previously filed as Exhibit 10.32 with CDW Corporation's Form 10-K filed on March 8, 2013 and incorporated herein by reference. 10.29§Form of Indemnification Agreement by and between CDW Corporation and its directors and officers, previously filed as Exhibit 10.32 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.30 Stockholders Agreement, dated as of June 10, 2013, by and among CDW Corporation, Madison Dearborn Capital Partners V-A, L.P., Madison Dearborn Capital Partners V-C, L.P., Madison Dearborn Capital Partners V Executive-A, L.P., Providence Equity Partners VI L.P., Providence Equity Partners VI-A L.P. and the other securityholders party thereto, previously filed as Exhibit 10.33 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.31§CDW Corporation 2013 Senior Management Incentive Plan, previously filed as Exhibit 10.34 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.32§CDW Corporation 2013 Long-Term Incentive Plan, previously filed as Exhibit 10.35 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.33§CDW Corporation Coworker Stock Purchase Plan, previously filed as Exhibit 10.36 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.34§Form of CDW Corporation Option Award Notice and Stock Option Agreement (executed by Thomas E. Richards), previously filed as Exhibit 10.37 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.35§Form of CDW Corporation Option Award Notice and Stock Option Agreement (executed by Neal J. Campbell and Christina M. Corley), previously filed as Exhibit 10.38 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.36§Form of CDW Corporation Restricted Stock Award Notice and Restricted Stock Award Agreement (executed by Thomas E. Richards, Dennis G. Berger, Douglas E. Eckrote, Christine A. Leahy, Jonathan J. Stevens and Ann E. Ziegler), previously filed as Exhibit 10.12 with CDW Corporation’s Form 10-Q filed on August 12, 2013 and incorporated herein by reference. 10.37§Form of CDW Corporation Restricted Stock Award Notice and Restricted Stock Award Agreement (executed by Neal J. Campbell, Christina M. Corley, Christina V. Rother and Matthew A. Troka), previously filed as Exhibit 10.13 with CDW Corporation’s Form 10-Q filed on August 12, 2013 and incorporated herein by reference. 10.38§CDW Amended and Restated Restricted Debt Unit Plan, previously filed as Exhibit 10.3 with CDW Corporation’s Form 10-Q filed on November 7, 2013 and incorporated herein by reference. 12.1* Computation of ratio of earnings to fixed charges. 21.1 List of subsidiaries, previously filed as Exhibit 21.1 with CDW Corporation's Form S-4 filed on April 13, 2012 (Reg. No. 333-180715) and incorporated herein by reference. 23.1*Consent of Ernst & Young LLP. 31.1* Certification of Chief Executive Officer pursuant to Rule 15d-14(a) under the Securities Exchange Act of 1934. Table of Contents 120 ExhibitNumber Description 31.2* Certification of Chief Financial Officer pursuant to Rule 15d-14(a) under the Securities Exchange Act of 1934. 32.1** Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350. 32.2** Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350. 101.INS*XBRL Instance Document 101.SCH*XBRL Taxonomy Extension Schema Document 101.CAL*XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF*XBRL Taxonomy Extension Definition Linkbase Document 101.LAB*XBRL Taxonomy Extension Label Linkbase Document 101.PRE*XBRL Taxonomy Extension Presentation Linkbase Document ________________ * Filed herewith ** These items are furnished and not filed. § A management contract or compensatory arrangement required to be filed as an exhibit pursuant to Item 601 of Regulation S-K. Table of Contents CDW CORP FORM 10-K(Annual Report) Filed 02/26/15 for the Period Ending 12/31/14 Address 200 N MILWAUKEE AVE VERNON HILLS, IL 60061 Telephone 8474656000 CIK 0001402057 Symbol CDW SIC Code 5961 - Catalog and Mail-Order Houses Fiscal Year 12/31 http://www.edgar-online.com © Copyright 2015, EDGAR Online, Inc. All Rights Reserved. Distribution and use of this document restricted under EDGAR Online, Inc. Terms of Use. Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) For the fiscal year ended December 31, 2014 or For the transition period from to Commission File Number 001-35985 (847) 465-6000 (Registrant’s telephone number, including area code) None (Former name, former address and former fiscal year, if changed since last report) ____________________________________________ Securities registered pursuant to Section 12(b) of the Act: Securities registered pursuant to Section 12(g) of the Act: None ____________________________________________ Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (Check one): FORM 10-K ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 CDW CORPORATION (Exact name of registrant as specified in its charter) Delaware 26-0273989 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) 200 N. Milwaukee Avenue Vernon Hills, Illinois 60061 (Address of principal executive offices) (Zip Code) Title of each class: Name of each exchange on which registered Common stock, par value $0.01 per share NASDAQ Global Select Market Large accelerated filer  Accelerated filer Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Table of Contents The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant as of June 30, 2014 , the last business day of the registrant’s most recently completed second fiscal quarter, was $2,762.3 million , based on the per share closing sale price of $31.88 on that date. As of February 20, 2015 , there were 172,275,656 shares of common stock, $0.01 par value, outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant’s definitive proxy statement for use in connection with its 2015 Annual Meeting of Shareholders, to be filed not later than 120 days after December 31, 2014 , are incorporated by reference into Part III of this report. CDW CORPORATION AND SUBSIDIARIES ANNUAL REPORT ON FORM 10-K Year Ended December 31, 2014 TABLE OF CONTENTS 2 Item Page PART I Item 1. Business 4 Item 1A. Risk Factors 9 Item 1B. Unresolved Staff Comments 20 Item 2. Properties 20 Item 3. Legal Proceedings 21 Item 4. Mine Safety Disclosures 21 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 25 Item 6. Selected Financial Data 27 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 33 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 57 Item 8. Financial Statements and Supplementary Data 58 Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 107 Item 9A. Controls and Procedures 107 Item 9B. Other Information 109 PART III Item 10. Directors, Executive Officers and Corporate Governance 110 Item 11. Executive Compensation 110 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 110 Item 13. Certain Relationships and Related Transactions, and Director Independence 110 Item 14. Principal Accountant Fees and Services 110 PART IV Item 15. Exhibits and Financial Statement Schedules 111 SIGNATURES 112 Table of Contents FORWARD-LOOKING STATEMENTS This report contains forward-looking statements within the meaning of the federal securities laws. All statements other than statements of historical fact included in this report are forward-looking statements. These statements relate to analyses and other information, which are based on forecasts of future results and estimates of amounts not yet determinable. These statements also relate to our future prospects, developments and business strategies. We claim the protection of The Private Securities Litigation Reform Act of 1995 for all forward-looking statements in this report. These forward-looking statements are identified by the use of terms and phrases such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,” “project,” “should,” “will” and similar terms and phrases, including references to assumptions. However, these words are not the exclusive means of identifying such statements. Although we believe that our plans, intentions and expectations reflected in or suggested by such forward-looking statements are reasonable, we cannot assure you that we will achieve those plans, intentions or expectations. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we expected. Important factors that could cause actual results to differ materially from our expectations, or cautionary statements, are disclosed under the section entitled “Risk Factors” included elsewhere in this report. All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the cautionary statements contained in the section entitled “Risk Factors” included elsewhere in this report as well as other cautionary statements that are made from time to time in our other Securities and Exchange Commission ("SEC") filings and public communications. You should evaluate all forward-looking statements made in this report in the context of these risks and uncertainties. We caution you that the important factors referenced above may not contain all of the factors that are important to you. In addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our operations in the way we expect. The forward-looking statements included in this report are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law. 3 Table of Contents PART I Item 1. Business Our Company CDW is a Fortune 500 company and a leading provider of integrated information technology (“IT”) solutions in the U.S. and Canada. We help our customer base of approximately 250,000 small, medium and large business, government, education and healthcare customers by delivering critical solutions to their increasingly complex IT needs. Our broad array of offerings ranges from discrete hardware and software products to integrated IT solutions such as mobility, security, data center optimization, cloud computing, virtualization and collaboration. We are technology "agnostic," with a product portfolio that includes over 100,000 products from more than 1,000 brands. We provide our products and solutions through sales force and service delivery teams consisting of nearly 4,600 coworkers, including more than 1,800 field sellers, highly- skilled technology specialists and advanced service delivery engineers. We are a leading U.S. sales channel partner for many original equipment manufacturers (“OEMs”) and software publishers (collectively, our “vendor partners”), whose products we sell or include in the solutions we offer. We believe we are an important extension of our vendor partners' sales and marketing capabilities, providing them with a cost-effective way to reach customers and deliver a consistent brand experience through our established end-market coverage and extensive customer access. We provide value to our customers by simplifying the complexities of technology across design, selection, procurement, integration and management. Our goal is to have our customers, regardless of their size, view us as an indispensable extension of their IT staffs. We seek to achieve this goal by providing our customers with superior service through our large and experienced sales force and service delivery teams. Our multi-brand offering approach enables us to identify the products or combination of products that best address each customer's specific organizational IT requirements and to evolve our offerings as new technologies develop. We believe we offer the following value proposition to our customers and our vendor partners: Our customers include private sector businesses many of which employ fewer than 5,000 employees, government agencies and educational and healthcare institutions. We serve our customers through channel-specific sales teams and service delivery teams with extensive technical skills and knowledge of the specific markets they serve. This market segmentation allows us to customize our offerings and to provide enhanced expertise in designing and implementing IT solutions for our customers. We currently have five dedicated customer channels: medium/large business, small business, government, education and healthcare, each of which generated nearly $1 billion or more in net sales in 2014 . The scale and diversity of our customer channels provide us with multiple avenues for growth and a balanced customer base to weather economic and technology cycles. 4 Our value proposition to our customers Our value proposition to our vendor partners Broad selection of products and multi-branded IT solutions Value-added services with integration capabilities Highly-skilled specialists and engineers Solutions across a very broad IT landscape Access to approximately 250,000 customers throughout the U.S. and Canada Large and established customer channels Strong distribution and implementation capabilities Value-added solutions and marketing programs that generate end-user demand Table of Contents The following table provides information regarding our reportable segments and our customer channels: For further information on our segments, including financial results, see Note 17 to the accompanying audited consolidated financial statements included elsewhere in this report. We offer more than 1,000 brands, from well-established companies such as APC, Apple, Cisco, EMC, Google, Hewlett-Packard, IBM, Lenovo, Microsoft, NetApp, Samsung, Symantec and VMware to emerging vendor partners such as Aerohive Networks, Box, Inc., Drobo, Jive, Nimble Storage, Nutanix, and Ruckus. In 2014 , we generated over $1 billion of revenue for each of four of our vendor partners and over $100 million of revenue for each of 12 other vendor partners. We have received the highest level of certification from major vendor partners such as Cisco, EMC and Microsoft, which reflects the extensive product and solution knowledge and capabilities that we bring to our customers' IT challenges. These certifications also provide us with access to favorable pricing, tools and resources, including vendor incentive programs, which we use to provide additional value to our customers. Our vendor partners also regularly recognize us with top awards and select us to develop and grow new customer solutions. History CDW was founded in 1984. In 2003, we purchased selected U.S. assets and the Canadian operations of Micro Warehouse, which extended our growth platform into Canada. In 2006, we acquired Berbee Information Networks Corporation, a regional provider of technology products, solutions and customized engineering services in advanced technologies primarily across Cisco, IBM and Microsoft portfolios. This acquisition increased our capabilities in customized engineering services and managed services. On October 12, 2007, CDW Corporation, an Illinois corporation, was acquired through a merger transaction by an entity controlled by investment funds affiliated with Madison Dearborn Partners, LLC and Providence Equity Partners L.L.C. (the “Acquisition”). CDW Corporation continued as the surviving corporation and same legal entity after the Acquisition, but became a wholly owned subsidiary of VH Holdings, Inc., a Delaware corporation. On December 31, 2009, CDW Corporation merged into CDWC LLC, an Illinois limited liability company owned by VH Holdings, Inc., with CDWC LLC as the surviving entity. This change had no impact on our operations or management. On December 31, 2009, CDWC LLC was renamed CDW LLC (“CDW LLC”). On August 17, 2010, VH Holdings, Inc. was renamed CDW Corporation (“Parent”), a Delaware corporation. Throughout this report, the terms “the Company” and “CDW” refer to Parent and its 100% owned subsidiaries. Prior to July 2, 2013, the date of our initial public offering (“IPO”), Parent was owned directly by CDW Holdings LLC ("CDW Holdings"), a company controlled by investment funds affiliated with Madison Dearborn Partners, LLC and Providence Equity Partners L.L.C. (the "Sponsors"), certain other co-investors and certain members of CDW management. Before the IPO, Madison Dearborn Partners, LLC and Providence Equity Partners L.L.C. owned 46.0% and 40.6% of our common stock, respectively. After the IPO and through subsequent secondary offerings in fourth quarter of 2013 and during 2014, the Sponsors' ownership has significantly decreased. As of December 31, 2014, the Sponsors own 15.5% and 13.7% of our common stock, respectively. 5 Corporate Segment Public Segment Customer Channels Medium/Large Business Small Business Government Education Healthcare Other Target Customers 100 - 5,000 employees 10 - 100 employees Various federal, state and local agencies Higher education and K-12 Hospitals, ambulatory service providers and long-term care facilities Advanced services customers plus Canada 2014 Net Sales (in billions) $5.5 $1.0 $1.5 $1.8 $1.6 $0.7 Table of Contents On July 2, 2013, Parent completed the IPO of its common stock. In connection with the IPO, CDW Holdings distributed all of its shares of Parent's common stock to its members in June 2013 in accordance with the members' respective membership interests and was subsequently dissolved in August 2013. See Note 9 to the accompanying audited consolidated financial statements included elsewhere in this report for additional discussion of the IPO. On November 10, 2014, we completed the acquisition of a 35% non-controlling equity interest in Kelway TopCo Limited ("Kelway"), a UK-based IT solutions provider, which has global supply chain relationships that enable it to conduct business in more than 100 countries. This investment strengthens our ability to provide a more comprehensive solution to our customers and enhances our ability to serve our existing multi-national customers. Our Market We operate in the U.S. and Canadian IT markets, which are large and growing markets. According to IDC, the overall U.S. IT market generated approximately $675 billion in sales in 2014 . We believe our addressable market in the U.S. in the indirect sales channel represents more than $215 billion in annual sales and for the year ended December 31, 2014 , our U.S. net sales of $11.5 billion represented approximately 5% of that highly diverse and fragmented market. According to IDC, the overall Canadian IT market generated more than $50 billion in sales in 2014 . We believe our addressable market in Canada in the indirect sales channel represents more than $11 billion in annual sales and for the year ended December 31, 2014, our net sales of $532 million in Canada represented approximately 5% of that market. We believe we have the largest market share in our addressable market, with our 2014 net sales exceeding the cumulative North American net sales of our four largest publicly traded sales channel competitors, based upon publicly available information for those companies. New technologies, including cloud, virtualization and mobility, coupled with the resulting increase in demand for data as well as aging infrastructure, are increasingly requiring businesses and institutions to seek integrated solutions to their IT needs. We expect this trend to continue for the foreseeable future, with end- user demand for business efficiency and productivity driving future IT spending growth. Our Offerings Our offerings range from discrete hardware and software products and services to complex integrated solutions that include one or more of these elements. We believe our customers increasingly view technology purchases as integrated solutions rather than discrete product and service categories and we estimate t hat approximately 47% of our net sales in 2014 came from sales of product categories and services typically associated with solutions. Our hardware products include notebooks/mobile devices (including tablets), network communications, enterprise and data storage, video monitors, printers, desktop computers and servers. Our software products include application suites, security, virtualization, operating systems, network management and Software as a Service (“SaaS”) offerings. We also provide a full suite of value-added-services, which range from basic installation, warranty and repair services to custom configuration, data center and network implementation services, as well as managed services that include Infrastructure as a Service (“IaaS”) offerings. We also offer a variety of integrated solutions, such as: • Mobility : We assist our customers with the selection, procurement and integration of mobile security software, hardware devices such as smartphones, tablets and notebooks, and cellular wireless activation systems. We also provide mobile device management applications with policy and security management capabilities across a variety of mobile operating systems and platforms. • Security : We assess our customers' security needs and provide them with threat prevention tools in order to protect their networks, servers and applications, such as anti-virus, anti-spam, content filtering, intrusion prevention, firewall and virtual private network services, and network access control. We also design and implement data loss prevention solutions, using data monitoring and encryption across a wide array of devices to ensure the security of customer information, personal employee information and research and development data. • Data Center Optimization : We help our customers evaluate their data centers for convergence and optimization opportunities. Our data center optimization solutions consist of server virtualization, physical server consolidation, data storage management and energy-efficient power and cooling systems. • Cloud Computing : We provide our customers with a broad portfolio of cloud-based solutions, which are technology delivered as a service. Our cloud offerings include: Infrastructure as a Service (IaaS), which delivers compute, networking, storage, and data center capabilities via the cloud; Software as a Service (SaaS), which connects users to cloud-based software applications; and Platform as a Service (PaaS), which enables development and ongoing maintenance of cloud-based solutions. We provide public cloud solutions which reside off customer premises on a public (shared) infrastructure, and private cloud solutions, which reside on customer premises. We also offer hybrid cloud solutions that deliver the benefits of both public and private solutions. Our migration, integration and managed 6 Table of Contents services offerings help our customers simplify cloud adoption, as well as the ongoing management of cloud solutions across the entire IT lifecycle. Dedicated Cloud Client Executives work with our customers to architect cloud solutions that meet their organizational, technology and financial objectives. • Virtualization : We design and implement server, storage and desktop virtualization solutions. Virtualization enables our customers to efficiently utilize hardware resources by running multiple, independent, virtual operating systems on a single computer and multiple virtual servers simultaneously on a single server. Virtualization also can separate a desktop environment and associated application software from the hardware device that is used to access it, and provides employees with remote desktop access. Our specialists assist customers with the steps of implementing virtualization solutions, including evaluating network environments, deploying shared storage options and licensing platform software. • Collaboration : We provide our customers with communication tools that allow employees to share knowledge, ideas and information among each other and with clients and partners effectively and quickly. Our collaboration solutions unite communications and applications via the integration of products that facilitate the use of multiple enterprise communication methods including email, instant messaging, presence, social media, voice, video, hardware, software and services. We also host cloud-based collaboration solutions. While we believe customers increasingly view technology purchases as solutions rather than discrete product and service categories, the following table shows our net sales by major category, based upon our internal category classifications. Our Customers We provide integrated IT solutions to approximately 250,000 small, medium and large business, government, education and healthcare customers throughout the U.S. and Canada. Sales to the U.S. federal government, which are diversified across multiple agencies and departments, collectively accounted for approximately 7% , 7% and 10% of total net sales in 2014, 2013 and 2012, respectively. However, there are several independent purchasing decision-makers across these agencies and departments. Excluding these sales to the federal government, we are not reliant on any one customer, as our next five largest customers cumulatively comprised approximately 3% of our net sales in 2014 . Inventory Management We utilize our IT systems to manage our inventory in a cost-efficient manner, resulting in a rapid-turn inventory model. We generally only stock items that have attained a minimum sales volume. 7 Year Ended December 31, 2014 Year Ended December 31, 2013 (1) Year Ended December 31, 2012 (1) Dollars in Millions Percentage of Total Net Sales Dollars in Millions Percentage of Total Net Sales Dollars in Millions Percentage of Total Net Sales Notebooks/Mobile Devices $ 2,352.3 19.5 % $ 1,698.4 15.8 % $ 1,462.8 14.4 % NetComm Products 1,615.9 13.4 1,486.3 13.8 1,351.5 13.3 Enterprise and Data Storage (Including Drives) 1,024.3 8.5 999.2 9.3 981.5 9.7 Other Hardware 4,549.2 37.6 4,178.5 38.8 4,075.7 40.3 Software (2) 2,076.7 17.2 1,993.1 18.5 1,877.7 18.5 Services 371.4 3.1 332.7 3.1 285.0 2.8 Other (3) 84.7 0.7 80.4 0.7 94.0 1.0 Total net sales $ 12,074.5 100.0 % $ 10,768.6 100.0 % $ 10,128.2 100.0 % (1) Amounts have been reclassified for changes in individual product classifications to conform to the presentation for the year ended December 31, 2014. (2) The decline in software as a percentage of total net sales is primarily driven by a higher proportion of revenue recorded on a net basis, including SaaS. (3) Includes items such as delivery charges to customers and certain commission revenue. Table of Contents Our distribution process is highly automated. Once a customer order is received and credit approved, orders are automatically routed to one of our distribution centers for picking and shipping as well as configuration and imaging services. We operate two distribution centers: a 450,000 square foot facility in Vernon Hills, Illinois, and a 513,000 square foot facility in North Las Vegas, Nevada. We ship almost 37 million units annually on an aggregate basis from our two distribution centers. We believe that the location of our distribution centers allows us to efficiently ship products throughout the U.S. and provide timely access to our principal distributors. In addition, in the event of weather-related or other disruptions at one of our distribution centers, we are able to shift order processing and fulfillment from one center to the other quickly and efficiently, enabling us to continue to ship products in a timely manner. We believe that competitive sources of supply are available in substantially all of the product categories we offer. We continue to improve the productivity of our distribution centers as measured by key performance indicators such as units shipped per hour worked and bin accuracy. We also have drop-shipment arrangements with many of our OEMs and wholesale distributors, which permit us to offer products to our customers without having to take physical delivery at either of our distribution centers. These arrangements generally represent approximately 40% to 50% of total net sales, including approximately 15% to 20% related to electronic delivery for software licenses. Information Technology Systems We maintain customized IT and unified communication systems that enhance our ability to provide prompt, efficient and expert service to our customers. In addition, these systems enable centralized management of key functions, including purchasing, inventory management, billing and collection of accounts receivable, sales and distribution. Our systems provide us with thorough, detailed and real-time information regarding key aspects of our business. This capability helps us to continuously enhance productivity, ship customer orders quickly and efficiently, respond appropriately to industry changes and provide high levels of customer service. We believe that our websites, which provide electronic order processing and advanced tools, such as order tracking, reporting and asset management, make it easy for customers to transact business with us and ultimately strengthen our customer relationships. Product Procurement We may purchase all or only some of the products that our vendor partners offer for resale to our customers or for inclusion in the solutions we offer. Each vendor partner agreement provides for specific terms and conditions, which may include one or more of the following: product return privileges, price protection policies, purchase discounts and vendor incentive programs, such as purchase or sales rebates and cooperative advertising reimbursements. We also purchase software from major software publishers for resale to our customers or for inclusion in the solutions we offer. Our agreements with software publishers allow the end-user customer to acquire software or licensed products and services. In addition to purchasing products directly from our vendor partners, we purchase products from wholesale distributors for resale to our customers or for inclusion in the solutions we offer. These wholesale distributors provide logistics management and supply-chain services for us, as well as for our vendor partners. For the year ended December 31, 2014 , we purchased 54% of the products we sold as discrete products or as components of a solution directly from our vendor partners and the remaining 46% from wholesale distributors. Purchases from our three largest wholesale distributors, Tech Data, SYNNEX and Ingram Micro each represented 9% of our total purchases. Sales of products manufactured by Apple, Cisco, EMC, Hewlett-Packard, Lenovo and Microsoft, whether purchased directly from these vendor partners or from a wholesale distributor, represented in the aggregate 54% of our net sales in 2014 . Sales of products manufactured by Hewlett-Packard and Cisco represented 18% and 14% , of our 2014 net sales, respectively. Competition The market for technology products and services is highly competitive. Competition is based on the ability to tailor specific solutions to customer needs, quality and breadth of product and service offerings, knowledge and expertise of sales force, customer service, price, product availability, speed of delivery and credit availability. Our competition includes: 8 • resellers such as Dimension Data, ePlus, Insight Enterprises, PC Connection, PCM, Presidio, Softchoice, World Wide Technology and many smaller resellers; • manufacturers who sell directly to customers, such as Dell, Hewlett-Packard and Apple; • large service providers and system integrators, such as IBM, Accenture, Hewlett-Packard and Dell; • e-tailers such as Amazon, Newegg, and TigerDirect.com; • cloud providers such as AT&T, Amazon Web Services and Box; and Table of Contents We expect the competitive landscape in which we compete to continue to change as new technologies are developed. While innovation can help our business as it creates new offerings for us to sell, it can also disrupt our business model and create new and stronger competitors. For a discussion of the risks associated with competition, see “Risk Factors” included elsewhere in this report. Marketing We market the CDW brand to both national and local audiences using a variety of channels that include online, broadcast, print, social and other media. This promotion is supported by integrated communication efforts that target decision-makers, influencers and the general public using a combination of news releases, case studies, media interviews and speaking opportunities. We also market to current and prospective customers through integrated marketing programs that include behaviorally targeted email, print, online media, events and sponsorships, as well as broadcast media. As a result of our relationships with our vendor partners, a significant portion of our advertising and marketing expenses are reimbursed through cooperative advertising reimbursement programs. These programs are at the discretion of our vendor partners and are typically tied to sales or purchasing volumes or other commitments to be met by us within a specified period of time. We believe that our national scale and analytical techniques that measure the efficacy of our marketing programs differentiate us from our competitors. Coworkers As of December 31, 2014 , we employed 7,211 coworkers, none of whom is covered by collective bargaining agreements. We consider our coworker relations to be good. Intellectual Property The CDW trademark and certain variations thereon are registered or subject to pending trademark applications in the U.S., Canada and certain other jurisdictions. We believe our trademarks have significant value and are important factors in our marketing programs. In addition, we own registrations for domain names, including cdw.com and cdwg.com, for certain of our primary trademarks. We also have unregistered copyrights in our website content. Item 1A. Risk Factors There are many factors that affect our business, results of operations and cash flows, some of which are beyond our control. The following is a description of some important factors that may cause our actual results of operations and cash flows in future periods to differ materially from those currently expected or desired. Risks Related to Our Business General economic conditions could negatively affect technology spending by our customers and put downward pressure on prices, which may have an adverse impact on our business, results of operations or cash flows. Weak economic conditions generally, sustained uncertainty about global economic conditions, U.S. federal government spending cuts and the impact of new government programs, or a tightening of credit markets could cause our customers and potential customers to postpone or reduce spending on technology products or services or put downward pressure on prices, which could have an adverse effect on our business, results of operations or cash flows. Our financial performance could be adversely affected by decreases in spending on technology products and services by our Public segment customers. Our sales to our Public segment customers are impacted by government spending policies, budget priorities and revenue levels. Although our sales to the federal government are diversified across multiple agencies and departments, they collectively accounted for approximately 7% of 2014 net sales. An adverse change in government spending policies (including ongoing budget cuts at the federal level), budget priorities or revenue levels could cause our Public segment customers to reduce their purchases or to terminate or not renew their contracts with us, which could adversely affect our business, results of operations or cash flows. For example, in 2013, as a result of sequestration and related budget uncertainty and the partial shutdown of the federal government for 16 days, we experienced significantly reduced Federal sales in our Public segment. Our business depends on our vendor partner relationships and the availability of their products. 9 • retailers (including their e-commerce activities) such as Staples and Office Depot. Table of Contents We purchase products for resale from vendor partners, which include OEMs and software publishers, and wholesale distributors. For the year ended December 31, 2014 , we purchased approximately 54% of the products we sold directly from vendor partners and the remaining amount from wholesale distributors. We are authorized by vendor partners to sell all or some of their products via direct marketing activities. Our authorization with each vendor partner is subject to specific terms and conditions regarding such things as sales channel restrictions, product return privileges, price protection policies, purchase discounts and vendor partner programs and funding, including purchase rebates, sales volume rebates, purchasing incentives and cooperative advertising reimbursements. However, we do not have any long-term contracts with our vendor partners and many of these arrangements are terminable upon notice by either party. A reduction in vendor partner programs or funding or our failure to timely react to changes in vendor partner programs or funding could have an adverse effect on our business, results of operations or cash flows. In addition, a reduction in the amount of credit granted to us by our vendor partners could increase our need for, and the cost of, working capital and could have an adverse effect on our business, results of operations or cash flows, particularly given our substantial indebtedness. From time to time, vendor partners may terminate or limit our right to sell some or all of their products or change the terms and conditions or reduce or discontinue the incentives that they offer us. For example, there is no assurance that, as our vendor partners continue to sell directly to end users and through resellers, they will not limit or curtail the availability of their products to solutions providers like us. Any such termination or limitation or the implementation of such changes could have a negative impact on our business, results of operations or cash flows. Although we purchase from a diverse vendor base, in 2014 , products we purchased from distributors Tech Data, SYNNEX and Ingram Micro each represented 9% of our total purchases. In addition, sales of Apple, Cisco, EMC, Hewlett-Packard, Lenovo and Microsoft products comprise a substantial portion of our sales, representing approximately 54% of net sales in 2014 . Sales of products manufactured by Hewlett- Packard and Cisco represented approximately 18% and 14% , respectively, of our 2014 net sales. The loss of, or change in business relationship with, any of these or any other key vendor partners, the diminished availability of their products, or backlogs for their products leading to manufacturer allocation, could reduce the supply and increase the cost of products we sell and negatively impact our competitive position. Additionally, the relocation of key distributors utilized in our purchasing model could increase our need for, and the cost of, working capital and have an adverse effect on our business, results of operations or cash flows. Further, the sale, spin-off or combination of any of our vendor partners and/or certain of their business units, including any such sale to or combination with a vendor with whom we do not currently have a commercial relationship or whose products we do not sell, could have an adverse impact on our business, results of operations or cash flows. Our sales are dependent on continued innovations in hardware, software and services offerings by our vendor partners and the competitiveness of their offerings, and our ability to partner with new and emerging technology providers. The technology industry is characterized by rapid innovation and the frequent introduction of new and enhanced hardware, software and services offerings, such as cloud-based solutions, including SaaS, IaaS and PaaS. We have been and will continue to be dependent on innovations in hardware, software and services offerings, as well as the acceptance of those innovations by customers. A decrease in the rate of innovation, or the lack of acceptance of innovations by customers, could have an adverse effect on our business, results of operations or cash flows. In addition, if we are unable to keep up with changes in technology and new hardware, software and services offerings, for example by providing the appropriate training to our account managers, sales technology specialists and engineers to enable them to effectively sell and deliver such new offerings to customers, our business, results of operations or cash flows could be adversely affected. We also are dependent upon our vendor partners for the development and marketing of hardware, software and services to compete effectively with hardware, software and services of vendors whose products and services we do not currently offer or that we are not authorized to offer in one or more customer channels. In addition, our success is dependent on our ability to develop relationships with and sell hardware, software and services from new emerging vendors and vendors that we have not historically represented in the marketplace. To the extent that a vendor's offering that is highly in demand is not available to us for resale in one or more customer channels, and there is not a competitive offering from another vendor that we are authorized to sell in such customer channels, or we are unable to develop relationships with new technology providers or companies that we have not historically represented, our business, results of operations or cash flows could be adversely impacted. Substantial competition could reduce our market share and significantly harm our financial performance. Our current competition includes: 10 Table of Contents We expect the competitive landscape in which we compete to continue to change as new technologies are developed. While innovation can help our business as it creates new offerings for us to sell, it can also disrupt our business model and create new and stronger competitors. For instance, while cloud-based solutions present an opportunity for us, cloud-based solutions and technologies that deliver technology solutions as a service could increase the amount of sales directly to customers rather than through solutions providers like us, or could reduce the amount of hardware we sell, leading to a reduction in our sales and/or profitability. In addition, some of our hardware and software vendor partners sell, and could intensify their efforts to sell, their products directly to our customers. Moreover, traditional OEMs have increased their services capabilities through mergers and acquisitions with service providers, which could potentially increase competition in the market to provide comprehensive technology solutions to customers. If any of these trends becomes more prevalent, it could adversely affect our business, results of operations or cash flows. We focus on offering a high level of service to gain new customers and retain existing customers. To the extent we face increased competition to gain and retain customers, we may be required to reduce prices, increase advertising expenditures or take other actions which could adversely affect our business, results of operations or cash flows. Additionally, some of our competitors may reduce their prices in an attempt to stimulate sales, which may require us to reduce prices. This would require us to sell a greater number of products to achieve the same level of net sales and gross profit. If such a reduction in prices occurs and we are unable to attract new customers and sell increased quantities of products, our sales growth and profitability could be adversely affected. The success of our business depends on the continuing development, maintenance and operation of our information technology systems. Our success is dependent on the accuracy, proper utilization and continuing development of our information technology systems, including our business systems, such as our sales, customer management, financial and accounting, marketing, purchasing, warehouse management, e-commerce and mobile systems, as well as our operational platforms, including voice and data networks and power systems. The quality and our utilization of the information generated by our information technology systems, and our success in implementing new systems and upgrades, affects, among other things, our ability to: The integrity of our information technology systems is vulnerable to disruption due to forces beyond our control. While we have taken steps to protect our information technology systems from a variety of threats, including computer viruses, malware, phishing, social engineering, unauthorized access and other malicious attacks, both internal and external, and human error, there can be no guarantee that those steps will be effective. Furthermore, although we have redundant systems at a separate location to back up our primary systems, there can be no assurance that these redundant systems will operate properly if and when required. Any disruption to or infiltration of our information technology systems could significantly harm our business and results of operations. Breaches of data security could adversely impact our business. 11 • resellers, such as Dimension Data, ePlus, Insight Enterprises, PC Connection, PCM, Presidio, Softchoice, World Wide Technology and many smaller resellers; • manufacturers who sell directly to customers, such as Dell, Hewlett-Packard and Apple; • large service providers and system integrators, such as IBM, Accenture, Hewlett-Packard and Dell; • e-tailers, such as Amazon, Newegg and TigerDirect.com; • cloud providers, such as AT&T, Amazon Web Services and Box; and • retailers (including their e-commerce activities), such as Staples and Office Depot. • conduct business with our customers, including delivering services and solutions to them; • manage our inventory and accounts receivable; • purchase, sell, ship and invoice our hardware and software products and provide and invoice our services efficiently and on a timely basis; and • maintain our cost-efficient operating model while scaling our business. Table of Contents Our business involves the storage and transmission of proprietary information and sensitive or confidential data, including personal information of coworkers, customers and others. In addition, we operate data centers for our customers which host their technology infrastructure and may store and transmit both business-critical data and confidential information. In connection with our services business, our coworkers also have access to our customers' confidential data and other information. We have privacy and data security policies in place that are designed to prevent security breaches; however, as newer technologies evolve, we could be exposed to increased risk of breaches in security. Breaches in security could expose us, our customers or other individuals to a risk of public disclosure, loss or misuse of this information, resulting in legal claims or proceedings, liability or regulatory penalties under laws protecting the privacy of personal information, as well as the loss of existing or potential customers and damage to our brand and reputation. In addition, the cost and operational consequences of implementing further data protection measures could be significant. Such breaches, costs and consequences could adversely affect our business, results of operations or cash flows. The failure to comply with our Public segment contracts or applicable laws and regulations could result in, among other things, termination, fines or other liabilities, and changes in procurement regulations could adversely impact our business, results of operations or cash flows. Revenues in our Public segment are derived from sales to governmental entities, educational institutions and healthcare customers, through various contracts and open market sales of products and services. Sales to Public segment customers are highly regulated. Noncompliance with contract provisions, government procurement regulations or other applicable laws or regulations (including but not limited to the False Claims Act and the Medicare and Medicaid Anti-Kickback Statute) could result in civil, criminal and administrative liability, including substantial monetary fines or damages, termination of government contracts or other Public segment customer contracts, and suspension, debarment or ineligibility from doing business with the government and other customers in the Public segment. In addition, contracts in the Public segment are generally terminable at any time for convenience of the contracting agency or group purchasing organization (“GPO”) or upon default. Furthermore, our inability to enter into or retain contracts with GPOs may threaten our ability to sell to customers in those GPOs and compete. The effect of any of these possible actions could adversely affect our business, results of operations or cash flows. In addition, the adoption of new or modified procurement regulations and other requirements may increase our compliance costs and reduce our gross margins, which could have a negative effect on our business, results of operations or cash flows. If we fail to provide high-quality services to our customers, or if our third-party service providers fail to provide high-quality services to our customers, our reputation, business, results of operations or cash flows could be adversely affected. Our service offerings include field services, managed services, warranties, configuration services, partner services and telecom services. Additionally, we deliver and manage mission critical software, systems and network solutions for our customers. We also offer certain services, such as implementation and installation services and repair services, to our customers through various third-party service providers engaged to perform these services on our behalf. If we or our third-party service providers fail to provide high quality services to our customers or such services result in a disruption of our customers' businesses, this could, among other things, result in legal claims and proceedings and liability. Moreover, as we expand our services and solutions business, we may be exposed to additional operational, regulatory and other risks. We also could incur liability for failure to comply with the rules and regulations applicable to the new services and solutions we provide to our customers. If any of the foregoing were to occur, our reputation with our customers, our brand and our business, results of operations or cash flows could be adversely affected. If we lose any of our key personnel, or are unable to attract and retain the talent required for our business, our business could be disrupted and our financial performance could suffer. Our success is heavily dependent upon our ability to attract, develop, engage and retain key personnel to manage and grow our business, including our key executive, management, sales, services and technical coworkers. Our future success will depend to a significant extent on the efforts of Thomas E. Richards, our Chairman and Chief Executive Officer, as well as the continued service and support of our other executive officers. Our future success also will depend on our ability to retain our customer-facing coworkers, who have been given critical CDW knowledge regarding, and the opportunity to develop strong relationships with, many of our customers. In addition, as we seek to expand our offerings of value-added services and solutions, our success will even more heavily depend on attracting and retaining highly skilled technology specialists and engineers, for whom the market is extremely competitive. Our inability to attract, develop and retain key personnel could have an adverse effect on our relationships with our vendor partners and customers and adversely affect our ability to expand our offerings of value-added services and solutions. Moreover, our inability to train our sales, services and technical personnel effectively to meet the rapidly changing technology 12 Table of Contents needs of our customers could cause a decrease in the overall quality and efficiency of such personnel. Such consequences could adversely affect our business, results of operations or cash flows. The interruption of the flow of products from suppliers could disrupt our supply chain. A significant portion of the products we sell are manufactured or purchased by our vendor partners outside of the U.S., primarily in Asia. Political, social or economic instability in Asia, or in other regions in which our vendor partners purchase or manufacture the products we sell, could cause disruptions in trade, including exports to the U.S. Other events that could also cause disruptions to our supply chain include: We cannot predict whether the countries in which the products we sell are purchased or manufactured, or may be purchased or manufactured in the future, will be subject to new or additional trade restrictions or sanctions imposed by the U.S. or foreign governments, including the likelihood, type or effect of any such restrictions. Trade restrictions, including new or increased tariffs or quotas, embargoes, sanctions, safeguards and customs restrictions against the products we sell, as well as foreign labor strikes and work stoppages or boycotts, could increase the cost or reduce the supply of product available to us and adversely affect our business, results of operations or cash flows. In addition, our exports are subject to regulations and noncompliance with these requirements could have a negative effect on our business, results of operations or cash flows. A natural disaster or other adverse occurrence at one of our primary facilities or customer data centers could damage our business. Substantially all of our corporate, warehouse and distribution functions are located at our Vernon Hills, Illinois facilities and our second distribution center in North Las Vegas, Nevada. If the warehouse and distribution equipment at one of our distribution centers were to be seriously damaged by a natural disaster or other adverse occurrence, we could utilize the other distribution center or third-party distributors to ship products to our customers. However, this may not be sufficient to avoid interruptions in our service and may not enable us to meet all of the needs of our customers and would cause us to incur incremental operating costs. In addition, we operate three customer data centers and numerous sales offices which may contain both business-critical data and confidential information of our customers. A natural disaster or other adverse occurrence at any of the customer data centers or at any of our major sales offices could negatively impact our business, results of operations or cash flows. We are heavily dependent on commercial delivery services. We generally ship hardware products to our customers by FedEx, United Parcel Service and other commercial delivery services and invoice customers for delivery charges. If we are unable to pass on to our customers future increases in the cost of commercial delivery services, our profitability could be adversely affected. Additionally, strikes, inclement weather, natural disasters or other service interruptions by such shippers could adversely affect our ability to deliver products on a timely basis. We are exposed to accounts receivable and inventory risks. We extend credit to our customers for a significant portion of our net sales, typically on 30-day payment terms. We are subject to the risk that our customers may not pay for the products they have purchased, or may pay at a slower rate than we have historically experienced, the risk of which is heightened during periods of economic downturn or uncertainty or, in the case of Public segment customers, during periods of budget constraints. We are also exposed to inventory risks as a result of the rapid technological changes that affect the market and pricing for the products we sell. We seek to minimize our inventory exposure through a variety of inventory management procedures and policies, including our rapid- turn inventory model, as well as vendor price protection and product return programs. However, if we were unable to maintain our rapid-turn inventory model, if there were unforeseen product developments that 13 • the imposition of additional trade law provisions or regulations; • the imposition of additional duties, tariffs and other charges on imports and exports; • foreign currency fluctuations; • natural disasters or other adverse occurrences at, or affecting, any of our suppliers' facilities; • restrictions on the transfer of funds; • the financial instability or bankruptcy of manufacturers; and • significant labor disputes, such as strikes. Table of Contents created more rapid obsolescence or if our vendor partners were to change their terms and conditions, our inventory risks could increase. We also from time to time take advantage of cost savings associated with certain opportunistic bulk inventory purchases offered by our vendor partners or we may decide to carry high inventory levels of certain products that have limited or no return privileges due to customer demand or request. These bulk purchases could increase our exposure to inventory obsolescence. We could be exposed to additional risks if we continue to make strategic investments or acquisitions or enter into alliances. We may continue to pursue transactions, including strategic investments, acquisitions or alliances, in an effort to extend or complement our existing business. These types of transactions involve numerous business risks, including finding suitable transaction partners and negotiating terms that are acceptable to us, the diversion of management's attention from other business concerns, extending our product or service offerings into areas in which we have limited experience, entering into new geographic markets, the potential loss of key coworkers or business relationships and successfully integrating acquired businesses, any of which could adversely affect our operations. In addition, our financial results could be adversely affected by financial adjustments required by accounting principles generally accepted in the United States of America (“GAAP”) in connection with these types of transactions where significant goodwill or intangible assets are recorded. To the extent the value of goodwill or identifiable intangible assets with indefinite lives becomes impaired, we may be required to incur material charges relating to the impairment of those assets. Our future operating results may fluctuate significantly. We may experience significant variations in our future quarterly results of operations. These fluctuations may cause the market price of our common stock to be volatile and may result from many factors, including the condition of the technology industry in general, shifts in demand and pricing for hardware, software and services and the introduction of new products or upgrades. Our operating results are also highly dependent on our level of gross profit as a percentage of net sales. Our gross profit percentage fluctuates due to numerous factors, some of which may be outside of our control, including general macroeconomic conditions; pricing pressures; changes in product costs from our vendor partners; the availability of price protection, purchase discounts and incentive programs from our vendor partners; changes in product, order size and customer mix; the risk of some items in our inventory becoming obsolete; increases in delivery costs that we cannot pass on to customers; and general market and competitive conditions. In addition, our cost structure is based, in part, on anticipated sales and gross margins. Therefore, we may not be able to adjust our cost structure quickly enough to compensate for any unexpected sales or gross margin shortfall, and any such inability could have an adverse effect on our business, results of operations or cash flows. We are exposed to risks from legal proceedings and audits. We are party to various legal proceedings that arise in the ordinary course of our business, which include commercial, employment, tort and other litigation. We are subject to intellectual property infringement claims against us in the ordinary course of our business, either because of the products and services we sell or the business systems and processes we use to sell such products and services, in the form of cease-and-desist letters, licensing inquiries, lawsuits and other communications and demands. In our industry, such intellectual property claims have become more frequent as the complexity of technological products and the intensity of competition in our industry have increased. Increasingly, many of these assertions are brought by non-practicing entities whose principal business model is to secure patent licensing revenue, but we may also be subject to suits from inventors, competitors or other patent holders who may seek licensing revenue, lost profits and/or an injunction preventing us from engaging in certain activities, including selling certain products and services. Because of our significant sales to governmental entities, we also are subject to audits by federal, state and local authorities. We also are subject to audits by various vendor partners and large customers, including government agencies, relating to purchases and sales under various contracts. In addition, we are subject to indemnification claims under various contracts. Current and future litigation, infringement claims, governmental proceedings, audits or indemnification claims that we face may result in substantial costs and expenses and significantly divert the attention of our management regardless of the outcome. In addition, current and future litigation, infringement claims, governmental proceedings, audits or indemnification claims could lead to increased costs or interruptions of our normal business operations. Litigation, infringement claims, governmental proceedings, audits or indemnification claims involve uncertainties and the eventual outcome of any litigation, 14 Table of Contents infringement claim, governmental proceeding, audit or indemnification claim could adversely affect our business, results of operations or cash flows. Failure to comply with the laws and regulations applicable to our operations could adversely impact our business, results of operations or cash flows. Our operations are subject to numerous U.S. and foreign laws and regulations in a number of areas including, but not limited to, areas of labor and employment, advertising, e-commerce, tax, import and export requirements, anti-corruption, data privacy requirements, anti- competition, and environmental, health, and safety. Compliance with these laws, regulations and similar requirements may be onerous and expensive, and they may be inconsistent from jurisdiction to jurisdiction, further increasing the cost of compliance and doing business, and the risk of noncompliance. We have implemented policies and procedures designed to help ensure compliance with applicable laws and regulations, but there can be no guarantee against coworkers, contractors, or agents violating such laws and regulations or our policies and procedures. We have significant deferred cancellation of debt income. As a result of a 2009 debt modification, we realized $395.5 million of cancellation of debt income (“CODI”). We made an election under Code Section 108(i) to defer this CODI from taxable income, pursuant to which we are also required to defer certain original issue discount (“OID”) deductions as they accrue. As of December 31, 2013, we had deferred approximately $114.5 million of OID deductions. Starting in 2014, we were required to include the deferred CODI and the deferred OID into taxable income ratably over a five-year period ending in 2018. Because we have more CODI than the aggregate of our deferred OID on the relevant remaining debt instruments, we will have a future cash tax liability associated with our significant deferred CODI. We have reflected the associated cash tax liability in our deferred taxes for financial accounting purposes. All of our deferred CODI will be accelerated into current taxable income if, prior to 2018, we engage in a so-called “impairment transaction” and the gross value of our assets immediately afterward is less than 110% of the sum of our total liabilities and the tax on the net amount of our deferred CODI and OID (the “110% test”) as determined under the applicable Treasury Regulations. An “impairment transaction” is any transaction that impairs our ability to pay the tax on our deferred CODI, and includes dividends or distributions with respect to our equity and charitable contributions, in each case in a manner that is not consistent with our historical practice within the meaning of the applicable Treasury Regulations. Prior to 2018, our willingness to pay dividends or make distributions with respect to our equity could be adversely affected if, at the time, we do not meet the 110% test and, as a result, the payment of a dividend or the making of a distribution would accelerate the tax payable with respect to our deferred CODI. We believe that, based on our interpretation of applicable Treasury Regulations, the gross value of our assets exceeds 110% of the sum of our total liabilities and the tax on the net amount of our deferred CODI and OID as of the filing date of this Annual Report on Form 10-K. However, we cannot assure you that this will continue to be true in the future. Risks Related to Our Indebtedness We have a substantial amount of indebtedness, which could have important consequences to our business. We have a substantial amount of indebtedness. As of December 31, 2014 , we had $3.2 billion of total long-term debt outstanding, as defined by GAAP, and $332.1 million of obligations outstanding under our inventory financing agreements, and the ability to borrow an additional $935.6 million under our senior secured asset-based revolving credit facility (the “Revolving Loan”). Our substantial indebtedness could have important consequences, including the following: 15 • making it more difficult for us to satisfy our obligations with respect to our indebtedness; • requiring us to dedicate a substantial portion of our cash flow from operations to debt service payments on our and our subsidiaries' debt, which reduces the funds available for working capital, capital expenditures, acquisitions and other general corporate purposes; • requiring us to comply with restrictive covenants in our senior credit facilities and indentures, which limit the manner in which we conduct our business; • making it more difficult for us to obtain vendor financing from our vendor partners, including original equipment manufacturers and software publishers; • limiting our flexibility in planning for, or reacting to, changes in the industry in which we operate; Table of Contents Restrictive covenants under our senior credit facilities and, to varying degrees, our indentures may adversely affect our operations and liquidity. Our senior credit facilities and, to varying degrees, our indentures contain, and any future indebtedness of ours may contain, various covenants that limit our ability to, among other things: As a result of these covenants, we are limited in the manner in which we conduct our business and we may be unable to engage in favorable business activities or finance future operations or capital needs. A breach of any of these covenants or any of the other restrictive covenants would result in a default under our senior credit facilities. Upon the occurrence of an event of default under our senior credit facilities, the lenders: The acceleration of amounts outstanding under our senior credit facilities would likely trigger an event of default under our existing indentures. If we were unable to repay those amounts, the lenders under our senior credit facilities could proceed against the collateral granted to them to secure our borrowings thereunder. We have pledged a significant portion of our assets as collateral under our senior credit facilities. If the lenders under our senior credit facilities accelerate the repayment of borrowings, we cannot assure you that we will have sufficient assets to repay our senior credit facilities and our other indebtedness or the ability to borrow sufficient funds to refinance such indebtedness. Even if we were able to obtain new financing, it may not be on commercially reasonable terms, or terms that are acceptable to us. In addition, under our Revolving Loan, we are permitted to borrow an aggregate amount of up to $1,250.0 million. However, our ability to borrow under our Revolving Loan is limited by a borrowing base and a liquidity condition. The borrowing base at any time equals the sum of up to 85% of CDW LLC and its subsidiary guarantors’ eligible accounts receivable (net of accounts reserves) (up to 30% of such eligible accounts receivable which can consist of federal government accounts receivable) plus the lesser of (i) 75% of CDW LLC and its subsidiary guarantors’ eligible inventory (valued at cost and net of inventory reserves) and (ii) the product of 85% multiplied by the net orderly liquidation value percentage multiplied by eligible inventory (valued at cost and net of inventory reserves), less reserves (other than accounts reserves and inventory 16 • placing us at a competitive disadvantage compared to any of our less-leveraged competitors; • increasing our vulnerability to both general and industry-specific adverse economic conditions; and • limiting our ability to obtain additional debt or equity financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements and increasing our cost of borrowing. • incur or guarantee additional debt; • pay dividends or make distributions to holders of our capital stock or to make certain other restricted payments or investments; • repurchase or redeem capital stock; • make loans, capital expenditures or investments or acquisitions; • receive dividends or other payments from our subsidiaries; • enter into transactions with affiliates; • create liens; • merge or consolidate with other companies or transfer all or substantially all of our assets; • transfer or sell assets, including capital stock of subsidiaries; and • prepay, repurchase or redeem debt. • will not be required to lend any additional amounts to us; • could elect to declare all borrowings outstanding thereunder, together with accrued and unpaid interest and fees, to be due and payable; or • could require us to apply all of our available cash to repay these borrowings. Table of Contents reserves). The borrowing base in effect as of December 31, 2014 was $1,253.4 million , and therefore, did not restrict our ability to borrow under our Revolving Loan as of that date. Our ability to borrow under our Revolving Loan is also limited by a minimum liquidity condition, which provides that, if excess cash availability is less than the lesser of (i) $125.0 million and (ii) the greater of (A) 10% of the borrowing base and (B) $100.0 million, the lenders are not required to lend any additional amounts under our Revolving Loan unless the consolidated fixed charge coverage ratio (as defined in the credit agreement for our Revolving Loan) is at least 1.0 to 1.0. Moreover, our Revolving Loan provides discretion to the agent bank acting on behalf of the lenders to impose additional availability reserves, which could materially impair the amount of borrowings that would otherwise be available to us. We cannot assure you that the agent bank will not impose such reserves or, were it to do so, that the resulting impact of this action would not materially and adversely impair our liquidity. We will be required to generate sufficient cash to service our indebtedness and, if not successful, we may be forced to take other actions to satisfy our obligations under our indebtedness. Our ability to make scheduled payments on or to refinance our debt obligations depends on our financial and operating performance, which is subject to prevailing economic and competitive conditions and to certain financial, business and other factors beyond our control. Our outstanding long-term debt will impose significant cash interest payment obligations on us and, accordingly, we will have to generate significant cash flow from operating activities to fund our debt service obligations. We cannot assure you that we will maintain a level of cash flows from operating activities sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations-Liquidity and Capital Resources” included elsewhere in this report. If our cash flows and capital resources are insufficient to fund our debt service obligations, we may be forced to reduce or delay capital expenditures, sell assets or operations, seek additional debt or equity capital, restructure or refinance our indebtedness, or revise or delay our strategic plan. We cannot assure you that we would be able to take any of these actions, that these actions would be successful and permit us to meet our scheduled debt service obligations or satisfy our capital requirements, or that these actions would be permitted under the terms of our existing or future debt agreements, including our senior credit facilities and indentures. In the absence of such operating results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations to meet our debt service and other obligations. Our senior credit facilities and the indenture governing our 8.5% Senior Notes due 2019 ("2019 Senior Notes") restrict our ability to dispose of assets and use the proceeds from the disposition. We may not be able to consummate those dispositions or to obtain the proceeds which we could realize from them and these proceeds may not be adequate to meet any debt service obligations then due. Furthermore, the Sponsors have no obligation to provide us with debt or equity financing. If we cannot make scheduled payments on our debt, we will be in default and, as a result: Despite our indebtedness levels, we and our subsidiaries may be able to incur substantially more debt, including secured debt. This could further increase the risks associated with our leverage. We and our subsidiaries may be able to incur substantial additional indebtedness in the future. The terms of our senior credit facilities and indentures do not fully prohibit us or our subsidiaries from doing so. To the extent that we incur additional indebtedness or such other obligations, the risks associated with our substantial indebtedness described above, including our possible inability to service our debt, will increase. As of December 31, 2014 , we had approximately $935.6 million available for additional borrowing under our Revolving Loan after taking into account borrowing base limitations (net of $2.1 million of issued and undrawn letters of credit and $332.1 million of reserves related to our floorplan sub-facility). Variable rate indebtedness subjects us to interest rate risk, which could cause our debt service obligations to increase significantly. Certain of our borrowings, primarily borrowings under our senior credit facilities, are at variable rates of interest and expose us to interest rate risk. As of December 31, 2014 , we had $1,513.5 million of variable rate debt outstanding. If interest rates increase above 1% per annum, our debt service obligations on the variable rate indebtedness would increase even though the amount borrowed remained the same, and our net income would decrease. Although we have entered into interest rate cap 17 • our debt holders could declare all outstanding principal and interest to be due and payable; • the lenders under our senior credit facilities could foreclose against the assets securing the borrowings from them and the lenders under our term loan facility could terminate their commitments to lend us money; and • we could be forced into bankruptcy or liquidation. Table of Contents agreements on our term loan facility to reduce interest rate volatility, we cannot assure you we will be able to enter into interest rate cap agreements in the future on acceptable terms or that such caps or the caps we have in place now will be effective. Risks Related to Ownership of Our Common Stock Our common stock price may be volatile and may decline regardless of our operating performance, and holders of our common stock could lose a significant portion of their investment. The market price for our common stock may be volatile. Our stockholders may not be able to resell their shares of common stock at or above the price at which they purchased such shares, due to fluctuations in the market price of our common stock, which may be caused by a number of factors, many of which we cannot control, including the risk factors described in this Annual Report on Form 10-K and the following: In addition, the stock markets have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many companies, including companies in our industry. In the past, securities class action litigation has followed periods of market volatility. If we were involved in securities litigation, we could incur substantial costs, and our resources and the attention of management could be diverted from our business. The Sponsors have influence over significant corporate activities and their interests may not align with yours. Madison Dearborn beneficially owns approximately 15.5% of our common stock and Providence Equity beneficially owns approximately 13.7% of our common stock as of February 20, 2015. As a result of their ownership, each Sponsor, so long as it holds a sizable portion of our outstanding common stock, will have substantial voting power with respect to matters submitted to a vote of stockholders. In addition, so long as each Sponsor has representation on our board of directors, it will have the ability to exercise influence over decision-making with respect to our business direction and policies. Matters over which each of the Sponsors may, directly or indirectly, exercise influence include: Under our amended and restated certificate of incorporation, each Sponsor and its affiliates do not have any obligation to present to us, and each Sponsor may separately pursue, corporate opportunities of which it becomes aware, even if those opportunities are ones that we would have pursued if granted the opportunity. 18 • changes in financial estimates by any securities analysts who follow our common stock, our failure to meet these estimates or failure of securities analysts to initiate or maintain coverage of our common stock; • downgrades by any securities analysts who follow our common stock; • future sales of our common stock by our officers, directors and significant stockholders, including the Sponsors; • market conditions or trends in our industry or the economy as a whole; • investors’ perceptions of our prospects; • announcements by us or our competitors of significant contracts, acquisitions, joint ventures or capital commitments; • changes in key personnel; and • our limited public float in light of the Sponsors’ beneficial ownership of a majority of our common stock, which may result in the trading of relatively small quantities of shares by our stockholders having a disproportionate positive or negative influence on the market price of our common stock. • the election of our board of directors and the appointment and removal of our officers; • mergers and other business combination transactions, including proposed transactions that would result in our stockholders receiving a premium price for their shares; • other acquisitions or dispositions of businesses or assets; • incurrence of indebtedness and the issuance of equity securities; • repurchase of stock and payment of dividends; and • the issuance of shares to management under our equity incentive plans. Table of Contents Future sales of our common stock, or the perception in the public markets that these sales may occur, may depress our stock price. Sales of substantial amounts of our common stock in the public market, or the perception that these sales could occur, could adversely affect the price of our common stock and could impair our ability to raise capital through the sale of additional shares. As of February 20, 2015, there were 172,275,656 shares of our common stock outstanding. The shares of our common stock sold in our initial public offering and in registered secondary offerings are freely tradable without restriction under the Securities Act of 1933, as amended (the “Securities Act”), except that any shares of our common stock that may be acquired by our directors, executive officers and other affiliates, as that term is defined in the Securities Act, may be sold only in compliance with certain volume limitations and other restrictions of Rule 144 under the Securities Act. The remaining shares of our common stock, to the extent not previously sold pursuant to an exemption from registration, will continue to be “restricted securities” within the meaning of Rule 144 under the Securities Act and subject to certain restrictions on resale. Restricted securities may be sold in the public market only if they are registered under the Securities Act or are sold pursuant to an exemption from registration such as Rule 144 under the Securities Act. As of February 20, 2015, the holders of approximately 53,000,000 shares of our common stock will continue to have the right to require us to register the sales of such shares under the Securities Act, under the terms of an agreement between us and the holders. In the future, we may also issue our securities in connection with investments or acquisitions. The number of shares of our common stock issued in connection with an investment or acquisition could constitute a material portion of our then-outstanding shares of our common stock. Anti-takeover provisions in our charter documents and Delaware law might discourage or delay acquisition attempts for us that you might consider favorable. Our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that may make the acquisition of the Company more difficult without the approval of our board of directors. These provisions: Our amended and restated certificate of incorporation also contains a provision that provides us with protections similar to Section 203 of the Delaware General Corporation Law, and will prevent us from engaging in a business combination with a person who acquires at least 15% of our common stock for a period of three years from the date such person acquired such common stock, unless board or stockholder approval is obtained prior to the acquisition. These anti-takeover provisions and other provisions under Delaware law could discourage, delay or prevent a transaction involving a change in control of the Company, even if doing so would benefit our stockholders. These provisions could also discourage proxy contests and make it more difficult for our stockholders to elect directors of their choosing and to cause us to take other corporate actions our stockholders desire. 19 • authorize the issuance of undesignated preferred stock, the terms of which may be established and the shares of which may be issued without stockholder approval, and which may include super voting, special approval, dividend, or other rights or preferences superior to the rights of the holders of common stock; • establish a classified board of directors so that not all members of our board of directors are elected at one time; • generally prohibit stockholder action by written consent, requiring all stockholder actions be taken at a meeting of our stockholders; • provide that special meetings of the stockholders can only be called by or at the direction of (i) our board of directors pursuant to a written resolution adopted by the affirmative vote of the majority of the total number of directors that the Company would have if there were no vacancies; • establish advance notice requirements for nominations for elections to our board of directors or for proposing matters that can be acted upon by stockholders at stockholder meetings; and • provide that our board of directors is expressly authorized to make, alter or repeal our amended and restated bylaws. Table of Contents Conflicts of interest may arise because some of our directors are principals of our largest stockholders. Paul Finnegan and Robin Selati, who are principals of Madison Dearborn, and Glenn Creamer and Michael Dominguez, who are managing directors of Providence Equity, serve on our board of directors. As of February 20, 2015, Madison Dearborn and Providence Equity each continue to hold a sizable portion of our outstanding common stock. The Sponsors and the entities respectively controlled by them may hold equity interests in entities that directly or indirectly compete with us, and companies in which they currently invest may begin competing with us. As a result of these relationships, when conflicts arise between the interests of Madison Dearborn or Providence Equity, on the one hand, and of other stockholders, on the other hand, these directors may not be disinterested. Although our directors and officers have a duty of loyalty to us under Delaware law and our amended and restated certificate of incorporation, transactions that we enter into in which a director or officer has a conflict of interest are generally permissible so long as (1) the material facts relating to the director’s or officer’s relationship or interest as to the transaction are disclosed to our board of directors and a majority of our disinterested directors approves the transaction, (2) the material facts relating to the director’s or officer’s relationship or interest as to the transaction are disclosed to our stockholders and a majority of our disinterested stockholders approve the transaction or (3) the transaction is otherwise fair to us. Our amended and restated certificate of incorporation also provides that any principal, officer, member, manager and/or employee of a Sponsor or any entity that controls, is controlled by or under common control with a Sponsor (other than us or any company that is controlled by us) or a Sponsor-managed investment fund will not be required to offer any transaction opportunity of which they become aware to us and could take any such opportunity for themselves or offer it to other companies in which they have an investment, unless such opportunity is offered to them solely in their capacities as our directors. We cannot assure you that we will continue to pay dividends on our common stock or repurchase any of our common stock under our share repurchase program, and our indebtedness and certain tax considerations could limit our ability to continue to pay dividends on, or make share repurchases of, our common stock. If we do not continue to pay dividends, you may not receive any return on investment unless you are able to sell your common stock for a price greater than your purchase price. We expect to continue to pay a cash dividend on our common stock of $0.0675 per share per quarter, or $0.27 per share per annum. Any determination to pay dividends in the future will be at the discretion of our board of directors. Any determination to pay dividends on, or repurchase, shares of our common stock in the future will depend upon our results of operations, financial condition, business prospects, capital requirements, contractual restrictions, including those under our senior credit facilities and indentures, any potential indebtedness we may incur, restrictions imposed by applicable law, tax considerations and other factors our board of directors deems relevant. In addition, our ability to pay dividends on, or repurchase, shares of our common stock will be limited by restrictions on our ability to pay dividends or make distributions to our stockholders and on the ability of our subsidiaries to pay dividends or make distributions to us, in each case, under the terms of our current and any future agreements governing our indebtedness. There can be no assurance that we will continue to pay a dividend at the current rate or at all or that we will repurchase shares of our common stock. If we do not pay dividends in the future, realization of a gain on your investment will depend entirely on the appreciation of the price of our common stock, which may never occur. See “--Risks Related to Our Business--We have significant deferred cancellation of debt income” for a discussion of certain tax considerations that could affect our willingness to pay dividends in the future . We are a holding company and rely on dividends, distributions and other payments, advances and transfers of funds from our subsidiaries to meet our obligations. We are a holding company that does not conduct any business operations of our own. As a result, we are largely dependent upon cash dividends and distributions and other transfers from our subsidiaries to meet our obligations. The agreements governing the indebtedness of our subsidiaries impose restrictions on our subsidiaries’ ability to pay dividends or other distributions to us. The deterioration of the earnings from, or other available assets of, our subsidiaries for any reason could also limit or impair their ability to pay dividends or other distributions to us. Item 1B. Unresolved Staff Comments None. Item 2. Properties As of December 31, 2014 , we owned or leased a total of 2.3 million square feet of space throughout the U.S. and Canada. We own two properties: a combined office and a 450,000 square foot distribution center in Vernon Hills, Illinois, and a 513,000 square foot distribution center in North Las Vegas, Nevada. In addition, we conduct sales, services and administrative activities in various leased locations throughout the U.S. and Canada, including data centers in Madison, Wisconsin and Minneapolis, Minnesota. 20 Table of Contents We believe that our facilities are well maintained, suitable for our business and occupy sufficient space to meet our operating needs. As part of our normal business, we regularly evaluate sales center performance and site suitability. Leases covering our currently occupied leased properties expire at varying dates, generally within the next ten years. We anticipate no difficulty in retaining occupancy through lease renewals, month-to-month occupancy or replacing the leased properties with equivalent properties. We believe that suitable additional or substitute leased properties will be available as required. Item 3. Legal Proceedings We are party to various legal proceedings that arise in the ordinary course of our business, which include commercial, intellectual property, employment, tort and other litigation matters. We are also subject to audit by federal, state and local authorities, and by various partners, group purchasing organizations and customers, including government agencies, relating to purchases and sales under various contracts. In addition, we are subject to indemnification claims under various contracts. From time to time, certain of our customers file voluntary petitions for reorganization or liquidation under the U.S. bankruptcy laws. In such cases, certain pre-petition payments received by us could be considered preference items and subject to return to the bankruptcy administrator. As of December 31, 2014 , we do not believe that there is a reasonable possibility that any material loss exceeding the amounts already recognized for these proceedings and matters, if any, has been incurred. However, the ultimate resolutions of these proceedings and matters are inherently unpredictable. As such, our financial condition and results of operations could be adversely affected in any particular period by the unfavorable resolution of one or more of these proceedings or matters. Item 4. Mine Safety Disclosures Not applicable. 21 Table of Contents Executive Officers Thomas E. Richards serves as our Chairman, President and Chief Executive Officer, as a member of our board of directors and as a manager of CDW LLC. Mr. Richards has served as our President and Chief Executive Officer since October 2011 and was named Chairman on January 1, 2013. From September 2009 to October 2011, Mr. Richards served as our President and Chief Operating Officer. Prior to joining CDW, Mr. Richards held leadership positions with Qwest Communications International Inc. ("Qwest"), a broadband Internet-based communications company. From 2008 to 2009, he served as Executive Vice President and Chief Operating Officer, where he was responsible for the day-to-day operation and performance of Qwest, and before assuming that role, was the Executive Vice President of the Business Markets Group from 2005 to 2008. Mr. Richards also has served as Chairman and Chief Executive Officer of Clear Communications Corporation and as Executive Vice President of Ameritech Corporation. Mr. Richards serves as a board member of Junior Achievement of Chicago, Rush University Medical Center and the University of Pittsburgh. Mr. Richards also is a member of the Economic Club of Chicago and the Executives’ Club of Chicago. Mr. Richards is a graduate of the University of Pittsburgh where he earned a bachelor’s degree and a graduate of Massachusetts Institute of Technology where he earned a Master of Science in Management as a Sloan Fellow. Dennis G. Berger serves as our Senior Vice President and Chief Coworker Services Officer. Mr. Berger joined CDW in September 2005 as Vice President-Coworker Services. In January 2007, he was named Senior Vice President and Chief Coworker Services Officer. Mr. Berger is responsible for leading CDW’s programs in coworker learning and development, benefits, compensation, performance management, coworker relations and talent acquisition. Prior to joining CDW, he served as Vice President of Human Resources at PepsiAmericas, a beverage company, from 2002 to 2005. Mr. Berger has also held human resources positions of increasing responsibility at Pepsi Bottling Group, Inc., Pepsico, Inc. and GTE Corporation. Mr. Berger serves on the board of directors of Glenwood Academy, Anti- Defamation League of Chicago and Skills for Chicagoland’s Future. Mr. Berger is a graduate of Northeastern University where he earned a bachelor’s degree and a graduate of John M. Olin School of Business at Washington University in St. Louis where he earned a Master of Business Administration. Neal J. Campbell serves as our Senior Vice President and Chief Marketing Officer. Mr. Campbell joined CDW in January 2011, and is responsible for the strategy and development of CDW’s advertising, public relations, channel marketing, marketing intelligence and research, merchandising, microsites, creative services and direct marketing content, along with relationship marketing, corporate communications and e- commerce initiatives including content development, online marketing and e-procurement. Prior to joining CDW, Mr. Campbell served as Chief Executive Officer of TrafficCast, a provider of real-time and predictive traffic information to Google, Yahoo and others from 2008 to 2011. From 2006 to 2008, he served as Executive Vice President and General Manager-Strategic Marketing and Next Generation Products for ISCO International, a manufacturer of wireless telecommunications components. Mr. Campbell also spent 17 years with Motorola, most recently as Vice President and General Manager, GSM Portfolio Marketing and Planning for the company’s mobile device business. He currently serves as a board member of TrafficCast and Junior Achievement of Chicago, and is on the Executive Advisory Council of Bradley University. Mr. Campbell is a graduate of Bradley University where he earned a bachelor’s degree and a graduate of Northwestern University’s Kellogg School of Management where he earned a Master of Business Administration. Christina M. Corley serves as our Senior Vice President of Corporate Sales and is responsible for managing all aspects of our corporate sales force, including sales force strategy, structure, goals, operations, revenue generation and training and development. Prior to joining CDW in September 2011, Ms. Corley served as President and Chief Operating Officer of Zones, Inc., a provider of IT products and solutions, from 2006 to 2011. She served as Executive Vice President of Purchasing and Operations for Zones, Inc. from April 2005 to October 2006. She served as President of Corporate PC Source (“CPCS”), a 22 Name Age Position Thomas E. Richards 60 Chairman, President and Chief Executive Officer, and Director Dennis G. Berger 50 Senior Vice President and Chief Coworker Services Officer Neal J. Campbell 53 Senior Vice President and Chief Marketing Officer Christina M. Corley 47 Senior Vice President - Corporate Sales Douglas E. Eckrote 50 Senior Vice President - Strategic Solutions and Services Christine A. Leahy 50 Senior Vice President, General Counsel and Corporate Secretary Christina V. Rother 51 Senior Vice President - Public and Advanced Technology Sales Jonathan J. Stevens 45 Senior Vice President - Operations and Chief Information Officer Matthew A. Troka 44 Senior Vice President - Product and Partner Management Ann E. Ziegler 56 Senior Vice President and Chief Financial Officer Table of Contents wholly owned subsidiary of Zones, Inc., from March 2003 to April 2005. Prior to its acquisition by Zones, Inc., Ms. Corley served as Chief Executive Officer of CPCS from 1999 to 2003. Ms. Corley began her career in sales and marketing, holding various positions at IBM, Dataflex and VisionTek. She currently serves as a board member of the Boys and Girls Club of Chicago. Ms. Corley is a graduate of the University of Illinois at Urbana-Champaign where she earned a bachelor’s degree and a graduate of Northwestern University’s Kellogg School of Management where she earned a Master of Business Administration in management and strategy. Douglas E. Eckrote serves as our Senior Vice President of Strategic Solutions and Services and is responsible for our technology specialist teams focusing on servers and storage, unified communications, security, wireless, power and cooling, networking, software licensing and mobility solutions. He also holds responsibility for CDW Canada, Inc. Mr. Eckrote joined CDW in 1989 as an account manager. Mr. Eckrote was appointed Director of Operations in 1996, Vice President of Operations in 1999 and Senior Vice President of Purchasing in April 2001. In October 2001, he was named Senior Vice President of Purchasing and Operations. He was named Senior Vice President of Operations, Services and Canada in 2006 and assumed his current role in 2009. Prior to joining CDW, Eckrote worked in outside sales for Arrow Electronics and Cintas Uniform Company. From 2003 to 2009, Mr. Eckrote served on the board of directors of the Make-A-Wish Foundation of Illinois, completing the last two years as board chair, and served on the Make-A-Wish Foundation of America National Chapter Performance Committee from 2009-2014. Mr. Eckrote also served on the board of directors of the Center for Enriched Living from 2002-2011, serving as Vice President from 2004-2005, President from 2006-2008, board emeritus from 2009-2011 and currently serves as a trustee. Mr. Eckrote is a graduate of Purdue University where he earned a bachelor’s degree and a graduate of Northwestern University’s Kellogg School of Management where he earned an Executive Master of Business Administration. Christine A. Leahy serves as our Senior Vice President, General Counsel and Corporate Secretary and is responsible for our legal, corporate governance, enterprise risk management and ethics and compliance functions. She also is responsible for our international strategy and serves on the board of directors of Kelway, a UK-based technology solutions provider in which CDW has a minority investment. Ms. Leahy joined CDW in January 2002. Prior to that, Ms. Leahy served as a corporate partner in the Chicago office of Sidley Austin LLP where she specialized in mergers and acquisitions, strategic counseling, corporate governance and securities law. Ms. Leahy serves on the board of trustees of Children’s Home and Aid. Ms. Leahy is a graduate of Brown University where she earned a bachelor’s degree and a graduate of Boston College Law School where she earned her Juris Doctor. She also completed the CEO Perspective and Women’s Director Development Programs at Northwestern University’s Kellogg School of Management. Christina V. Rother serves as our Senior Vice President of Public and Advanced Technology Sales and is responsible for managing all aspects of our public sector and advanced technology sales forces, including sales force strategy, structure, goals, operations, revenue generation and training and development. Ms. Rother joined CDW in 1991 as an account manager. In 2002, she was appointed Vice President for Education and State and Local Sales. In 2005, she was chosen to lead our newly formed healthcare sales team. Beginning in 2006, Ms. Rother has held various positions ranging from Group Vice President of CDW Government LLC, President of CDW Government LLC and Senior Vice President of Sales. In September 2011, Ms. Rother assumed her current role as Senior Vice President of Public and Advanced Technology Sales. Prior to joining CDW, Ms. Rother held a number of sales positions with technology companies including Laser Computers and Price Electronics. Ms. Rother currently serves as chair of the board of directors of the Make-A-Wish Foundation of Illinois. Ms. Rother is a graduate of the University of Illinois at Chicago where she earned a bachelor’s degree. Jonathan J. Stevens serves as our Senior Vice President of Operations and Chief Information Officer. Mr. Stevens joined CDW in June 2001 as Vice President-Information Technology, was named Chief Information Officer in January 2002 and Vice President-International and Chief Information Officer from 2005 until December 2006. In January 2007, he was named Senior Vice President and Chief Information Officer and assumed his current role in November 2009. Mr. Stevens is responsible for the strategic direction of our information technology. Additionally, he holds responsibility for our distribution centers, transportation, facilities, customer relations and operational excellence practices. Prior to joining CDW, Mr. Stevens served as regional technology director for Avanade, an international technology integration company formed through a joint venture between Microsoft and Accenture from 2000 to 2001. Prior to that, Mr. Stevens was a principal with Microsoft Consulting Services and led an information technology group for a corporate division of AT&T/NCR. He currently serves on the board of directors of SingleWire Software, LLC and Northeast Illinois Council: Boy Scouts of America. Mr. Stevens is a graduate of the University of Dayton where he earned a bachelor’s degree. Matthew A. Troka serves as our Senior Vice President of Product and Partner Management. Mr. Troka is responsible for managing our relationships with all of our vendor partners. In addition, he directs the day-to-day operations of our purchasing department. Mr. Troka joined CDW in 1992 as an account manager and became a sales manager in 1995. From 1998 to 2001, he served as Corporate Sales Director. From 2001 to 2004, Mr. Troka was Senior Director of Purchasing. From 2004 to 2006, Mr. Troka served as Vice President of Purchasing. From 2006 to 2011, Mr. Troka was Vice President of Product and Partner Management. On March 3, 2011, Mr. Troka was elected Senior Vice President of Product and Partner Management. 23 Table of Contents Mr. Troka serves as a member of the board of directors of Encompass Championship Charities. Mr. Troka is a graduate of the University of Illinois where he earned a bachelor’s degree. Ann E. Ziegler joined CDW in April 2008 as Senior Vice President and Chief Financial Officer. Prior to joining CDW, Ms. Ziegler spent 15 years at Sara Lee Corporation (“Sara Lee”), a global consumer goods company, in a number of executive roles including finance, mergers and acquisitions, strategy and general management positions in both U.S. and international businesses. Most recently, from 2005 until April 2008, Ms. Ziegler served as Chief Financial Officer and Senior Vice President of Administration for Sara Lee Food and Beverage. Prior to joining Sara Lee, Ms. Ziegler was a corporate attorney at Skadden, Arps, Slate, Meagher & Flom. Ms. Ziegler serves on the board of directors of Hanesbrands, Inc, Groupon, Inc., and the board of governors of the Smart Museum of Art at the University of Chicago. During the previous five years, Ms. Ziegler also served on the board of directors of Unitrin, Inc. Ms. Ziegler is a graduate of The College of William and Mary where she earned a bachelor’s degree and a graduate of the University of Chicago Law School where she earned her Juris Doctor. 24 Table of Contents PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock has been listed on the NASDAQ Global Select Market since June 27, 2013 under the symbol “CDW.” Prior to that date, there was no public market for our common stock. Shares sold in our initial public offering ("IPO") were priced at $17.00 per share on June 26, 2013. The following table sets forth the ranges of high and low sales prices per share of our common stock as reported on the NASDAQ Global Select Market and the cash dividends per share of common stock declared for the periods indicated. Holders As of February 20, 2015 , there were 71 holders of record of our common stock. The number of beneficial stockholders is substantially greater than the number of holders of record because a portion of our common stock is held through brokerage firms. Dividends On February 10, 2015 , we announced that our board of directors declared a quarterly cash dividend on our common stock of $0.0675 per share. The dividend will be paid on March 10, 2015 to all stockholders of record as of the close of business on February 25, 2015 . We expect to continue to pay quarterly cash dividends on our common stock in the future, but such payments remain at the discretion of our board of directors and will depend upon our results of operations, financial condition, business prospects, capital requirements, contractual restrictions, any potential indebtedness we may incur, restrictions imposed by applicable law, tax considerations and other factors that our board of directors deems relevant. In addition, our ability to pay dividends on our common stock will be limited by restrictions on our ability to pay dividends or make distributions to our stockholders and on the ability of our subsidiaries to pay dividends or make distributions to us, in each case, under the terms of our current and any future agreements governing our indebtedness. For a discussion of our cash resources and needs and restrictions on our ability to pay dividends, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations— Liquidity and Capital Resources” included elsewhere in this report. For additional discussion of restrictions on our ability to pay dividends, see Note 7 to the accompanying audited consolidated financial statements included elsewhere in this report. Issuer Purchases of Equity Securities On November 6, 2014, we announced that the board of directors approved a $500 million share repurchase program, which became effective immediately, under which we may repurchase shares of our common stock in the open market or through privately negotiated transactions, depending on share price, market conditions and other factors. The share repurchase program does not obligate us to repurchase any dollar amount or number of shares, and repurchases may be commenced or 25 Year ended December 31, 2014 High Low Dividends declared per share Fourth quarter $ 36.08 $ 27.59 $ 0.0675 Third quarter $ 33.80 $ 30.07 $ 0.0425 Second quarter $ 32.41 $ 26.70 $ 0.0425 First quarter $ 27.53 $ 22.72 $ 0.0425 Year ended December 31, 2013 High Low Dividends declared per share Fourth quarter $ 23.56 $ 20.50 $ 0.0425 Third quarter $ 24.51 $ 18.26 $ — Second quarter (beginning June 27, 2013) $ 19.17 $ 17.38 $ — Table of Contents suspended from time to time without prior notice. As of the date of this filing, no shares have been repurchased under the share repurchase program. Stock Performance Graph The information contained in this Stock Performance Graph section shall not be deemed to be "soliciting material" or "filed" or incorporated by reference in future filings with the SEC, or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, except to the extent that we specifically incorporate it by reference into a document filed under the Securities Act of 1933 or the Securities Exchange Act of 1934. The following graph compares the cumulative total shareholder return, calculated on a dividend reinvested basis, on $100.00 invested at the opening of the market on June 27, 2013, the date our common stock first traded on the NASDAQ Global Select Market, through and including the market close on December 31, 2014, with the cumulative total return for the same time period of the same amount invested in the S&P MidCap 400 index and a peer group index. Our peer group index for 2014 consists of the following companies: Accenture plc, Anixter International, Inc., Arrow Electronics, Inc., Avnet, Inc., CGI Group Inc., Genuine Parts Company, Henry Schein, Inc., Insight Enterprises, Inc., Owens & Minor, Inc., Patterson Companies, Inc., SYNNEX Corporation, United Stationers Inc., W.W. Grainger, Inc. and Wesco International, Inc. This peer group was selected based on a review of publicly available information about these companies and our determination that they met one or more of the following criteria: (i) similar size in terms of revenue and/or enterprise value (one-third to three times our revenue or enterprise value); (ii) operates in a business-to-business distribution environment; (iii) members of the technology industry; (iv) similar customers ( i.e. , business, government, healthcare, and education); (v) companies that provide services and/or solutions; and (vi) similar EBITDA and gross margins. Shareholder returns over the indicated period are based on historical data and should not be considered indicative of future shareholder returns. 26 Table of Contents Recent Sales of Unregistered Securities None. Use of Proceeds from Registered Securities None. Item 6. Selected Financial Data The selected financial data set forth below are not necessarily indicative of the results of future operations and should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our audited consolidated financial statements and the related notes included elsewhere in this report. We have derived the selected financial data presented below as of December 31, 2014 and December 31, 2013 and for the years ended December 31, 2014, 2013, and 2012 from our audited consolidated financial statements and related notes, which are included elsewhere in this report. The selected financial data as of December 31, 2011 and December 31, 2010 have been derived from our audited consolidated financial statements as of and for those periods, which are not included in this report. The following are some of the items affecting comparability of the selected financial data for the periods presented: 27 June 27, 2013 December 31, 2013 December 31, 2014 CDW Corp $ 100 $ 138 $ 208 S&P MidCap 400 index 100 118 130 CDW Peers 100 113 147 Table of Contents 28 • During the years ended December 31, 2014, 2013, 2012, and 2011, we recorded net losses on extinguishments of long-term debt of $90.7 million , $64.0 million , $17.2 million , and $118.9 million , respectively. The losses represented the difference between the amount paid upon extinguishment, including call premiums and expenses paid to the debt holders and agents, and the net carrying amount of the extinguished debt, adjusted for a portion of the unamortized deferred financing costs. Refer to Note 7 to the accompanying audited consolidated financial statements included elsewhere in this report for additional information on long-term debt. • During the year ended December 31, 2013, we recorded IPO- and secondary-offering related expenses of $75.0 million. Refer to Note 9 to the accompanying audited consolidated financial statements included elsewhere in this report for additional information on the IPO- and secondary-offering related expenses. Table of Contents 29 Years Ended December 31, (dollars and shares in millions, except per share amounts) 2014 2013 2012 2011 2010 Statement of Operations Data: Net sales $ 12,074.5 $ 10,768.6 $ 10,128.2 $ 9,602.4 $ 8,801.2 Cost of sales 10,153.2 9,008.3 8,458.6 8,018.9 7,410.4 Gross profit 1,921.3 1,760.3 1,669.6 1,583.5 1,390.8 Selling and administrative expenses 1,110.3 1,120.9 1,029.5 990.1 932.1 Advertising expense 138.0 130.8 129.5 122.7 106.0 Income from operations 673.0 508.6 510.6 470.7 352.7 Interest expense, net (197.3 ) (250.1 ) (307.4 ) (324.2 ) (391.9 ) Net (loss) gain on extinguishments of long-term debt (90.7 ) (64.0 ) (17.2 ) (118.9 ) 2.0 Other income, net 2.7 1.0 0.1 0.7 0.2 Income (loss) before income taxes 387.7 195.5 186.1 28.3 (37.0 ) Income tax (expense) benefit (142.8 ) (62.7 ) (67.1 ) (11.2 ) 7.8 Net income (loss) $ 244.9 $ 132.8 $ 119.0 $ 17.1 $ (29.2 ) Net income (loss) per common share: Basic $1.44 $0.85 $0.82 $0.12 $(0.20) Diluted $1.42 $0.84 $0.82 $0.12 $(0.20) Weighted-average common shares outstanding: Basic 170.6 156.6 145.1 144.8 144.4 Diluted 172.8 158.7 145.8 144.9 144.4 Balance Sheet Data (at period end): Cash and cash equivalents $ 344.5 $ 188.1 $ 37.9 99.9 $ 36.6 Working capital 985.4 810.9 666.5 538.1 675.4 Total assets 6,099.9 5,924.6 5,720.0 5,967.7 5,943.8 Total debt and capitalized lease obligations (1) 3,190.0 3,251.2 3,771.0 4,066.0 4,290.0 Total shareholders’ equity (deficit) 936.5 711.7 136.5 (7.3 ) (43.5 ) Other Financial Data: Capital expenditures $ 55.0 $ 47.1 $ 41.4 45.7 $ 41.5 Depreciation and amortization 207.9 208.2 210.2 204.9 209.4 Gross profit as a percentage of net sales 15.9 % 16.3 % 16.5 % 16.5 % 15.8 % Ratio of earnings to fixed charges (2) 2.9 1.8 1.6 1.1 (a) EBITDA (3) $ 792.9 $ 653.8 $ 703.7 557.4 $ 564.3 Adjusted EBITDA (3) 907.0 808.5 766.6 717.3 601.8 Non-GAAP net income (4) 409.9 314.3 247.1 198.8 85.7 Statement of Cash Flows Data: Net cash provided by (used in): Operating activities $ 435.0 $ 366.3 $ 317.4 $ 214.7 $ 423.7 Investing activities (164.8 ) (47.1 ) (41.7 ) (56.0 ) (125.4 ) Financing activities (112.0 ) (168.3 ) (338.0 ) (95.4 ) (350.1 ) (1) Excludes borrowings of $332.1 million , $256.6 million , $249.2 million , $278.7 million and $28.2 million , as of December 31, 2014, 2013, 2012, 2011, and 2010, respectively, under our inventory financing agreements. We do not include these borrowings in total debt because we have not in the past incurred, and in the future do not expect to incur, any interest expense or late fees under these agreements. Table of Contents We have included a reconciliation of EBITDA and Adjusted EBITDA in the table below. Both EBITDA and Adjusted EBITDA are considered non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that EBITDA and Adjusted EBITDA provide helpful information with respect to our operating performance and cash flows including our ability to meet our future debt service, capital expenditures and working capital requirements. Adjusted EBITDA also provides helpful information as it is the primary measure used in certain financial covenants contained in our credit agreements. The following unaudited table sets forth reconciliations of net income (loss) to EBITDA and EBITDA to Adjusted EBITDA for the periods presented: 30 (2) For purposes of calculating the ratio of earnings to fixed charges, earnings consist of earnings before income taxes minus income from equity investments plus distributed income from equity investments and fixed charges. Fixed charges consist of interest expense and the portion of rental expense we believe is representative of the interest component of rental expense. (a) For the year ended December 31, 2010, earnings available for fixed charges were inadequate to cover fixed charges by $37.0 million. (3) EBITDA is defined as consolidated net income (loss) before interest expense, income tax expense (benefit), depreciation, and amortization. Adjusted EBITDA, which is a measure defined in our credit agreements, is calculated by adjusting EBITDA for certain items of income and expense including (but not limited to) the following: (a) non-cash equity-based compensation; (b) goodwill impairment charges; (c) sponsor fees; (d) certain consulting fees; (e) debt-related legal and accounting costs; (f) equity investment income and losses; (g) certain severance and retention costs; (h) gains and losses from the early extinguishment of debt; (i) gains and losses from asset dispositions outside the ordinary course of business; and (j) non-recurring, extraordinary or unusual gains or losses or expenses. Years Ended December 31, (in millions) 2014 2013 2012 2011 2010 Net income (loss) $ 244.9 $ 132.8 $ 119.0 $ 17.1 $ (29.2 ) Depreciation and amortization 207.9 208.2 210.2 204.9 209.4 Income tax expense (benefit) 142.8 62.7 67.1 11.2 (7.8 ) Interest expense, net 197.3 250.1 307.4 324.2 391.9 EBITDA 792.9 653.8 703.7 557.4 564.3 Non-cash equity-based compensation 16.4 8.6 22.1 19.5 11.5 Sponsor fees — 2.5 5.0 5.0 5.0 Consulting and debt-related professional fees — 0.1 0.6 5.1 15.1 Net loss (gain) on extinguishments of long-term debt 90.7 64.0 17.2 118.9 (2.0 ) Litigation, net (i) (0.9 ) (4.1 ) 4.3 — — IPO- and secondary-offering related expenses 1.4 75.0 — — — Other adjustments (ii) 6.5 8.6 13.7 11.4 7.9 Adjusted EBITDA $ 907.0 $ 808.5 $ 766.6 $ 717.3 $ 601.8 (i) Relates to unusual, non-recurring litigation matters. (ii) Other adjustments primarily include certain retention costs and equity investment income. Table of Contents The following unaudited table sets forth a reconciliation of EBITDA to net cash provided by operating activities for the periods presented: 31 Years Ended December 31, (in millions) 2014 2013 2012 2011 2010 EBITDA $ 792.9 $ 653.8 $ 703.7 $ 557.4 $ 564.3 Depreciation and amortization (207.9 ) (208.2 ) (210.2 ) (204.9 ) (209.4 ) Income tax (expense) benefit (142.8 ) (62.7 ) (67.1 ) (11.2 ) 7.8 Interest expense, net (197.3 ) (250.1 ) (307.4 ) (324.2 ) (391.9 ) Net income (loss) 244.9 132.8 119.0 17.1 (29.2 ) Depreciation and amortization 207.9 208.2 210.2 204.9 209.4 Equity-based compensation expense 16.4 46.6 22.1 19.5 11.5 Amortization of deferred financing costs, debt premium, and debt discount, net 6.4 8.8 13.6 15.7 18.0 Deferred income taxes (89.1 ) (48.7 ) (56.3 ) (10.2 ) (4.3 ) Allowance for doubtful accounts 0.3 — — 0.4 (1.3 ) Realized loss on interest rate swap agreements — — — 2.8 51.5 Net loss (gain) on extinguishments of long-term debt 90.7 64.0 17.2 118.9 (2.0 ) Income from equity investments (1.2 ) — — — — Changes in assets and liabilities (41.8 ) (47.1 ) (9.4 ) (158.3 ) 165.3 Other non-cash items 0.5 1.7 1.0 3.9 4.8 Net cash provided by operating activities $ 435.0 $ 366.3 $ 317.4 $ 214.7 $ 423.7 Table of Contents 32 (4) Non-GAAP net income is considered a non-GAAP financial measure. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that non-GAAP net income provides meaningful information regarding our operating performance and our prospects for the future. This supplemental measure excludes, among other things, charges related to the amortization of acquisition-related intangibles, non-cash equity-based compensation and gains and losses from the early extinguishment of debt. The following unaudited table sets forth a reconciliation of net income (loss) to non-GAAP net income for the periods presented: Years Ended December 31, (in millions) 2014 2013 2012 2011 2010 Net income (loss) $ 244.9 $ 132.8 $ 119.0 $ 17.1 $ (29.2 ) Amortization of intangibles (i) 161.2 161.2 163.7 165.7 166.8 Non-cash equity-based compensation 16.4 8.6 22.1 19.5 11.5 Litigation, net (ii) (0.6 ) (6.3 ) — — — Net loss on extinguishments of long-term debt 90.7 64.0 17.2 118.9 (2.0 ) Interest expense adjustment related to extinguishments of long-term debt (iii) (1.1 ) (7.5 ) (3.3 ) (19.4 ) (0.7 ) IPO- and secondary-offering related expenses (iv) 1.4 75.0 — — — Debt-related refinancing costs (v) — — — 3.8 5.6 Aggregate adjustment for income taxes (vi) (103.0 ) (113.5 ) (71.6 ) (106.8 ) (66.3 ) Non-GAAP net income $ 409.9 $ 314.3 $ 247.1 $ 198.8 $ 85.7 (i) Includes amortization expense for acquisition-related intangible assets, primarily customer relationships and trade names. (ii) Relates to unusual, non-recurring litigation matters. (iii) Reflects adjustments to interest expense resulting from debt extinguishments. Represents the difference between interest expense previously recognized under the effective interest method and actual interest paid. (iv) IPO- and secondary-offering related expenses consist of the following: (in millions) Years Ended December 31, 2014 2013 Acceleration charge for certain equity awards and related employer payroll taxes $ — $ 40.7 RDU Plan cash retention pool accrual — 7.5 Management services agreement termination fee — 24.4 Other expenses 1.4 2.4 IPO- and secondary-offering related expenses $ 1.4 $ 75.0 (v) Represents fees and costs expensed related to the December 2010 and March 2011 amendments to our prior senior secured term loan facility. (vi) Based on a normalized effective tax rate of 39.0%. Table of Contents Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations Unless otherwise indicated or the context otherwise requires, as used in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the terms “we,” “us,” “the Company,” “our,” “CDW” and similar terms refer to CDW Corporation and its subsidiaries. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” should be read in conjunction with the audited consolidated financial statements and the related notes included elsewhere in this report. This discussion contains forward-looking statements that are subject to numerous risks and uncertainties. Actual results may differ materially from those contained in any forward- looking statements. See “Forward-Looking Statements” above. Overview CDW is a Fortune 500 company and a leading provider of integrated information technology (“IT”) solutions in the U.S. and Canada. We help our customer base of approximately 250,000 small, medium and large business, government, education and healthcare customers by delivering critical solutions to their increasingly complex IT needs. Our broad array of offerings ranges from discrete hardware and software products to integrated IT solutions such as mobility, security, data center optimization, cloud computing, virtualization and collaboration. We are technology "agnostic," with a product portfolio that includes more than 100,000 products from more than 1,000 brands. We provide our products and solutions through sales force and service delivery teams consisting of nearly 4,600 coworkers, including more than 1,800 field sellers, highly-skilled technology specialists and advanced service delivery engineers. We are a leading U.S. sales channel partner for many original equipment manufacturers (“OEMs”) and software publishers (collectively, our “vendor partners”), whose products we sell or include in the solutions we offer. We believe we are an important extension of our vendor partners' sales and marketing capabilities, providing them with a cost-effective way to reach customers and deliver a consistent brand experience through our established end-market coverage and extensive customer access. We have two reportable segments: Corporate, which is comprised primarily of private sector business customers, and Public, which is comprised of government agencies and education and healthcare institutions. Our Corporate segment is divided into a medium/large business customer channel, primarily serving customers with more than 100 employees, and a small business customer channel, primarily serving customers with up to 100 employees. We also have three other operating segments, CDW Advanced Services, Canada and Kelway TopCo Limited ("Kelway"), which do not meet the reportable segment quantitative thresholds and, accordingly, are combined together as “Other.” In November 2014, we acquired a 35% non-controlling equity interest in Kelway. See Note 15 to the accompanying audited consolidated financial statements included elsewhere in this report for additional details. The CDW Advanced Services business consists primarily of customized engineering services delivered by technology specialists and engineers, and managed services that include Infrastructure as a Service (“IaaS”) offerings. Revenues from the sale of hardware, software, custom configuration and third-party provided services are recorded within our Corporate and Public segments. We may sell all or only select products that our vendor partners offer. Each vendor partner agreement provides for specific terms and conditions, which may include one or more of the following: product return privileges, price protection policies, purchase discounts and vendor incentive programs, such as purchase or sales rebates and cooperative advertising reimbursements. We also resell software for major software publishers. Our agreements with software publishers allow the end-user customer to acquire software or licensed products and services. In addition to helping our customers determine the best software solutions for their needs, we help them manage their software agreements, including warranties and renewals. A significant portion of our advertising and marketing expenses is reimbursed through cooperative advertising reimbursement programs with our vendor partners. These programs are at the discretion of our vendor partners and are typically tied to sales or purchasing volumes or other commitments to be met by us within a specified period of time. Trends and Key Factors Affecting our Financial Performance We believe the following trends may have an important impact on our financial performance: 33 • Our Public segment sales are impacted by government spending policies, budget priorities and revenue levels. An adverse change in any of these factors could cause our Public segment customers to reduce their purchases or to terminate or not renew contracts with us, which could adversely affect our business, results of operations or cash flows. Although our sales to the federal government are diversified across multiple Table of Contents agencies and departments, they collectively accounted for approximately 7% , 7% and 10% of our net sales for the years ended December 31, 2014, 2013 and 2012, respectively. In 2013, and through the second quarter of 2014, Public segment results were impacted by the combined and residual negative effects of sequestration, the partial shutdown of the federal government in 2013 and federal government budget uncertainty. However, with the finalization of federal budget allocations in early 2014, we began to see improvement in federal sales in the second quarter of 2014. The momentum continued through the third quarter of 2014 in conjunction with the federal fiscal year-end. This recovery continued into the fourth quarter of 2014 in connection with increased customer confidence that a federal budget for 2015 would be in place. Key Business Metrics Our management monitors a number of financial and non-financial measures and ratios on a regular basis in order to track the progress of our business and make adjustments as necessary. We believe that the most important of these measures and ratios include average daily sales, gross margin, operating margin, net income, Non-GAAP net income, net income per diluted share, Non-GAAP net income per diluted share, EBITDA and Adjusted EBITDA, return on invested capital, cash and cash equivalents, cash flow, net working capital, cash conversion cycle (defined to be days of sales outstanding in accounts receivable plus days of supply in inventory minus days of purchases outstanding in accounts payable, based on a rolling three-month average), debt levels including available credit and leverage ratios, sales per coworker and coworker turnover. These measures and ratios are compared to standards or objectives set by management, so that actions can be taken, as necessary, in order to achieve the standards and objectives. Non-GAAP net income, Non-GAAP net income per diluted share and Adjusted EBITDA are non- GAAP financial measures. We believe these measures provide helpful information with respect to the company’s operating performance and cash flows including our ability to meet our future debt service, capital expenditures, dividend payments, and working capital requirements. Adjusted EBITDA also provides helpful information as it is the primary measure used in certain financial covenants contained in our senior credit facilities. See "Selected Financial Data" included elsewhere in this report for the definitions of Non-GAAP net income and Adjusted EBITDA and reconciliations to net income. 34 • An important factor affecting our ability to generate sales and achieve our targeted operating results is the impact of general economic conditions on our customers’ willingness to spend on information technology. While macroeconomic uncertainty drove a cautious approach to customer spending in the early part of 2013, uncertainty began to dissipate in the back half of 2013 and continued to dissipate throughout 2014. Our sales to small business customers increased in 2014 as a result of the improvement in the macroeconomic environment. We will continue to closely monitor macroeconomic conditions during 2015. Uncertainties related to potential reductions in government spending, requirements associated with implementation of the Affordable Care Act, potential changes in tax and regulatory policy, weakening consumer and business confidence or increased unemployment could result in reduced or deferred spending on information technology products and services by our customers and result in increased competitive pricing pressures. • We believe that our customers’ transition to more complex technology solutions will continue to be an important growth area for us in the future. However, because the market for technology products and services is highly competitive, our success at capitalizing on this transition will be based on our ability to tailor specific solutions to customer needs, the quality and breadth of our product and service offerings, the knowledge and expertise of our sales force, price, product availability and speed of delivery. In 2014, market dynamics, including client device refresh and digital testing needs for K-12 students, drove customer demand for transactional products, primarily client devices, which include notebooks/mobile devices and desktops. Our diverse product suite of more than 100,000 products from over 1,000 leading and emerging brands and efficient, distribution capabilities enabled us to capitalize on this demand. While sales growth for transactional products was strong during the year, growth in solutions-focused products, including netcomm and software, also contributed to the increase in net sales during 2014. We expect the demand for client devices to moderate in 2015, both from the client device refresh slowing and a wind- down in preparation for digital testing requirements. Table of Contents The results of certain key business metrics are as follows: Results of Operations Year Ended December 31, 2014 Compared to Year Ended December 31, 2013 The following table presents our results of operations, in dollars and as a percentage of net sales, for the years ended December 31, 2014 and 2013 : 35 (dollars in millions) Years Ended December 31, 2014 2013 2012 Net sales $ 12,074.5 $ 10,768.6 $ 10,128.2 Gross profit 1,921.3 1,760.3 1,669.6 Income from operations 673.0 508.6 510.6 Net income 244.9 132.8 119.0 Non-GAAP net income 409.9 314.3 247.1 Adjusted EBITDA 907.0 808.5 766.6 Average daily sales 47.5 42.4 39.9 Net debt (defined as total debt minus cash and cash equivalents) 2,845.5 3,063.1 3,733.1 Cash conversion cycle (in days) (1) 21 23 24 (1) Cash conversion cycle is defined as days of sales outstanding in accounts receivable plus days of supply in inventory minus days of purchases outstanding in accounts payable, based on a rolling three-month average. The prior periods have been revised to conform to the current definition. Year Ended December 31, 2014 Year Ended December 31, 2013 Dollars in Millions Percentage of Net Sales Dollars in Millions Percentage of Net Sales Net sales $ 12,074.5 100.0 % $ 10,768.6 100.0 % Cost of sales 10,153.2 84.1 9,008.3 83.7 Gross profit 1,921.3 15.9 1,760.3 16.3 Selling and administrative expenses 1,110.3 9.2 1,120.9 10.4 Advertising expense 138.0 1.1 130.8 1.2 Income from operations 673.0 5.6 508.6 4.7 Interest expense, net (197.3 ) (1.6 ) (250.1 ) (2.3 ) Net loss on extinguishments of long-term debt (90.7 ) (0.8 ) (64.0 ) (0.6 ) Other income, net 2.7 — 1.0 — Income before income taxes 387.7 3.2 195.5 1.8 Income tax expense (142.8 ) (1.2 ) (62.7 ) (0.6 ) Net income $ 244.9 2.0 % $ 132.8 1.2 % Table of Contents Net sales The following table presents our net sales by segment, in dollars and as a percentage of total net sales, and the year-over-year dollar and percentage change in net sales for the years ended December 31, 2014 and 2013 : The following table presents our net sales by customer channel for our Corporate and Public segments and the year-over-year dollar and percentage change in net sales for the years ended December 31, 2014 and 2013 . Net sales of $150.1 million for the year ended December 31, 2013 have been reclassified from the small business customer channel to the medium/large customer channel to conform to the current period presentation. Total net sales in 2014 increased $1,305.9 million , or 12.1% , to $12,074.5 million , compared to $10,768.6 million in 2013 . There were 254 selling days for both the years ended December 31, 2014 and 2013 . The increase in total net sales was primarily the result of continued growth in transactional products driven by notebooks/mobile devices and desktop computers as customers across all channels refreshed their client devices and K-12 customers continued to prepare for digital testing requirements, and the addition of more than 140 customer-facing coworkers, the majority in pre- and post-sale technical positions such as technical specialists and service delivery roles. Growth in solutions-focused products, including netcomm and software, also contributed to the increase in net sales during 2014 . Corporate segment net sales in 2014 increased $515.4 million , or 8.6% , compared to 2013 , driven by sales growth in the medium/large customer channel. Within our Corporate segment, net sales to medium/large customers increased $432.7 million , or 8.6% , between years primarily due to customers refreshing their client devices and making continued investments in technology infrastructure and a continued focus on seller productivity. This increase was led by growth in notebooks/mobile devices, netcomm products, software, and desktop computers. Net sales to small business customers increased $82.7 million , or 9.1% , between years, driven by growth in notebooks/mobile devices and desktop computers due to customers refreshing their client devices. Public segment net sales in 2014 increased $714.9 million , or 17.2% , between years, driven by strong performance across all channels. In 2013, and through the second quarter of 2014, Public segment results were impacted by the combined and residual negative effects of sequestration, the partial shutdown of the federal government in 2013 and federal government budget uncertainty. However, with the finalization of federal budget allocations in early 2014, we began to see improvement in federal sales in the second quarter of 2014 and saw continued momentum through the third quarter of 2014 in conjunction with 36 Years Ended December 31, 2014 2013 Dollars in Millions Percentage of Total Net Sales Dollars in Millions Percentage of Total Net Sales Dollar Change Percent Change (1) Corporate $ 6,475.5 53.6 % $ 5,960.1 55.3 % $ 515.4 8.6 % Public 4,879.4 40.4 4,164.5 38.7 714.9 17.2 Other 719.6 6.0 644.0 6.0 75.6 11.7 Total net sales $ 12,074.5 100.0 % $ 10,768.6 100.0 % $ 1,305.9 12.1 % (1) There were 254 selling days in both the years ended December 31, 2014 and 2013 . (dollars in millions) Years Ended December 31, 2014 2013 Dollar Change Percent Change Corporate: Medium / Large $ 5,485.4 $ 5,052.7 $ 432.7 8.6 % Small Business 990.1 907.4 82.7 9.1 Total Corporate $ 6,475.5 $ 5,960.1 $ 515.4 8.6 % Public: Government $ 1,449.4 $ 1,250.6 $ 198.8 15.9 % Education 1,824.0 1,449.0 375.0 25.9 Healthcare 1,606.0 1,464.9 141.1 9.6 Total Public $ 4,879.4 $ 4,164.5 $ 714.9 17.2 % Table of Contents the federal fiscal year-end. This recovery continued into the fourth quarter of 2014 in connection with increased customer confidence that a federal budget for 2015 would be in place. Net sales to government customers increased $198.8 million , or 15.9% . The increase in net sales to the federal government was led by increases in sales of notebooks/mobile devices and desktop computers. The increase in net sales to state/local government customers was led by growth in sales of notebooks/mobile devices, netcomm products, enterprise storage, and software due to a continued focus on public safety solutions. Net sales to education customers increased $375.0 million , or 25.9% , between years, led by growth in net sales to K-12 customers, reflecting increased sales of notebooks/mobile devices to support digital testing requirements. Net sales to healthcare customers increased $141.1 million , or 9.6% , between periods, driven by growth in netcomm products, notebook/mobile devices, and desktop computers. Gross profit Gross profit increased $161.0 million , or 9.1% , to $1,921.3 million in 2014 , compared to $1,760.3 million in 2013 . As a percentage of total net sales, gross profit decreased 40 basis points to 15.9% during 2014 , down from 16.3% in 2013 . Gross profit margin was negatively impacted 30 basis points by unfavorable price/mix changes within product margin, as transactional product categories such as notebooks/mobile devices and desktops experienced a higher rate of net sales growth than our overall net sales growth, accompanied by continuing product margin compression in these product categories. Additionally, we experienced an unfavorable impact of 10 basis points from vendor funding in 2014. Although vendor funding dollars increased, it represented a lower percentage of net sales in 2014 compared to 2013 . Vendor funding includes purchase discounts, volume rebates and cooperative advertising. The gross profit margin may fluctuate based on various factors, including vendor incentive and inventory price protection programs, cooperative advertising funds classified as a reduction of cost of sales, product mix, net service contract revenue, commission revenue, pricing strategies, market conditions and other factors, any of which could result in changes in gross profit margins. Selling and administrative expenses Selling and administrative expenses decreased $10.6 million , or 0.9% , to $1,110.3 million in 2014 , compared to $1,120.9 million in 2013 . The overall decrease was largely driven by the absence of $74.3 million in costs incurred during 2013 related to the completion of our IPO. This decrease was partially offset by an increase of $31.4 million, or 14.3%, of certain coworker costs between years which was primarily due to higher compensation consistent with increased coworker count and attainment-based compensation accruals tied to annual performance. Total coworker count was 7,211, up 244 from 6,967 at December 31, 2013 . In addition, sales payroll, including sales commissions and other variable compensation costs, increased $18.6 million, or 3.9% between years, consistent with higher sales and gross profit. Further offsetting the decrease in selling and administrative expenses was an increase in long-term compensation expense and equity compensation expense of $7.2 million during 2014. As a percentage of total net sales, selling and administrative expenses decreased 120 basis points to 9.2% in 2014 , down from 10.4% in 2013 . The decrease in selling and administrative expenses as a percentage of net sales was largely driven by a decline of 70 basis points in costs related to the IPO in 2013 . Sales payroll as a percentage of net sales also decreased 30 basis points during 2014 reflecting the lower cost to serve transactional sales compared to solutions-focused sales, consistent with our variable compensation cost structure. Advertising expense Advertising expense increase d $7.2 million , or 5.5% , to $138.0 million in 2014 , compared to $130.8 million in 2013 . As a percentage of net sales, advertising expense remained relatively consistent at 1.1% in 2014 , compared to 1.2% in 2013 . The dollar increase in advertising expense was due to a continued focus on advertising our solutions and products, which reinforces our reputation as a leading IT solutions provider. 37 Table of Contents Income from operations The following table presents income from operations by segment, in dollars and as a percentage of net sales, and the year-over-year percentage change in income from operations for the years ended December 31, 2014 and 2013 : * Not meaningful Income from operations was $673.0 million in 2014 , an increase of $164.4 million , or 32.3% , compared to $508.6 million in 2013 . The increase in income from operations was driven by higher net sales and gross profit and the absence of IPO-related costs. Total operating margin percentage increased 90 basis points to 5.6% in 2014 , from 4.7% in 2013 . Operating margin percentage benefited from the decrease in selling and administrative expenses as a percentage of net sales, which was driven by the absence of $74.3 million in costs related to our IPO in 2013, and was partially offset by a decrease in gross profit margin. Corporate segment income from operations was $439.8 million in 2014 , an increase of $76.5 million , or 21.1% , compared to $363.3 million in 2013 . This increase was primarily driven by higher net sales and gross profit. Corporate segment operating margin percentage increased 70 basis points to 6.8% in 2014 , from 6.1% in 2013 . Operating margin percentage benefited from the decrease in selling and administrative expenses as a percentage of net sales, which was driven by the absence of costs related to our IPO in 2013, and was partially offset by a decrease in gross profit margin. Public segment income from operations was $313.2 million in 2014 , an increase of $66.7 million , or 27.1% , compared to $246.5 million in 2013 . This increase was primarily driven by higher net sales and gross profit. Public segment operating margin percentage increased 50 basis points to 6.4% in 2014 , from 5.9% in 2013 . Operating margin percentage benefited from the decrease in selling and administrative expenses as a percentage of net sales, which was driven by the absence of costs related to our IPO in 2013, and was partially offset by a decrease in gross profit margin. Interest expense, net At December 31, 2014 , our outstanding long-term debt totaled $3,190.0 million , compared to $3,251.2 million at December 31, 2013 . We reduced our long-term debt during 2014 through refinancing activities to redeem our higher interest debt. Net interest expense in 2014 was $197.3 million , a decrease of $52.8 million compared to $250.1 million in 2013 . This decrease was primarily due to lower debt balances and effective interest rates for 2014 compared to 2013 as a result of debt repayments and refinancing activities completed during 2014 and 2013 . See "Liquidity and Capital Resources" below for a description of the significant debt refinancings in 2014. Net loss on extinguishments of long-term debt During 2014, we recorded a net loss on extinguishments of long-term debt of $90.7 million compared to $64.0 million in 2013. In December 2014, we redeemed $541.4 million aggregate principal amount of the 2019 Senior Notes. We recorded a loss on extinguishment of debt of $36.9 million , representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs and unamortized premium. 38 Year Ended December 31, 2014 Year Ended December 31, 2013 Dollars in Millions Operating Margin Percentage Dollars in Millions Operating Margin Percentage Percent Change in Income from Operations Segments: (1) Corporate $ 439.8 6.8 % $ 363.3 6.1 % 21.1 % Public 313.2 6.4 246.5 5.9 27.1 Other 32.9 4.6 27.2 4.2 20.9 Headquarters (2) (112.9 ) nm* (128.4 ) nm* 12.0 Total income from operations $ 673.0 5.6 % $ 508.6 4.7 % 32.3 % (1) Segment income (loss) from operations includes the segment’s direct operating income (loss) and allocations for Headquarters’ costs, allocations for income and expenses from logistics services, certain inventory adjustments and volume rebates and cooperative advertising from vendors. (2) Includes certain Headquarters’ function costs that are not allocated to the segments. Table of Contents In September 2014, we redeemed $234.7 million aggregate principal amount of the 2019 Senior Notes. We recorded a loss on extinguishment of debt of $22.1 million , representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs and unamortized premium. In August 2014, we redeemed all of the remaining $325.0 million aggregate principal amount of the 8.0% Senior Secured Notes due 2018 ("Senior Secured Notes"). We recorded a loss on extinguishment of debt of $23.7 million , representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for the remaining unamortized deferred financing costs. In June 2014, we entered into the Senior Secured Asset-Based Revolving Credit Facility ("Revolving Loan"), a new five-year $1,250.0 million senior secured asset-based revolving credit facility. The Revolving Loan replaces our previous revolving loan credit facility that was to mature on June 24, 2016. In connection with the termination of the previous facility, we recorded a loss on extinguishment of long-term debt of $0.4 million , representing a write-off of a portion of unamortized deferred financing costs. In May 2014, we redeemed all of the remaining $42.5 million aggregate principal amount of the 12.535% Senior Subordinated Exchange Notes due 2017 ("Senior Subordinated Notes"). We recorded a loss on extinguishment of long-term debt of $2.2 million , representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for the remaining unamortized deferred financing costs. In March 2014, we repurchased $25.0 million aggregate principal amount of the 2019 Senior Notes. We recorded a loss on extinguishment of long-term debt of $2.7 million , representing the difference between the repurchase price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In January and February 2014, we redeemed $50.0 million aggregate principal amounts of the Senior Subordinated Notes. We recorded a loss on extinguishment of long-term debt of $2.7 million , representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In October 2013, we redeemed $155.0 million aggregate principal amount of the Senior Subordinated Notes. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $8.5 million , representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In August 2013, we redeemed $324.0 million aggregate principal amount of the Senior Subordinated Notes. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $24.6 million , representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In July 2013, we redeemed $175.0 million aggregate principal amount of the Senior Secured Notes. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $16.7 million , representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In April 2013, we entered into a new seven-year, $1,350.0 million aggregate principal amount Senior Secured Term Loan Facility ("Term Loan"). Substantially all of the proceeds were used to repay the $1,299.5 million outstanding aggregate principal amount of the prior senior secured term loan facility. In connection with this refinancing, we recorded a loss on extinguishment of long-term debt of $10.3 million , representing a write-off of the remaining unamortized deferred financing costs related to the prior senior secured term loan facility. In March 2013, we redeemed $50.0 million aggregate principal amount of the Senior Subordinated Notes. We recorded a loss on extinguishment of long-term debt of $3.9 million , representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. 39 Table of Contents Income tax expense Income tax expense was $142.8 million in 2014 , compared to $62.7 million in 2013 . The effective income tax rate, expressed by calculating income tax expense or benefit as a percentage of income before income taxes, was 36.8% and 32.1% for 2014 and 2013 , respectively. For 2014 , the effective tax rate differed from the U.S. federal statutory rate primarily due to state income taxes, including current year state income tax credits. For 2013 , the effective tax rate differed from the U.S. federal statutory rate primarily due to state income taxes, including current year state income tax credits and an adjustment to deferred state income taxes due to changes in apportionment factors. The higher effective tax rate for 2014 as compared to 2013 was primarily attributable to the favorable impact of changes in state tax apportionment factors had on deferred state income taxes in 2013 and a lower rate impact of state income tax credits due to the increase in income before income taxes in 2014. Net income Net income was $244.9 million in 2014 , compared to $132.8 million in 2013 . Significant factors and events causing the net changes between the periods are discussed above. Non-GAAP net income Non-GAAP net income was $409.9 million for the year ended December 31, 2014 , an increase of $95.6 million , or 30.4% , compared to $314.3 million for the year ended December 31, 2013 . We have included a reconciliation of Non-GAAP net income for the years ended December 31, 2014 and 2013 below. Non-GAAP net income excludes, among other things, charges related to the amortization of acquisition-related intangible assets, non-cash equity-based compensation, and gains and losses from the early extinguishment of debt. Non-GAAP net income is considered a non-GAAP financial measure. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that Non-GAAP net income provides helpful information with respect to our operating performance and cash flows including our ability to meet our future debt service, capital expenditures and working capital requirements. 40 Table of Contents Adjusted EBITDA Adjusted EBITDA was $907.0 million for the year ended December 31, 2014 , an increase of $98.5 million , or 12.2% , compared to $808.5 million for the year ended December 31, 2013 . As a percentage of net sales, Adjusted EBITDA was 7.5% for both the years ended December 31, 2014 and 2013 . We have included a reconciliation of EBITDA and Adjusted EBITDA for the years ended December 31, 2014 and 2013 in the tables below. EBITDA is defined as consolidated net income before interest expense, income tax expense, depreciation and amortization. Adjusted EBITDA, which is a measure defined in our credit agreements, means EBITDA adjusted for certain items which are described in the table below. Both EBITDA and Adjusted EBITDA are considered non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that EBITDA and Adjusted EBITDA provide helpful information with respect to our operating performance and cash flows including our ability to meet our future debt service, capital expenditures and working capital requirements. Adjusted EBITDA also provides helpful information as it is the primary measure used in certain financial covenants contained in our credit agreements. 41 (in millions) Years Ended December 31, 2014 2013 Net income $ 244.9 $ 132.8 Amortization of intangibles (1) 161.2 161.2 Non-cash equity-based compensation 16.4 8.6 Litigation, net (2) (0.6 ) (6.3 ) Net loss on extinguishments of long-term debt 90.7 64.0 Interest expense adjustment related to extinguishments of long-term debt (3) (1.1 ) (7.5 ) IPO- and secondary-offering related expenses (4) 1.4 75.0 Aggregate adjustment for income taxes (5) (103.0 ) (113.5 ) Non-GAAP net income $ 409.9 $ 314.3 (1) Includes amortization expense for acquisition-related intangible assets, primarily customer relationships and trade names. (2) Relates to unusual, non-recurring litigation matters. (3) Reflects adjustments to interest expense resulting from debt extinguishments. Represents the difference between interest expense previously recognized under the effective interest method and actual interest paid. (4) IPO- and secondary-offering related expenses consist of the following: (in millions) Years Ended December 31, 2014 2013 Acceleration charge for certain equity awards and related employer payroll taxes $ — $ 40.7 RDU Plan cash retention pool accrual — 7.5 Management services agreement termination fee — 24.4 Other expenses 1.4 2.4 IPO- and secondary-offering related expenses $ 1.4 $ 75.0 (5) Based on a normalized effective tax rate of 39.0%. Table of Contents The following table sets forth a reconciliation of EBITDA to net cash provided by operating activities for the years ended December 31, 2014 and 2013 . 42 (in millions) Years Ended December 31, 2014 2013 Net income $ 244.9 $ 132.8 Depreciation and amortization 207.9 208.2 Income tax expense 142.8 62.7 Interest expense, net 197.3 250.1 EBITDA 792.9 653.8 Adjustments: Non-cash equity-based compensation 16.4 8.6 Sponsor fee — 2.5 Net loss on extinguishments of long-term debt 90.7 64.0 Litigation, net (1) (0.9 ) (4.1 ) IPO- and secondary-offering related expenses (2) 1.4 75.0 Other adjustments (3) 6.5 8.7 Total adjustments 114.1 154.7 Adjusted EBITDA $ 907.0 $ 808.5 (1) Relates to unusual, non-recurring litigation matters. (2) As defined under Non-GAAP net income above. (3) Other adjustments primarily include certain retention costs and equity investment income. Years Ended December 31, (in millions) 2014 2013 EBITDA $ 792.9 $ 653.8 Depreciation and amortization (207.9 ) (208.2 ) Income tax expense (142.8 ) (62.7 ) Interest expense, net (197.3 ) (250.1 ) Net income 244.9 132.8 Depreciation and amortization 207.9 208.2 Equity-based compensation expense 16.4 46.6 Deferred income taxes (89.1 ) (48.7 ) Amortization of deferred financing costs, debt premium, and debt discount, net 6.4 8.8 Net loss on extinguishments of long-term debt 90.7 64.0 Other (0.4 ) 1.7 Changes in assets and liabilities (41.8 ) (47.1 ) Net cash provided by operating activities $ 435.0 $ 366.3 Table of Contents Year Ended December 31, 2013 Compared to Year Ended December 31, 2012 The following table presents our results of operations, in dollars and as a percentage of net sales, for the years ended December 31, 2013 and 2012: Net sales The following table presents our net sales by segment, in dollars and as a percentage of total net sales, and the year-over-year dollar and percentage change in net sales for the years ended December 31, 2013 and 2012: 43 Year Ended December 31, 2013 Year Ended December 31, 2012 Dollars in Millions Percentage of Net Sales Dollars in Millions Percentage of Net Sales Net sales $ 10,768.6 100.0 % $ 10,128.2 100.0 % Cost of sales 9,008.3 83.7 8,458.6 83.5 Gross profit 1,760.3 16.3 1,669.6 16.5 Selling and administrative expenses 1,120.9 10.4 1,029.5 10.2 Advertising expense 130.8 1.2 129.5 1.3 Income from operations 508.6 4.7 510.6 5.0 Interest expense, net (250.1 ) (2.3 ) (307.4 ) (3.0 ) Net loss on extinguishments of long-term debt (64.0 ) (0.6 ) (17.2 ) (0.2 ) Other income, net 1.0 — 0.1 — Income before income taxes 195.5 1.8 186.1 1.8 Income tax expense (62.7 ) (0.6 ) (67.1 ) (0.7 ) Net income $ 132.8 1.2 % $ 119.0 1.1 % Years Ended December 31, 2013 2012 Dollars in Millions Percentage of Total Net Sales Dollars in Millions Percentage of Total Net Sales Dollar Change Percent Change (1) Corporate $ 5,960.1 55.3 % $ 5,512.8 54.4 % $ 447.3 8.1 % Public 4,164.5 38.7 4,023.0 39.7 141.5 3.5 Other 644.0 6.0 592.4 5.9 51.6 8.7 Total net sales $ 10,768.6 100.0 % $ 10,128.2 100.0 % $ 640.4 6.3 % (1) There were 254 selling days in both the years ended December 31, 2013 and 2012. Table of Contents The following table presents our net sales by customer channel for our Corporate and Public segments and the year-over-year dollar and percentage change in net sales for the years ended December 31, 2013 and 2012. Net sales of $150.1 million and $124.2 million for the years ended December 31, 2013 and 2012 have been reclassified from the small business customer channel to the medium/large customer channel to conform to the 2014 presentation. Total net sales in 2013 increased $640.4 million , or 6.3% , to $10,768.6 million , compared to $10,128.2 million in 2012. There were 254 selling days for both the years ended December 31, 2013 and 2012. The increase in total net sales was primarily the result of growth in hardware and software, a more tenured sales force, a continued focus on seller productivity across all areas of the organization and the addition of nearly 120 customer-facing coworkers, the majority in pre- and post-sale technical positions such as technical specialists and service delivery roles. Our total net sales growth for the year ended December 31, 2013 reflected growth in notebooks/mobile devices, netcomm products and software. Software gains were driven by growth in security, document management software and network management software, partially offset by a decline in application suites. Corporate segment net sales in 2013 increased $447.3 million , or 8.1% , compared to 2012, driven by sales growth in the medium/large customer channel. Within our Corporate segment, net sales to medium/large customers increased 10.5% between years primarily due to certain of these customers increasing their IT spending, a more tenured sales force, a continued focus on seller productivity and additional customer- facing coworkers, the majority in pre- and post-sale technical positions such as technical specialists and service delivery roles. This increase was led by unit volume growth in netcomm products and growth in notebooks/mobile devices and software. Partially offsetting the growth in the medium/large customer channel was a 3.5% decline in net sales to small business customers, due to certain of these customers taking a more cautious approach to spending as macroeconomic and regulatory uncertainty impacted decision-making. This decrease was led by unit volume declines in notebooks/mobile devices, partially offset by growth in netcomm products. Public segment net sales in 2013 increased $141.5 million , or 3.5% , between years, driven by strong performance in the education customer channel. Net sales to education customers increased $256.7 million , or 21.5% , between years, led by growth in net sales to K-12 customers, reflecting increased sales of notebooks/mobile devices to support new standardized digital testing requirements that will take effect in 2014. Net sales to government customers decreased $143.5 million , or 10.3% , in 2013 compared to 2012 due to reductions and delays in federal government spending following sequestration, uncertainty over future budget negotiations and the partial shutdown of the federal government. The government customer channel net sales decline was led by decreases in sales of enterprise storage and notebooks/mobile devices, partially offset by growth in software. Net sales to healthcare customers increased $28.3 million , or 2.0% , between years, driven by growth in notebooks/mobile devices and desktop computers. Gross profit Gross profit increased $90.7 million , or 5.4% , to $1,760.3 million in 2013, compared to $1,669.6 million in 2012. As a percentage of total net sales, gross profit decreased 20 basis points to 16.3% in 2013, down from 16.5% in 2012. Gross profit margin was negatively impacted 30 basis points by unfavorable price/mix changes within product margin, as we experienced product margin compression in transactional product categories such as desktops and notebooks. Partially offsetting this decrease was an increase of 10 basis points due to a higher mix of net service contract revenue. Net service contract revenue, including items such as third-party services and warranties, has a positive impact on gross profit margin as our cost paid to the vendor or third-party service provider is recorded as a reduction to net sales, resulting in net sales being equal to the gross profit on the transaction. 44 (in millions) Years Ended December 31, 2013 2012 Dollar Change Percent Change Corporate: Medium / Large $ 5,052.7 $ 4,572.7 $ 480.0 10.5 % Small Business 907.4 940.1 (32.7 ) (3.5 ) Total Corporate $ 5,960.1 $ 5,512.8 $ 447.3 8.1 % Public: Government $ 1,250.6 $ 1,394.1 $ (143.5 ) (10.3 )% Education 1,449.0 1,192.3 256.7 21.5 Healthcare 1,464.9 1,436.6 28.3 2.0 Total Public $ 4,164.5 $ 4,023.0 $ 141.5 3.5 % Table of Contents The gross profit margin may fluctuate based on various factors, including vendor incentive and inventory price protection programs, cooperative advertising funds classified as a reduction of cost of sales, product mix, net service contract revenue, commission revenue, pricing strategies, market conditions and other factors, any of which could result in changes in gross profit margins. Selling and administrative expenses Selling and administrative expenses increased $91.3 million , or 8.9% , to $1,120.9 million in 2013, compared to $1,029.5 million in 2012. As a percentage of total net sales, selling and administrative expenses increased 20 basis points to 10.4% in 2013, up from 10.2% in 2012. Sales payroll, including sales commissions and other variable compensation costs, increased $28.9 million, or 6.4%, between years, consistent with higher sales and gross profit. Additionally, selling and administrative expenses for 2013 included IPO- and secondary-offering related expenses of $75.0 million, as follows: We did not record any IPO- or secondary-offering related expenses during 2012. Partially offsetting these increases in 2013 was the favorable resolution of a class action legal proceeding in which we were a claimant, which reduced selling and administrative expenses by $10.4 million in 2013 compared to 2012. Total coworker count increased by 163 coworkers, from 6,804 at December 31, 2012, to 6,967 at December 31, 2013. Advertising expense Advertising expense increased $1.3 million , or 0.9% , to $130.8 million in 2013, compared to $129.5 million in 2012. As a percentage of net sales, advertising expense was 1.2% in 2013, compared to 1.3% in 2012. The dollar increase in advertising expense was due to a continued focus on advertising our solutions and products, which reinforces our reputation as a leading IT solutions provider. Income from operations The following table presents income from operations by segment, in dollars and as a percentage of net sales, and the year-over-year percentage change in income from operations for the years ended December 31, 2013 and 2012: * Not meaningful 45 • Pre-tax charges of $36.7 million related to the acceleration of the expense recognition for certain equity awards and $4.0 million for the related employer payroll taxes. See Note 10 of the accompanying audited consolidated financial statements for additional discussion of the impact of the IPO on our equity awards. • A pre-tax charge of $24.4 million related to the payment of a termination fee to affiliates of the Sponsors in connection with the termination of the management services agreement with such entities. • A pre-tax charge of $7.5 million related to compensation expense in connection with the Restricted Debt Unit Plan. See Note 12 of the accompanying audited consolidated financial statements for additional discussion of this charge. • Other IPO- and secondary-offering related expenses of $2.4 million. Year Ended December 31, 2013 Year Ended December 31, 2012 Dollars in Millions Operating Margin Percentage Dollars in Millions Operating Margin Percentage Percent Change in Income from Operations Segments: (1) Corporate $ 363.3 6.1 % $ 349.0 6.3 % 4.1 % Public 246.5 5.9 246.7 6.1 (0.1 ) Other 27.2 4.2 18.6 3.1 46.3 Headquarters (2) (128.4 ) nm* (103.7 ) nm* (23.8 ) Total income from operations $ 508.6 4.7 % $ 510.6 5.0 % (0.4 )% (1) Segment income (loss) from operations includes the segment’s direct operating income (loss) and allocations for Headquarters’ costs, allocations for logistics services, certain inventory adjustments, and volume rebates and cooperative advertising from vendors. (2) Includes Headquarters’ function costs that are not allocated to the segments. Table of Contents Income from operations was $508.6 million in 2013, a decrease of $2.0 million, or 0.4% , compared to $510.6 million in 2012. The decrease in income from operations was driven by higher selling and administrative expenses primarily resulting from $75.0 million of IPO- and secondary-offering related expenses recorded during 2013, mostly offset by higher net sales and gross profit. Total operating margin percentage decreased 30 basis points to 4.7% in 2013, from 5.0% in 2012. Operating margin percentage was negatively impacted by the increase in selling and administrative expenses as a percentage of net sales and gross profit margin compression, partially offset by a decrease in advertising expense as a percentage of net sales. Corporate segment income from operations was $363.3 million in 2013, an increase of $14.3 million, or 4.1% , compared to $349.0 million in 2012. Corporate segment operating margin percentage decreased 20 basis points to 6.1% in 2013, from 6.3% in 2012. Results for 2013 included $26.4 million of IPO- and secondary-offering related expenses, which reduced Corporate segment operating margin by 40 basis points. Higher sales and gross profit dollars offset the effect of IPO- and secondary-offering related expenses on income from operations for 2013. Public segment income from operations was $246.5 million in 2013, a decrease of $0.2 million, or 0.1%, compared to $246.7 million in 2012. Public segment operating margin percentage decreased 20 basis points to 5.9% in 2013, from 6.1% in 2012. Results for 2013 included $14.4 million of IPO- and secondary-offering related expenses, which reduced Public segment operating margin by 30 basis points. Higher sales and gross profit dollars nearly offset the effect of IPO- and secondary-offering related expenses on income from operations for 2013. Interest expense, net At December 31, 2013 , our outstanding long-term debt totaled $3,251.2 million, compared to $3,771.0 million at December 31, 2012. We reduced long-term debt throughout the year primarily through the use of a portion of the net proceeds from the IPO and cash flows provided by operating activities. Net interest expense in 2013 was $250.1 million , a decrease of $57.3 million compared to $307.4 million in 2012. This decrease was primarily due to lower debt balances and effective interest rates for 2013 compared to 2012 as a result of debt repayments and refinancing activities completed during 2012 and 2013. Net loss on extinguishments of long-term debt During 2013 , we recorded a net loss on extinguishments of long-term debt of $64.0 million compared to $17.2 million in 2012 . In October 2013, we redeemed $155.0 million aggregate principal amount of the Senior Subordinated Notes. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $8.5 million, representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In August 2013, we redeemed $324.0 million aggregate principal amount of the Senior Subordinated Notes. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $24.6 million, representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In July 2013, we redeemed $175.0 million aggregate principal amount of the Senior Secured Notes. In connection with this redemption, we recorded a loss on extinguishment of long-term debt of $16.7 million, representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In April 2013, we entered into a new seven-year, $1,350.0 million aggregate principal amount Term Loan. Substantially all of the proceeds were used to repay the $1,299.5 million outstanding aggregate principal amount of the prior senior secured term loan facility. In connection with this refinancing, we recorded a loss on extinguishment of long-term debt of $10.3 million, representing a write-off of the remaining unamortized deferred financing costs related to the prior senior secured term loan facility. In March 2013, we redeemed $50.0 million aggregate principal amount of the Senior Subordinated Notes. We recorded a loss on extinguishment of long-term debt of $3.9 million, representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. In December 2012, we redeemed $100.0 million aggregate principal amount of the Senior Subordinated Notes. We recorded a loss on extinguishment of long-term debt of $7.8 million representing the difference between the redemption price and the net carrying amount of the purchased debt, adjusted for a portion of the unamortized deferred financing costs. 46 Table of Contents In February and March 2012, we purchased or redeemed the remaining $129.0 million of 11.0% Senior Exchange Notes due 2015 and 11.5%/12.25% Senior PIK Election Exchange Notes due 2015 (together, the "Senior Notes due 2015"), funded with the issuance of an additional $130.0 million of Senior Notes due 2019. As a result, we recorded a loss on extinguishment of long-term debt of $9.4 million, representing the difference between the purchase or redemption price of the Senior Notes due 2015 and the net carrying amount of the purchased debt, adjusted for the remaining unamortized deferred financing costs. Income tax expense Income tax expense was $62.7 million in 2013 , compared to $67.1 million in 2012 . The effective income tax rate was 32.1% and 36.0% for 2013 and 2012 , respectively. For 2013 , the effective tax rate differed from the U.S. federal statutory rate primarily due to state income taxes, including current year state income tax credits and an adjustment to deferred state income taxes due to changes in apportionment factors. For 2012 , the effective tax rate differed from the U.S. federal statutory rate primarily due to favorable adjustments to state tax credits which were partially offset by the unfavorable impact of adjustments to deferred state income taxes due to changes in state tax laws and non-deductible expenses, primarily equity- based compensation and meals and entertainment. The lower effective tax rate for 2013 as compared to 2012 was primarily driven by the favorable impact of adjustments to deferred state income taxes due to changes in state tax apportionment factors and lower non-deductible expenses. Net income Net income was $132.8 million in 2013, compared to $119.0 million in 2012. Significant factors and events causing the net changes between the periods are discussed above. Non-GAAP net income Non-GAAP net income was $314.3 million for the year ended December 31, 2013, an increase of $67.2 million , or 27.2% , compared to $247.1 million for the year ended December 31, 2012. We have included a reconciliation of Non-GAAP net income for the years ended December 31, 2013 and 2012 below. Non-GAAP net income excludes, among other things, charges related to the amortization of acquisition-related intangibles, non-cash equity-based compensation, IPO- and secondary-offering related expenses and gains and losses from the early extinguishment of debt. Non-GAAP net income is considered a non-GAAP financial measure. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that Non-GAAP net income provides helpful information with respect to our operating performance and cash flows including our ability to meet our future debt service, capital expenditures and working capital requirements. 47 Table of Contents Adjusted EBITDA Adjusted EBITDA was $808.5 million in 2013, an increase of $41.9 million, or 5.5%, compared to $766.6 million in 2012. As a percentage of net sales, Adjusted EBITDA was 7.5% and 7.6% in 2013 and 2012, respectively. We have included a reconciliation of EBITDA and Adjusted EBITDA for 2013 and 2012 in the table below. EBITDA is defined as consolidated net income before interest expense, income tax expense, depreciation and amortization. Adjusted EBITDA, which is a measure defined in our credit agreements, means EBITDA adjusted for certain items which are described in the table below. Both EBITDA and Adjusted EBITDA are considered non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP measures used by the Company may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that EBITDA and Adjusted EBITDA provide helpful information with respect to our operating performance and cash flows including our ability to meet our future debt service, capital expenditures and working capital requirements. Adjusted EBITDA also provides helpful information as it is the primary measure used in certain financial covenants contained in our credit agreements. 48 (in millions) Years Ended December 31, 2013 2012 Net income $ 132.8 $ 119.0 Amortization of intangibles (1) 161.2 163.7 Non-cash equity-based compensation 8.6 22.1 Litigation, net (2) (6.3 ) — Net loss on extinguishments of long-term debt 64.0 17.2 Interest expense adjustment related to extinguishments of long-term debt (3) (7.5 ) (3.3 ) IPO- and secondary-offering related expenses (4) 75.0 — Aggregate adjustment for income taxes (5) (113.5 ) (71.6 ) Non-GAAP net income $ 314.3 $ 247.1 (1) Includes amortization expense for acquisition-related intangible assets, primarily customer relationships and trade names. (2) Relates to unusual, non-recurring litigation matters. (3) Reflects adjustments to interest expense resulting from debt extinguishments. Represents the difference between interest expense previously recognized under the effective interest method and actual interest paid. (4) IPO- and secondary-offering related expenses consist of the following: (in millions) Years Ended December 31, 2013 2012 Acceleration charge for certain equity awards and related employer payroll taxes $ 40.7 $ — RDU Plan cash retention pool accrual 7.5 — Management services agreement termination fee 24.4 — Other expenses 2.4 — IPO- and secondary-offering related expenses $ 75.0 $ — (5) Based on a normalized effective tax rate of 39.0%. Table of Contents The following table sets forth a reconciliation of EBITDA to net cash provided by operating activities for the years ended December 31, 2013 and 2012. Seasonality While we have not historically experienced significant seasonality throughout the year, sales in our Corporate segment, which primarily serves private sector business customers, are typically higher in the fourth quarter than in other quarters due to customers spending their remaining technology budget dollars at the end of the year. Additionally, sales in our Public segment have historically been higher in the third quarter than in other quarters primarily due to the buying patterns of the federal government and education customers. (in millions) Years Ended December 31, 2013 2012 Net income $ 132.8 $ 119.0 Depreciation and amortization 208.2 210.2 Income tax expense 62.7 67.1 Interest expense, net 250.1 307.4 EBITDA 653.8 703.7 Adjustments: Non-cash equity-based compensation 8.6 22.1 Sponsor fee 2.5 5.0 Consulting and debt-related professional fees 0.1 0.6 Net loss on extinguishments of long-term debt 64.0 17.2 Litigation, net (1) (4.1 ) 4.3 IPO- and secondary-offering related expenses (2) 75.0 — Other adjustments (3) 8.6 13.7 Total adjustments 154.7 62.9 Adjusted EBITDA $ 808.5 $ 766.6 (1) Relates to unusual, non-recurring litigation matters. (2) As defined under Non-GAAP net income above. (3) Other adjustments primarily include certain retention costs and equity investment income. Years Ended December 31, (in millions) 2013 2012 EBITDA $ 653.8 $ 703.7 Depreciation and amortization (208.2 ) (210.2 ) Income tax expense (62.7 ) (67.1 ) Interest expense, net (250.1 ) (307.4 ) Net income 132.8 119.0 Depreciation and amortization 208.2 210.2 Equity-based compensation expense 46.6 22.1 Deferred income taxes (48.7 ) (56.3 ) Amortization of deferred financing costs, debt premium, and debt discount, net 8.8 13.6 Net loss on extinguishments of long-term debt 64.0 17.2 Other 1.7 1.0 Changes in assets and liabilities (47.1 ) (9.4 ) Net cash provided by operating activities $ 366.3 $ 317.4 Liquidity and Capital Resources 49 Table of Contents Overview We finance our operations and capital expenditures through a combination of internally generated cash from operations and from borrowings under our senior secured asset-based revolving credit facility. We believe that our current sources of funds will be sufficient to fund our cash operating requirements for the next year. In addition, we believe that, in spite of the uncertainty of future macroeconomic conditions, we have adequate sources of liquidity and funding available to meet our longer-term needs. However, there are a number of factors that may negatively impact our available sources of funds. The amount of cash generated from operations will be dependent upon factors such as the successful execution of our business plan and general economic conditions. Long-Term Debt Activities During the year ended December 31, 2014, we had significant debt refinancings. In connection with these refinancings, we recorded a loss on extinguishment of long-term debt of $90.7 million in our consolidated statement of operations for the year ended December 31, 2014. See Note 7 to the accompanying audited consolidated financial statements included elsewhere in this report for additional details. Share Repurchase Program On November 6, 2014, we announced that our Board of Directors approved a $500 million share repurchase program effective immediately under which we may repurchase shares of our common stock in the open market or through privately negotiated transactions, depending on share price, market conditions and other factors. The share repurchase program does not obligate us to repurchase any dollar amount or number of shares, and repurchases may be commenced or suspended from time to time without prior notice. As of the date of this filing, no shares have been repurchased under the share repurchase program. Dividends A summary of 2014 dividend activity for our common stock is shown below: On February 10, 2015, we announced that our board of directors declared a quarterly cash dividend on our common stock of $0.0675 per share. The dividend will be paid on March 10, 2015 to all stockholders of record as of the close of business on February 25, 2015. The payment of any future dividends will be at the discretion of our board of directors and will depend upon our results of operations, financial condition, business prospects, capital requirements, contractual restrictions, any potential indebtedness we may incur, restrictions imposed by applicable law, tax considerations and other factors that our board of directors deems relevant. In addition, our ability to pay dividends on our common stock will be limited by restrictions on our ability to pay dividends or make distributions to our stockholders and on the ability of our subsidiaries to pay dividends or make distributions to us, in each case, under the terms of our current and any future agreements governing our indebtedness. Cash Flows 50 Dividend Amount Declaration Date Record Date Payment Date $0.0425 February 12, 2014 February 25, 2014 March 10, 2014 $0.0425 May 8, 2014 May 27, 2014 June 10, 2014 $0.0425 July 31, 2014 August 25, 2014 September 10, 2014 $0.0675 November 6, 2014 November 25, 2014 December 10, 2014 Table of Contents Cash flows from operating, investing and financing activities were as follows: Operating Activities Net cash provided by operating activities for 2014 increased $68.7 million compared to 2013 . Net income adjusted for the impact of non-cash items such as depreciation and amortization, equity-based compensation expense and net loss on extinguishments of long-term debt was $476.8 million during 2014 , compared to $413.4 million during 2013 . The increase in cash of $63.4 million reflected stronger operating results in 2014 compared to 2013 . Net changes in assets and liabilities reduced cash by $41.8 million in 2014 compared to a reduction of $47.1 million in 2013 , resulting in a change of $5.3 million between periods. The decrease in inventory balances year over year contributed to a $111.7 million increase in cash flows which was primarily due to the timing of inventory receipts and earlier than expected inventory shipments at the end of 2014 due to accelerated customer roll-outs. Partially offsetting the increase in cash flows from inventory was a decline in cash inflows from accounts payable of $102.4 million driven by the timing of inventory receipts at the end of 2014 versus 2013. Net cash provided by operating activities for 2013 increased $48.9 million compared to 2012. Net income adjusted for the impact of non-cash items such as depreciation and amortization, equity-based compensation expense and net loss on extinguishments of long-term debt was $413.4 million during 2013, compared to $326.8 million during 2012, an increase of $86.6 million. The increase in cash of $86.6 million reflected stronger operating results in 2013 compared to 2012. Net changes in assets and liabilities reduced cash by $47.1 million in 2013 compared to a reduction of $9.4 million in 2012, resulting in a change of $37.7 million between periods. While changes in assets and liabilities were relatively flat during 2012, during 2013, accounts receivable and accounts payable balances decreased and increased cash by $170.8 million and $146.1 million, respectively, primarily as a result of accelerated sales growth during the final month of 2013. Merchandise inventory also increased during 2013 to support strong sales order volume near the end of 2013. 51 (in millions) Years Ended December 31, 2014 2013 2012 Net cash provided by (used in): Operating activities $ 435.0 $ 366.3 $ 317.4 Investing activities (164.8 ) (47.1 ) (41.7 ) Net change in accounts payable - inventory financing 75.5 7.4 (29.5 ) Other financing activities (187.5 ) (175.7 ) (308.5 ) Financing activities (112.0 ) (168.3 ) (338.0 ) Effect of exchange rate changes on cash and cash equivalents (1.8 ) (0.7 ) 0.3 Net increase (decrease) in cash and cash equivalents $ 156.4 $ 150.2 $ (62.0 ) Table of Contents In order to manage our working capital and operating cash needs, we monitor our cash conversion cycle, defined as days of sales outstanding in accounts receivable plus days of supply in inventory minus days of purchases outstanding in accounts payable, based on a rolling three-month average. The following table presents the components of our cash conversion cycle: The cash conversion cycle decreased to 21 days at December 31, 2014 compared to 23 days at December 31, 2013, primarily driven by improvement in DSO. The decline in DSO was primarily driven by improved collections and early payments from certain customers. Additionally, the timing of inventory receipts at the end of 2014 had a favorable impact on DIO and an unfavorable impact on DPO. The cash conversion cycle decreased to 23 days at December 31, 2013 compared to 24 days at December 31, 2012. The increase in DSO was primarily driven by an increase in receivables for third-party services such as software assurance and warranties. These services have an unfavorable impact on DSO as the receivable is recognized on the balance sheet on a gross basis while the corresponding sales amount in the statement of operations is recorded on a net basis. The DPO increase was primarily due to an increase in payables for third-party services, which offsets the related increase in DSO discussed above. These services have a favorable impact on DPO as the payable is recognized on the balance sheet without a corresponding cost of sales in the statement of operations because the cost paid to the vendor or third-party service provider is recorded as a reduction to net sales. The timing of quarter-end payments also had a favorable impact on DPO at December 31, 2013. Investing Activities Net cash used in investing activities increased $117.7 million in 2014 compared to 2013 . We paid $86.8 million in the fourth quarter of 2014 to acquire a 35% non-controlling interest in Kelway. Additionally, capital expenditures increased $7.9 million to $55.0 million from $47.1 million for 2014 and 2013 , respectively, primarily for improvements to our information technology systems during both years. Net cash used in investing activities increased $5.4 million in 2013 compared to 2012. Capital expenditures were $47.1 million and $41.4 million for 2013 and 2012, respectively, primarily for improvements to our information technology systems during both years. Financing Activities Net cash used in financing activities decreased $56.3 million in 2014 compared to 2013 . The decrease was primarily driven by several debt refinancing transactions during each period and our July 2013 IPO, which generated net proceeds of $424.7 million after deducting underwriting discounts, expenses and transaction costs. The net impact of our debt transactions resulted in cash outflows of $161.3 million and $569.4 million during 2014 and 2013 , respectively, as cash was used in each period to reduce our total long-term debt. See Note 7 to the accompanying audited consolidated financial statements included elsewhere in this report for a description of the debt transactions impacting each period. Net cash used in financing activities decreased $169.7 million in 2013 compared to 2012. The decrease was primarily driven by various debt transactions during each period and our July 2013 IPO, which generated net proceeds of $424.7 million after deducting underwriting discounts, expenses and transaction costs. The net impact of our debt transactions resulted 52 (in days) December 31, 2014 2013 2012 Days of sales outstanding (DSO) (1) 42 44 42 Days of supply in inventory (DIO) (2) 13 14 14 Days of purchases outstanding (DPO) (3) (34 ) (35 ) (32 ) Cash conversion cycle 21 23 24 (1) Represents the rolling three-month average of the balance of trade accounts receivable, net at the end of the period divided by average daily net sales for the same three-month period. Also incorporates components of other miscellaneous receivables. (2) Represents the rolling three-month average of the balance of inventory at the end of the period divided by average daily cost of goods sold for the same three-month period. The prior period has been revised to conform to the current definition. (3) Represents the rolling three-month average of the combined balance of accounts payable-trade, excluding cash overdrafts, and accounts payable-inventory financing at the end of the period divided by average daily cost of goods sold for the same three-month period. Table of Contents in cash outflows of $569.4 million and $310.6 million during 2013 and 2012, respectively, as cash was used in each period to reduce our total long-term debt. Long-Term Debt and Financing Arrangements As of December 31, 2014, we had total indebtedness of $ 3.2 billion , of which $1.5 billion was secured indebtedness. At December 31, 2014, we were in compliance with the covenants under our various credit agreements and indentures. Under the indenture governing the 8.5% Senior Notes due 2019, which contains the most restrictive restricted payment provisions in our various credit agreements and indentures, we are generally restricted from paying dividends and making other restricted payments. For the purpose of determining restricted payment capacity, consolidated net income or loss includes certain adjustments that are defined in the applicable indenture. At December 31, 2014, the amount of cumulative consolidated net income free of restrictions under our credit agreements and indentures was $230.3 million . See Note 7 to the accompanying audited consolidated financial statements included elsewhere in this report for further details regarding our debt and each of the transactions described below. During the year ended December 31, 2014, the following events occurred with respect to our debt structure: Inventory Financing Agreements We have entered into agreements with certain financial intermediaries to facilitate the purchase of inventory from various suppliers under certain terms and conditions. These amounts are classified separately as accounts payable-inventory financing on the consolidated balance sheets. We do not incur any interest expense associated with these agreements as balances are paid when they are due. See Note 5 to the accompanying audited consolidated financial statements included elsewhere in this report for further details. Contractual Obligations We have future obligations under various contracts relating to debt and interest payments, operating leases and asset retirement obligations. The following table presents our estimated future payments under contractual obligations that existed as of December 31, 2014, based on undiscounted amounts. 53 • On January 22, 2014 and February 21, 2014, we redeemed $30.0 million and $20.0 million aggregate principal amounts of the 12.535% Senior Subordinated Exchange Notes due 2017, respectively. • On March 20, 2014, we repurchased and subsequently canceled $25.0 million aggregate principal amount of the 8.5% Senior Notes due 2019 from an affiliate of Providence Equity in a privately-negotiated transaction on an arms’ length basis. • On May 9, 2014, we redeemed all of the remaining $42.5 million aggregate principal amount of the 12.535% Senior Subordinated Exchange Notes due 2017. • On June 6, 2014, we entered into a new five-year $1,250.0 million senior secured asset-based revolving credit facility which will mature on June 6, 2019. • On August 5, 2014, we completed the issuance of $600.0 million aggregate principal amount of 6.0% Senior Notes due 2022 which will mature on August 15, 2022. • On September 5, 2014, we redeemed all of the remaining $325.0 million aggregate principal amount of the 12.535% Senior Subordinated Exchange Notes due 2017, plus accrued and unpaid interest through the date of redemption. • On September 5, 2014, we redeemed $234.7 million aggregate principal amount of the 8.5% Senior Notes due 2019, plus accrued and unpaid interest through the date of redemption. • On December 1, 2014, we completed the issuance of $575.0 million principal amount of 5.5% Senior Notes due 2024 which will mature on December 1, 2024. • On December 31, 2014, we redeemed $541.4 million aggregate principal amount of the 8.5% Senior Notes due 2019, plus accrued and unpaid interest through the date of redemption. Table of Contents Off-Balance Sheet Arrangements We have no off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. Inflation Inflation has not had a material impact on our operating results. We generally have been able to pass along price increases to our customers, though certain economic factors and technological advances in recent years have tended to place downward pressure on pricing. We also have been able to generally offset the effects of inflation on operating costs by continuing to emphasize productivity improvements and by accelerating our overall cash conversion cycle. There can be no assurances, however, that inflation would not have a material impact on our sales or operating costs in the future. Commitments and Contingencies The information set forth in Note 14 to the accompanying audited consolidated financial statements included in Part II, Item 8 of this Form 10-K is incorporated herein by reference. Critical Accounting Policies and Estimates The preparation of financial statements in accordance with GAAP requires management to make use of certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reported periods. We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. In Note 1 to the accompanying audited consolidated financial statements, we include a discussion of the significant accounting policies used in the preparation of our consolidated financial statements. We believe the following are the most critical accounting policies and estimates that include significant judgments used in the preparation of our financial statements. We consider an accounting policy or estimate to be critical if it requires assumptions to be made that were uncertain at the time they were made, and if changes in these assumptions could have a material impact on our financial condition or results of operations. 54 (in millions) Payments Due by Period Total < 1 year 1-3 years 4-5 years > 5 years Term Loan (1) $ 1,767.8 $ 64.4 $ 127.3 $ 125.3 $ 1,450.8 Senior Notes due 2019 (2) 696.6 42.8 85.7 568.1 — Senior Notes due 2022 (2) 889.0 37.0 72.0 72.0 708.0 Senior Notes due 2024 (2) 891.3 31.6 63.3 63.3 733.1 Operating leases (3) 127.5 19.1 31.4 26.4 50.6 Asset retirement obligations (4) 0.5 — 0.5 — — Total $ 4,372.7 $ 194.9 $ 380.2 $ 855.1 $ 2,942.5 (1) Includes future principal and cash interest payments on long-term borrowings through scheduled maturity dates. Interest payments for variable rate debt were calculated using interest rates as of December 31, 2014. Excluded from these amounts are the amortization of debt issuance and other costs related to indebtedness. (2) Includes future principal and cash interest payments on long-term borrowings through scheduled maturity dates. Interest on the Senior Notes is calculated using the stated interest rates. Excluded from these amounts are the amortization of debt issuance and other costs related to indebtedness. (3) Includes the minimum lease payments for non-cancelable leases of properties and equipment used in our operations. Additionally, included in these amounts are future minimum lease payments commencing in the fourth quarter of 2016 that relate to a new lease entered into in December 2014 for our future headquarters in Lincolnshire, Illinois. Also reflected in these amounts is the future expiration of two leases in the first quarter of 2016 for facilities currently in use by us which we plan to consolidate into the new headquarters location and accordingly, these leases will not be renewed. (4) Represent commitments to return property subject to operating leases to original condition upon lease termination. Table of Contents Revenue Recognition We are a primary distribution channel for a large group of vendors and suppliers, including OEMs, software publishers and wholesale distributors. We record revenue from sales transactions when title and risk of loss are passed to our customer, there is persuasive evidence of an arrangement for sale, delivery has occurred and/or services have been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. Our shipping terms typically specify F.O.B. destination, at which time title and risk of loss have passed to the customer. Revenues from the sales of hardware products and software products and licenses are generally recognized on a gross basis with the selling price to the customer recorded as sales and the acquisition cost of the product recorded as cost of sales. These items can be delivered to customers in a variety of ways, including (i) as physical product shipped from our warehouse, (ii) via drop-shipment by the vendor or supplier, or (iii) via electronic delivery for software licenses. At the time of sale, we record an estimate for sales returns and allowances based on historical experience. Our vendor partners warrant most of the products we sell. We leverage drop-shipment arrangements with many of our vendors and suppliers to deliver products to our customers without having to physically hold the inventory at our warehouses, thereby increasing efficiency and reducing costs. We recognize revenue for drop-shipment arrangements on a gross basis upon delivery to the customer with contract terms that typically specify F.O.B. destination. We recognize revenue on a gross basis as the principal in the transaction because we are the primary obligor in the arrangement, we assume inventory risk if the product is returned by the customer, we set the price of the product charged to the customer, we assume credit risk for the amounts invoiced, and we work closely with our customers to determine their hardware and software specifications. These arrangements generally represent approximately 40% to 50% of total net sales, including approximately 15% to 20% related to electronic delivery for software licenses. Revenue from professional services is either recognized as provided for services billed at an hourly rate or recognized using a proportional performance model for services provided at a fixed fee. Revenue from cloud computing solutions including Software as a Service ("SaaS") and Infrastructure as a Service ("IaaS") arrangements, as well as data center services such as managed and remote managed services, server co-location, internet connectivity and data backup and storage, is recognized over the period service is provided. We also sell certain products for which we act as an agent. Products in this category include the sale of third-party services, warranties, software assurance (“SA”) and third-party hosted SaaS and IaaS arrangements. SA is a product that allows customers to upgrade, at no additional cost, to the latest technology if new applications are introduced during the period that the SA is in effect. These sales do not meet the criteria for gross sales recognition, and thus are recognized on a net basis at the time of sale. Under net sales recognition, the cost paid to the vendor or third-party service provider is recorded as a reduction to sales, resulting in net sales being equal to the gross profit on the transaction. Our larger customers are offered the opportunity by certain of our vendors to purchase software licenses and SA under enterprise agreements (“EAs”). Under EAs, customers are considered to be compliant with applicable license requirements for the ensuing year, regardless of changes to their employee base. Customers are charged an annual true-up fee for changes in the number of users over the year. With most EAs, our vendors will transfer the license and bill the customer directly, paying resellers such as us an agency fee or commission on these sales. We record these fees as a component of net sales as earned and there is no corresponding cost of sales amount. In certain instances, we bill the customer directly under an EA and account for the individual items sold based on the nature of the item. Our vendors typically dictate how the EA will be sold to the customer. From time to time, we sell some of our products and services as part of bundled contract arrangements containing multiple deliverables, which may include a combination of the products and services. For each deliverable that represents a separate unit of accounting, total arrangement consideration is allocated based upon the relative selling prices of each element. The allocated arrangement consideration is recognized as revenue in accordance with the principles described above. Selling prices are determined by using vendor specific objective evidence (“VSOE”) if it exists. Otherwise, selling prices are determined using third party evidence (“TPE”). If neither VSOE or TPE is available, we use our best estimate of selling prices. We record freight billed to our customers as net sales and the related freight costs as a cost of sales. Deferred revenue includes (1) payments received from customers in advance of providing the product or performing services, and (2) amounts deferred if other conditions of revenue recognition have not been met. We perform an analysis of the estimated number of days of sales in-transit to customers at the end of each period based on a weighted- average analysis of commercial delivery terms that includes drop-shipment arrangements. This analysis is the basis upon which we estimate the amount of sales in-transit at the end of the period and adjust revenue and the related costs 55 Table of Contents to reflect only what has been received by the customer. Changes in delivery patterns may result in a different number of business days used in making this adjustment and could have a material impact on our revenue recognition for the period. Inventory Valuation Inventory is valued at the lower of cost or market value. Cost is determined using a weighted-average cost method. Price protection is recorded when earned as a reduction to the cost of inventory. We decrease the value of inventory for estimated obsolescence equal to the difference between the cost of inventory and the estimated market value, based upon an aging analysis of the inventory on hand, specifically known inventory-related risks, and assumptions about future demand and market conditions. If future demand or actual market conditions are less favorable than those projected by management, additional inventory write-downs may be required. Vendor Programs We receive incentives from certain of our vendors related to cooperative advertising allowances, volume rebates, bid programs, price protection and other programs. These incentives generally relate to written agreements with specified performance requirements with the vendors and are recorded as adjustments to cost of sales or inventory, depending on the nature of the incentive. Vendors may change the terms of some or all of these programs, which could have an impact on our results of operations. We record receivables from vendors related to these programs when the amounts are probable and reasonably estimable. Some programs are based on the achievement of specific targets, and we base our estimates on information provided by our vendors and internal information to assess our progress toward achieving those targets. If actual performance does not match our estimates, we may be required to adjust our receivables. We record reserves for vendor receivables for estimated losses due to vendors’ inability to pay or rejections by vendors of claims; however, if actual collections differ from our estimates, we may incur additional losses that could have a material impact on gross margin and operating income. Goodwill and Other Intangible Assets Goodwill is not amortized but is subject to periodic testing for impairment at the reporting unit level. Our reporting units used to assess potential goodwill impairment are the same as our operating segments. We are required to perform an evaluation of goodwill on an annual basis or more frequently if circumstances indicate a potential impairment. The annual test for impairment is conducted as of December 1. We have the option of performing a qualitative assessment of a reporting unit's fair value from the last quantitative assessment to determine if it is more likely than not that the reporting unit's goodwill is impaired or performing a quantitative assessment by comparing a reporting unit's estimated fair value to its carrying amount. Under the quantitative assessment, testing for impairment of goodwill is a two-step process. The first step compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill to determine the amount of impairment loss. Fair value of a reporting unit is determined by using a weighted combination of an income approach and a market approach, as this combination is considered the most indicative of the reporting units’ fair value in an orderly transaction between market participants. Under the income approach, we determine fair value based on estimated future cash flows of a reporting unit, discounted by an estimated weighted- average cost of capital, which reflects the overall level of inherent risk of a reporting unit and the rate of return an outside investor would expect to earn. Under the market approach, we utilize valuation multiples derived from publicly available information for peer group companies to provide an indication of how much a knowledgeable investor in the marketplace would be willing to pay for a company. We have weighted the income approach and the market approach at 75% and 25%, respectively. Determining the fair value of a reporting unit (and the allocation of that fair value to individual assets and liabilities within the reporting unit to determine the implied fair value of goodwill in the event a step two analysis is required) is judgmental in nature and requires the use of significant estimates and assumptions. These estimates and assumptions include primarily, but are not limited to, discount rate, terminal growth rate, selection of appropriate peer group companies and control premium applied, and forecasts of revenue growth rates, gross margins, operating margins, and working capital requirements. The allocation requires analysis to determine the fair value of assets and liabilities including, among others, customer relationships, trade names, and property and equipment. Any changes in the judgments, estimates, or assumptions used could produce significantly different results. Although we believe our assumptions are reasonable, actual results may vary significantly and may expose us to material impairment charges in the future. Intangible assets include customer relationships, trade names, internally developed software and other intangibles. Intangible assets with determinable lives are amortized on a straight-line basis over the estimated useful lives of the assets. The cost of software developed or obtained for internal use is capitalized and amortized on a straight-line basis over the estimated useful life of the software. These intangible assets are reviewed for impairment whenever events or changes in circumstances 56 Table of Contents indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. If the carrying amount of an asset exceeds its estimated future undiscounted cash flows, an impairment loss is recorded for the excess of the asset’s carrying amount over its fair value. Allowance for Doubtful Accounts We record an allowance for doubtful accounts related to trade accounts receivable for estimated losses resulting from the inability of our customers to make required payments. We take into consideration historical loss experience, the overall quality of the receivable portfolio and specifically identified customer risks. If actual collections of customer receivables differ from our estimates, additional allowances may be required which could have an impact on our results of operations. Income Taxes Deferred income taxes are provided to reflect the differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements using enacted tax rates in effect for the year in which the differences are expected to reverse. We perform an evaluation of the realizability of our deferred tax assets on a quarterly basis. This evaluation requires us to use estimates and make assumptions and considers all positive and negative evidence and factors, such as the scheduled reversal of temporary differences, the mix of earnings in the jurisdictions in which we operate, and prudent and feasible tax planning strategies. We account for unrecognized tax benefits based upon our assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. We report a liability for unrecognized tax benefits resulting from unrecognized tax benefits taken or expected to be taken in a tax return and recognize interest and penalties, if any, related to unrecognized tax benefits in income tax expense. Recent Accounting Pronouncements The information set forth in Note 2 to the accompanying audited consolidated financial statements included in Part II, Item 8 of this Form 10-K is incorporated herein by reference. Subsequent Events The information set forth in Note 20 to the accompanying audited consolidated financial statements included in Part II, Item 8 of this Form 10-K is incorporated herein by reference. Item 7A. Quantitative and Qualitative Disclosures of Market Risks Our market risks relate primarily to changes in interest rates. The interest rates on borrowings under our senior secured asset-based revolving credit facility and our senior secured term loan facility are floating and, therefore, are subject to fluctuations. In order to manage the risk associated with changes in interest rates on borrowings under our senior secured term loan facility, we have entered into interest rate derivative agreements to economically hedge a portion of the cash flows associated with the facility. Our objectives in using interest rate derivatives are to add stability to interest expense and to manage our exposure to interest rate fluctuations. W e utilize interest rate caps for the purpose of limiting current and future exposure to interest rate risk on our floating-rate debt under the senior secured term loan facility. As of December 31, 2014 we have ten interest rate cap agreements in effect through January 14, 2015 with a combined notional amount of $1,150.0 million which entitled the Company to payments from the counterparty of the amount, if any, by which three-month LIBOR exceeds a weighted average rate of 2.4% during the agreement period. During the year ended December 31, 2014 , we entered into 14 additional interest rate cap agreements with a combined notional amount of $1,000.0 million . These interest rate cap agreements have not been designated as cash flow hedges of interest rate risk for GAAP accounting purposes. The entire $1,000.0 million notional amount entitles us to payments from the counterparty of the amount, if any, by which three-month LIBOR exceeds 2.0% during the agreement period. The interest rate cap agreements are effective from January 14, 2015 through January 14, 2017. See Note 7 to the accompanying audited consolidated financial statements included elsewhere in this report for additional details. See “Management's Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources - Contractual Obligations” for information on cash flows, interest rates and maturity dates of our debt obligations. 57 Table of Contents Item 8. Financial Statements and Supplementary Data Index to Consolidated Financial Statements 58 Page Report of Independent Registered Public Accounting Firm 59 Consolidated Balance Sheets as of December 31, 2014 and 2013 60 Consolidated Statements of Operations for the years ended December 31, 2014, 2013 and 2012 61 Consolidated Statements of Comprehensive Income for the years ended December 31, 2014, 2013 and 2012 62 Consolidated Statements of Shareholders’ Equity (Deficit) for the years ended December 31, 2014, 2013 and 2012 63 Consolidated Statements of Cash Flows for the years ended December 31, 2014, 2013 and 2012 64 Notes to Consolidated Financial Statements 65 Table of Contents Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholders of CDW Corporation We have audited the accompanying consolidated balance sheets of CDW Corporation and subsidiaries as of December 31, 2014 and 2013, and the related consolidated statements of operations, comprehensive income, shareholders' equity (deficit) and cash flows for each of the three years in the period ended December 31, 2014. Our audits also included the financial statement schedule listed in the Index at Item 15(a)(2). These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of CDW Corporation and subsidiaries at December 31, 2014 and 2013, and the consolidated results of their operations and their cash flows for each of the three years in the period ended December 31, 2014, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the information set forth therein. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), CDW Corporation and subsidiaries’ internal control over financial reporting as of December 31, 2014, based on criteria established in Internal Control- Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 26, 2015 expressed an unqualified opinion thereon. 59 /s/ Ernst & Young LLP Chicago, Illinois February 26, 2015 Table of Contents The accompanying notes are an integral part of the consolidated financial statements. CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in millions, except per-share amounts) December 31, 2014 2013 Assets Current assets: Cash and cash equivalents $ 344.5 $ 188.1 Accounts receivable, net of allowance for doubtful accounts of $5.7 and $5.4, respectively 1,561.1 1,451.0 Merchandise inventory 337.5 382.0 Miscellaneous receivables 155.6 146.3 Prepaid expenses and other 54.7 46.1 Total current assets 2,453.4 2,213.5 Property and equipment, net 137.2 131.1 Equity investments 86.7 — Goodwill 2,217.6 2,220.3 Other intangible assets, net 1,168.8 1,328.0 Deferred financing costs, net 33.0 30.1 Other assets 3.2 1.6 Total assets $ 6,099.9 $ 5,924.6 Liabilities and Shareholders’ Equity Current liabilities: Accounts payable-trade $ 704.0 $ 662.8 Accounts payable-inventory financing 332.1 256.6 Current maturities of long-term debt 15.4 45.4 Deferred revenue 81.3 94.8 Accrued expenses: Compensation 130.1 112.2 Interest 28.1 31.8 Sales taxes 29.1 29.2 Advertising 34.0 33.2 Income taxes 0.2 6.3 Other 113.7 130.3 Total current liabilities 1,468.0 1,402.6 Long-term liabilities: Debt 3,174.6 3,205.8 Deferred income taxes 475.0 563.5 Other liabilities 45.8 41.0 Total long-term liabilities 3,695.4 3,810.3 Commitments and contingencies (Note 14) Shareholders’ equity: Preferred shares, $0.01 par value, 100.0 shares authorized, and no shares issued or outstanding for both periods — — Common shares, $0.01 par value, 1,000.0 shares authorized; 172.2 and 172.0 shares issued, respectively; 172.2 and 172.0 shares outstanding, respectively 1.7 1.7 Paid-in capital 2,711.9 2,688.1 Accumulated deficit (1,760.5 ) (1,971.8 ) Accumulated other comprehensive loss (16.6 ) (6.3 ) Total shareholders’ equity 936.5 711.7 Total liabilities and shareholders’ equity $ 6,099.9 $ 5,924.6 60 Table of Contents The accompanying notes are an integral part of the consolidated financial statements. 61 CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per-share amounts) Years Ended December 31, 2014 2013 2012 Net sales $ 12,074.5 $ 10,768.6 $ 10,128.2 Cost of sales 10,153.2 9,008.3 8,458.6 Gross profit 1,921.3 1,760.3 1,669.6 Selling and administrative expenses 1,110.3 1,120.9 1,029.5 Advertising expense 138.0 130.8 129.5 Income from operations 673.0 508.6 510.6 Interest expense, net (197.3 ) (250.1 ) (307.4 ) Net loss on extinguishments of long-term debt (90.7 ) (64.0 ) (17.2 ) Other income, net 2.7 1.0 0.1 Income before income taxes 387.7 195.5 186.1 Income tax expense (142.8 ) (62.7 ) (67.1 ) Net income $ 244.9 $ 132.8 $ 119.0 Net income per common share: Basic $ 1.44 $ 0.85 $ 0.82 Diluted $ 1.42 $ 0.84 $ 0.82 Weighted-average number of common shares outstanding: Basic 170.6 156.6 145.1 Diluted 172.8 158.7 145.8 Cash dividends declared per common share $ 0.1950 $ 0.0425 $ — Table of Contents The accompanying notes are an integral part of the consolidated financial statements. 62 CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (in millions) Years Ended December 31, 2014 2013 2012 Net income $ 244.9 $ 132.8 $ 119.0 Foreign currency translation adjustment (net of tax benefit of $0.5 million, $0 million, and $0 million, respectively) (10.3 ) (6.7 ) 2.5 Other comprehensive (loss) income (10.3 ) (6.7 ) 2.5 Comprehensive income $ 234.6 $ 126.1 $ 121.5 Table of Contents The accompanying notes are an integral part of the consolidated financial statements. 63 CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (DEFICIT) (in millions) Preferred Stock Common Stock Shares Amount Shares Amount Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive (Loss) Income Total Shareholders’ (Deficit) Equity Balance at December 31, 2011 — $ — 144.9 $ 1.4 $ 2,184.7 $ (2,191.3 ) $ (2.1 ) $ (7.3 ) Equity-based compensation expense — — — — 22.1 — — 22.1 Investment from CDW Holdings LLC — — — — 2.8 — — 2.8 Repurchase of common shares — — — — — (0.7 ) — (0.7 ) Accrued charitable contribution related to the MPK Coworker Incentive Plan II, net of tax — — 0.3 — (1.4 ) — — (1.4 ) Net income — — — — — 119.0 — 119.0 Incentive compensation plan units withheld for taxes — — — — (0.5 ) — — (0.5 ) Foreign currency translation adjustment — — — — — — 2.5 2.5 Balance at December 31, 2012 — $ — 145.2 $ 1.4 $ 2,207.7 $ (2,073.0 ) $ 0.4 $ 136.5 Equity-based compensation expense — — — — 46.6 — — 46.6 Issuance of common shares — — 26.8 0.3 424.4 — — 424.7 Repurchase of common shares — — — — — (0.2 ) — (0.2 ) Dividends declared — — — — — (7.3 ) (7.3 ) Reclassification to goodwill for accrued charitable contributions — — — — 9.4 — — 9.4 Incentive compensation plan units withheld for taxes — — — — — (24.1 ) — (24.1 ) Net income — — — — — 132.8 — 132.8 Foreign currency translation adjustment — — — — — — (6.7 ) (6.7 ) Balance at December 31, 2013 — $ — 172.0 $ 1.7 $ 2,688.1 $ (1,971.8 ) $ (6.3 ) $ 711.7 Equity-based compensation expense — — — — 16.4 — — 16.4 Stock options exercised — — — — 1.3 — — 1.3 Excess tax benefits from equity-based compensation — — — — 0.3 — — 0.3 Coworker stock purchase plan — — 0.2 — 5.8 — — 5.8 Dividends declared — — — — — (33.6 ) — (33.6 ) Net income — — — — — 244.9 — 244.9 Foreign currency translation adjustment — — — — — — (10.3 ) (10.3 ) Balance at December 31, 2014 — $ — 172.2 $ 1.7 $ 2,711.9 $ (1,760.5 ) $ (16.6 ) $ 936.5 Table of Contents CDW CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) Years Ended December 31, 2014 2013 2012 Cash flows from operating activities: Net income $ 244.9 $ 132.8 $ 119.0 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 207.9 208.2 210.2 Equity-based compensation expense 16.4 46.6 22.1 Deferred income taxes (89.1 ) (48.7 ) (56.3 ) Allowance for doubtful accounts 0.3 — — Amortization of deferred financing costs, debt premium, and debt discount, net 6.4 8.8 13.6 Net loss on extinguishments of long-term debt 90.7 64.0 17.2 Income from equity investments (1.2 ) — — Other 0.5 1.7 1.0 Changes in assets and liabilities: Accounts receivable (117.6 ) (170.8 ) (10.4 ) Merchandise inventory 44.2 (67.5 ) 7.1 Other assets (18.7 ) (10.1 ) (3.8 ) Accounts payable-trade 43.7 146.1 0.8 Other current liabilities 1.7 64.1 (2.1 ) Long-term liabilities 4.9 (8.9 ) (1.0 ) Net cash provided by operating activities 435.0 366.3 317.4 Cash flows from investing activities: Capital expenditures (55.0 ) (47.1 ) (41.4 ) Payment for equity investment (86.8 ) — — Payment of accrued charitable contribution related to the MPK Coworker Incentive Plan II (20.9 ) — — Premium payments on interest rate cap agreements (2.1 ) — (0.3 ) Net cash used in investing activities (164.8 ) (47.1 ) (41.7 ) Cash flows from financing activities: Proceeds from borrowings under revolving credit facility — 63.0 289.0 Repayments of borrowings under revolving credit facility — (63.0 ) (289.0 ) Repayments of long-term debt (15.4 ) (51.1 ) (201.0 ) Proceeds from issuance of long-term debt 1,175.0 1,535.2 135.7 Payments to extinguish long-term debt (1,299.0 ) (2,047.4 ) (243.2 ) Payments of debt financing costs (21.9 ) (6.1 ) (2.1 ) Investment from CDW Holdings LLC, net — — 2.8 Net change in accounts payable-inventory financing 75.5 7.4 (29.5 ) Proceeds from issuance of common shares — 424.7 — Proceeds from stock option exercises 1.3 — — Proceeds from Coworker Stock Purchase Plan 5.8 — — Dividends paid (33.6 ) (7.3 ) — Excess tax benefits from equity-based compensation 0.3 0.6 — Payment of incentive compensation plan withholding taxes — (24.1 ) — Repurchase of common shares — (0.2 ) (0.7 ) Net cash used in financing activities (112.0 ) (168.3 ) (338.0 ) Effect of exchange rate changes on cash and cash equivalents (1.8 ) (0.7 ) 0.3 Net increase (decrease) in cash and cash equivalents 156.4 150.2 (62.0 ) Cash and cash equivalents – beginning of period 188.1 37.9 99.9 Cash and cash equivalents – end of period $ 344.5 $ 188.1 $ 37.9 Supplementary disclosure of cash flow information: The accompanying notes are an integral part of the consolidated financial statements. 64 Interest paid $ (195.8 ) $ (267.6 ) $ (302.7 ) Taxes paid, net of taxes refunded $ (241.2 ) $ (82.5 ) $ (123.2 ) Non-cash investing and financing activities: Capital expenditures accrued in accounts payable-trade $ 0.6 $ 0.2 $ 0.5 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Description of Business CDW Corporation ("Parent") is a Fortune 500 company and a leading provider of integrated information technology (“IT”) solutions to small, medium and large business, government, education and healthcare customers in the U.S. and Canada. The Company's offerings range from discrete hardware and software products to integrated IT solutions such as mobility, security, data center optimization, cloud computing, virtualization and collaboration. Throughout this report, the terms “the Company” and “CDW” refer to Parent and its 100% owned subsidiaries. Parent has two 100% owned subsidiaries, CDW LLC and CDW Finance Corporation. CDW LLC is an Illinois limited liability company that, together with its 100% owned subsidiaries, holds all material assets and conducts all business activities and operations of the Company. On August 6, 2010, CDW Finance Corporation, a Delaware corporation, was formed for the sole purpose of acting as co- issuer of certain debt obligations as described in Note 18 and does not hold any material assets or engage in any business activities or operations. CDW Corporation was previously owned directly by CDW Holdings LLC ("CDW Holdings"), a company controlled by investment funds affiliated with Madison Dearborn Partners, LLC ("Madison Dearborn") and Providence Equity Partners L.L.C. ("Providence Equity," and together with Madison Dearborn, the "Sponsors"), certain other co-investors and certain members of CDW management. On July 2, 2013, Parent completed an initial public offering ("IPO") of its common stock. In connection with the IPO, CDW Holdings distributed all of its shares of Parent's common stock to its members in June 2013 in accordance with the members’ respective membership interests and was subsequently dissolved in August 2013. See Note 9 for additional discussion of the IPO. Basis of Presentation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). Principles of Consolidation The accompanying consolidated financial statements include the accounts of Parent and its 100% owned subsidiaries. All intercompany transactions and accounts are eliminated in consolidation. Use of Estimates The preparation of the consolidated financial statements in accordance with GAAP requires management to make use of certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported periods. The Company bases its estimates on historical experience and on various other assumptions that management believes are reasonable under the circumstances, the results of which form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. Cash and Cash Equivalents Cash and cash equivalents include all deposits in banks and short-term (original maturities of three months or less), highly liquid investments that are readily convertible to known amounts of cash and are so near maturity that there is insignificant risk of changes in value due to interest rate changes. Accounts Receivable Trade accounts receivable are recorded at the invoiced amount and typically do not bear interest. The Company provides allowances for doubtful accounts related to accounts receivable for estimated losses resulting from the inability of its customers to make required payments. The Company takes into consideration the overall quality of the receivable portfolio along with specifically-identified customer risks. 65 1. Description of Business and Summary of Significant Accounting Policies Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Merchandise Inventory Inventory is valued at the lower of cost or market value. Cost is determined using a weighted-average cost method. Price protection is recorded when earned as a reduction to the cost of inventory. The Company decreases the value of inventory for estimated obsolescence equal to the difference between the cost of inventory and the estimated market value, based upon an aging analysis of the inventory on hand, specifically known inventory-related risks, and assumptions about future demand and market conditions. Miscellaneous Receivables Miscellaneous receivables generally consist of amounts due from vendors. The Company receives incentives from vendors related to cooperative advertising allowances, volume rebates, bid programs, price protection and other programs. These incentives generally relate to written vendor agreements with specified performance requirements and are recorded as adjustments to cost of sales or inventory, depending on the nature of the incentive. Property and Equipment Property and equipment are stated at cost, less accumulated depreciation. The Company calculates depreciation expense using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of their useful lives or the initial lease term. Expenditures for major renewals and improvements that extend the useful life of property and equipment are capitalized. Expenditures for maintenance and repairs are charged to expense as incurred. The following table shows estimated useful lives of property and equipment: The Company has asset retirement obligations associated with commitments to return property subject to operating leases to its original condition upon lease termination. The Company’s asset retirement liability was $0.5 million as of December 31, 2014 and 2013. Equity Investments If the Company is not required to consolidate its investment in another entity because it does not have control, the Company uses the equity method if it (i) can exercise significant influence over the other entity and (ii) holds common stock of the other entity. Under the equity method, investments are carried at cost, plus or minus the Company’s share of equity in the increases and decreases in the investee’s net assets after the date of acquisition and adjustments for basis differences. The Company’s share of the net income or loss of equity method investees is included in other income, net in the consolidated statements of operations. Goodwill and Other Intangible Assets The Company is required to perform an evaluation of goodwill on an annual basis or more frequently if circumstances indicate a potential impairment. The annual test for impairment is conducted as of December 1. The Company’s reporting units used to assess potential goodwill impairment are the same as its operating segments. The Company has the option of performing a qualitative assessment of a reporting unit's fair value from the last quantitative assessment to determine if it is more likely than not that the reporting unit's goodwill is impaired or performing a quantitative assessment by comparing a reporting unit's estimated fair value to its carrying amount. Under the quantitative assessment, testing for impairment of goodwill is a two-step process. The first step compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill to determine the amount of impairment loss. Fair value of a reporting unit is determined by using a weighted combination of an income approach and a market approach, as this combination is considered the most indicative of the Company’s fair value in an orderly transaction between market participants. This assessment uses significant 66 Classification Estimated Useful Lives Machinery and equipment 5 to 10 years Building and leasehold improvements 5 to 25 years Computer and data processing equipment 3 to 5 years Computer software 3 to 5 years Furniture and fixtures 5 to 10 years Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS accounting judgments, estimates and assumptions. Any changes in the judgments, estimates or assumptions used could produce significantly different results. During the years ended December 31, 2014, 2013 and 2012 , the Company concluded its goodwill was not impaired. See Note 4 for more information on the Company’s evaluations of goodwill for impairment. Intangible assets with determinable lives are amortized on a straight-line basis over their respective estimated useful lives. The cost of computer software developed or obtained for internal use is capitalized and amortized on a straight-line basis over the estimated useful life of the software. These intangible assets are reviewed for impairment when indicators are present using undiscounted cash flows. The Company uses the undiscounted cash flows, excluding interest charges, to assess the recoverability of the carrying value of such assets. To the extent carrying value exceeds the undiscounted cash flows, an impairment loss is recorded based upon the excess of the carrying value over fair value. In addition, each quarter, the Company evaluates whether events and circumstances warrant a revision to the remaining estimated useful life of each of these intangible assets. If the Company were to determine that a change to the remaining estimated useful life of an intangible asset was necessary, then the remaining carrying amount of the intangible asset would be amortized prospectively over that revised remaining useful life. During the years ended December 31, 2014, 2013 and 2012 , no impairment existed with respect to the Company’s intangible assets with determinable lives and no significant changes to the remaining useful lives were necessary. The following table shows estimated useful lives of definite-lived intangible assets: Deferred Financing Costs Deferred financing costs, such as underwriting, financial advisory, professional fees and other similar fees are capitalized and recognized in interest expense over the estimated life of the related debt instrument using the effective interest method or straight-line method, as applicable. Derivatives The Company has entered into interest rate cap agreements for the purpose of economically hedging its exposure to fluctuations in interest rates. These derivatives are recorded at fair value in the Company’s consolidated balance sheets. The Company’s interest rate cap agreements are not designated as cash flow hedges of interest rate risk. Changes in fair value of the derivatives are recorded directly to interest expense in the Company’s consolidated statements of operations. Fair Value Measurements Fair value is defined under GAAP as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value hierarchy has been established for valuation inputs to prioritize the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels which is determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are: Level 1 – observable inputs such as quoted prices for identical instruments traded in active markets. Level 2 – inputs are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 – inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models and similar techniques. 67 Classification Estimated Useful Lives Customer relationships 11 to 14 years Trade name 20 years Internally developed software 3 to 5 years Other 1 to 10 years Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Accumulated Other Comprehensive (Loss) Income Foreign currency translation adjustments are included in shareholders’ equity under accumulated other comprehensive (loss) income. The components of accumulated other comprehensive (loss) income are as follows: Revenue Recognition The Company is a primary distribution channel for a large group of vendors and suppliers, including original equipment manufacturers (“OEMs”), software publishers and wholesale distributors. The Company records revenue from sales transactions when title and risk of loss are passed to the customer, there is persuasive evidence of an arrangement for sale, delivery has occurred and/or services have been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. The Company's shipping terms typically specify F.O.B. destination, at which time title and risk of loss have passed to the customer. Revenues from the sales of hardware products and software products and licenses are generally recognized on a gross basis with the selling price to the customer recorded as sales and the acquisition cost of the product recorded as cost of sales. These items can be delivered to customers in a variety of ways, including (i) as physical product shipped from the Company's warehouse, (ii) via drop- shipment by the vendor or supplier, or (iii) via electronic delivery for software licenses. At the time of sale, the Company records an estimate for sales returns and allowances based on historical experience. The Company's vendor partners warrant most of the products the Company sells. The Company leverages drop-shipment arrangements with many of its vendors and suppliers to deliver products to its customers without having to physically hold the inventory at its warehouses, thereby increasing efficiency and reducing costs. The Company recognizes revenue for drop-shipment arrangements on a gross basis upon delivery to the customer with contract terms that typically specify F.O.B. destination. Revenue from professional services is either recognized as provided for services billed at an hourly rate or recognized using a proportional performance model for services provided at a fixed fee. Revenue from cloud computing solutions including Software as a Service ("SaaS") and Infrastructure as a Service ("IaaS") arrangements, as well as data center services such as managed and remote managed services, server co-location, internet connectivity and data backup and storage, is recognized over the period service is provided. The Company also sells certain products for which it acts as an agent. Products in this category include the sale of third-party services, warranties, software assurance (“SA”) and third-party hosted SaaS and IaaS arrangements. SA is a product that allows customers to upgrade, at no additional cost, to the latest technology if new applications are introduced during the period that the SA is in effect. These sales do not meet the criteria for gross sales recognition, and thus are recognized on a net basis at the time of sale. Under net sales recognition, the cost paid to the vendor or third-party service provider is recorded as a reduction to sales, resulting in net sales being equal to the gross profit on the transaction. The Company's larger customers are offered the opportunity by certain of its vendors to purchase software licenses and SA under enterprise agreements (“EAs”). Under EAs, customers are considered to be compliant with applicable license requirements for the ensuing year, regardless of changes to their employee base. Customers are charged an annual true-up fee for changes in the number of users over the year. With most EAs, the Company's vendors will transfer the license and bill the customer directly, paying resellers such as the Company an agency fee or commission on these sales. The Company records these fees as a component of net sales as earned and there is no corresponding cost of sales amount. In certain instances, the Company bills the customer directly under an EA and accounts for the individual items sold based on the nature of the item. The Company's vendors typically dictate how the EA will be sold to the customer. From time to time, the Company sells some of its products and services as part of bundled contract arrangements containing multiple deliverables, which may include a combination of products and services. For each deliverable that represents a separate unit of accounting, total arrangement consideration is allocated based upon the relative selling 68 (in millions) December 31, 2014 2013 2012 Foreign currency translation adjustment $ (16.6 ) $ (6.3 ) $ 0.4 Accumulated other comprehensive (loss) income $ (16.6 ) $ (6.3 ) $ 0.4 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS prices of each element. The allocated arrangement consideration is recognized as revenue in accordance with the principles described above. Selling prices are determined by using vendor specific objective evidence (“VSOE”) if it exists. Otherwise, selling prices are determined using third party evidence (“TPE”). If neither VSOE or TPE is available, the Company uses its best estimate of selling prices. The Company records freight billed to its customers as net sales and the related freight costs as a cost of sales. Deferred revenue includes (1) payments received from customers in advance of providing the product or performing services, and (2) amounts deferred if other conditions of revenue recognition have not been met. The Company performs an analysis of the estimated number of days of sales in-transit to customers at the end of each period based on a weighted-average analysis of commercial delivery terms that includes drop-shipment arrangements. This analysis is the basis upon which the Company estimates the amount of sales in-transit at the end of the period and adjusts revenue and the related costs to reflect only what has been received by the customer. Changes in delivery patterns may result in a different number of business days used in making this adjustment and could have a material impact on the Company's revenue recognition for the period. Sales Taxes Sales tax amounts collected from customers for remittance to governmental authorities are presented on a net basis in the Company’s consolidated statements of operations. Advertising Advertising costs are generally charged to expense in the period incurred. Cooperative reimbursements from vendors are recorded in the period the related advertising expenditure is incurred. The Company classifies vendor consideration as a reduction to cost of sales. Equity-Based Compensation The Company measures all equity-based payments using a fair-value-based method and records compensation expense over the requisite service period using the straight-line method in its consolidated financial statements. Estimated forfeiture rates have been developed based upon historical experience. Interest Expense Interest expense is typically recognized in the period incurred at the applicable interest rate in effect. For increasing-rate debt, the Company determines the periodic interest cost using the effective interest method over the estimated outstanding term of the debt. The difference between interest expense recorded and cash interest paid is reflected as short-term or long-term accrued interest in the Company’s consolidated balance sheets. Foreign Currency Translation The Company’s functional currency is the U.S. dollar. The functional currency of the Company’s Canadian subsidiary is the local currency, the Canadian dollar. The functional currency of the Company's equity investment in Kelway TopCo Limited ("Kelway") is the local currency, the British pound sterling. Assets and liabilities of the Canadian subsidiary and the Company’s share of assets and liabilities in Kelway are translated at the spot rate in effect at the applicable reporting date and the consolidated results of operations of the Canadian subsidiary and the Company’s share of the net income or loss of Kelway are translated at the average exchange rates in effect during the applicable period. The resulting foreign currency translation adjustment is recorded as accumulated other comprehensive (loss) income, which is reflected as a separate component of shareholders’ equity. Income Taxes Deferred income taxes are provided to reflect the differences between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements using enacted tax rates in effect for the year in which the differences are expected to reverse. The Company performs an evaluation of the realizability of deferred tax assets on a quarterly basis. This evaluation requires management to make use of estimates and assumptions and considers all positive and negative evidence and factors, such as the scheduled reversal of temporary differences, the mix of earnings in the jurisdictions in which the Company operates, and prudent and feasible tax planning strategies. 69 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The Company accounts for unrecognized tax benefits based upon its assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. The Company reports a liability for unrecognized tax benefits resulting from unrecognized tax benefits taken or expected to be taken in a tax return and recognizes interest and penalties, if any, related to its unrecognized tax benefits in income tax expense. Stock Compensation - Performance Share Awards In June 2014, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") 2014-12, “Compensation - Stock Compensation,” which amended the standard on how to account for share-based payments when the terms of an award provide that a performance target could be achieved after the requisite service period. Under this ASU, a performance target that could be achieved after the requisite service period is required to be treated as a performance condition that affects the vesting of the award and should not be reflected in estimating the fair value of the award at the grant date. This ASU is effective for the first quarter of 2016 with early adoption permitted. The Company already accounts for performance shares utilizing the method outlined by this ASU and is not impacted by the new standard. Revenue Recognition In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers," which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes the most current revenue recognition standard. This ASU is effective for the Company for the first quarter of 2017 and early adoption is not permitted. This ASU allows for either a full retrospective adoption approach or a modified retrospective adoption approach. The Company is currently evaluating the impact that this ASU will have on its consolidated financial position, results of operations and cash flows. Property and equipment consisted of the following: During 2014, 2013 and 2012, the Company recorded disposals of $32.0 million , $7.9 million and $12.2 million , respectively, to remove assets that were no longer in use from property and equipment. The Company recorded a pre-tax loss of $0.1 million , $0.0 million and $0.1 million in 2014, 2013 and 2012, respectively, for certain disposed assets that were not fully depreciated. Depreciation expense for the years ended December 31, 2014, 2013 and 2012 was $25.8 million , $27.2 million and $32.0 million , respectively. As described in Note 1, the Company is required to perform an evaluation of goodwill on an annual basis or more frequently if circumstances indicate a potential impairment. The annual test for impairment is conducted as of December 1. The Company’s reporting units used to assess potential goodwill impairment are the same as its operating segments. The Company has two reportable segments: Corporate, which is comprised primarily of business customers, 70 2. Recent Accounting Pronouncements 3. Property and Equipment (in millions) December 31, 2014 2013 Land $ 27.7 $ 27.7 Machinery and equipment 54.3 53.0 Building and leasehold improvements 105.1 104.8 Computer and data processing equipment 65.6 61.2 Computer software 10.6 30.9 Furniture and fixtures 21.7 21.6 Construction in progress 24.7 10.9 Property and equipment 309.7 310.1 Less: accumulated depreciation 172.5 179.0 Property and equipment, net $ 137.2 $ 131.1 4. Goodwill and Other Intangible Assets Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS and Public, which is comprised of government entities and education and healthcare institutions. The Company also has three other operating segments, CDW Advanced Services, Canada, and Kelway, which do not meet the reportable segment quantitative thresholds and, accordingly, are combined together as “Other” for segment reporting purposes. The Company has the option of performing a qualitative assessment of a reporting unit's fair value from the last quantitative assessment to determine if it is more likely than not that the reporting unit's goodwill is impaired or performing a quantitative assessment by comparing a reporting unit's estimated fair value to its carrying amount. Under the quantitative assessment, testing for impairment of goodwill is a two-step process. The first step compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of reporting unit goodwill with the carrying amount of that goodwill to determine the amount of impairment loss. Fair value of a reporting unit is determined by using a weighted combination of an income approach and a market approach, as this combination is considered the most indicative of the Company’s fair value in an orderly transaction between market participants. Under the income approach, the Company determined fair value based on estimated future cash flows of a reporting unit, discounted by an estimated weighted-average cost of capital, which reflects the overall level of inherent risk of a reporting unit and the rate of return an outside investor would expect to earn. Under the market approach, the Company utilized valuation multiples derived from publicly available information for guideline companies to provide an indication of how much a knowledgeable investor in the marketplace would be willing to pay for a company. The valuation multiples were applied to the reporting units. Determining the fair value of a reporting unit is judgmental in nature and requires the use of significant estimates and assumptions, including revenue growth rates, gross margins, operating margins, discount rates and future market conditions, among others. December 1, 2014 Evaluation The Company performed its annual evaluation of goodwill as of December 1, 2014 by utilizing a quantitative assessment for all reporting units. All reporting units passed the first step of the goodwill evaluation (with the fair value exceeding the carrying value by 169% , 147% , 276% and 78% for the Corporate, Public, Canada and CDW Advanced Services reporting units, respectively) and, accordingly, the Company was not required to perform the second step of the goodwill evaluation. To determine the fair value of the reporting units, the Company used a 75% / 25% weighting of the income approach and market approach, respectively. Under the income approach, the Company estimated future cash flows of each reporting unit based on internally generated forecasts for the remainder of 2014 and the next six years. The Company used a 3.5% long-term assumed consolidated annual revenue growth rate for periods after the six-year forecast. The estimated future cash flows for the Corporate and Public reporting units were discounted at 9.0% ; cash flows for the Canada and CDW Advanced Services reporting units were discounted at 9.3% and 11.5% , respectively, based on the future growth rates assumed in the discounted cash flows. Discount rates utilized during the 2014 goodwill evaluation declined compared to those used in 2013 as a result of the market performance of the Company's common stock and a lower equity risk premium with the exception of CDW Advanced Services. The discount rate for CDW Advanced Services increased to account for additional forecast risk. December 1, 2013 Evaluation The Company performed its annual evaluation of goodwill as of December 1, 2013 by utilizing a quantitative assessment for all reporting units. All reporting units passed the first step of the goodwill evaluation (with the fair value exceeding the carrying value by 107% , 82% , 167% and 168% for the Corporate, Public, Canada and CDW Advanced Services reporting units, respectively) and, accordingly, the Company was not required to perform the second step of the goodwill evaluation. To determine the fair value of the reporting units, the Company used a 75% / 25% weighting of the income approach and market approach, respectively. Under the income approach, the Company estimated future cash flows of each reporting unit based on internally generated forecasts for the remainder of 2013 and the next six years. The Company used a 3.5% long-term assumed consolidated annual revenue growth rate for periods after the six-year forecast. The estimated future cash flows for the Corporate and Public reporting units were discounted at 10.0% ; cash flows for the Canada and CDW Advanced Services reporting units were discounted at 10.3% and 10.5% , respectively, based on the future growth rates assumed in the discounted cash flows. Discount rates utilized during the 2013 goodwill evaluation declined compared to those used in 2012 as a result of the market performance of the Company's common stock and a lower equity risk premium. December 1, 2012 Evaluation 71 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The Company performed its annual evaluation of goodwill as of December 1, 2012 by utilizing a quantitative assessment for all reporting units. All reporting units passed the first step of the goodwill evaluation (with the fair value exceeding the carrying value by 49% , 44% , 104% and 17% for the Corporate, Public, Canada and CDW Advanced Services reporting units, respectively) and, accordingly, the Company was not required to perform the second step of the goodwill evaluation. To determine the fair value of the reporting units, the Company used a 75% / 25% weighting of the income approach and market approach, respectively. Under the income approach, the Company estimated future cash flows of each reporting unit based on internally generated forecasts for the remainder of 2012 and the next six years. The Company used a 3.5% long-term assumed consolidated annual revenue growth rate for periods after the six-year forecast. The estimated future cash flows for the Corporate and Public reporting units were discounted at 11.5% ; cash flows for the Canada and CDW Advanced Services reporting units were discounted at 11.8% and 12.0% , respectively, based on the future growth rates assumed in the discounted cash flows. The following table presents the change in goodwill by segment for the years ended December 31, 2014 and 2013 : 72 (in millions) Corporate Public Other (1) Consolidated Balances as of December 31, 2012: Goodwill $ 2,794.4 $ 1,261.4 $ 107.3 $ 4,163.1 Accumulated impairment charges (1,571.4 ) (354.1 ) (28.3 ) (1,953.8 ) $ 1,223.0 $ 907.3 $ 79.0 $ 2,209.3 2013 Activity: Translation adjustment $ — $ — $ (2.1 ) $ (2.1 ) Contingent consideration (2) 8.8 4.0 0.3 13.1 $ 8.8 $ 4.0 $ (1.8 ) $ 11.0 Balances as of December 31, 2013: Goodwill $ 2,803.2 $ 1,265.4 $ 105.5 $ 4,174.1 Accumulated impairment charges (1,571.4 ) (354.1 ) (28.3 ) (1,953.8 ) $ 1,231.8 $ 911.3 $ 77.2 $ 2,220.3 2014 Activity: Translation adjustment $ — $ — $ (2.7 ) $ (2.7 ) $ — $ — $ (2.7 ) $ (2.7 ) Balances as of December 31, 2014: Goodwill $ 2,803.2 $ 1,265.4 $ 102.8 $ 4,171.4 Accumulated impairment charges (1,571.4 ) (354.1 ) (28.3 ) (1,953.8 ) $ 1,231.8 $ 911.3 $ 74.5 $ 2,217.6 (1) Other is comprised of CDW Advanced Services, Canada, and Kelway reporting units. There is no goodwill attributable to the Kelway reporting unit. (2) During 2013, the Company recorded a $13.1 million net-of-tax addition to goodwill in connection with the settlement of the MPK Coworker Incentive Plan II and related charitable contribution. The charitable contribution was accounted for as additional purchase price (goodwill) in accordance with pre-2009 business combinations accounting guidance. See Note 10 for additional discussion of this transaction. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The following table presents a summary of intangible assets at December 31, 2014 and 2013 : During 2014, the Company recorded disposals of $41.7 million to remove fully amortized internally developed software assets that were no longer in use from intangible assets. Amortization expense related to intangible assets for the years ended December 31, 2014, 2013 and 2012 was $182.1 million , $181.0 million and $178.2 million , respectively. Estimated future amortization expense related to intangible assets for the next five years is as follows: The Company has entered into agreements with certain financial intermediaries to facilitate the purchase of inventory from various suppliers under certain terms and conditions, as described below. These amounts are classified separately as accounts payable-inventory financing on the accompanying consolidated balance sheets. The Company does not incur any interest expense associated with these agreements as balances are paid when they are due. The following table presents the amounts included in accounts payable-inventory financing: As described in Note 7, in June 2014, the Company entered into a new senior secured asset-based revolving credit facility, which incorporates the previous inventory floorplan sub-facility and, among other changes, removes the $400.0 million limit on the size of the floorplan sub-facility. In connection with the floorplan sub-facility, the Company maintains an inventory financing agreement on an unsecured basis with a financial intermediary to facilitate 73 (in millions) December 31, 2014 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 1,859.7 $ 1,012.1 $ 847.6 Trade name 421.0 152.0 269.0 Internally developed software 110.1 58.9 51.2 Other 3.2 2.2 1.0 Total $ 2,394.0 $ 1,225.2 $ 1,168.8 December 31, 2013 Customer relationships $ 1,860.8 $ 872.8 $ 988.0 Trade name 421.0 130.9 290.1 Internally developed software 128.5 79.8 48.7 Other 3.1 1.9 1.2 Total $ 2,413.4 $ 1,085.4 $ 1,328.0 (in millions) Years ending December 31, 2015 $ 180.7 2016 172.8 2017 167.1 2018 160.4 2019 158.9 5. Inventory Financing Agreements (in millions) December 31, 2014 2013 Revolving Loan inventory financing agreement $ 330.1 $ 256.1 Other inventory financing agreements 2.0 0.5 Accounts payable-inventory financing $ 332.1 $ 256.6 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS the purchase of inventory from this vendor (the “Revolving Loan inventory financing agreement”). Amounts outstanding under the Revolving Loan inventory financing agreement are unsecured and non-interest bearing. The Company also maintains other inventory financing agreements with financial intermediaries to facilitate the purchase of inventory from certain vendors. At December 31, 2014 and 2013 , amounts owed under other inventory financing agreements of $2.0 million and $0.5 million , respectively, were collateralized by the inventory purchased under these financing agreements and a second lien on the related accounts receivable. The Company is obligated under various non-cancelable operating lease agreements for office facilities that generally provide for minimum rent payments and a proportionate share of operating expenses and property taxes and include certain renewal and expansion options. For the years ended December 31, 2014, 2013 and 2012 , rent expense under these lease arrangements was $21.4 million , $20.7 million and $22.4 million , respectively. Future minimum lease payments are as follows: (1) Included in these amounts are future minimum lease payments commencing in the fourth quarter of 2016 that relate to a new lease entered into in December 2014 for the Company’s future headquarters in Lincolnshire, Illinois. Also reflected in these amounts is the future expiration of two leases in the first quarter of 2016 for facilities currently in use by the Company which the Company plans to consolidate into the new headquarters location and accordingly, these leases will not be renewed. Long-term debt was as follows: (1) Interest rate at December 31, 2014 . At December 31, 2014 , the Company was in compliance with the covenants under its various credit agreements and indentures as described below. Under the indenture governing the 8.5% Senior Notes due 2019, which contains the 6. Lease Commitments (in millions) Years ending December 31, 2015 $ 19.1 2016 15.3 2017 16.1 2018 13.6 2019 12.8 Thereafter 50.6 Total future minimum lease payments (1) $ 127.5 7. Long-Term Debt (dollars in millions) December 31, Interest Rate (1) 2014 2013 Senior secured asset-based revolving credit facility —% $ — $ — Senior secured term loan facility 3.25 % 1,513.5 1,528.9 Unamortized discount on senior secured term loan facility (3.7 ) (4.4 ) Senior secured notes due 2018 —% — 325.0 Senior notes due 2019 8.5 % 503.9 1,305.0 Unamortized premium on senior notes due 2019 1.3 4.2 Senior notes due 2022 6.0 % 600.0 — Senior notes due 2024 5.5 % 575.0 — Senior subordinated notes due 2017 —% — 92.5 Total long-term debt 3,190.0 3,251.2 Less current maturities of long-term debt (15.4 ) (45.4 ) Long-term debt, excluding current maturities $ 3,174.6 $ 3,205.8 74 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS most restrictive restricted payment provisions in the Company’s various credit agreements and indentures, CDW LLC and its restricted subsidiaries are generally restricted from paying dividends and making other restricted payments. For the purpose of determining restricted payment capacity, consolidated net income or loss includes certain adjustments that are defined in the applicable indenture. At December 31, 2014 , the amount of cumulative consolidated net income free of restrictions under the credit agreements and indentures ("Restricted Payment Capacity") was $230.3 million . Senior Secured Asset-Based Revolving Credit Facility (“Revolving Loan”) At December 31, 2014 , the Company had no outstanding borrowings under the Revolving Loan, $2.1 million of undrawn letters of credit and $312.3 million reserved related to the floorplan sub-facility. On June 6, 2014, the Company entered into the Revolving Loan, a new five-year $1,250.0 million senior secured asset-based revolving credit facility, with the facility being available to the Company for borrowings, issuance of letters of credit and floorplan financing for certain vendor products. The Revolving Loan matures on June 6, 2019, subject to an acceleration provision discussed below. The Revolving Loan replaces the Company’s previous revolving loan credit facility that was to mature on June 24, 2016. The Revolving Loan (i) increases the overall revolving credit facility capacity available to the Company from $900.0 million to $1,250.0 million , (ii) increases the maximum aggregate amount of increases that may be made to the revolving credit facility from $200.0 million to $300.0 million , (iii) maintains a maturity acceleration provision based upon excess cash availability whereby the Revolving Loan may mature 45 days prior to the final maturity of any then outstanding senior debt if excess cash availability does not exceed the outstanding borrowings of the subject maturing debt at the time of the test plus $150.0 million , (iv) decreases the fee on the unused portion of the revolving credit facility from either 37.5 or 50 basis points, depending on the amount of utilization, to 25 basis points, (v) decreases the applicable interest rate margin by 50 basis points, and (vi) amends the existing inventory floorplan sub-facility as discussed below. In connection with the termination of the previous facility, the Company recorded a loss on extinguishment of long-term debt of $0.4 million in the consolidated statement of operations for the year ended December 31, 2014 , representing a write-off of a portion of unamortized deferred financing costs. Fees of $6.4 million related to the Revolving Loan were capitalized as deferred financing costs and are being amortized over the five-year term of the facility on a straight-line basis. The Revolving Loan incorporates the previous inventory floorplan sub-facility and related Revolving Loan inventory financing agreement while removing the previous $400.0 million limit on the size of the floorplan sub-facility and the in-transit reserve of 15% of open orders. At December 31, 2014 , the financial intermediary reported an outstanding balance of $312.3 million under the Revolving Loan inventory financing agreement. The amount included on the Company's consolidated balance sheet as of December 31, 2014 as accounts payable-inventory financing related to the Revolving Loan inventory financing agreement of $330.1 million includes a $17.8 million accrual for amounts in transit. Borrowings under the Revolving Loan bear interest at a variable interest rate plus an applicable margin. The interest rate margin is based on one of two indices, either (i) LIBOR, or (ii) the Alternate Base Rate (“ABR”) with the ABR being the greater of (a) the prime rate, (b) the federal funds effective rate plus 50 basis points or (c) the one-month LIBOR plus 1.00% . The applicable margin varies ( 1.50% to 2.00% for LIBOR borrowings and 0.50% to 1.00% for ABR borrowings) depending upon average daily excess cash availability under the agreement evidencing the Revolving Loan and is subject to a reduction of 0.25% if, and for as long as, CDW LLC's corporate credit rating from Standard & Poor’s Rating Services is BB or better and CDW LLC's corporate family rating from Moody’s Investors Service, Inc. is Ba3 or better (in each case with stable or better outlook). Under the new Revolving Loan, the Company is permitted to borrow an aggregate amount of $1,250.0 million ; however, its ability to borrow under the Revolving Loan is limited by a borrowing base. The borrowing base is (a) the sum of the products of the applicable advance rates on eligible accounts receivable and on eligible inventory as defined in the agreement less (b) any reserves. At December 31, 2014 , the borrowing base was $1,253.4 million based on the amount of eligible inventory and accounts receivable balances as of November 30, 2014. The Company could have borrowed up to an additional $935.6 million under the Revolving Loan at December 31, 2014 . The ability to borrow under the Revolving Loan also remains limited by a minimum liquidity condition which provides that, if excess cash availability is less than the lesser of (i) $125.0 million and (ii) the greater of (A) 10.0% of the borrowing base and (B) $100.0 million , the lenders are not required to lend any additional amounts under the Revolving Loan unless the consolidated fixed charge coverage ratio (as described in the agreement evidencing the Revolving Loan) is at least 1.00 to 1.00 . 75 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS CDW LLC is the borrower under the Revolving Loan. All obligations under the Revolving Loan are guaranteed by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. Borrowings under the Revolving Loan are collateralized by a first priority interest in inventory (excluding inventory collateralized under the inventory floorplan arrangements as described in Note 5), deposits, and accounts receivable, and a second priority interest in substantially all other assets. The Revolving Loan contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. The Revolving Loan also includes maintenance of a minimum average daily excess cash availability requirement. Should the Company fall below the minimum average daily excess cash availability requirement for five consecutive business days, the Company becomes subject to a fixed charge coverage ratio until such time as the daily excess cash availability requirement is met for 30 consecutive business days. Senior Secured Term Loan Facility On April 29, 2013, the Company entered into a seven-year, $1,350.0 million aggregate principal amount senior secured term loan facility (the "Term Loan"). The Term Loan was issued at a price that was 99.75% of par, which resulted in a discount of $3.4 million . Substantially all of the proceeds from the Term Loan were used to repay the $1,299.5 million outstanding aggregate principal amount of the prior senior secured term loan facility (the "Prior Term Loan Facility"). In connection with this refinancing, the Company recorded a loss on extinguishment of long-term debt of $10.3 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented a write-off of the remaining unamortized deferred financing costs related to the Prior Term Loan Facility. On July 31, 2013, the Company borrowed an additional $190.0 million aggregate principal amount under the Term Loan at a price that was 99.25% of par, which resulted in a discount of $1.4 million . Such proceeds were used to redeem a portion of outstanding Senior Subordinated Notes. The discounts are reported on the consolidated balance sheet as a reduction to the face amount of the Term Loan and are being amortized to interest expense over the term of the related debt. Fees of $6.1 million related to the Term Loan were capitalized as deferred financing costs and are being amortized over the term of the facility using the effective interest method. The Company is required to pay quarterly principal installments equal to 0.25% of the original principal amount of the Term Loan, with the remaining principal amount payable on the maturity date of April 29, 2020. The quarterly principal installment payments commenced during the quarter ended June 30, 2013. At December 31, 2014 , the outstanding principal amount of the Term Loan was $1,513.5 million , excluding $3.7 million in unamortized discount. Borrowings under the Term Loan bear interest at either (a) the alternate base rate ("ABR") plus a margin or (b) LIBOR plus a margin; provided that for the purposes of the Term Loan, LIBOR shall not be less than 1.00% per annum at any time ("LIBOR Floor"). The margin is based upon a net leverage ratio as defined in the agreement governing the Term Loan, ranging from 1.25% to 1.50% for ABR borrowings and 2.25% to 2.50% for LIBOR borrowings. The total net leverage ratio was 3.1 at December 31, 2014 . An interest rate of 3.25% , LIBOR Floor plus a 2.25% margin, was in effect during the three-month period ended December 31, 2014 . In order to manage the risk associated with changes in interest rates on borrowings under the Term Loan, the Company has entered into interest rate cap agreements. The Company had ten interest rate cap agreements in effect through January 14, 2015 with a combined notional amount of $1,150.0 million which entitled the Company to payments from the counterparty of the amount, if any, by which three-month LIBOR exceeds a weighted average rate of 2.4% during the agreement period. The fair value of these interest rate cap agreements was zero at both December 31, 2014 and 2013. In connection with the expiration of the ten interest rate cap agreements noted above, during the year ended December 31, 2014 , the Company entered into 14 additional interest rate cap agreements with a combined notional amount of $1,000.0 million . Under these agreements, the Company made premium payments totaling $2.1 million to the counterparties in exchange for the right to receive payments equal to the amount, if any, by which three-month LIBOR exceeds 2.0% during the agreement period. These interest rate cap agreements are effective from January 14, 2015 through January 14, 2017. The fair value of these interest rate cap agreements was $1.7 million at December 31, 2014 . The Company's interest rate cap agreements have not been designated as cash flow hedges of interest rate risk for GAAP accounting purposes. The interest rate cap agreements are recorded at fair value on the Company’s 76 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS consolidated balance sheet in Other Assets each period, with changes in fair value recorded directly to interest expense in the Company’s consolidated statements of operations. The fair value of the Company’s interest rate cap agreements is classified as Level 2 in the fair value hierarchy. The valuation of the interest rate cap agreements is derived by using a discounted cash flow analysis on the expected cash receipts that would occur if variable interest rates rise above the strike rates of the caps. This analysis reflects the contractual terms of the interest rate cap agreements, including the period to maturity, and uses observable market-based inputs, including LIBOR curves and implied volatilities. The Company also incorporates insignificant credit valuation adjustments to appropriately reflect the respective counterparty’s nonperformance risk in the fair value measurements. The counterparty credit spreads are based on publicly available credit information obtained from a third party credit data provider. See Note 20 for a description of the interest rate cap agreements entered into during the first quarter of 2015. On January 30, 2013, the Company made an optional prepayment of $40.0 million aggregate principal amount outstanding under the Prior Term Loan Facility. The optional prepayment satisfied the excess cash flow payment provision of the Prior Term Loan Facility with respect to the year ended December 31, 2012. CDW LLC is the borrower under the Term Loan. All obligations under the Term Loan are guaranteed by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. The Term Loan is collateralized by a second priority interest in substantially all inventory (excluding inventory collateralized under the inventory floorplan arrangements as described in Note 5), deposits, and accounts receivable, and by a first priority interest in substantially all other assets. The Term Loan contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. 8.0% Senior Secured Notes due 2018 (“Senior Secured Notes”) At December 31, 2014 , there were no outstanding Senior Secured Notes. On August 5, 2014, the proceeds from the issuance of the 2022 Senior Notes discussed below, along with cash on hand, were deposited with the trustee to redeem all of the remaining $325.0 million aggregate principal amount of the Senior Secured Notes at a redemption price of 106.061% of the principal amount redeemed, plus accrued and unpaid interest through the date of redemption. On the same date, the indenture governing the Senior Secured Notes was satisfied and discharged. The redemption date was September 5, 2014. In connection with this redemption, the Company recorded a loss on extinguishment of long-term debt of $23.7 million in the consolidated statement of operations for the year ended December 31, 2014 , which was comprised of $4.0 million for the write-off of the unamortized deferred financing fees, a redemption premium of $13.0 million and a make-whole interest payment of $6.7 million . On July 2, 2013, the Company used a portion of the net proceeds from the IPO to redeem $175.0 million aggregate principal amount of Senior Secured Notes. The redemption price of the Senior Secured Notes was 108.0% of the principal amount redeemed, plus $0.7 million of accrued and unpaid interest to the date of redemption. The Company used cash on hand to pay such accrued and unpaid interest. In connection with this redemption, the Company recorded a loss on extinguishment of long-term debt of $16.7 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented $14.0 million in redemption premium and $2.7 million for the write-off of a portion of the remaining deferred financing costs related to the Senior Secured Notes. 8.5% Senior Notes due 2019 (“2019 Senior Notes”) At December 31, 2014 , the outstanding principal amount of 2019 Senior Notes was $503.9 million , excluding $1.3 million in unamortized premium. The 2019 Senior Notes mature on April 1, 2019. 77 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS On December 1, 2014, the proceeds from the issuance of the 2024 Senior Notes discussed below, along with cash on hand, were deposited with the trustee to redeem $541.4 million aggregate principal amount of the 2019 Senior Notes at a redemption price of 106.202% of the principal amount redeemed, plus accrued and unpaid interest through the date of redemption. The redemption date was December 31, 2014. In connection with this redemption, the Company recorded a loss on extinguishment of long-term debt of $36.9 million in the consolidated statement of operations for the year ended December 31, 2014 , which was comprised of $4.7 million for the write-off of a portion of the unamortized deferred financing fees, a redemption premium of $23.0 million , and a make-whole interest payment of $10.6 million , partially offset by $1.4 million for the write-off of a portion of the unamortized premium. On August 5, 2014, the proceeds from the issuance of the 2022 Senior Notes discussed below, along with cash on hand, were deposited with the trustee to redeem $234.7 million aggregate principal amount of the 2019 Senior Notes at a redemption price of 108.764% of the principal amount redeemed, plus accrued and unpaid interest through the date of redemption. The redemption date was September 5, 2014. In connection with this redemption, the Company recorded a loss on extinguishment of long-term debt of $22.1 million in the consolidated statement of operations for the year ended December 31, 2014 , which was comprised of $2.2 million for the write-off of a portion of the unamortized deferred financing fees, a redemption premium of $10.0 million , and a make-whole interest payment of $10.6 million , partially offset by $0.7 million for the write-off of a portion of the unamortized premium. On March 20, 2014, the Company repurchased and subsequently canceled $25.0 million aggregate principal amount of the 2019 Senior Notes from an affiliate of Providence Equity in a privately negotiated transaction on an arms' length basis at a price of 109.75% of the principal amount. Cash on hand was used to fund the repurchase of $25.0 million aggregate principal amount, $2.4 million of repurchase premium and $1.0 million in accrued and unpaid interest to the date of repurchase. In connection with this repurchase, the Company recorded a loss on extinguishment of long-term debt of $2.7 million in the Company's consolidated statement of operations for the year ended December 31, 2014 . This loss represented $2.4 million in repurchase premium and $0.3 million for the write-off of a portion of the unamortized deferred financing costs related to the 2019 Senior Notes. CDW LLC and CDW Finance Corporation are the co-issuers of the 2019 Senior Notes. Obligations under the 2019 Senior Notes are guaranteed on an unsecured senior basis by Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries. The 2019 Senior Note indenture contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to dispose of assets, incur additional indebtedness, incur guarantee obligations, prepay other indebtedness, make distributions or other restricted payments, create liens, make equity or debt investments, make acquisitions, engage in mergers or consolidations, or engage in certain transactions with affiliates. The 2019 Senior Notes do not contain any financial covenants. 6.0% Senior Notes due 2022 ("2022 Senior Notes") On August 5, 2014, CDW LLC and CDW Finance Corporation, as co-issuers, completed the issuance of $600.0 million aggregate principal amount of 2022 Senior Notes at par. Fees of $8.0 million related to the 2022 Senior Notes were capitalized as deferred financing costs and are being amortized over the term of the notes on a straight-line basis. The 2022 Senior Notes will mature on August 15, 2022 and bear interest at a rate of 6.00% per annum, payable semi-annually on February 15 and August 15 of each year. The first interest payment date was February 15, 2015. CDW LLC and CDW Finance Corporation are the co-issuers of the 2022 Senior Notes and the obligations under the notes are guaranteed by Parent and each of CDW LLC's direct and indirect, wholly owned, domestic subsidiaries. The 2022 Senior Notes indenture contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to enter into sale and lease-back transactions, incur additional secured indebtedness, and create liens. The indenture governing the 2022 Senior Notes does not contain any financial covenants. 5.5% Senior Notes due 2024 ("2024 Senior Notes") On December 1, 2014, CDW LLC and CDW Finance Corporation, as co-issuers, completed the issuance of $575.0 million aggregate principal amount of 2024 Senior Notes at par. Fees of $7.5 million related to the 2024 Senior Notes were capitalized as deferred financing costs and are being amortized over the term of the notes on a straight-line basis. The 2024 Senior Notes will mature on December 1, 2024 and bear interest at a rate of 5.50% per annum, payable semi-annually on June 1 and December 1 of each year. The first interest payment date will be June 1, 2015. 78 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS CDW LLC and CDW Finance Corporation are the co-issuers of the 2024 Senior Notes and the obligations under the notes are guaranteed by Parent and each of CDW LLC's direct and indirect, wholly owned, domestic subsidiaries. The 2024 Senior Notes indenture contains negative covenants that, among other things, place restrictions and limitations on the ability of Parent and each of CDW LLC's direct and indirect, 100% owned, domestic subsidiaries to enter into sale and lease-back transactions, incur additional secured indebtedness, and create liens. The indenture governing the 2024 Senior Notes does not contain any financial covenants. 12.535% Senior Subordinated Exchange Notes due 2017 (“Senior Subordinated Notes”) At December 31, 2014 , there were no outstanding Senior Subordinated Notes. On May 9, 2014, the Company redeemed all of the remaining $42.5 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 104.178% of the principal amount redeemed. Cash on hand was used to fund the redemption of $42.5 million aggregate principal amount, $1.8 million in redemption premium and $0.4 million in accrued and unpaid interest to the date of redemption. In connection with this redemption, the Company recorded a loss on extinguishment of long-term debt of $2.2 million in the consolidated statement of operations for the year ended December 31, 2014 . This loss represented $1.8 million in redemption premium and $0.4 million for the write-off of the remaining deferred financing costs related to the Senior Subordinated Notes. On January 22, 2014 and February 21, 2014, the Company redeemed $30.0 million and $20.0 million aggregate principal amounts of Senior Subordinated Notes, respectively, at redemption prices that were 104.178% of the principal amounts redeemed. Cash on hand was used to fund the redemptions of $50.0 million aggregate principal amount, $2.1 million in redemption premiums and $1.9 million in aggregate accrued and unpaid interest to the dates of redemption. In connection with these redemptions, the Company recorded a loss on extinguishment of long-term debt of $2.7 million in the consolidated statement of operations for the year ended December 31, 2014 . This loss represented $2.1 million in redemption premiums and $0.6 million for the write-off of a portion of the remaining deferred financing costs related to the Senior Subordinated Notes. On October 18, 2013, the Company redeemed $155.0 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 104.178% of the principal amount redeemed. A combination of cash on hand and the net proceeds from the sale of shares of common stock related to the underwriters' exercise in full of the overallotment option granted to them in connection with the IPO, in the amount of $56.0 million , was used to fund the redemption of $155.0 million aggregate principal amount, $6.5 million of redemption premium and $0.2 million in accrued and unpaid interest to the date of redemption. See Note 9 for additional discussion of the underwriters' overallotment option. In connection with this redemption, the Company recorded a loss on extinguishment of long- term debt of $8.5 million in the Company's consolidated statement of operations for the year ended December 31, 2013. This loss represented $6.5 million in redemption premium and $2.0 million for the write-off of a portion of the remaining unamortized deferred financing costs related to the Senior Subordinated Notes. On August 1, 2013, the Company redeemed $324.0 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 106.268% of the principal amount redeemed. The Company used a portion of the net proceeds from the IPO to redeem $146.0 million aggregate principal amount of Senior Subordinated Notes and incremental borrowings of $190.0 million under the Term Loan to redeem $178.0 million aggregate principal amount of Senior Subordinated Notes. The Company used cash on hand to pay $12.0 million of accrued and unpaid interest to the date of redemption. In connection with this redemption, the Company recorded a loss on extinguishment of long-term debt of $24.6 million in the consolidated statement of operations for the year ended December 31, 2013. This loss represented $20.3 million in redemption premium and $4.3 million for the write-off of a portion of the remaining deferred financing costs related to the Senior Subordinated Notes. On March 8, 2013, the Company redeemed $50.0 million aggregate principal amount of Senior Subordinated Notes at a redemption price that was 106.268% of the principal amount redeemed. Cash on hand was used to fund the redemption of $50.0 million aggregate principal amount, $3.1 million of redemption premium and $2.5 million in accrued and unpaid interest to the date of redemption. In connection with this redemption, the Company recorded a loss on extinguishment of long-term debt of $3.9 million in the Company's consolidated statement of operations for the year ended December 31, 2013. This loss represented $3.1 million in redemption premium and $0.8 million for the write-off of a portion of the remaining unamortized deferred financing costs related to the Senior Subordinated Notes. 79 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Long-Term Debt Maturities As of December 31, 2014 , the maturities of long-term debt were as follows: Fair Value The fair value of the Company's long-term debt instruments at December 31, 2014 was $3,208.7 million . The fair value of the 2019 Senior Notes, the 2022 Senior Notes, and the 2024 Senior Notes was estimated using quoted market prices for identical assets or liabilities that are traded in over-the-counter secondary markets that are not considered active. The fair value of the Term Loan was estimated using dealer quotes for identical assets or liabilities in markets that are not considered active. Consequently, the Company's long-term debt is classified as Level 2 within the fair value hierarchy. At December 31, 2014 , the carrying value of the Company's long-term debt was $3,192.4 million , excluding $1.3 million in unamortized premium and $3.7 million in unamortized discount. Deferred Financing Costs The following table summarizes the deferred financing costs activity for the years ended December 31, 2014 and 2013 : As of December 31, 2014 and December 31, 2013 , the weighted-average remaining life of unamortized deferred financing costs was 6.6 and 4.9 years, respectively. Income before income taxes was taxed under the following jurisdictions: 80 (in millions) Years ending December 31, 2015 $ 15.4 2016 — 2017 — 2018 — 2019 503.9 Thereafter 2,673.1 $ 3,192.4 (in millions) December 31, 2014 2013 Beginning balance $ 30.1 $ 53.2 Additional costs capitalized 21.9 6.1 Recognized in interest expense (6.4 ) (9.1 ) Write-off of unamortized deferred financing costs (12.6 ) (20.1 ) Ending balance $ 33.0 $ 30.1 8. Income Taxes (in millions) Years Ended December 31, 2014 2013 2012 Domestic $ 366.6 $ 179.4 $ 170.3 Foreign 21.1 16.1 15.8 Total $ 387.7 $ 195.5 $ 186.1 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Components of income tax expense (benefit) consisted of the following: The reconciliation between the statutory tax rate expressed as a percentage of income before income taxes and the effective tax rate is as follows: The tax effect of temporary differences that give rise to the net deferred income tax liability is presented below: 81 (in millions) Years Ended December 31, 2014 2013 2012 Current: Federal $ 206.8 $ 96.7 $ 110.3 State 19.3 10.1 8.0 Foreign 5.8 4.6 5.1 Total current 231.9 111.4 123.4 Deferred: Domestic (89.0 ) (48.6 ) (56.2 ) Foreign (0.1 ) (0.1 ) (0.1 ) Total deferred (89.1 ) (48.7 ) (56.3 ) Income tax expense $ 142.8 $ 62.7 $ 67.1 (dollars in millions) Years Ended December 31, 2014 2013 2012 Statutory federal income tax rate $ 135.7 35.0 % $ 68.4 35.0 % $ 65.1 35.0 % State taxes, net of federal effect 6.5 1.6 (5.0 ) (2.6 ) 0.4 0.2 Equity-based compensation 1.1 0.3 1.5 0.7 5.7 3.1 Effect of rates different than statutory (1.9 ) (0.5 ) (1.4 ) (0.7 ) (1.4 ) (0.8 ) Other 1.4 0.4 (0.8 ) (0.3 ) (2.7 ) (1.5 ) Effective tax rate $ 142.8 36.8 % $ 62.7 32.1 % $ 67.1 36.0 % (in millions) December 31, 2014 2013 Deferred Tax Assets: Deferred interest $ 32.9 $ 43.5 State net operating loss and credit carryforwards, net 18.8 21.1 Payroll and benefits 27.0 16.2 Rent 5.5 6.4 Accounts receivable 6.3 5.4 Equity compensation plans 6.5 1.6 Trade credits 1.5 1.5 Other 5.0 7.1 Total deferred tax assets 103.5 102.8 Deferred Tax Liabilities: Software and intangibles 425.3 486.2 Deferred income 116.2 145.5 Property and equipment 22.5 25.0 Other 15.3 11.6 Total deferred tax liabilities 579.3 668.3 Deferred tax asset valuation allowance — — Net deferred tax liability $ 475.8 $ 565.5 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The Company has state income tax net operating loss carryforwards of $124.0 million , which will expire at various dates from 2015 through 2033 and state tax credit carryforwards of $19.6 million , which expire at various dates from 2016 through 2019. The Company has not provided for U.S. federal income taxes or tax benefits on the undistributed earnings of its international subsidiary because such earnings are reinvested and it is currently intended that they will continue to be reinvested indefinitely. At December 31, 2014 , the Company has not provided for federal income taxes on earnings of approximately $66.6 million from its international subsidiary. The Company had no unrecognized tax benefits at December 31, 2014, 2013 and 2012 . In the ordinary course of business, the Company is subject to review by domestic and foreign taxing authorities, including the Internal Revenue Service (“IRS”). In general, the Company is no longer subject to audit by the IRS for tax years through 2010 and state, local or foreign taxing authorities for tax years through 2009. Various other taxing authorities are in the process of auditing income tax returns of the Company and its subsidiaries. The Company does not anticipate that any adjustments from the audits would have a material impact on its consolidated financial position, results of operations or cash flows. The Company accrues net interest and penalties related to unrecognized tax benefits in income tax expense in its consolidated statements of operations. For the years ended December 31, 2014, 2013 and 2012 , the Company had no liability recorded for the payment of interest and penalties on unrecognized tax benefits and did not recognize any such interest and penalty expense. The Company declared and paid cash dividends per common share during the periods presented as follows: See Note 20 for a discussion of the dividend declared during the first quarter of 2015. Future dividends will be subject to the approval of the Company's Board of Directors and will depend upon the Company’s results of operations, financial condition, business prospects, capital requirements, contractual restrictions, any potential indebtedness the Company may incur, restrictions imposed by applicable law, tax considerations and other factors that the Company’s Board of Directors deems relevant. In addition, the Company’s ability to pay dividends on its common stock will be limited by restrictions on the ability of subsidiaries to pay dividends or make distributions to the Company, in each case, under the terms of certain current and future agreements governing the Company’s indebtedness. On November 6, 2014, the Company announced that its Board of Directors approved a $500.0 million share repurchase program effective immediately under which the Company may repurchase shares of its common stock in the open market or through privately negotiated transactions, depending on share price, market conditions and other factors. The share repurchase program does not obligate the Company to repurchase any dollar amount or number of shares, and repurchases may be commenced or suspended from time to time without prior notice. As of the date of this filing, no shares have been repurchased under the share repurchase program. On January 1, 2014, the first offering period under the Company's Coworker Stock Purchase Plan (the “CSPP”) commenced. The CSPP provides the opportunity for eligible coworkers to acquire shares of the Company's common 82 9. Shareholders' Equity (in millions, except per share amounts) Dividends Per Share Amount 2014: First Quarter $ 0.0425 $ 7.3 Second Quarter 0.0425 7.3 Third Quarter 0.0425 7.3 Fourth Quarter 0.0675 11.7 2013: First Quarter $ — $ — Second Quarter — — Third Quarter — — Fourth Quarter 0.0425 7.3 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS stock at a 5% discount from the closing market price on the final day of the offering period. There is no compensation expense associated with the CSPP. On July 2, 2013, the Company completed an IPO of 23,250,000 shares of common stock. On July 31, 2013, the Company completed the sale of an additional 3,487,500 shares of common stock to the underwriters of the IPO pursuant to the underwriters' July 26, 2013 exercise in full of the overallotment option granted to them in connection with the IPO. Such shares were registered under the Securities Act of 1933, as amended, pursuant to the Company's Registration Statement on Form S-1, which was declared effective by the SEC on June 26, 2013. The shares of common stock are listed on the NASDAQ Global Select Market under the symbol “CDW.” The Company's shares of common stock were sold to the underwriters at a price of $17.00 per share in the IPO and upon the exercise of the overallotment option, which together generated aggregate net proceeds of $424.7 million to the Company after deducting underwriting discounts, expenses and transaction costs. The Company has completed the following secondary public offerings, whereby certain selling stockholders sold shares of common stock to the underwriters. The Company did not receive any proceeds from these sales of shares. (1) Under each underwriting agreement, the selling stockholders granted the underwriters an option, exercisable for thirty days, to purchase up to the additional amount of shares noted. (2) The option to purchase additional shares was not exercised in connection with the September 2014 secondary offering. The following pre-tax IPO-related expenses and secondary-offering-related expenses were included within selling and administrative expenses in the consolidated statements of operations for the years ended December 31, 2014 and 2013, respectively. (1) See Note 10 for additional discussion of the impact of the IPO on the Company's equity awards. (2) See Note 12 for additional discussion of this transaction. (3) Represents the payment of a termination fee to affiliates of the Sponsors in connection with the termination of the management services agreement with such entities. (4) Other expenses include secondary-offering expenses of $1.4 million and $0.6 million for the years ended December 31, 2014 and 2013, respectively. 83 Secondary Offering Shares Completion Date of Secondary Offering Overallotment Shares (1) Completion Date of Overallotment Shares Secondary Offering Expenses (in millions) 15,000,000 11/19/2013 2,250,000 12/18/2013 $ 0.6 10,000,000 3/12/2014 1,500,000 3/12/2014 $ 0.4 15,000,000 5/28/2014 2,250,000 6/4/2014 $ 0.5 15,000,000 9/8/2014 (2) — — $ 0.3 15,000,000 12/8/2014 2,250,000 12/8/2014 $ 0.2 (in millions) Year Ended December 31, 2014 2013 Acceleration charge for certain equity awards and related employer payroll taxes (1) $ — $ 40.7 RDU Plan cash retention pool accrual (2) — 7.5 Management services agreement termination fee (3) — 24.4 Other expenses (4) 1.4 2.4 IPO- and secondary-offering-related expenses $ 1.4 $ 75.0 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS In June 2013, the Company’s Board of Directors and the Company's sole shareholder at that time, CDW Holdings, approved the reclassification of the Company’s Class A common shares and Class B common shares into a single class of common shares and a 143.0299613 -for-1 stock split, effective immediately. The par value of the common shares was maintained at $0.01 per share. All references to common shares and per share amounts in the accompanying consolidated financial statements have been adjusted to reflect the reclassification and stock split on a retroactive basis. In June 2013, the Company amended and restated its certificate of incorporation to authorize the issuance of 100,000,000 shares of preferred stock with a par value of $0.01 . No shares of preferred stock have been issued or are outstanding as of December 31, 2014. Additionally, the amended and restated certificate of incorporation increased the number of authorized common shares to 1,000,000,000 . The 2013 Long-Term Incentive Plan (“2013 LTIP”) provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, bonus stock and performance awards. The maximum aggregate number of shares that may be issued under the 2013 LTIP is 11,700,000 shares of the Company's common stock, in addition to the 3,798,508 shares of restricted stock granted in exchange for unvested Class B Common Units in connection with the Company's IPO, as discussed below. As of December 31, 2014, 7,541,891 shares were available for issuance under the 2013 LTIP which was approved by the Company's pre-IPO shareholders. Authorized but unissued shares are reserved for issuance in connection with equity-based awards. The following table summarizes equity-based compensation expense, which is included in selling and administrative expenses, for the years ended December 31, 2014, 2013 and 2012 : The total unrecognized compensation cost related to nonvested awards was $28.9 million at December 31, 2014 and is expected to be recognized over a weighted-average period of 2.3 years. Stock Options During the year ended December 31, 2014 , the Company granted 1,245,513 stock options under the 2013 LTIP. These options vest annually over three years and have a contractual term of 10 years. The exercise price of a stock option is equal to the fair value of a share of the Company's common stock on the date of the grant. The Company uses the Black-Scholes option pricing model to estimate the fair value of stock options granted. The Black-Scholes option pricing model incorporates various assumptions including volatility, expected term, risk-free interest rates and dividend yields. The weighted-average assumptions used to value the stock options granted during the years ended December 31, 2014 and 2013 are presented below. 84 10. Equity-Based Compensation (in millions) Year Ended December 31, 2014 2013 (1) 2012 (2) Equity-based compensation expense $ 16.4 $ 46.6 $ 22.1 Income tax benefit (5.1 ) (16.5 ) (2.3 ) Total (net of tax) $ 11.3 $ 30.1 $ 19.8 (1) Includes pre-tax expense of $36.7 million related to the accelerated vesting of certain equity awards granted prior to our IPO. All unvested awards granted pursuant to the MPK Coworker Incentive Plan II (the “MPK Plan”) vested in connection with the IPO as discussed further below in the section labeled "MPK II Units." (2) Includes pre-tax expense of $6.6 million in connection with the modification of Class B Common Unit awards granted pursuant to the CDW Holdings LLC 2007 Incentive Equity Plan to the Company’s former Chief Executive Officer, as discussed further below in the section labeled "Class B Common Units." Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The following table summarizes the Company's stock option activity for the year ended December 31, 2014 : The total intrinsic value of stock options exercised during the years ended December 31, 2014 and 2013 was $1.0 million and zero , respectively. Restricted Stock Units ("RSUs") Restricted stock units represent the right to receive unrestricted shares of the Company's stock at the time of vesting. RSUs generally cliff-vest at the end of four years. The following table summarizes the Company's RSU activity for the year ended December 31, 2014 : 85 Year Ended December 31, 2014 2013 Weighted-average grant date fair value $ 7.23 $ 4.75 Weighted-average volatility (1) 30.00 % 35.00 % Weighted-average risk-free rate (2) 1.77 % 1.58 % Dividend yield 0.70 % 1.00 % Expected term (in years) (3) 6.0 5.4 (1) Based upon an assessment of the two-year, five-year and implied volatility for the Company’s selected peer group, adjusted for the Company’s leverage. (2) Based on a composite U.S. Treasury rate. (3) Calculated using the simplified method. The simplified method defines the expected term as the average of the option’s contractual term and the option’s weighted-average vesting period. The Company utilizes this method as it has limited historical stock option data that is sufficient to derive a reasonable estimate of the expected stock option term. Options Number of Options Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (years) Aggregate Intrinsic Value (millions) Outstanding at January 1, 2014 1,280,255 $17.00 Granted 1,245,513 24.40 Forfeited/Expired (31,209 ) 21.33 Exercised (73,487 ) 17.00 Outstanding at December 31, 2014 2,421,072 $20.75 8.3 $34.9 Exercisable at December 31, 2014 576,963 $17.00 7.2 $10.5 Vested and expected to vest at December 31, 2014 2,378,364 $20.74 8.3 $34.3 Number of Units Weighted-Average Grant-Date Fair Value Nonvested at January 1, 2014 1,351,572 $ 17.04 Granted 25,895 24.29 Vested/Settled (5,984 ) 17.00 Forfeited (126,781 ) 17.04 Nonvested at December 31, 2014 1,244,702 $ 17.19 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The weighted-average grant date fair value of RSUs granted during the year ended December 31, 2014 and 2013 was $24.29 and $17.03 , respectively. The aggregate fair value of RSUs that vested during the years ended December 31, 2014 and 2013 , was $0.2 million and zero , respectively. Performance Share Units ("PSUs") During the year ended December 31, 2014 , the Company granted 417,784 PSUs under the 2013 LTIP which cliff-vest on December 31, 2016. The percentage of shares that shall vest will range from 0% to 200% of the number of PSUs granted based on the Company's performance against a cumulative adjusted free cash flow measure and cumulative non-GAAP net income per diluted share measure over a three-year performance period. The weighted-average grant-date fair value of the PSUs granted during the period was $24.40 per unit. During the year ended December 31, 2014 , 6,204 PSUs were forfeited at a weighted-average grant-date fair value of $24.29 . As of December 31, 2014 , 411,580 PSUs were outstanding at a weighted-average grant date fair value of $24.40 . No units vested during the year ended December 31, 2014. Restricted Stock In connection with the IPO, CDW Holdings distributed all of its shares of the Company's common stock to its existing members in accordance with their respective membership interests. Common stock received by holders of Class B Common Units in connection with the distribution is subject to any vesting provisions previously applicable to the holder's Class B Common Units. Class B Common Unit holders received 3,798,508 shares of restricted stock with respect to Class B Common Units that had not yet vested at the time of the distribution. For the year ended December 31, 2014 , 2,321,973 shares of such restricted stock vested/settled and 9,546 shares were forfeited. As of December 31, 2014 , 260,514 shares of restricted stock were outstanding. The aggregate fair value of restricted stock that vested during the years ended December 31, 2014 and 2013 was $68.6 million and $26.7 million , respectively. Pre-IPO Equity Awards Prior to the IPO, the Company had the following equity-based compensation plans in place: Class B Common Units The Board of Managers of CDW Holdings adopted the CDW Holdings LLC 2007 Incentive Equity Plan (the “Plan”) for coworkers, managers, consultants and advisors of the Company and its subsidiaries. The Plan permitted a committee designated by the Board of Managers of CDW Holdings (the “Committee”) to grant or sell to any participant Class A Common Units or Class B Common Units of CDW Holdings in such quantity, at such price, on such terms and subject to such conditions that were consistent with the Plan and as established by the Committee. The Class B Common Units that were granted vested daily on a pro rata basis between the date of grant and the fifth anniversary thereof and were subject to repurchase by, with respect to vested units, or forfeiture to, with respect to unvested units, the Company upon the coworker's separation from service as was set forth in each holder’s Class B Common Unit Grant Agreement. On June 30, 2011, the Board of Managers approved the terms of a modified Class B Common Unit grant agreement with the Company's former Chief Executive Officer, who retired as the Company's Chief Executive Officer effective October 1, 2011 but continued to serve as Chairman of the Board through December 31, 2012. As a result of this modification, the Company recorded incremental equity- based compensation expense of $6.6 million during the year ended December 31, 2012. The grant date fair value of Class B Common Unit grants was calculated using the Option-Pricing Method. This method considered Class A Common Units and Class B Common Units as call options on the total equity value, giving consideration to liquidation preferences and conversion of the preferred units. Such Class A Common Units and Class B Common Units were modeled as call options that gave their owners the right, but not the obligation, to buy the underlying equity value at a predetermined (or exercise) price. Class B Common Units were considered to be call options with a claim on equity value at an exercise price equal to the remaining value immediately after the Class A Common Units and Class B Common Units with a lower participation threshold were liquidated. The Option-Pricing Method is highly sensitive to key assumptions, such as the volatility assumption. As such, the use of this method can be applied when the range of possible future outcomes is difficult to predict. 86 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The following table summarizes the assumptions and resulting fair value of the Class B Common Unit grants for the years ended December 31, 2013 and 2012: MPK II Units Contemporaneous with the Acquisition, the Company agreed with Michael P. Krasny, CDW Corporation founder, former chairman and CEO and significant selling shareholder, to establish the MPK Plan for the benefit of all of the coworkers of the Company other than members of senior management who received incentive equity awards under the Plan. The MPK Plan established an “account” for each eligible participant which was notionally credited with a number of Class A Common Units of CDW Holdings LLC on October 15, 2007, the day the plan was established. The notional units credited to participants' accounts were to cliff-vest at the end of ten years, subject to acceleration upon the occurrence of certain events. Notional units granted under the MPK Plan were valued on the grant date at $1,000 per unit, the fair value equivalent of the Class A Common Units at the time the awards were granted. On July 2, 2013, the Company completed an IPO of its common shares. Under the terms of the MPK Plan, vesting accelerated for all unvested units upon completion of the IPO. The Company recorded a pre-tax charge of $36.7 million for compensation expense related to the acceleration of the expense recognition for MPK Plan units in the year ended December 31, 2013. In connection with the completion of the IPO, the Company distributed common stock to each participant and withheld the number of shares of common stock equal to the required tax withholding for each participant. The Company paid required withholding taxes of $24.0 million to federal, state and foreign taxing authorities. This amount is reported as a financing activity in the consolidated statement of cash flows and as an increase to accumulated deficit in the consolidated statement of shareholders' equity for the year ended December 31, 2013. In addition, the Company paid $4.0 million of employer payroll taxes that are included as an operating activity in the consolidated statement of cash flows for the year ended December 31, 2013. The following table sets forth a summary of pre-IPO equity plan activity for the year ended December 31, 2013 : In connection with the establishment of the MPK Plan, the Company agreed to make charitable contributions in amounts equal to the net income tax benefits derived from payouts to participants under the MPK Plan (net of any 87 Years Ended December 31, Assumptions 2013 2012 Weighted-average grant date fair value $ 119.00 $ 125.65 Weighted-average volatility (1) 65.50 % 65.26 % Weighted-average risk-free rate (2) 0.18 % 0.19 % Dividend yield 0.00 % 0.00 % (1) Based upon an assessment of the two-year, five-year and implied volatility for the Company’s selected peer group, adjusted for the Company’s leverage. (2) Based on a composite U.S. Treasury rate. Class B Common Units MPK Plan Units Outstanding at January 1, 2013 216,483 66,137 Granted 400 — Forfeited (860 ) (2,228 ) Converted/Settled (1) (216,023 ) (63,909 ) Outstanding at December 31, 2013 — — Vested at December 31, 2013 — — (1) As discussed above, the Class B Common Units and MPK Plan Units were converted/settled into shares of the Company's common stock upon completion of the IPO. The converted Class B Common Units, to the extent unvested at the time of the IPO, relate to the grants of restricted stock disclosed above. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS related employer payroll tax costs). The contributions of these amounts are due by March 15 of the calendar year following the year in which the Company realizes the benefits of the deductions. This arrangement has been accounted for as contingent consideration. Pre- 2009 business combinations were accounted for under a former accounting standard which, among other aspects, precluded the recognition of certain contingent consideration as of the business combination date. Instead, under the former accounting standard, contingent consideration is accounted for as additional purchase price (goodwill) at the time the contingency is resolved. As of December 31, 2013, the Company accrued $20.9 million related to this arrangement within other current liabilities, as the Company realized the tax benefit of the compensation deductions during the 2013 tax year. The Company made the related cash contribution during the first quarter of 2014. The numerator for both basic and diluted earnings per share is net income. The denominator for basic earnings per share is the weighted-average number of common shares outstanding during the period. The 2013 denominator was impacted by the common shares issued during both the IPO and the underwriters' exercise in full of the overallotment option granted to them in connection with the IPO. Because such common shares were issued on July 2, 2013 and July 31, 2013, respectively, they are only partially reflected in the 2013 denominator. Such shares are fully reflected in the 2014 denominator. See Note 9 for additional discussion of the IPO. The dilutive effect of outstanding restricted stock, restricted stock units, stock options, Coworker Stock Purchase Plan units and MPK Plan units is reflected in the denominator for diluted earnings per share using the treasury stock method. The following is a reconciliation of basic shares to diluted shares: There was an insignificant amount of potential common shares excluded from diluted earnings per share for the years ended December 31, 2014, 2013 and 2012, as their inclusion would have had an anti-dilutive effect. On March 10, 2010, in connection with the Company’s purchase of $28.5 million principal amount of its outstanding senior subordinated debt, the Company established the Restricted Debt Unit Plan (the “RDU Plan”), an unfunded nonqualified deferred compensation plan. The total number of RDUs that could be granted under the RDU Plan was 28,500 . As of December 31, 2014 , 28,500 RDUs were outstanding. RDUs vested daily on a pro rata basis over the three -year period from January 1, 2012 (or, if later, the date of hire or the date of a subsequent RDU grant) through December 31, 2014. All outstanding RDUs were vested as of December 31, 2014. Participants have no rights to the underlying debt. The total amount of compensation available to be paid under the RDU Plan was initially to be based on two components, a principal component and an interest component. The principal component credits the RDU Plan with a notional amount equal to the $28.5 million face value of the Senior Subordinated Notes (the "Debt Pool"), together with certain redemption premium equivalents as noted below. The interest component credited the RDU Plan with amounts equal to the interest that would have been earned on the Debt Pool from March 10, 2010 through maturity on October 12, 2017, except as discussed below. Interest amounts for 2010 and 2011 were deferred until 2012, and thereafter, interest amounts were paid to participants semi-annually on the interest payment due dates. The Company used a portion of the IPO proceeds together with incremental borrowings to redeem $324.0 million of the total Senior Subordinated Notes outstanding on August 1, 2013. In connection with the IPO and the partial redemption of the Senior Subordinated Notes, the Company amended the RDU Plan to increase the retentive value of the plan. In accordance with the original terms of the RDU Plan, the principal component of the RDUs converted to a cash-denominated pool upon the redemption of the Senior Subordinated Notes. In addition, the Company added $0.1 88 11. Earnings Per Share Years Ended December 31, (in millions) 2014 2013 2012 Weighted-average shares - basic 170.6 156.6 145.1 Effect of dilutive securities 2.2 2.1 0.7 Weighted-average shares - diluted 172.8 158.7 145.8 12. Deferred Compensation Plan Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS million and $1.4 million to the principal component in the years ended December 31, 2014 and 2013, respectively, as redemption premium equivalents in accordance with the terms of the RDU plan. Under the terms of the amended RDU Plan, upon the partial redemption of outstanding Senior Subordinated Notes, the RDUs ceased to accrue the proportionate related interest component credits. The amended RDU Plan provides participants the opportunity to share on a pro rata basis in cash retention pools payable to participants who satisfy certain retention requirements. The aggregate amount of the retention pools was determined to be $15.0 million based upon the amount of interest component credits that would have been allocated to the RDU Plan if the Senior Subordinated Notes had remained outstanding from August 1, 2013 through maturity. The Company recorded a pre-tax charge of $7.5 million in the year ended December 31, 2013 for payment of the first cash retention pool. The second cash retention pool payment is expected to be made to participants who remain employed through December 31, 2015 in the first quarter of 2016. Participants continued to accrue an interest component credit for the proportionate amount of Senior Subordinated Notes while outstanding, payable on the aforementioned semi-annual due dates; such payments, however, will be deducted from the second retention pool payment amount of $7.5 million . Unrecognized compensation expense as of December 31, 2014 of approximately $5 million is expected to be recognized through 2015 and approximately $3 million in 2016 through 2017. Payments under the RDU Plan may be impacted if certain significant events occur or circumstances change that would impact the financial condition or structure of the Company. Compensation expense of $8.8 million , $16.8 million , and $8.4 million related to the RDU Plan was recognized in the years ended December 31, 2014, 2013 and 2012 , respectively. At December 31, 2014 and 2013 , the Company had $30.4 million and $21.8 million of liabilities related to the RDU Plan recorded on the consolidated balance sheets, respectively. Payment of the principal component of the RDU Plan is expected to be made on October 12, 2017, unless accelerated due to a sale of the Company. The Company has a profit sharing plan that includes a salary reduction feature established under the Internal Revenue Code Section 401 (k) covering substantially all coworkers. Company contributions to the profit sharing plan are made in cash and determined at the discretion of the Board of Directors. For the years ended December 31, 2014, 2013 and 2012 , the amounts charged to expense for this plan totaled $21.9 million , $17.3 million and $14.6 million , respectively. The Company is party to various legal proceedings that arise in the ordinary course of its business, which include commercial, intellectual property, employment, tort and other litigation matters. The Company is also subject to audit by federal, state and local authorities, and by various partners, group purchasing organizations and customers, including government agencies, relating to purchases and sales under various contracts. In addition, the Company is subject to indemnification claims under various contracts. From time to time, certain customers of the Company file voluntary petitions for reorganization or liquidation under the U.S. bankruptcy laws. In such cases, certain pre-petition payments received by the Company could be considered preference items and subject to return to the bankruptcy administrator. As of December 31, 2014, the Company does not believe that there is a reasonable possibility that any material loss exceeding the amounts already recognized for these proceedings and matters, if any, has been incurred. However, the ultimate resolutions of these proceedings and matters are inherently unpredictable. As such, the Company’s financial condition and results of operations could be adversely affected in any particular period by the unfavorable resolution of one or more of these proceedings or matters. On November 10, 2014 , the Company acquired a 35% non-controlling interest in Kelway, a UK-based IT solutions provider, which has global supply chain relationships that enable it to conduct business in over 100 countries. The Company paid $86.8 million to acquire its ownership interest in Kelway, with the option to purchase the remaining 65% between June 2015 and June 2017. The Company accounts for its investment in Kelway using the equity method. As of December 31, 2014 , the amount assigned to goodwill and definite-lived intangible assets related to the 89 13. Profit Sharing and 401(k) Plan 14. Commitments and Contingencies 15. Equity Investments Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Company's 35% non-controlling equity investment in Kelway was $119.2 million , which represented the excess of the purchase price plus liabilities assumed less tangible assets acquired. The Company had previously entered into a management services agreement with the Sponsors pursuant to which they had agreed to provide it with management and consulting services and financial and other advisory services. Pursuant to such agreement, the Sponsors received an annual management fee of $5.0 million and reimbursement of out-of-pocket expenses incurred in connection with the provision of such services. Such amounts were classified as selling and administrative expenses within the consolidated statements of operations. The management services agreement included customary indemnification and provisions in favor of the Sponsors. On July 2, 2013, the Company completed an IPO of its common stock. Using a portion of the net proceeds from the IPO, the Company paid a $24.4 million termination fee to affiliates of the Sponsors in connection with the termination of the management services agreement with such entities that was effective upon completion of the IPO. The Company paid an annual management fee of $2.5 million and $5.0 million in the years ended December 31, 2013 and 2012, respectively. There was no management fee paid for the year ended December 31, 2014. On March 20, 2014, the Company repurchased and subsequently canceled $25.0 million aggregate principal amount of the 2019 Senior Notes from an affiliate of Providence Equity. See Note 7 for additional information related to this transaction. Segment information is presented in accordance with a “management approach,” which designates the internal reporting used by the chief operating decision-maker for making decisions and assessing performance as the source of the Company's reportable segments. The Company's segments are organized in a manner consistent with which separate financial information is available and evaluated regularly by the chief operating decision-maker in deciding how to allocate resources and in assessing performance. The Company has two reportable segments: Corporate, which is comprised primarily of business customers, and Public, which is comprised of government entities and education and healthcare institutions. The Company also has three other operating segments, CDW Advanced Services, Canada and Kelway, which do not meet the reportable segment quantitative thresholds and, accordingly, are combined together as “Other.” In November 2014, the Company acquired a 35% non-controlling equity interest in Kelway. See Note 15 for additional information on Kelway. The Company has centralized logistics and headquarters functions that provide services to the segments. The logistics function includes purchasing, distribution and fulfillment services to support both the Corporate and Public segments. As a result, costs and intercompany charges associated with the logistics function are fully allocated to both of these segments based on a percent of sales. The centralized headquarters function provides services in areas such as accounting, information technology, marketing, legal and coworker services. Headquarters' function costs that are not allocated to the segments are included under the heading of “Headquarters” in the tables below. Depreciation expense is included in Headquarters as it is not allocated among segments or used in measuring segment performance. IPO- and secondary-offering related expenses primarily relating to coworker compensation were included within operating segment results for the year ended December 31, 2013. See Note 9 for additional discussion of IPO- and secondary-offering related expenses. The Company allocates resources to and evaluates performance of its segments based on net sales, income (loss) from operations and Adjusted EBITDA, a non-GAAP measure as defined in the Company's credit agreements. However, the Company has concluded that income (loss) from operations is the more useful measure in terms of discussion of operating results, as it is a GAAP measure. Segment information for total assets and capital expenditures is not presented, as such information is not used in measuring segment performance or allocating resources between segments. 90 16. Related Party Transactions 17. Segment Information Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Selected Segment Financial Information The following table presents information about the Company’s segments for the years ended December 31, 2014, 2013 and 2012 : (1) Includes $75.0 million of IPO- and secondary-offering related expenses, as follows: Corporate $26.4 million ; Public $14.4 million ; Other $3.6 million ; and Headquarters $30.6 million . Major Customers, Geographic Areas, and Product Mix Net sales to the federal government were $884.2 million , $764.4 million and $964.7 million and accounted for approximately 7% , 7% and 10% of total net sales in 2014, 2013 and 2012, respectively. Net sales to customers outside of the U.S., primarily in Canada, were approximately 4% of the Company's total net sales in 2014, 2013 and 2012. Approximately 1% of the Company’s long-lived assets were located outside of the U.S. as of December 31, 2014 and 2013. The following table presents net sales by major category for the years ended December 31, 2014, 2013 and 2012 . Categories are based upon internal classifications. Amounts for the years ended December 31, 2013 and 2012 have been reclassified for certain changes in individual product classifications to conform to the presentation for the year ended December 31, 2014 . 91 (in millions) Corporate Public Other Headquarters Total 2014: Net sales $ 6,475.5 $ 4,879.4 $ 719.6 $ — $ 12,074.5 Income (loss) from operations 439.8 313.2 32.9 (112.9 ) 673.0 Depreciation and amortization expense (96.3 ) (43.8 ) (8.8 ) (59.0 ) (207.9 ) 2013: Net sales $ 5,960.1 $ 4,164.5 $ 644.0 $ — $ 10,768.6 Income (loss) from operations (1) 363.3 246.5 27.2 (128.4 ) 508.6 Depreciation and amortization expense (97.3 ) (44.0 ) (8.6 ) (58.3 ) (208.2 ) 2012: Net sales $ 5,512.8 $ 4,023.0 $ 592.4 $ — $ 10,128.2 Income (loss) from operations 349.0 246.7 18.6 (103.7 ) 510.6 Depreciation and amortization expense (97.6 ) (44.0 ) (9.3 ) (59.3 ) (210.2 ) Year Ended December 31, 2014 Year Ended December 31, 2013 Year Ended December 31, 2012 Dollars in Millions Percentage of Total Net Sales Dollars in Millions Percentage of Total Net Sales Dollars in Millions Percentage of Total Net Sales Notebooks/Mobile Devices $ 2,352.3 19.5 % $ 1,698.4 15.8 % $ 1,462.8 14.4 % NetComm Products 1,615.9 13.4 1,486.3 13.8 1,351.5 13.3 Enterprise and Data Storage (Including Drives) 1,024.3 8.5 999.2 9.3 981.5 9.7 Other Hardware 4,549.2 37.6 4,178.5 38.8 4,075.7 40.3 Software 2,076.7 17.2 1,993.1 18.5 1,877.7 18.5 Services 371.4 3.1 332.7 3.1 285.0 2.8 Other (1) 84.7 0.7 80.4 0.7 94.0 1.0 Total net sales $ 12,074.5 100.0 % $ 10,768.6 100.0 % $ 10,128.2 100.0 % (1) Includes items such as delivery charges to customers and certain commission revenue. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS The 2019 Senior Notes, the 2022 Senior Notes, and the 2024 Senior Notes are, and, prior to being redeemed in full, the Senior Subordinated Notes and the Senior Secured Notes, were guaranteed by Parent and each of CDW LLC’s direct and indirect, 100% owned, domestic subsidiaries (the “Guarantor Subsidiaries”). All guarantees by Parent and Guarantor Subsidiaries are and were joint and several, and full and unconditional; provided that guarantees by the Guarantor Subsidiaries (i) are subject to certain customary release provisions contained in the indentures governing the 2019 Senior Notes, the 2022 Senior Notes, and the 2024 Senior Notes, and (ii) were subject to certain customary release provisions contained in the indentures governing the Senior Subordinated Notes and the Senior Secured Notes until such indentures were satisfied and discharged in 2014. CDW LLC's Canada subsidiary (the “Non-Guarantor Subsidiary”) does not guarantee the debt obligations. CDW LLC and CDW Finance Corporation, as co-issuers, are 100% owned by Parent, and each of the Guarantor Subsidiaries and the Non-Guarantor Subsidiary is 100% owned by CDW LLC. On May 9, 2014, all of the remaining $42.5 million aggregate principal amount of Senior Subordinated Notes was redeemed in full and the indenture governing the Senior Subordinated Notes was satisfied and discharged. See Note 7 for more information. On August 5, 2014, CDW LLC and CDW Finance Corporation, as co-issuers, completed the issuance of $600.0 million aggregate principal amount of 2022 Senior Notes, which is guaranteed by Parent and the Guarantor Subsidiaries. The proceeds from this issuance, along with cash on hand, were used to redeem all of the remaining $325.0 million aggregate principal amount of the Senior Secured Notes and to redeem $234.7 million aggregate principal amount of the 2019 Senior Notes. The indenture governing the Senior Secured Notes was concurrently satisfied and discharged. See Note 7 for more information. On December 1, 2014, CDW LLC and CDW Finance Corporation, as co-issuers, completed the issuance of $575.0 million aggregate principal amount of 2024 Senior Notes, which is guaranteed by Parent and the Guarantor Subsidiaries. The proceeds from this issuance, along with cash on hand, were used to redeem $541.4 million aggregate principal amount of the 8.5% Senior Notes. See Note 7 for more information. The following tables set forth condensed consolidating balance sheets as of December 31, 2014 and 2013 , consolidating statements of operations for the years ended December 31, 2014, 2013 and 2012 , condensed consolidating statements of comprehensive income for the years ended December 31, 2014, 2013 and 2012 , and condensed consolidating statements of cash flows for the years ended December 31, 2014, 2013 and 2012 , in accordance with Rule 3-10 of Regulation S-X. The consolidating financial information includes the accounts of CDW Corporation (the “Parent Guarantor”), which has no independent assets or operations, the accounts of CDW LLC (the “Subsidiary Issuer”), the combined accounts of the Guarantor Subsidiaries, the accounts of the Non-Guarantor Subsidiary, and the accounts of CDW Finance Corporation (the “Co-Issuer”) for the periods indicated. The information was prepared on the same basis as the Company’s consolidated financial statements. 92 18. Supplemental Guarantor Information Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 93 Condensed Consolidating Balance Sheet December 31, 2014 (in millions) Parent Guarantor Subsidiary Issuer Guarantor Subsidiaries Non-Guarantor Subsidiary Co-Issuer Consolidating Adjustments Consolidated Assets Current assets: Cash and cash equivalents $ — $ 346.4 $ — $ 24.6 $ — $ (26.5 ) $ 344.5 Accounts receivable, net — — 1,479.1 82.0 — — 1,561.1 Merchandise inventory — — 333.9 3.6 — — 337.5 Miscellaneous receivables — 56.1 93.3 6.2 — — 155.6 Prepaid expenses and other — 11.0 46.0 1.5 — (3.8 ) 54.7 Total current assets — 413.5 1,952.3 117.9 — (30.3 ) 2,453.4 Property and equipment, net — 80.5 55.5 1.2 — — 137.2 Equity investments — 86.7 — — — — 86.7 Goodwill — 751.8 1,439.0 26.8 — — 2,217.6 Other intangible assets, net — 320.0 843.6 5.2 — — 1,168.8 Deferred financing costs, net — 33.0 — — — — 33.0 Other assets 4.3 3.2 0.4 1.4 — (6.1 ) 3.2 Investment in and advances to subsidiaries 932.2 2,784.5 — — — (3,716.7 ) — Total assets $ 936.5 $ 4,473.2 $ 4,290.8 $ 152.5 $ — $ (3,753.1 ) $ 6,099.9 Liabilities and Shareholders’ Equity Current liabilities: Accounts payable-trade $ — $ 23.9 $ 671.9 $ 34.7 $ — $ (26.5 ) $ 704.0 Accounts payable-inventory financing — — 332.1 — — — 332.1 Current maturities of long-term debt — 15.4 — — — — 15.4 Deferred revenue — — 79.9 1.4 — — 81.3 Accrued expenses — 137.8 193.6 7.9 — (4.1 ) 335.2 Total current liabilities — 177.1 1,277.5 44.0 — (30.6 ) 1,468.0 Long-term liabilities: Debt — 3,174.6 — — — — 3,174.6 Deferred income taxes — 146.7 331.3 1.3 — (4.3 ) 475.0 Other liabilities — 42.6 3.7 1.0 — (1.5 ) 45.8 Total long-term liabilities — 3,363.9 335.0 2.3 — (5.8 ) 3,695.4 Total shareholders’ equity 936.5 932.2 2,678.3 106.2 — (3,716.7 ) 936.5 Total liabilities and shareholders' equity $ 936.5 $ 4,473.2 $ 4,290.8 $ 152.5 $ — $ (3,753.1 ) $ 6,099.9 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 94 Condensed Consolidating Balance Sheet December 31, 2013 (in millions) Parent Guarantor Subsidiary Issuer Guarantor Subsidiaries Non-Guarantor Subsidiary Co-Issuer Consolidating Adjustments Consolidated Assets Current assets: Cash and cash equivalents $ — $ 196.5 $ — $ 14.0 $ — $ (22.4 ) $ 188.1 Accounts receivable, net — — 1,375.9 75.1 — — 1,451.0 Merchandise inventory — — 378.9 3.1 — — 382.0 Miscellaneous receivables — 49.9 91.0 5.4 — — 146.3 Prepaid expenses and other — 10.7 33.4 5.1 — (3.1 ) 46.1 Total current assets — 257.1 1,879.2 102.7 — (25.5 ) 2,213.5 Property and equipment, net — 69.7 59.6 1.8 — — 131.1 Goodwill — 751.9 1,439.0 29.4 — — 2,220.3 Other intangible assets, net — 338.5 982.8 6.7 — — 1,328.0 Deferred financing costs, net — 30.1 — — — — 30.1 Other assets 4.9 1.4 0.1 0.9 — (5.7 ) 1.6 Investment in and advances to subsidiaries 706.8 2,909.4 — — — (3,616.2 ) — Total assets $ 711.7 $ 4,358.1 $ 4,360.7 $ 141.5 $ — $ (3,647.4 ) $ 5,924.6 Liabilities and Shareholders' Equity Current liabilities: Accounts payable-trade $ — $ 21.4 $ 637.3 $ 26.5 $ — $ (22.4 ) $ 662.8 Accounts payable-inventory financing — — 256.6 — — — 256.6 Current maturities of long-term debt — 45.4 — — — — 45.4 Deferred revenue — — 89.9 4.9 — — 94.8 Accrued expenses — 163.5 175.1 7.5 — (3.1 ) 343.0 Total current liabilities — 230.3 1,158.9 38.9 — (25.5 ) 1,402.6 Long-term liabilities: Debt — 3,205.8 — — — — 3,205.8 Deferred income taxes — 178.3 388.4 1.6 — (4.8 ) 563.5 Other liabilities — 36.9 3.6 1.4 — (0.9 ) 41.0 Total long-term liabilities — 3,421.0 392.0 3.0 — (5.7 ) 3,810.3 Total shareholders’ equity 711.7 706.8 2,809.8 99.6 — (3,616.2 ) 711.7 Total liabilities and shareholders’ equity $ 711.7 $ 4,358.1 $ 4,360.7 $ 141.5 $ — $ (3,647.4 ) $ 5,924.6 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 95 Consolidating Statement of Operations Year Ended December 31, 2014 (in millions) Parent Guarantor Subsidiary Issuer Guarantor Subsidiaries Non-Guarantor Subsidiary Co-Issuer Consolidating Adjustments Consolidated Net sales $ — $ — $ 11,542.3 $ 532.2 $ — $ — $ 12,074.5 Cost of sales — — 9,684.9 468.3 — — 10,153.2 Gross profit — — 1,857.4 63.9 — — 1,921.3 Selling and administrative expenses — 112.8 962.3 35.2 — — 1,110.3 Advertising expense — — 134.0 4.0 — — 138.0 (Loss) income from operations — (112.8 ) 761.1 24.7 — — 673.0 Interest (expense) income, net — (197.7 ) 0.1 0.3 — — (197.3 ) Net loss on extinguishments of long- term debt — (90.7 ) — — — — (90.7 ) Management fee — 3.9 — (3.9 ) — — — Other income, net — 1.2 1.5 — — — 2.7 (Loss) income before income taxes — (396.1 ) 762.7 21.1 — — 387.7 Income tax benefit (expense) — 141.0 (278.1 ) (5.7 ) — — (142.8 ) (Loss) income before equity in earnings of subsidiaries — (255.1 ) 484.6 15.4 — — 244.9 Equity in earnings of subsidiaries 244.9 500.0 — — — (744.9 ) — Net income $ 244.9 $ 244.9 $ 484.6 $ 15.4 $ — $ (744.9 ) $ 244.9 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 96 Consolidating Statement of Operations Year Ended December 31, 2013 (in millions) Parent Guarantor Subsidiary Issuer Guarantor Subsidiaries Non-Guarantor Subsidiary Co-Issuer Consolidating Adjustments Consolidated Net sales $ — $ — $ 10,293.3 $ 475.3 $ — $ — $ 10,768.6 Cost of sales — — 8,592.1 416.2 — — 9,008.3 Gross profit — — 1,701.2 59.1 — — 1,760.3 Selling and administrative expenses 24.4 103.9 957.3 35.3 — — 1,120.9 Advertising expense — — 126.8 4.0 — — 130.8 (Loss) income from operations (24.4 ) (103.9 ) 617.1 19.8 — — 508.6 Interest (expense) income, net — (250.6 ) 0.2 0.3 — — (250.1 ) Net loss on extinguishments of long- term debt — (64.0 ) — — — — (64.0 ) Management fee — 4.3 — (4.3 ) — — — Other (expense) income, net — (0.5 ) 1.2 0.3 — — 1.0 (Loss) income before income taxes (24.4 ) (414.7 ) 618.5 16.1 — — 195.5 Income tax benefit (expense) 9.2 142.2 (209.5 ) (4.6 ) — — (62.7 ) (Loss) income before equity in earnings of subsidiaries (15.2 ) (272.5 ) 409.0 11.5 — — 132.8 Equity in earnings of subsidiaries 148.0 420.5 — — — (568.5 ) — Net income $ 132.8 $ 148.0 $ 409.0 $ 11.5 $ — $ (568.5 ) $ 132.8 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Consolidating Statement of Operations Year Ended December 31, 2012 (in millions) Parent Guarantor Subsidiary Issuer Guarantor Subsidiaries Non-Guarantor Subsidiary Co-Issuer Consolidating Adjustments Consolidated Net sales $ — $ — $ 9,683.0 $ 445.2 $ — $ — $ 10,128.2 Cost of sales — — 8,071.5 387.1 — — 8,458.6 Gross profit — — 1,611.5 58.1 — — 1,669.6 Selling and administrative expenses — 103.7 891.6 34.2 — — 1,029.5 Advertising expense — — 125.1 4.4 — — 129.5 (Loss) income from operations — (103.7 ) 594.8 19.5 — — 510.6 Interest (expense) income, net — (308.0 ) 0.4 0.2 — — (307.4 ) Net loss on extinguishments of long- term debt — (17.2 ) — — — — (17.2 ) Management fee — 3.8 — (3.8 ) — — — Other income (expense), net — — 0.2 (0.1 ) — — 0.1 (Loss) income before income taxes — (425.1 ) 595.4 15.8 — — 186.1 Income tax benefit (expense) — 210.6 (272.6 ) (5.1 ) — — (67.1 ) (Loss) income before equity in earnings of subsidiaries — (214.5 ) 322.8 10.7 — — 119.0 Equity in earnings of subsidiaries 119.0 333.5 — — — (452.5 ) — Net income $ 119.0 $ 119.0 $ 322.8 $ 10.7 $ — $ (452.5 ) $ 119.0 97 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Condensed Consolidating Statement of Comprehensive Income Year Ended December 31, 2014 (in millions) Parent Guarantor Subsidiary Issuer Guarantor Subsidiaries Non-Guarantor Subsidiary Co-Issuer Consolidating Adjustments Consolidated Comprehensive income $ 234.6 $ 234.6 $ 484.6 $ 5.1 $ — $ (724.3 ) $ 234.6 98 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Condensed Consolidating Statement of Comprehensive Income Year Ended December 31, 2013 (in millions) Parent Guarantor Subsidiary Issuer Guarantor Subsidiaries Non-Guarantor Subsidiary Co-Issuer Consolidating Adjustments Consolidated Comprehensive income $ 126.1 $ 141.3 $ 409.0 $ 4.8 $ — $ (555.1 ) $ 126.1 99 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Condensed Consolidating Statement of Comprehensive Income Year Ended December 31, 2012 (in millions) Parent Guarantor Subsidiary Issuer Guarantor Subsidiaries Non-Guarantor Subsidiary Co-Issuer Consolidating Adjustments Consolidated Comprehensive income $ 121.5 $ 121.5 $ 322.8 $ 13.2 $ — $ (457.5 ) $ 121.5 100 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 101 Condensed Consolidating Statement of Cash Flows Year Ended December 31, 2014 (in millions) Parent Guarantor Subsidiary Issuer Guarantor Subsidiaries Non-Guarantor Subsidiary Co-Issuer Consolidating Adjustments Consolidated Net cash (used in) provided by operating activities $ — $ (120.4 ) $ 547.7 $ 11.8 $ — $ (4.1 ) $ 435.0 Cash flows from investing activities: Capital expenditures — (47.9 ) (7.1 ) — — — (55.0 ) Payment for equity investments — (86.8 ) — — — — (86.8 ) Payment of accrued charitable contribution related to the MPK Coworker Incentive Plan II — (20.9 ) — — — — (20.9 ) Premium payments on interest rate cap agreements — (2.1 ) — — — — (2.1 ) Net cash used in investing activities — (157.7 ) (7.1 ) — — — (164.8 ) Cash flows from financing activities: Repayments of long-term debt — (15.4 ) — — — — (15.4 ) Proceeds from issuance of long- term debt — 1,175.0 — — — — 1,175.0 Payments to extinguish long- term debt — (1,299.0 ) — — — — (1,299.0 ) Payment of debt financing costs — (21.9 ) — — — — (21.9 ) Net change in accounts payable- inventory financing — — 75.5 — — — 75.5 Proceeds from stock option exercises — 1.3 — — — — 1.3 Proceeds from Coworker stock purchase plan — 5.8 — — — — 5.8 Dividends paid (33.6 ) — — — — — (33.6 ) Excess tax benefits from equity- based compensation — 0.3 — — — — 0.3 Advances to/from affiliates 33.6 581.9 (616.1 ) 0.6 — — — Net cash provided by (used in) financing activities — 428.0 (540.6 ) 0.6 — — (112.0 ) Effect of exchange rate changes on cash and cash equivalents — — — (1.8 ) — — (1.8 ) Net increase in cash and cash equivalents — 149.9 — 10.6 — (4.1 ) 156.4 Cash and cash equivalents – beginning of period — 196.5 — 14.0 — (22.4 ) 188.1 Cash and cash equivalents – end of period $ — $ 346.4 $ — $ 24.6 $ — $ (26.5 ) $ 344.5 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 102 Condensed Consolidating Statement of Cash Flows Year Ended December 31, 2013 (in millions) Parent Guarantor Subsidiary Issuer Guarantor Subsidiaries Non-Guarantor Subsidiary Co-Issuer Consolidating Adjustments Consolidated Net cash (used in) provided by operating activities $ (15.2 ) $ (130.3 ) $ 508.8 $ 5.5 $ — $ (2.5 ) $ 366.3 Cash flows from investing activities: Capital expenditures — (40.8 ) (6.2 ) (0.1 ) — — (47.1 ) Net cash used in investing activities — (40.8 ) (6.2 ) (0.1 ) — — (47.1 ) Cash flows from financing activities: Proceeds from borrowings under revolving credit facility — 63.0 — — — — 63.0 Repayments of borrowings under revolving credit facility — (63.0 ) — — — — (63.0 ) Repayments of long-term debt — (51.1 ) — — — — (51.1 ) Proceeds from issuance of long- term debt — 1,535.2 — — — — 1,535.2 Payments to extinguish long- term debt — (2,047.4 ) — — — — (2,047.4 ) Payment of debt financing costs — (6.1 ) — — — — (6.1 ) Net change in accounts payable- inventory financing — — 7.4 — — — 7.4 Payment of incentive compensation plan withholding taxes — (4.0 ) (19.6 ) (0.5 ) — — (24.1 ) Net proceeds from issuance of common shares 424.7 — — — — — 424.7 Dividends paid (7.3 ) — — — — — (7.3 ) Advances to/from affiliates (402.2 ) 892.6 (490.4 ) — — — — Other financing activities — 0.4 — — — — 0.4 Net cash provided by (used in) financing activities 15.2 319.6 (502.6 ) (0.5 ) — — (168.3 ) Effect of exchange rate changes on cash and cash equivalents — — — (0.7 ) — — (0.7 ) Net increase in cash and cash equivalents — 148.5 — 4.2 — (2.5 ) 150.2 Cash and cash equivalents – beginning of period — 48.0 — 9.8 — (19.9 ) 37.9 Cash and cash equivalents – end of period $ — $ 196.5 $ — $ 14.0 $ — $ (22.4 ) $ 188.1 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 103 Condensed Consolidating Statement of Cash Flows Year Ended December 31, 2012 (in millions) Parent Guarantor Subsidiary Issuer Guarantor Subsidiaries Non-Guarantor Subsidiary Co-Issuer Consolidating Adjustments Consolidated Net cash (used in) provided by operating activities $ — $ (204.3 ) $ 514.2 $ 1.3 $ — $ 6.2 $ 317.4 Cash flows from investing activities: Capital expenditures — (27.0 ) (14.0 ) (0.4 ) — — (41.4 ) Premium payments on interest rate cap agreements — (0.3 ) — — — — (0.3 ) Net cash used in investing activities — (27.3 ) (14.0 ) (0.4 ) — — (41.7 ) Cash flows from financing activities: Proceeds from borrowings under revolving credit facility — 289.0 — — — — 289.0 Repayments of borrowings under revolving credit facility — (289.0 ) — — — — (289.0 ) Repayments of long-term debt — (201.0 ) — — — — (201.0 ) Proceeds from issuance of long- term debt — 135.7 — — — — 135.7 Payments to extinguish long- term debt — (243.2 ) — — — — (243.2 ) Payment of debt financing costs — (2.1 ) — — — — (2.1 ) Net change in accounts payable- inventory financing — — (29.5 ) — — — (29.5 ) Advances to/from affiliates — 486.0 (486.5 ) 0.5 — — — Other financing activities — 2.1 — — — — 2.1 Net cash provided by (used in) financing activities — 177.5 (516.0 ) 0.5 — — (338.0 ) Effect of exchange rate changes on cash and cash equivalents — — — 0.3 — — 0.3 Net (decrease) increase in cash and cash equivalents — (54.1 ) (15.8 ) 1.7 — 6.2 (62.0 ) Cash and cash equivalents – beginning of period — 102.1 15.8 8.1 — (26.1 ) 99.9 Cash and cash equivalents – end of period $ — $ 48.0 $ — $ 9.8 $ — $ (19.9 ) $ 37.9 Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 104 19. Selected Quarterly Financial Results (unaudited) (in millions, except per-share amounts) 2014 First Quarter Second Quarter Third Quarter Fourth Quarter Net Sales Detail: Corporate: Medium/Large $ 1,274.8 $ 1,395.4 $ 1,374.8 $ 1,440.3 Small Business 230.8 260.8 247.9 250.7 Total Corporate 1,505.6 1,656.2 1,622.7 1,691.0 Public: Government 254.2 313.1 441.3 440.8 Education 321.6 527.0 632.8 342.6 Healthcare 394.1 431.5 394.7 385.7 Total Public 969.9 1,271.6 1,468.8 1,169.1 Other 176.8 178.2 174.6 190.0 Net sales $ 2,652.3 $ 3,106.0 $ 3,266.1 $ 3,050.1 Gross profit $ 425.2 $ 496.9 $ 507.3 $ 491.9 Income from operations 135.8 188.2 184.7 164.3 Net income 50.9 86.6 55.6 51.8 Net income per common share (1) : Basic 0.30 0.51 0.33 $ 0.30 Diluted 0.30 0.50 0.32 $ 0.30 (in millions, except per-share amounts) 2013 First Quarter Second Quarter Third Quarter Fourth Quarter Net Sales Detail: Corporate: Medium/Large (2) $ 1,180.5 $ 1,308.5 $ 1,241.3 $ 1,322.3 Small Business (2) 223.4 228.9 224.5 230.7 Total Corporate 1,403.9 1,537.4 1,465.8 1,553.0 Public: Government 252.3 295.7 375.3 327.3 Education 232.2 420.6 513.4 282.8 Healthcare 362.3 366.3 355.9 380.4 Total Public 846.8 1,082.6 1,244.6 990.5 Other 161.0 159.3 153.9 169.8 Net sales $ 2,411.7 $ 2,779.3 $ 2,864.3 $ 2,713.3 Gross profit $ 402.0 $ 451.6 $ 458.4 $ 448.3 Income from operations (3) 120.1 153.6 92.9 142.0 Net income (loss) (3) 28.3 46.7 (2.2 ) 60.0 Net income (loss) per common share (1)(3) : Basic 0.19 0.32 (0.01 ) 0.35 Diluted 0.19 0.32 (0.01 ) 0.35 (1) Basic and diluted net income (loss) per share are computed independently for each of the quarters presented. Therefore, the sum of quarterly basic and diluted per share information may not equal annual basic and diluted net income (loss) per share. Table of Contents CDW CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS During the first quarter of 2015, the Company entered into six interest rate cap agreements with a combined notional amount of $400.0 million . Under the agreements, the Company made premium payments totaling $0.5 million to the counterparties in exchange for the right to receive payments equal to the amount, if any, by which three-month LIBOR exceeds 2.0% during the agreement period. The interest rate cap agreements are effective from January 14, 2015 through January 14, 2017. On February 10, 2015, the Company announced that its board of directors declared a cash dividend on the Company's common stock of $0.0675 per share. The dividend will be paid on March 10, 2015 to all stockholders of record as of the close of business on February 25, 2015. Future dividends will be subject to the approval of the Company's board of directors. 105 (2) Net sales for the corporate channels (medium/large and small business) have been restated for all periods presented above to conform with the new corporate hierarchy presented for first quarter of 2014. (3) The third quarter of 2013 included pre-tax IPO-related charges of $74.1 million . See Note 9 for additional discussion of the IPO. 20. Subsequent Events Table of Contents SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS Years ended December 31, 2014, 2013 and 2012 106 (in millions) Balance at Beginning of Period Charged to Costs and Expenses Deductions Balance at End of Period Allowance for doubtful accounts: Year Ended December 31, 2014 $ 5.4 $ 5.4 $ (5.1 ) $ 5.7 Year Ended December 31, 2013 5.4 2.8 (2.8 ) 5.4 Year Ended December 31, 2012 5.4 3.9 (3.9 ) 5.4 Reserve for sales returns: Year Ended December 31, 2014 $ 5.1 $ 36.2 $ (36.2 ) $ 5.1 Year Ended December 31, 2013 4.4 35.0 (34.3 ) 5.1 Year Ended December 31, 2012 4.5 33.2 (33.3 ) 4.4 Table of Contents Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None. Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rule13a-15(e) or Rule 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end of the period covered by this report. Based on such evaluation, the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, has concluded that, as of the end of such period, the Company’s disclosure controls and procedures were effective in recording, processing, summarizing, and reporting, on a timely basis, information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act, and that information is accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely discussions regarding required disclosure. Management’s Annual Report on Internal Control over Financial Reporting Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a- 15(f) and 15d-15(f) under the Exchange Act. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements and can provide only reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate. Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2014. Management based this assessment on the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in “Internal Control — Integrated Framework (2013 framework).” Based on its assessment, management concluded that, as of December 31, 2014, the Company’s internal control over financial reporting is effective. Ernst & Young LLP, independent registered public accounting firm, has audited the consolidated financial statements of the Company and the Company's internal control over financial reporting and has included their reports herein. Changes in Internal Control over Financial Reporting There were no changes in the Company’s internal control over financial reporting during the fiscal quarter ended December 31, 2014 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. 107 Table of Contents Report of Independent Registered Public Accounting Firm To the Board of Directors and Shareholders of CDW Corporation We have audited CDW Corporation and subsidiaries’ internal control over financial reporting as of December 31, 2014, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). CDW Corporation and subsidiaries’ management is responsible for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the company’s internal control over financial reporting based on our audit. We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. In our opinion, CDW Corporation and subsidiaries maintained, in all material respects, effective internal control over financial reporting as of December 31, 2014, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of CDW Corporation and subsidiaries as of December 31, 2014 and 2013, and the related consolidated statements of operations, comprehensive income, shareholders’ equity (deficit) and cash flows for each of the three years in the period ended December 31, 2014 of CDW Corporation and subsidiaries and our report dated February 26, 2015 expressed an unqualified opinion thereon. 108 /s/ Ernst & Young LLP Chicago, Illinois February 26, 2015 Table of Contents Item 9B. Other Information None. 109 Table of Contents PART III Item 10. Directors, Managers, Executive Officers and Corporate Governance We have adopted The CDW Way Code, our code of business conduct and ethics, that is applicable to all of our coworkers. Additionally, within The CDW Way Code is a Financial Integrity Code of Ethics that sets forth an even higher standard applicable to our executives, officers, members of our internal disclosure committee and all managers and above in our finance department. A copy of this code is available on our corporate website at www.cdw.com . If we make any substantive amendments to this code or grant any waiver from a provision to our chief executive officer, principal financial officer or principal accounting officer, we will disclose the nature of such amendment or waiver on our website or in a report on Form 8-K. See Part I - “Executive Officers” for information about our executive officers, which is incorporated by reference in this Item 10. Other information required under this Item 10 is incorporated herein by reference to our definitive proxy statement for our 2015 annual meeting of stockholders on May 13, 2015 (“2015 proxy statement”), which we will file with the SEC on or before 120 days after our 2014 fiscal year-end. Item 11. Executive Compensation Information required under this Item 11 is incorporated herein by reference to the 2015 proxy statement. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Information required under this Item 12 is incorporated herein by reference to the 2015 proxy statement. Item 13. Certain Relationships and Related Transactions, and Director Independence Information required under this Item 13 is incorporated herein by reference to the 2015 proxy statement. Item 14. Principal Accountant Fees and Services Information required under this Item 14 is incorporated herein by reference to the 2015 proxy statement. 110 Table of Contents PART IV Item 15. Exhibits and Financial Statement Schedules The following documents are filed as part of this report: All other schedules are omitted since the required information is not present or is not present in amounts sufficient to require submission of the schedule, or because the information required is included in the consolidated financial statements or notes thereto. The information required by this Item is set forth on the exhibit index that follows the signature page of this report. 111 (a) Financial Statements and Schedules (1) Consolidated Financial Statements: Page Report of Independent Registered Public Accounting Firm 59 Consolidated Balance Sheets as of December 31, 2014 and 2013 60 Consolidated Statements of Operations for the years ended December 31, 2014, 2013 and 2012 61 Consolidated Statements of Comprehensive Income for the years ended December 31, 2014, 2013 and 2012 62 Consolidated Statements of Shareholders’ Equity (Deficit) for the years ended December 31, 2014, 2013 and 2012 63 Consolidated Statements of Cash Flows for the years ended December 31, 2014, 2013 and 2012 64 Notes to Consolidated Financial Statements 65 (2) Financial Statement Schedules: Page Schedule II – Valuation and Qualifying Accounts 106 (b) Exhibits Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. CDW CORPORATION Date: February 26, 2015 By: /s/ Thomas E. Richards Thomas E. Richards Chairman, President and Chief Executive Officer 112 Signature Title Date /s/ Thomas E. Richards Chairman, President and Chief Executive Officer (principal executive officer) and Director February 26, 2015 Thomas E. Richards /s/ Ann E. Ziegler Senior Vice President and Chief Financial Officer (principal financial officer) February 26, 2015 Ann E. Ziegler /s/ Virginia L. Seggerman Vice President and Controller (principal accounting officer) February 26, 2015 Virginia L. Seggerman /s/ Steven W. Alesio Director February 26, 2015 Steven W. Alesio /s/ Barry K. Allen Director February 26, 2015 Barry K. Allen /s/ Benjamin D. Chereskin Director February 26, 2015 Benjamin D. Chereskin /s/ Glenn M. Creamer Director February 26, 2015 Glenn M. Creamer /s/ Michael J. Dominguez Director February 26, 2015 Michael J. Dominguez /s/ Paul J. Finnegan Director February 26, 2015 Paul J. Finnegan /s/ David W. Nelms Director February 26, 2015 David W. Nelms /s/ Robin P. Selati Director February 26, 2015 Robin P. Selati /s/ Donna F. Zarcone Director February 26, 2015 Donna F. Zarcone Table of Contents EXHIBIT INDEX Exhibit Number Description 3.1 Fifth Amended and Restated Certificate of Incorporation of CDW Corporation, previously filed as Exhibit 3.1 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 3.2 Amended and Restated By-Laws of CDW Corporation, previously filed as Exhibit 3.2 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 3.3 Articles of Organization of CDW LLC, previously filed as Exhibit 3.3 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.4 Amended and Restated Limited Liability Company Agreement of CDW LLC, previously filed as Exhibit 3.4 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.5 Certificate of Incorporation of CDW Finance Corporation, previously filed as Exhibit 3.5 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.6 By-Laws of CDW Finance Corporation, previously filed as Exhibit 3.6 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.7 Amended and Restated Articles of Incorporation of CDW Technologies, Inc., previously filed as Exhibit 3.7 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.8 Amended and Restated By-Laws of CDW Technologies, Inc., previously filed as Exhibit 3.8 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.9 Articles of Organization of CDW Direct, LLC, previously filed as Exhibit 3.9 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.10 Amended and Restated Limited Liability Company Agreement of CDW Direct, LLC, previously filed as Exhibit 3.10 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.11 Articles of Organization of CDW Government LLC, previously filed as Exhibit 3.11 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.12 Amended and Restated Limited Liability Company Agreement of CDW Government LLC, previously filed as Exhibit 3.12 113 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 3.13 Articles of Incorporation of CDW Logistics, Inc., previously filed as Exhibit 3.14 with CDW Corporation's Form S-3 filed on July 31, 2014 (Reg. No. 333-197744) and incorporated herein by reference. 3.14 By-Laws of CDW Logistics, Inc., previously filed as Exhibit 3.14 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 4.1 Specimen Common Stock Certificate, previously filed as Exhibit 4.1 with CDW Corporation’s Amendment No. 3 to Form S- 1 filed on June 25, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 4.2 Indenture, dated as of August 5, 2014, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association, as trustee, previously filed as Exhibit 4.1 with CDW Corporation's Form 8-K filed on August 6, 2014 and incorporated herein by reference. Table of Contents Exhibit Number Description 4.3 Form of 6% Senior Note (included as Exhibit A to Exhibit 4.1), previously filed as Exhibit 4.2 with CDW Corporation's Form 8-K filed on August 6, 2014 and incorporated herein by reference. 4.4 Senior Note Indenture, dated as of April 13, 2011, between CDW Escrow Corporation and U.S. Bank National Association as trustee, previously filed as Exhibit 4.1 with CDW Corporation's Form 8-K filed on April 14, 2011 and incorporated herein by reference. 4.5 Senior Note Supplemental Indenture, dated as of April 13, 2011, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.2 with CDW Corporation's Form 8-K filed on April 14, 2011 and incorporated herein by reference. \ 4.6 Second Senior Note Supplemental Indenture, dated as of May 20, 2011, by and among CDW LLC, CDW Finance Corporation, CDW Escrow Corporation, the guarantors party thereto and U.S. Bank National Association as Trustee, previously filed as Exhibit 4.1 with CDW Corporation's Form 8-K filed on May 23, 2011 and incorporated herein by reference. 4.7 Third Senior Note Supplemental Indenture, dated as of February 17, 2012, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association as Trustee, previously filed as Exhibit 4.5 with CDW Corporation's Form 8-K filed on February 17, 2012 and incorporated herein by reference. 4.8 Fourth Senior Note Supplemental Indenture, dated as of May 10, 2012, by and among CDW LLC, CDW Finance Corporation, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.3 with CDW Corporation's Form 8-K filed on May 11, 2012 and incorporated herein by reference. 4.9 Form of Senior Note (included as Exhibit A to Exhibit 4.5), previously filed as Exhibit 4.3 with CDW Corporation's Form 8- K filed on April 14, 2011 and incorporated herein by reference. 4.10 Base Indenture, dated as of December 1, 2014, by and among CDW LLC, CDW Finance Corporation, CDW Corporation, the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.1 with CDW Corporation's Form 8-K filed on December 1, 2014 and incorporated herein by reference. 4.11 Supplemental Indenture, dated as of December 1, 2014, by and among CDW LLC, CDW Finance Corporation, CDW Corporation the guarantors party thereto and U.S. Bank National Association as trustee, previously filed as Exhibit 4.2 with CDW Corporation's Form 8-K filed on December 1, 2014 and incorporated herein by reference. 114 4.12 Form of 5.5% Senior Note (included as Exhibit B to Exhibit 4.12), previously filed as Exhibit 4.3 with CDW Corporation's Form 8-K filed on December 1, 2014 and incorporated herein by reference. 10.1 Amended and Restated Revolving Loan Credit Agreement, dated as of June 6, 2014, by and among CDW LLC, the lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, GE Commercial Distribution Finance Corporation, as floorplan funding agent, and the joint lead arrangers, joint bookrunners, co-collateral agents, co-syndication agents and co-documentation agents party thereto, previously filed as Exhibit 10.1 with CDW Corporation's Form 8-K filed on June 9, 2014 (Reg. No. 333-197744) and incorporated herein by reference. 10.2 Term Loan Agreement, dated as of April 29, 2013, by and among CDW LLC, the lenders from time to time party thereto, Barclays Bank PLC, as administrative agent and collateral agent, and the joint lead arrangers, joint bookrunners, co- syndication agents and co-documentation agents party thereto, previously filed as Exhibit 10.1 with CDW Corporation’s Form 8-K filed on May 1, 2013 and incorporated herein by reference. 10.3 First Amendment to Term Loan Agreement, dated as of May 30, 2013, by and among CDW LLC, the lenders from time to time party thereto, and Barclays Bank PLC, as administrative agent and collateral agent, previously filed as Exhibit 10.3 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.4 Incremental Amendment, dated as of July 31, 2013, by and among CDW LLC, the lenders party thereto and Barclays Bank PLC, as administrative agent, previously filed as Exhibit 10.1 with CDW Corporation’s Form 8-K filed on August 1, 2013 and incorporated herein by reference. Table of Contents Exhibit Number Description 10.5 Third Amendment to the Term Loan Agreement, dated as of September 12, 2013, by and among CDW LLC, the lenders from time to time party thereto and Barclays Bank PLC, as administrative agent and collateral agent, previously filed as Exhibit 10.2 with CDW Corporation's Form 10-Q filed on November 7, 2013 and incorporated herein by reference. 10.6 Second Amended and Restated Guarantee and Collateral Agreement, dated April 29, 2013, by and among CDW LLC, the guarantors party thereto and Barclays Bank PLC, as collateral agent, previously filed as Exhibit 10.2 with CDW Corporation’s Form 8-K filed on May 1, 2013 and incorporated herein by reference. 10.7 Management Services Agreement, dated as of October 12, 2007, by and between CDW Corporation, Madison Dearborn Partners V-B, L.P. and Providence Equity Partners L.L.C., previously filed as Exhibit 10.9 with CDW Corporation’s Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.8 Termination Agreement, dated as of June 12, 2013, by and among CDW Corporation, Madison Dearborn Partners V-B, L.P. and Providence Equity Partners L.L.C., previously filed as Exhibit 10.6 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.9 Registration Agreement, dated as of October 12, 2007, by and among VH Holdings, Inc., CDW Holdings LLC, Madison Dearborn Capital Partners V-A, L.P., Madison Dearborn Capital Partners V-C, L.P., Madison Dearborn Partners V Executive-A, L.P., Providence Equity Partners VI L.P., Providence Equity Partners VI-A L.P., and the other securityholders party thereto, previously filed as Exhibit 10.10 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.10 Withdrawal from Registration Agreement, dated as of November 12, 2013, by and between CDW Corporation and Paul S. Shain, previously filed as Exhibit 10.10 with CDW Corporation’s Form 10-K filed on March 5, 2014 and incorporated herein by reference. 10.11 Withdrawal from Registration Agreement, dated as of November 20, 2013, by and among CDW Corporation, James R. Shanks and BOS Holdings, LLC, previously filed as Exhibit 10.11 with CDW Corporation’s Form 10-K filed on March 5, 2014 and incorporated herein by reference. 10.12 Withdrawal from Registration Agreement, dated as of August 27, 2014, by and between CDW Corporation, John A. Edwardson and Whispering Pines Capital LLC , previously filed as Exhibit 10.1 with CDW Corporation’s Form 10-Q filed on November 12, 2014 and incorporated herein by reference. 10.13§ Amended and Restated Compensation Protection Agreement, dated as of March 24, 2014, by and among CDW Corporation, CDW LLC and Thomas E. Richards, previously filed as Exhibit 10.1 with CDW Corporation's Form 8-K filed on March 28, 2014 and incorporated herein by reference. 10.14§ Form of Compensation Protection Agreement (executive officers other than Thomas E. Richards), previously filed as Exhibit 115 10.2 with CDW Corporation's Form 8-K filed on March 28, 2014 and incorporated herein by reference. 10.15§ Form of Noncompetition Agreement under the Compensation Protection Agreement, previously filed as Exhibit 10.3 with CDW Corporation's Form 8-K filed on March 28, 2014 and incorporated herein by reference. 10.16§ Letter Agreement, dated as of September 13, 2011, by and between CDW Direct, LLC and Christina M. Corley, previously filed as Exhibit 10.31 with CDW Corporation's Form 10-K filed on March 9, 2012 and incorporated herein by reference. 10.17§ Form of Indemnification Agreement by and between CDW Corporation and its directors and officers, previously filed as Exhibit 10.32 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.18 Stockholders Agreement, dated as of June 10, 2013, by and among CDW Corporation, Madison Dearborn Capital Partners V-A, L.P., Madison Dearborn Capital Partners V-C, L.P., Madison Dearborn Capital Partners V Executive-A, L.P., Providence Equity Partners VI L.P., Providence Equity Partners VI-A L.P. and the other securityholders party thereto, previously filed as Exhibit 10.33 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. Table of Contents Exhibit Number Description 10.19§ CDW Corporation 2013 Senior Management Incentive Plan, previously filed as Exhibit 10.34 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.20§ CDW Corporation 2013 Long-Term Incentive Plan, previously filed as Exhibit 10.35 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.21§ CDW Corporation Coworker Stock Purchase Plan, previously filed as Exhibit 10.36 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.22§ Form of CDW Corporation Option Award Notice and Stock Option Agreement (executed by Thomas E. Richards), previously filed as Exhibit 10.37 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.23§ Form of CDW Corporation Option Award Notice and Stock Option Agreement (executed by Neal J. Campbell and Christina M. Corley), previously filed as Exhibit 10.38 with CDW Corporation’s Amendment No. 2 to Form S-1 filed on June 14, 2013 (Reg. No. 333-187472) and incorporated herein by reference. 10.24§ Form of CDW Corporation Restricted Stock Award Notice and Restricted Stock Award Agreement (executed by Thomas E. Richards, Dennis G. Berger, Douglas E. Eckrote, Christine A. Leahy, Jonathan J. Stevens and Ann E. Ziegler), previously filed as Exhibit 10.12 with CDW Corporation’s Form 10-Q filed on August 12, 2013 and incorporated herein by reference. 10.25§ Form of CDW Corporation Restricted Stock Award Notice and Restricted Stock Award Agreement (executed by Neal J. Campbell, Christina M. Corley, Christina V. Rother and Matthew A. Troka), previously filed as Exhibit 10.13 with CDW Corporation’s Form 10-Q filed on August 12, 2013 and incorporated herein by reference. 10.26§ CDW Amended and Restated Restricted Debt Unit Plan, previously filed as Exhibit 10.3 with CDW Corporation’s Form 10- Q filed on November 7, 2013 and incorporated herein by reference. 10.27§ Form of CDW Restricted Debt Unit Grant Notice and Agreement (executed by Thomas E. Richards, Dennis G. Berger, Douglas E. Eckrote, Christine A. Leahy, Jonathan J. Stevens and Ann E. Ziegler), previously filed as Exhibit 10.23 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.28§ Form of CDW Restricted Debt Unit Grant Notice and Agreement (executed by Neal J. Campbell, Christina M. Corley, Christina V. Rother and Matthew A. Troka and to be used for certain future grantees), previously filed as Exhibit 10.24 with CDW Corporation's Form S-4 filed on September 7, 2010 (Reg. No. 333-169258) and incorporated herein by reference. 10.29§ Form of Stock Option Agreement (executive officers) under the CDW Corporation 2013 Long-Term Incentive Plan, 116 previously filed as Exhibit 10.4 with CDW Corporation’s Form 10-Q filed on May 12, 2014 and incorporated herein by reference. 10.30§ Form of Performance Share Unit Award Agreement (executive officers) under the CDW Corporation 2013 Long-Term Incentive Plan, previously filed as Exhibit 10.5 with CDW Corporation’s Form 10-Q filed on May 12, 2014 and incorporated herein by reference. 10.31§* Form of Performance Share Award Agreement (executive officers) under the CDW Corporation 2013 Long-Term Incentive Plan. 10.32§ Form of Non-Employee Director Restricted Stock Unit Award Agreement under the CDW Corporation 2013 Long-Term Incentive Plan, previously filed as Exhibit 10.6 with CDW Corporation’s Form 10-Q filed on May 12, 2014 and incorporated herein by reference. 12.1* Computation of ratio of earnings to fixed charges. 21.1 List of subsidiaries, previously filed as Exhibit 21.1 with CDW Corporation's Form S-4 filed on April 13, 2012 (Reg. No. 333-180715) and incorporated herein by reference. Table of Contents ________________ 117 Exhibit Number Description 23.1* Consent of Ernst & Young LLP. 31.1* Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934. 31.2* Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) under the Securities Exchange Act of 1934. 32.1** Certification of Chief Executive Officer pursuant to 18 U.S.C. 1350. 32.2** Certification of Chief Financial Officer pursuant to 18 U.S.C. 1350. 101.INS* XBRL Instance Document 101.SCH* XBRL Taxonomy Extension Schema Document 101.CAL* XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF* XBRL Taxonomy Extension Definition Linkbase Document 101.LAB* XBRL Taxonomy Extension Label Linkbase Document 101.PRE* XBRL Taxonomy Extension Presentation Linkbase Document * Filed herewith ** These items are furnished and not filed. § A management contract or compensatory arrangement required to be filed as an exhibit pursuant to Item 601 of Regulation S-K. Exhibit 10.31 CDW CORPORATION 2013 LONG-TERM INCENTIVE PLAN PERFORMANCE SHARE AWARD AGREEMENT CDW Corporation, a Delaware corporation (the “ Company ”), hereby grants to the individual (the “ Holder ”) named in the award notice attached hereto (the “ Award Notice ”) as of the date set forth in the Award Notice (the “ Grant Date ”), pursuant to the provisions of the CDW Corporation 2013 Long-Term Incentive Plan (the “ Plan ”), a performance share award (the “ Award ”) with respect to the number of shares of the Company’s Common Stock, par value $0.01 per share (“ Stock ”), set forth in the Award Notice, upon and subject to the restrictions, terms and conditions set forth in the Plan and this agreement (the “ Agreement ”). Capitalized terms not defined herein shall have the meanings specified in the Plan. 1. Award Subject to Acceptance of Agreement . The Award shall be null and void unless the Holder (a) accepts this Agreement by executing the Award Notice in the space provided therefor and returning an original execution copy of the Award Notice to the Company (or electronically accepting this Agreement within the Holder’s stock plan account with the Company’s stock plan administrator according to the procedures then in effect) and (b) if requested by the Company, executes and returns one or more irrevocable stock powers to facilitate the transfer to the Company (or its assignee or nominee) of all or a portion of the shares subject to the Award, if shares are forfeited pursuant to Section 3 hereof or if required under applicable laws or regulations. As soon as practicable after the Holder has accepted this Agreement and executed such stock power or powers and returned the same to the Company, the Company shall cause to be issued in the Holder’s name the maximum number of shares of Stock subject to the Award. 2. Rights as a Stockholder . The Holder shall have the right to vote the shares of Stock subject to the Award unless and until such shares are forfeited pursuant to Section 3 hereof. As of each date on which the Company pays a cash dividend on the shares of Stock subject to the Award (a “ Dividend Date ”), the dividend shall be used to purchase from the Company a number of shares equal to (i) the product of the total number of shares subject to the Award immediately prior to such Dividend Date multiplied by the dollar amount of the cash dividend paid per share of Stock by the Company on such Dividend Date, divided by (ii) the Fair Market Value of a share of Stock on such Dividend Date. Any such additional shares shall be subject to the same vesting conditions and other terms set forth herein as the shares to which they relate. The shares of Stock subject to the Award may be held by a custodian in book entry form with the restrictions on such shares duly noted or, alternatively, the Company may hold the certificate or certificates representing such shares, in either case until the Award shall have vested, in whole or in part, pursuant to Section 3 hereof. As soon as practicable after shares of Stock shall have vested pursuant to Section 3 hereof, subject to Section 4 hereof, the restrictions shall be removed from those of such shares that are held in book entry form, and the Company shall deliver to the Holder any certificate or certificates representing those of such shares that are held by the Company and destroy or return to the Holder the stock power or powers relating to such shares. Any shares of Stock that do not become vested and are forfeited pursuant to Section 3 shall be transferred to the Company (or its assignee or nominee). Exec Form 1 3. Restriction Period and Vesting . 3.1. Performance-Based Vesting Conditions . Subject to the remainder of this Section 3 , the Stock shall vest pursuant to the terms of this Agreement and the Plan based on the achievement of the performance goals set forth in the Award Notice over the performance period set forth in the Award Notice (the “ Performance Period ”), provided that that the Holder remains in continuous employment with the Company through the end of the Performance Period. Attainment of the performance goals shall be determined and certified by the Committee in writing prior to the vesting of the Award. Any shares of Stock subject to the portion of the Award that does not become vested due to the failure of the Company to achieve the performance goals at the maximum levels of performance shall be forfeited and transferred to the Company (or its assignee or nominee). 3.2. Termination of Employment (a) Termination due to Retirement, Death or Disability . If the Holder’s employment with the Company terminates prior to the end of the Performance Period and prior to a Change in Control by reason of the Holder’s Retirement, death or a termination by the Company due to Disability, the Performance Period shall continue through the last day thereof and the Holder shall be entitled to a prorated Award, provided that the Holder has continuously complied with the Restrictive Covenants. Such prorated Award shall be equal to the number of shares earned at the end of the Performance Period based on the actual performance during the Performance Period multiplied by a fraction, the numerator of which shall equal the number of full months in the Performance Period during which the Holder was employed by the Company and the denominator of which shall equal 36. Attainment of the performance goals shall be determined and certified by the Committee in writing prior to the vesting of the Award. Any shares of Stock subject to the portion of the Award that does not become vested shall be forfeited and transferred to the Company (or its assignee or nominee). (b) Termination other than due to Retirement, Death or Disability . If the Holder’s employment with the Company terminates prior to the end of the Performance Period and prior to a Change in Control by reason of (i) the Company’s termination of the Holder’s employment for any reason other than death or Disability or (ii) the Holder’s resignation for any reason other than Retirement, then the Award shall be immediately forfeited by the Holder and cancelled by the Company. The shares of Stock subject to the Award shall be forfeited and transferred to the Company (or its assignee or nominee). 3.3. Change in Control . (a) Satisfaction of Performance Goals . If a Change in Control occurs prior to the 24-month anniversary of the first day of the Performance Period, the Performance Period shall end as of the date of the Change in Control and the performance goals set forth in Section 3.1 shall be deemed to have been satisfied at the target level. If the Change in Control occurs on or after the 24-month anniversary of the first day of the Performance Period, the Performance Period shall end as of the date of the Change in Control, and the number of shares of Stock earned pursuant to Section 3.1 shall be based on the projected level of performance through the end of the Performance Period, as determined by the Committee prior to the date of the Change in Control based on performance through the date of such determination. If the Change in Control occurs after the date on which the Participant’s employment is terminated by reason of death, Disability or Retirement, pursuant to Section 3.2(a) , the number of shares earned for purposes of such section shall be determined as of the date of the Change in Control in accordance with this Section 3.3(a) and shall be vested as of the date of such Change in Control. Any shares of Stock subject to the 2 portion of the Award that does not become vested shall be forfeited and transferred to the Company (or its assignee or nominee). (b) Vesting of Award Not Assumed . In the event of a Change in Control prior to the end of the Performance Period pursuant to which the Award is not effectively assumed or continued by the surviving or acquiring corporation in such Change in Control (as determined by the Board or Committee, with appropriate adjustments to the number and kind of shares, in each case, that preserve the value of the shares subject to the Award and other material terms and conditions of the outstanding Award as in effect immediately prior to the Change in Control), the Award shall vest as of the date of the Change in Control, based on the performance level determined in accordance with Section 3.3(a) . Any shares of Stock subject to the portion of the Award that does not become vested shall be forfeited and transferred to the Company (or its assignee or nominee). (c) Vesting of Award Assumed . In the event of a Change in Control prior to the end of the Performance Period pursuant to which the Award is effectively assumed or continued by the surviving or acquiring corporation in such Change in Control (as determined by the Board or Committee, with appropriate adjustments to the number and kind of shares, in each case, that preserve the value of the shares subject to the Award and other material terms and conditions of the outstanding Award as in effect immediately prior to the Change in Control) and (i) the Holder remains continuously employed through the end of the Performance Period, (ii) the Company terminates the Holder’s employment without Cause or the Holder resigns for Good Reason within 24 months following such Change in Control and the Holder executes and does not revoke a waiver and release of claims in the form prescribed by the Company within 60 days after the date of such termination or (iii) the Holder’s employment terminates due to death, Disability or Retirement following such Change in Control, in any such case, the Award shall vest based on the performance level determined in accordance with Section 3.3(a ) hereof as of the end of the Performance Period or, if earlier, the Holder’s termination of employment; provided that to the extent that any Required Tax Payments are due prior to such vesting date, the Company shall withhold whole shares of Stock from the number of shares subject to the Award having an aggregate Fair Market Value, determined as of the date on which such withholding obligation arises, equal to the Required Tax Payments, in accordance with Section 6.1 . In the case of a termination pursuant to clause (ii) of this Section 3.3(c) (termination without Cause or resignation for Good Reason), the Award shall vest in full, and in the case of a termination pursuant to clause (iii) of this Section 3.3(c) (death, Disability or Retirement), the Award shall be prorated in accordance with, and subject to the terms of, Section 3.2(a) . If, following a Change in Control, the Holder experiences a termination of employment other than as set forth in this Section 3.3 (c) , the Award shall be immediately forfeited by the Holder and cancelled by the Company. Any shares of Stock subject to the portion of the Award that does not become vested shall be forfeited and transferred to the Company (or its assignee or nominee). 3.4. Definitions . (a) Cause . For purposes of this Award, “ Cause ” shall mean one or more of the following: (A) Holder’s refusal (after written notice and reasonable opportunity to cure) to perform duties properly assigned which are consistent with the scope and nature of Holder's position; (B) Holder’s commission of an act materially and demonstrably detrimental to the financial condition and/or goodwill of the Company or any of its Subsidiaries, which act constitutes gross negligence or willful misconduct in the performance of duties to the Company or any of its Subsidiaries; (C) Holder’s commission of any theft, fraud, act of dishonesty or breach of trust resulting in or intended to result in material personal gain or enrichment of Holder at the direct or indirect expense of the Company or any of its Subsidiaries; (D) Holder’s conviction of, or plea of guilty or nolo contendere to, a felony; (E) Holder’s material violation of 3 any Restrictive Covenant; or (F) Holder’s material and willful violation of the Company’s written policies or of Holder’s statutory or common law duty of loyalty to the Company or its affiliates that in either case is materially injurious to the Company, monetarily or otherwise. No act or failure to act will be considered “willful” (x) unless it is done, or omitted to be done, by Holder in bad faith or without reasonable belief that Holder’s action or omission was in the best interests of the Company or (y) if it is done, or omitted to be done, in reliance on the informed advice of the Company’s outside counsel or independent accountants or at the express direction of the Board. (b) Disability . For purposes of this Award, “ Disability ” shall mean the Holder’s absence from the Holder’s duties with the Company on a full-time basis for at least 180 consecutive days as a result of the Holder’s incapacity due to physical or mental illness, or under such other circumstances as the Committee determines, in its sole discretion, constitute a Disability. (c) Good Reason . For purposes of this Award, “ Good Reason ” shall mean that the Holder resigns from employment with the Company and its Subsidiaries as a result of one or more of the following reasons: (i) the Company reduces the amount of the Holder’s base salary or cash bonus opportunity (it being understood that the Board shall have discretion to set the Company’s and the Holder’s personal performance targets to which the cash bonus will be tied), (ii) the Company adversely changes the Holder’s reporting responsibilities, titles or office as in effect as of the date hereof or reduces his/her position, authority, duties, responsibilities or status materially inconsistent with the positions, authority, duties, responsibilities or status the Holder then holds, (iii) any successor to the Company in any merger, consolidation or transfer of assets does not expressly assume any material obligation of the Company to the Holder under any agreement or plan pursuant to which the Holder receives benefits or rights, or (iv) the Company changes the Holder’s place of work to a location more than fifty (50) miles from the Holder’s present place of work; provided , however , that the occurrence of any such condition shall not constitute Good Reason unless (A) the Holder provides written notice to the Company of the existence of such condition not later than 60 days after the Holder knows or reasonably should know of the existence of such condition, (B) the Company fails to remedy such condition within 30 days after receipt of such notice and (C) the Holder resigns due to the existence of such condition within 60 days after the expiration of the remedial period described in clause (B) hereof. (d) Restrictive Covenant . For purposes of this Award, “ Restrictive Covenant ” shall mean any non- competition, non-solicitation, confidentiality or protection of trade secrets (or similar provision regarding intellectual property) covenant by which Holder is bound under any agreement between Holder and the Company and its Subsidiaries. (e) Retirement . For purposes of this Award, “ Retirement ” shall mean Holder’s termination of employment at a time when (i) the Holder has attained age 55 and (B) the sum of the Holder’s age and years of employment with or service to the Company or its Subsidiaries equals or exceeds 65; provided that such termination occurs at least six months after the Grant Date. 4. Clawback of Proceeds . 4.1. Clawback of Proceeds . This award is subject to the clawback provisions in Section 5.15 of the Plan. In addition, if the Holder materially violates any Restrictive Covenant and such violation occurs on or before the third anniversary of the date of the Holder’s termination of employment: (i) the Award shall be forfeited and (ii) any and all Performance Share Proceeds (as hereinafter defined) shall be immediately due and payable by the Holder to the Company. For purposes of this Section, “ Performance Share Proceeds ” shall mean, with respect to any portion of the Award which becomes 4 vested later than 24 months prior to the date of the Holder’s termination of employment or service with the Company, the Fair Market Value of a share of Common Stock on the date such portion of the Award became vested, multiplied by the number of shares of Common Stock that became vested. The remedy provided by this Section shall be in addition to and not in lieu of any rights or remedies which the Company may have against the Holder in respect of a breach by the Holder of any duty or obligation to the Company. 4.2. Right of Setoff . The Holder agrees that by accepting the Award the Holder authorizes the Company and its affiliates to deduct any amount or amounts owed by the Holder pursuant to this Section 4 from any amounts payable by or on behalf of the Company or any affiliate to the Holder, including, without limitation, any amount payable to the Holder as salary, wages, vacation pay, bonus or the vesting or settlement of the Award or any stock-based award. This right of setoff shall not be an exclusive remedy and the Company’s or an affiliate’s election not to exercise this right of setoff with respect to any amount payable to the Holder shall not constitute a waiver of this right of setoff with respect to any other amount payable to the Holder or any other remedy. 5. Transfer Restrictions and Investment Representation . 5.1. Nontransferability of Award . The Award may not be transferred by the Holder other than by will or the laws of descent and distribution. Except to the extent permitted by the foregoing sentence, the Award may not be sold, transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by operation of law or otherwise) or be subject to execution, attachment or similar process. Upon any attempt to so sell, transfer, assign, pledge, hypothecate, encumber or otherwise dispose of the Award, the Award and all rights hereunder shall immediately become null and void. 5.2. Investment Representation . The Holder hereby covenants that (a) any sale of any share of Stock acquired upon the vesting of the Award shall be made either pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “ Securities Act ”), and any applicable state securities laws, or pursuant to an exemption from registration under the Securities Act and such state securities laws and (b) the Holder shall comply with all regulations and requirements of any regulatory authority having control of or supervision over the issuance of the shares and, in connection therewith, shall execute any documents which the Committee shall in its sole discretion deem necessary or advisable. 6. Additional Terms and Conditions of Award . 6.1. Withholding Taxes . As a condition precedent to the vesting of the Award and the delivery of the Stock hereunder, at the Company’s discretion either (i) the Holder shall pay to the Company such amount as the Company (or an affiliate) determines is required, under all applicable federal, state, local, foreign or other laws or regulations, to be withheld and paid over as income or other withholding taxes (the “ Required Tax Payments ”) with respect to the Award or (ii) the Company or an affiliate may, in its discretion, deduct any Required Tax Payments from any amount then or thereafter payable by the Company or an affiliate to the Holder, which may include the withholding of whole shares of Stock which would otherwise be delivered to the Holder having an aggregate Fair Market Value, determined as of the date on which such withholding obligation arises, equal to the Required Tax Payments, in either case in accordance with such terms, conditions and procedures that may be prescribed by the Company. Shares of stock withheld may not have a Fair Market Value in excess of the Company’s minimum statutory withholding requirements for the Required Tax Payments; 5 provided, however, that if a fraction of a share of Stock would be required to satisfy the minimum amount of the Required Tax Payments, then the number of shares of Stock to be withheld may be rounded up to the next nearest whole share of Stock. Notwithstanding the foregoing, if the Required Tax Payments are due prior to the date the Company determines the number of shares of Stock that have become vested, the amount of the Required Tax Payments, including the number of shares withheld to pay such Required Tax Payments, may be based on a reasonable estimate of the number of shares that are expected to become vested. No certificate representing a share of Stock shall be delivered until the Required Tax Payments have been satisfied in full. A determination by the Company to satisfy the Required Tax Payments by withholding shares of Stock shall be made by the Committee if the Holder is subject to Section 16 of the Exchange Act. 6.2. Compliance with Applicable Law . The Award is subject to the condition that if the listing, registration or qualification of the shares of Stock subject to the Award upon any securities exchange or under any law, or the consent or approval of any governmental body, or the taking of any other action is necessary or desirable as a condition of, or in connection with, the delivery of shares hereunder, the shares of Stock subject to the Award shall not be delivered, in whole or in part, unless such listing, registration, qualification, consent, approval or other action shall have been effected or obtained, free of any conditions not acceptable to the Company. The Company agrees to use reasonable efforts to effect or obtain any such listing, registration, qualification, consent, approval or other action. 6.3. Award Confers No Rights to Continued Employment . In no event shall the granting of the Award or its acceptance by the Holder, or any provision of the Agreement or the Plan, give or be deemed to give the Holder any right to continued employment by the Company, any Subsidiary or any affiliate of the Company or affect in any manner the right of the Company, any Subsidiary or any affiliate of the Company to terminate the employment of any person at any time. 6.4. Decisions of Board or Committee . The Board or the Committee shall have the right to resolve all questions which may arise in connection with the Award. Any interpretation, determination or other action made or taken by the Board or the Committee regarding the Plan or this Agreement shall be final, binding and conclusive. 6.5. Successors . This Agreement shall be binding upon and inure to the benefit of any successor or successors of the Company and any person or persons who shall, upon the death of the Holder, acquire any rights hereunder in accordance with this Agreement or the Plan. 6.6. Notices . All notices, requests or other communications provided for in this Agreement shall be made, if to the Company, to CDW Corporation, Attn: General Counsel, 200 N. Milwaukee Avenue, Vernon Hills, Illinois 60061, and if to the Holder, to the last known mailing address of the Holder contained in the records of the Company. All notices, requests or other communications provided for in this Agreement shall be made in writing either (a) by personal delivery, (b) by facsimile or electronic mail with confirmation of receipt, (c) by mailing in the United States mails or (d) by express courier service. The notice, request or other communication shall be deemed to be received upon personal delivery, upon confirmation of receipt of facsimile or electronic mail transmission or upon receipt by the party entitled thereto if by United States mail or express courier service; provided , however , that if a notice, request or other communication sent to the Company is not received during regular business hours, it shall be deemed to be received on the next succeeding business day of the Company. 6.7. Governing Law . This Agreement, the Award and all determinations made and actions taken pursuant hereto and thereto, to the extent not governed by the laws of the United States, 6 shall be governed by the laws of the State of Delaware and construed in accordance therewith without giving effect to principles of conflicts of laws. 6.8. Agreement Subject to the Plan . This Agreement is subject to the provisions of the Plan and shall be interpreted in accordance therewith. In the event that the provisions of this Agreement and the Plan conflict, the Plan shall control. The Holder hereby acknowledges receipt of a copy of the Plan. 6.9. Entire Agreement . This Agreement and the Plan constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and the Holder with respect to the subject matter hereof, and may not be modified adversely to the Holder’s interest except by means of a writing signed by the Company and the Holder. 6.10. Partial Invalidity . The invalidity or unenforceability of any particular provision of this Agreement shall not affect the other provisions hereof and this Agreement shall be construed in all respects as if such invalid or unenforceable provision was omitted. 6.11. Amendment and Waiver . The Company may amend the provisions of this Agreement at any time; provided that an amendment that would adversely affect the Holder’s rights under this Agreement shall be subject to the written consent of the Holder. No course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of this Agreement. 6.12. Compliance With Section 409A of the Code . This Award is intended to be exempt from Section 409A of the Code, and shall be interpreted and construed accordingly. 7 EXHIBIT 12.1 CDW CORPORATION COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (unaudited) Years ended December 31, (dollars in millions) 2010 2011 2012 2013 2014 Computation of earnings: Income (loss) before income taxes and adjustment for (income) loss from equity investees $ (37.1 ) $ 28.3 $ 185.8 $ 194.9 $ 385.5 Distributed income from equity investees 0.2 0.5 1.2 1.0 1.1 Fixed charges 420.7 324.9 312.4 254.3 202.8 Total earnings $ 383.8 $ 353.7 $ 499.4 $ 450.2 $ 589.4 Computation of fixed charges: Interest expense $ 394.7 $ 302.0 $ 294.4 $ 241.8 $ 191.3 Amortization of deferred financing costs and debt premium 18.0 15.7 13.6 8.8 6.4 Portion of rent expense representative of interest (1) 8.0 7.2 4.4 3.7 5.1 Total fixed charges $ 420.7 $ 324.9 $ 312.4 $ 254.3 $ 202.8 Ratio of earnings to fixed charges (2 ) 1.1 1.6 1.8 2.9 (1) Fixed charges include a reasonable estimation of the interest factor included in rental expense. (2) For the year ended December 31, 2010, earnings available for fixed charges were inadequate to cover fixed charges by $37.0 million. Exhibit 23.1 Consent of Independent Registered Public Accounting Firm We consent to the incorporation by reference in the following Registration Statements: (1) Registration Statement (Form S-3 ASR No. 333-199425) of CDW Corporation, and (2) Registration Statement (Form S-8 No. 333-189622) pertaining to the 2013 Long-Term Incentive Plan and Coworker Stock Purchase Plan of CDW Corporation; of our reports dated February 26, 2015, with respect to the consolidated financial statements and schedule of CDW Corporation and subsidiaries and the effectiveness of internal control over financial reporting of CDW Corporation and subsidiaries included in this Annual Report (Form 10-K) of CDW Corporation for the year ended December 31, 2014. /s/ Ernst & Young LLP Chicago, Illinois February 26, 2015 Exhibit 31.1 CERTIFICATION PURSUANT TO RULE 13a-14(a) or 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934 I, Thomas E. Richards, certify that: 1. I have reviewed this annual report on Form 10-K of CDW Corporation (the "registrant"); 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions): a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. /s/ Thomas E. Richards Thomas E. Richards Chairman, President and Chief Executive Officer CDW Corporation February 26, 2015 Exhibit 31.2 CERTIFICATION PURSUANT TO RULE 13a-14(a) or 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934 I, Ann E. Ziegler, certify that: 1. I have reviewed this annual report on Form 10-K of CDW Corporation (the "registrant"); 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; c. Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d. Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions): a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. /s/ Ann E. Ziegler Ann E. Ziegler Senior Vice President and Chief Financial Officer CDW Corporation February 26, 2015 Exhibit 32.1 CERTIFICATION PURSUANT TO SECTION 1350 OF CHAPTER 63 OF TITLE 18 OF THE UNITED STATES CODE I, Thomas E. Richards, the chief executive officer of CDW Corporation (“CDW”), certify that (i) the Annual Report on Form 10-K for the year ended December 31, 2014 (the “10-K”) of CDW fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and (ii) the information contained in the 10-K fairly presents, in all material respects, the financial condition and results of operations of CDW. /s/ Thomas E. Richards Thomas E. Richards Chairman, President and Chief Executive Officer CDW Corporation February 26, 2015 Exhibit 32.2 CERTIFICATION PURSUANT TO SECTION 1350 OF CHAPTER 63 OF TITLE 18 OF THE UNITED STATES CODE I, Ann E. Ziegler, the chief financial officer of CDW Corporation (“CDW”), certify that (i) the Annual Report on Form 10-K for the year ended December 31, 2014 (the “10-K”) of CDW fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and (ii) the information contained in the 10-K fairly presents, in all material respects, the financial condition and results of operations of CDW. /s/ Ann E. Ziegler Ann E. Ziegler Senior Vice President and Chief Financial Officer CDW Corporation February 26, 2015 NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-1 Attachment B: Methodology 1. Overall Approach Requirement 1. Offeror shall describe its overall approach to providing solicited services. Include how Offeror plans to meet or exceed requirements of the Scope of Work and Terms and Conditions. Response At CDW, our software business is the single largest category, with sales generating over $3 billion annually. This encompasses both traditional software licensing and subscription-based Software-as- a-Service (SaaS) licensing models. We offer innovative value-added benefits (detailed further in requirement 7) to enhance the procurement process, lower administrative costs, and reduce the risk of noncompliance associate with volume software licensing. To meet—and exceed—the needs of the NASPO ValuePoint contract customers, as delineated in the Scope of Work and Terms and Conditions, CDW•G presents our customizable customer website, dedicated account managers and software licensing specialists, industry-best customer service, a streamlined software-management system, and direct, timely support. CDW•G has proposed changes to the Terms and Conditions that are detailed within Attachment D, per the requirements of Executive Summary. Most of the proposed changes are a direct result of our status as an authorized reseller of licensing, where terms are currently drafted as if the awardee is the publisher. We appreciate the opportunity to discuss further and anticipate a good-faith negotiation. 2. Website Requirement 2. Per Section 3.1.3, the SVAR shall Develop and Maintain Website. Describe the website to be established for a state. Address that website’s functionalities or special features. You may supplement this response with illustrative screen prints (no more than 10) from one of your company’s existing websites. Taking into account the requirements of Section 3.1.3, address at a minimum: Response CDW has over 20 years’ experience in providing customer purchasing solutions on our website. We transact over $2.5 billion dollars in business through our website annually, which puts us in one of the top 10 e-commerce sites in the US. Our website, found at www.cdwg.com, is highly customizable, allowing each agency, department, and workgroup to tailor the site according to their specific needs. Additionally, the CDW•G program manager supporting the contract will create and maintain a contract-specific website, called a Premium Page. This site possesses the same functionalities as our website, with additional links features and contract pricing listed for each available contract item. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-2 Requirement  2.1 Home page appearance and information; Response The contract’s CDW•G Premium Page requires no login to view, so our account teams and NASPO ValuePoint can easily direct eligible agencies to the site to demonstrate the competitive pricing available. There are a number of customizable features we will tailor to your preferences. Options include links of interest, text and images, related documentation, and the highlighting of specific OEMs and/or software solutions. Items standard to the home page include a quick “Find My Quote” search option and our general sales contact information, as well as providing easy access to our site subpages (e.g., Software, Cloud, Blog, Solutions). CDW•G will provide NASPO ValuePoint customers with access to a free customized Account Center site where they can view quotes, place orders, check status of orders, and track their order history. This site is available by logging into the customer account from either the Premium Page or www.cdwg.com. Requirement  2.2 On-line tutorials; Response We offer online tutorials for use of our website, as well as webinars about popular technology solutions. A high-level Account Center tour and a CDW website tour are available here: www.cdwsiteinfo.com. The site also includes website FAQs; detailed breakdowns of the Account Center functionalities, and a blog featuring new site updates. Within your Account Center, function-specific tutorials and instructions are available for major areas (e.g., catalogs, quotes, order tracking. We house solution-specific tutorials and webinars in the Media Library, with nearly 70 webinars and over 10 different video channels. This easy-to-search library includes a plethora of helpful documentation for users to research, as well. Requirement  2.3 Product catalog (include searchable fields, products to be included, how license information is provided); Response The contract’s Premium Page allows NASPO ValuePoint customers to perform quick product searches and to comparison shop by viewing up to 10 side-by-side product descriptions, with a number of helpful filtering options. Additionally, customers can export the comparison information into a CSV file for reporting needs. Our site includes license information on each product page. This information appears on the comparison tool when selecting the “Technical Specs” option. Licensing details include, but are not limited to, agreement term, category, level, type, licensing program, pricing level, subscription details (when applicable), quantity, and service support (where included). NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-3 Specific to NASPO ValuePoint, users can also view descriptions of the most popular vendor partners’ licensing programs from the software licensing center, eliminating the hassle of downloading data from multiple manufacturer websites and providing a full library of helpful resources to educate on software licensing. To continue with a purchase, users must enter a unique ID and password, at which point eligible entities can quickly track orders and quotes. A key element in expanding contract reach, the website is a trustworthy means of easily choosing and ordering new licenses and products on the contract. Contract pricing continues to be displayed for all items. When authenticated, entities can add additional products from any of their available contracts, all on one order. If a customer does not currently have a CDW•G Account Center and would like to utilize this tool, the registration process is simple, selecting their own login ID and password for their customized site. Site functionality includes the following:  Track orders and shipments  Connect with your account team  Manage applicable purchases and payments  Review consistent, contract-compliant pricing  Promote IT standards  Set shipping preferences and manage contact information  Control access to features and information through customer organization The Account Center improves efficacy and efficiency when working with CDW•G, as compared to our competitors. Starting with comparing products, finding compatible accessories, creating custom catalogs, setting authorization levels, and selecting from a number of shipping options, your CDW•G Account Center expands to track agency spending history, manage assets, and create customized reports. Support and assistance is available via the site, through contacting the account manager and/or a customer service rep, as well as placing and reviewing RMA requests. Software Management NASPO ValuePoint users can take advantage of features that make it easy to find, download, activate, and manage software licenses.  Discover and analyze  Audit software applications running on network  Instantly run inventory of software assets  Analyze software usage  Automatically find all IT assets  Monitor network vulnerabilities  View comprehensive asset reporting  Software filters  Quickly narrow purchase options based on current software contract  Some publishers available for automatic/web-based features  Use Software Keycodes to store keycodes from software licensing purchases Additional Features  Track licenses purchased from CDW and other vendor purchases  Robust standardized and custom reporting options NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-4  Option to upload license information so you can consolidate software license reports and information Requirement  2.4 Links Response As stated in requirement 2.1, links of interest (e.g., the NASPO ValuePoint primary website, CDW Media Library, etc.) can be tailored to customer preference on the Account Center site. This customization is available at no cost to the user. Requirement  2.5 Downloadable standard reports. Include: o 2.5.1 How information is controlled and sorted (e.g. what information LSCA can access); Response Information can be captured and reported via the Account Center and include (but are not limited to) the following sortable fields:  ABB Billing ID  Accounting Code  Apple Education Account Number  Invoice Approval ID  Business Area  Buyers ID for Billing  Buyers ID for Seller  Buyers ID for Vendor  Capital Budget Number  Cost Center  Corporation Code  Department Code  Employee Email Address  Employee First Initial  Employee ID Number  Employee Last Name  Employee Phone Number  Freight Cost Center  Freight GL Account  Inventory Cost Center  Inventory GL Account  Account  Unit  MW Customer Number  Release Number  SAP Company  Shipping Account Number  Selling Division  Buying Unit #  Staples Internal Customer Number  Staples Merchandise Type Code  Tax Cost Center  Tax GL Account  Ticket Number  Vendor ID  3rd Party Assigned Order Number  Work Request  Original Order Price  Original Order Quantity The Account Center is set up by customer number, meaning that the LSCA will need to work with the program manager to receive contract-wide reports (see requirement 2.5.2). NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-5 Requirement o 2.5.2 How state Procurement Officer can obtain purchasing profile for Users and volume in State; Response Standard reports are available for download via the Account Center and your account manager, utilizing sortable data fields which can be accessed and viewed by the customer, managed as Preferences. Each site will only show the individual agency, with “roll up” reports for the LSCA performed by the program manager. Each customer (requirement 2.5.3), if set as a subordinate to the main central agency, can roll up to the Procurement Officer (2.5.2). Use easy drag and drop options to customize reports or download data for offline analysis. More information about the types of reporting available to NASPO ValuePoint customers is featured in requirement 5. Through the Account Center, customers will have the ability to coordinate to the individual state’s electronic purchasing system, utilizing our Purchase Authorization System (PAS), streamlining and controlling IT purchases with automated, rules-based approvals and workflows. Requirement o 2.5.3 How an individual User can obtain only their information. Response Our Account Centers are set up by each customer’s CDW•G account number. Agencies access and generate reports that include only the information relevant to their account. The authorized user(s) designated to manage the entity’s account act as administrator and can customize the site to restrict the information available to individual purchases, if desired. Requirement  2.6 How website is monitored, kept current and accurate. Response Once your program manager puts the contract structure into the system, the system updates the contract pricing automatically, as we receive it from our OEM and distributor partners. Our major partners send daily EDI downloads or real-time information directly to our ordering and inventory system. For all quote requests, our AMs use one system to manage the process (from quote to order placement). This system allows us to centrally manage many key functions, including purchasing, inventory management, accounts receivable, sales, and distribution. For general site maintenance, we have an in-house team of over 200 IT personnel to keep our website refreshed quickly, cutting edge, and accurate. Much customer feedback goes into site updates, ensuring our site continues to offer the best features for easing customer procurement needs. For example, our team redesigned the site’s segment-specific homepages in early 2015. The winning designs were a result of a 12-hour hackathon, a 10-day customer beta test, and additional customer feedback. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-6 We schedule updates during times with the lowest traffic and always notify customer of updates in advance via a site banner and our website’s blog. Our success is reflected in the less-than-six minutes of unplanned downtime in 2014—an uptime exceeding 99.997%. 3. Software Tracking Requirement 3. Describe your Company’s method for tracking software licenses and ensuring that Participating States receive timely notifications of renewals or are advised of volume agreement opportunities or vulnerabilities, etc. Response Software tracking differs from state to state, agency to agency, dependent upon the structuring of procurement practices and information required. For example, if the LSCA is the contract administrator, then the licensing team will provide all necessary information (including licensing cost analysis reports, software entitlements reports, and license history review reporting). If a state is leading the purchasing of licenses, or other agencies are listed as child accounts within our system, then our internal system will generate a license report applicable to each account. For procurement that is more decentralized, reports will be provided directly to the agencies holding the agreement. States can be kept informed of licensing details such as OEM and license name.  3.1 The standard sortable data fields established for these records. Response CDW•G will provide NASPO ValuePoint customers with access to a customized Account Center site where they can view quotes, place orders, check status of orders, and track their order history, where all fields are sortable. The CDW•G Account Center site, customized specifically for each agency, also provides access to each customer’s software purchases and licenses. The Account Center is a proprietary tool made available to CDW•G customers at no cost. Additionally, AMs can handle requests for scheduled or ad hoc reporting. Requirement  3.2 The information tracked on behalf of Participating States. Response CDW•G eases the burden of tracking renewal dates and solution comparisons through the methodical management processes followed by our AMs and licensing specialists, ensuring accuracy of purchased licenses and true up dates (requirement 3.3). Our personalized approach means we know our customers’ systems and offer recommendations tailored to best fit your needs. Your AM assists with understanding the advantages and vulnerabilities of specific solutions and helps negotiate Volume Licensing Agreements (VLAs) with software partners, resulting in substantial time and money saved. See requirement 4.3 for detail on our true up workbook report, available for EA customers. As detailed in requirement 2.3, the Account Center offers multiple tracking options for relevant information and features software management consolidating license information, application audits, and various reporting capabilities. Additionally, knowledgeable licensing experts monitor contract customers’ significant dates and volume plateaus (requirement 3.3), as well as assisting in navigation through software partner customer portals. Reports are details further in requirement 5. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-7 Requirement  3.3 How reminders of significant dates or volume plateaus are triggered. Include how your Company, as a partner with the Participating State, communicates with the State to ensure no deadlines are missed or opportunities are unexplored. Response Our licensing specialists track the anniversary and expiration dates for each enrollment. CDW•G requires our AMs to send monthly notifications of upcoming annual payments for the three months prior to anniversary date. Account managers and licensing specialists have also made it a best practice to initiate volume license renewal discussions six months prior to expiration. During this process, the CDW•G licensing specialist reviews the licenses on the current agreement and explain any license changes that may impact how they are renewed on the next agreement. Each NASPO ValuePoint member’s dedicated licensing specialist is a customer advocate, focusing on the customer’s existing environment and future plans. This allows them to make licensing recommendations for renewal and work with the AM to create an initial renewal proposal. The customer can review the proposal, make changes, ask questions, and ultimately approve. Once approved, CDW•G prepares the renewal paperwork and provides instructions for completion. Our ability to manage thousands of concurrent publisher contracts has been built on this system and a partnership with us will give NASPO ValuePoint customers the peace of mind that agency renewals will not be missed. CDW•G updates our systems immediately when we receive notifications on products and pricing from publishers. Your software licensing specialist tracks licensing purchases and ensures that NASPO ValuePoint customers have the following: new software version (as appropriate), access to technical support, ongoing audits, reduced risk through compliance, and timely contract renewal. 4. Proof of License Requirement 4. Describe your Company’s method of ensuring a Participating State receives documentation of Proof of License that can be provided to requestors (e.g. auditors, in response to FOIA requests, etc.) 4.1 Describe process for providing Proof of License to a buyer. Provide a sample Proof of License. Response All Proof of License certificates are available electronically or in hard copy after purchase. Proof of license methods differ from publisher to publisher. Usually, purchasers can pull the proof of license directly from the OEM invoice. These serve as proof of ownership in the event of an audit. CDW•G can also provide a proof of license certificate (see the sample) or the OEM purchase automatically or when requested, such as an auditor response to FOIA, etc. Requirement 4.2 Explain method of retaining back-up copies of Proof of License. State how quickly a duplicate copy can be provided. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-8 Response Our invoices and proof of licenses are available via request to your AM at any point, as they serve as part of our day-to-day business and operational processes. Further, CDW•G has the highest ranking partner status available with our top-tier software manufacturers (and most of the publishers listed as part of this RFP). We also have CDW•G-badged partner specialists and partner-badged resources with permanent desks at our offices. Further, we can leverage our software partner resources—and our own CDW•G resources—to quickly obtain any necessary back-up/duplication documentation a customer may need. Requirement 4.3 Describe how your Company partners with a State to demonstrate accuracy of licensing information to a publisher (aka a “True Up”). Response With CDW•G, the conversation does not end at purchase. As described in requirement 3, Software Tracking, our account managers and licensing specialists are trained to proactively support our customers throughout the life of their software contract. It would be simpler for us to use a completely automated process for the management and renewal of software licenses, as many companies do, but using an automated approach alone results in mistakes and unhappy customers. We prefer to bolster automated elements with consultative touch points. Our licensing specialists are subject matter experts and work proactively with the account managers to manage these contracts. Our methodology described in requirement 3 shows that we start the true-up discussion/process three months prior to a customer’s anniversary date, or earlier (upon request). The true-up process includes a review of what is on the current license agreement. The licensing specialist spends time explaining to the customer what each license means and how it ties back to their environment. Through this discussion, the license specialist gains an understanding of what the current customer’s environment is and is able to compare that to the licensing shown on the current agreement. If a true- up is needed as a result of this discussion, the licensing specialist makes a recommendation on license to purchase. Additionally, if the licensing specialist determines there is a more cost-effective means to license the current environment, they recommend changes to the agreement in order to reflect any potential cost savings. If a customer is anticipating a future project that may result in a true-up and needs to plan further out in advance (for budgetary reasons), the licensing specialist is available to have that discussion and provide budgetary numbers at any time. Lastly, upon request, CDW•G has a true up workbook available for EA customers. The workbook includes reporting around current licensed products and allows the customer to populate their current install quantity. Since the workbook includes true up pricing, the customer immediately sees their exact true-up cost. This information is extremely valuable for budgeting, forecasting, and project planning. With more than 180,000 software renewals processed yearly, CDW•G offers the expertise necessary for NASPO ValuePoint members, having proven our ability to execute timely renewals with reduced customer stress. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-9 5. Reports Requirement 5.1 Describe standard reports which can be generated for a State (other than downloadable reports addressed earlier). Provide sample reports. Response CDW•G has a slew of reporting options available to NASPO ValuePoint customers. Agency-specific reports are accessible through the Account Center or their AM. State-wide reports are available through the state’s dedicated program manager, reporting flexibility a key benefit to partnering with CDW•G; procurement-structure specific reporting is detailed in requirement 3. Requirement 5.2 Describe on-line, real time, reporting capabilities using established state website reports:  5.2.1 Standard Reports. Provide sample reports. Response Agencies have access to invoice reporting through the Account Center Payment Reporting section (note: requires finance user permission). We also offer the following invoice/invoice reporting methods: P-Cards (compliant to level/tier 3) and electronic invoicing (ANSIx12 4010 EDI, XML, cXML, mapped flat file formats. Requirement  5.2.2 Reports that can be generated by the LSCA. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-10 Response Your program manager can provide contract-wide reports to the LSCA, including but not limited to standard reports, licensing reports, and ad hoc reports. Please refer to the sample report included in requirement 5.2.1. Requirement  5.2.3 Reports that can be generated by the Participating State. Provide sample reports. Response CDW•G’s dynamic, ad hoc reporting capabilities on the Account Center, including our pivot table feature, enable purchasers to better manage data and to make more cost-effective decisions. The Account Center provides access to real-time information in a way that is convenient and easy to use. Authorized users have the ability to generate a variety of reports, such as those listed below, as well as others at their request. Customers can view standard reports, and create and save custom reports. Reports can also be generated for a variety of timeframes, differentiated by site, division, department, buyer, city, product, etc. In order to generate reports at the state level, Account Centers need to be linked for all applicable state agencies. Please also refer to the sample report included for requirement 5.2.1. Requirement  5.2.4 Reports that can be generated by the User agency. Provide sample reports. Response In addition to the reporting capabilities at the state level (detailed in requirement 5.2.3), within the Account Center, customers can also generate reports for various assets with a variety of fields. As part of any hardware sale that goes through our configuration center, customers can view serial numbers, MAC Addresses (where applicable), BIOS configurations, software installations, and much more. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-11 Using CDW•G’s Software License Tracker (SLT), offered to customers via the Account Center site at no additional charge, users can access this tool that simplifies license management, especially software license agreements. The SLT is accessible to all authorized users via the Account Center 24/7 and enables authorized users to manage license agreements by tracking expiration dates and generating standard or customized reports for delivery via email. Users can run reports in SLT to show what license agreements are about to expire and to set up email alerts to be sent out at a specified time in advance of expiration. Our EA workbook (detailed in requirement 4.3) also lends a significant amount of customization at the agency level. Requirement 5.3 Address whether your Company is able to provide “Custom Reports” as an optional service to Participating States, should State determine to utilize this service? (See Section 3: Scope of Work, 3.7.3 Custom Reports) Response Yes; should the state need to see reporting into areas of the contract that fall outside of the ad hoc and standard capabilities listed above, we will work with you to create the custom report. Our reporting tools are incredibly flexible, and we employ database administrators to combine the power of data feeds we have from our partners with our own data sets to automate custom reports. Upon award, CDW•G commits to having a discovery meeting with the state to determine additional reporting requirements that are necessary for the success of this contract. 6. Maximizing Value for the State Requirement 6. Describe how your Company works with a State and publisher to maximize the State’s value in obtaining products and services under this contract. Description is to address, but is not limited to, the following:  6.1 Working with a State and a publisher to assist the State in managing their volume or enterprise license agreements. Response True to our customer-centric approach, CDW•G aims to be more than a fulfillment provider to NASPO ValuePoint members, committing to provide the resources to navigate the increasingly complex world of software. Maximizing value for NASPO ValuePoint customers starts with the CDW•G field presence in each of the participating states. It is our best practice to work closely with a manufacturer’s account manager within a specific state to build the necessary relationship and customer trust. Our field and inside reps have many existing relationships with the publisher rep for each state named in this contract. Streamlining license agreements, providing install-based reports from a given publisher, and working with each agency to manage all software—including software purchased from other vendors—is the heart of the CDW•G advantage. As mentioned in requirement 4.3, our AMs and licensing specialists use a very methodical approach in managing agreements. This process is in place to ensure accuracy of licensing purchased, true updates, and renewals. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-12 Even after a software contract is signed, our dedicated account teams and software licensing specialists maintain regular contact with customers to ensure that all licensing program benefits are maximized and that contracts are renewed on time. CDW•G provides contract management for all our software licensing partners’ programs; our team of 22 software licensing renewal specialists will offer fast processing of renewal orders. Sample Contract Lifecycle Management Year 1 Year 2 Year 3  Welcome letter  Kickoff meeting  Software review  Cloud planning  Software profile  CDW solutions  Software deployment check  True Up 1 due  Annual business review  Cloud planning  Software profile  CDW solutions  Software deployment check  True Up 2 due  Annual business review  Renewal intro  Cloud planning  Software profile  Software deployment check  Contract review  True Up 3 due  Annual business review Requirement  6.2 Working with a State and publisher to maximize the leverage created by the total sales volume from a State and its cooperative partners to ensure best value to all State’s. Response Prior to software purchase and any renewals, our LAEs evaluate total spend, assets, usage, and purchase history. Their recommendations include potential options that would optimize investment through vendor and contract consolidation, including volume transactional purchasing options or contractual volume agreements. Additionally, our teams will inform the customer of any volume purchase opportunities specific to the contract available for entities to leverage. For example, CDW•G is the University of Southern California’s (USC’s) primary software provider, managing their Microsoft EES agreement. We recognized an opportunity for savings by aggregating USC’s departmental Microsoft purchases under one master EES agreement, to leverage the volume the university was purchasing as a whole. Even though the master agreement is leveraged campus- wide, each department still has their own portal, ability to manage their own licenses, and pay for usage out of their department’s budget. Consolidating departments’ purchases under one EES agreement—as opposed to Microsoft’s Open-Value option—provided USC with approximately three percent (3%) savings on the majority of their desktop product purchases. Requirement  6.3 Working with a publisher to maximize the leverage created by the total sales volume overall resulting from this contract. Response We work in partnership with contract holders to act as an advocate in the contract environment, utilizing our experience with similar contracts to negotiate prices prior to final agreement and compare volume discounts occurring elsewhere. Regular reporting measures, monitored by our program manager and reviewed by sales leadership at various intervals, allow us to provide NASPO ValuePoint and its customers the most competitive offers on the market today. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-13 With broad-scope contracts, we often see emerging trends in demand for certain publishers. If sales volumes indicate high spend in a specific solution, we collaborate with the software publisher to determine if additional savings or value can be incorporated for purchasers. If reports indicate a high volume of purchases with a software publisher with which we do not have a direct relationship established, a CDW•G coworker will initiate our New Vendor Addition Process, structure for evaluating both risk and reward when considering potential new vendors. This process protects contract users’ best interests by considering the unique capabilities and products each vendor offers alongside potential areas of risk. Part of this methodology includes negotiating a partner agreement and competitive pricing with the new vendor, so that we can bolster support around the solutions being purchased and pass on additional savings. Requirement  6.4 Working with State and publisher to obtain the best quote on a high volume purchase. Response While our online ordering capabilities are far superior to other resellers, we always encourage customers to reach out to their CDW•G AM before making a large purchase. This is because we train our AMs to view the contract pricing as a “ceiling” price. They will negotiate with the publisher on the customer’s behalf, often securing additional savings. Requirement  6.5 If, and how, your Company uses historical purchase information to provide targeted assistance to State. Response The team described in our response to requirement 6.1 leverages historical data in supporting software license purchasing and management. However, leveraging historical data requires a different approach when you are not a contract incumbent. When awarded, CDW•G is committed to expend the extra effort to effectively collaborate with the customer and applicable software publishers. The number of publishers purchased and the willingness of the customer to share information dictates the method in which CDW•G collects historical information. Most often, our licensing team will recommend our Software License Review, to ensure we gather all relevant information available. The CDW Software License Review provides our team and our customers an easy-to-read overview of all software assets and license purchased across all departments and units. Instead of customers having to contact each publisher individually, we take that task on for them. While other resellers offer similar solutions, CDW•G returns this review and accompanying timeline within 10 days, not four to eight weeks. Instead of uploading the information to a web portal for customers to navigate alone, our software experts consult customers, providing recommendations for cost savings, license consolidation, and renewal strategy. These steps simplify and streamline the licensing review process. As our software and account teams learn the customer’s systems and processes, they proactively guide the customer to licensing programs and products that best fit the customers’ requirements and technology goals. Requirement  6.6 How maintenance support is to be made available. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-14 Response CDW•G partners closely with each software publisher’s supporting resources to provide easy access for phone-in incidents, software upgrades, and technical support. Within our sales offices, we have dedicated vendor desks, where qualified manufacturer personnel respond to customer inquiries and provide support to AMs. Additionally, software-specific newsletters are available to customers, keeping you up-to-date on popular and new-release products. Part of our industry-best pre-sales consulting methodology is maintaining communication with customers to ensure awareness of release dates and the maximization of our no-cost roadmapping offer. Please note that CDW•G account managers will never include maintenance or any additional purchasing options on a quote without first discussing with the customer to ensure they understand the different maintenance levels that are available and what is included in the maintenance offer selected. Requirement  6.7 Describe how training regarding the installation of products and use of products will be made available and how to obtain best value from it. Response CDW•G’s software practice includes resources such as pre-sales technical specialists, licensing specialists, product specialists, and post-sales engineers. These resources play a valuable role for our customers as it relates to product-pertinent questions, technical questions, and installation/use rights. Our team of experts offers guidance and directs customers to the correct location on a manufacturer website to obtain installation training, instructions, and industry best practice. Our ability to quickly provide this guidance is a value to getting the most out of the software once purchased. Online Training The current webinars/trainings offered by CDW•G are listed in the Media Library located by clicking on the Solutions tab on www.cdwg.com. The Media Library is dynamic, with new content updated monthly. In addition to webinars and video channels, there are helpful documents, including white papers, reference guides, data sheets, and reports. CDW•G also offers website showcases for many of our software manufacturing partners, such as Microsoft. For example, the Microsoft Showcase is located at www.cdwg.com/Microsoft. The site provides customers with Microsoft-specific material, updated at minimum on a monthly basis. Additional resources for segment-specific material include our State Tech magazines (www.statetechmagazine.com) and Ed Tech Magazine (www.edtechmagazing.com/k12/), both to which interested agencies and schools can subscribe. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-15 7. Value-Added Services Requirement 7. A significant aspect of this service is to be Value-Added Services.  7.1 Describe how your company handles the complexities related to enterprise license agreements (e.g. Microsoft EA, Adobe CLP, etc.). Include how you assist customers (especially first time customers) through this process to ensure they are comfortable moving forward, and are knowledgeable about the agreements once they are complete? Response CDW•G understands that Enterprise Agreements (EAs) are often one of the most expensive IT costs a customer will incur during a year. It is our goal to ensure our customers are knowledgeable about the agreement and receive the most out of their investment as possible. Because of this, we have created the following EA contract management process, which has become a proven methodology in helping manage state software contracts over the years. Requirement  7.2 Describe how your company handles transitioning a group of customers from an account manager with whom they have built a relationship to an account manager who is new to them? o 7.2.1 How do you ensure that all of the customers' needs are met? o 7.2.2 How do you ensure the new account manager is given the resources necessary to be successful in the new role? Response CDW•G subscribes to a practice of warm transfers in regard to customer transition. The existing account manager will reach out to the customer and introduce the incoming account manager; behind the scenes, the incoming account manager will receive a full debrief from the existing, utilizing our internal tracking and monitoring system which manages individual account history. Customer accounts transfer to tenured, experienced dedicated account resources, often already possessing familiarity with the customer and who have completed approximately six months of in-depth sales training. Nearly a quarter of our AMs have been with CDW for more than 10 years. Requirement  7.3 Describe the training available regarding the use of this contract and how to obtain best value from it, other than on-line tutorials. Response CDW•G provides a variety of value-added training options. Many times, we offer these options in tandem with our publisher partners. For example, CDW•G works closely with Microsoft to directly engage and educate customers via phone, online, and in-person seminars and educational events. Microsoft and CDW•G work together to present information to customers and respond to their questions. CDW•G is open to all options, both remote and onsite, as well as at CDW•G facilities to meet NASPO ValuePoint customer needs. We also offer the unique Microsoft Education Center, which presents a hands-on experience to our customers who want to test out new Microsoft products and software. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-16 For all other solutions, CDW•G offers our Technology Experience Center, which allows customers to try out a demo of the software outside of their own environment, make software comparisons, and explore the latest innovations to see if that product will help achieve the customer’s business goals. Requirement  7.4 Explain what unique Value-Added services your Company will make available under a resultant contract. State whether they are to be provided at no cost. If there are costs, identify these costs on the applicable Pricing Sheet in the Cost Section. Response CDW•G does not compete on price alone. As a vendor-agnostic solution provider, pre-sales recommendation support from our knowledgeable account teams and software specialists will always be an unparalleled differentiator when compared against our major competitors. We are the leading reseller to multiple named publishers in this RFP, including key itemized Microsoft, VMware, and Adobe. Our close partnerships mean we receive competitive price offers and early notifications regarding product changes, allowing the account managers serving NASPO ValuePoint members to keep their customers apprised of new product releases, version and price changes, and more in a timely manner. Our ability to serve NASPO ValuePoint customers participating in this contract is exponentially heightened by the myriad value-added benefits we provide at no cost. These benefits include, but are not limited to, the following: NO COST Value-Added Benefits for NASPO ValuePoint Benefit Cost Description Solution Consultation Services FREE Savings: over $250/hour Inside Solution Architects (ISAs)—technology and product experts—vet complex solutions, arrange product demos, webinars, and information documentation Solution Design Services FREE Savings: over $300/hour Field and inside engineers available for onsite access to customer environments, conduct assessment, provide technology-needs analysis Threat Check FREE Savings: $3,000-5,000 per assessment Passively monitors networks for unknown malware, alerts customers to active and installed malware, provide customized plan for remediation Partner Assisted Grant Help FREE AMs assist with learning about available resources for segment-specific grant-finding processes eProcurement Integration Services FREE Dedicated team integrating customer ePro systems for punch-out, PO delivery, eInvoicing, quote retrieval, order, and more K–12 Consulting FREE Savings: over $250/hour Former educators and educational technologists work as strategists to guide schools through high- access implementation and develop long-term adoption success plans Digital Age Teaching and Learning Webinars FREE Savings: over $125 per attendee CDW·G’s Education Strategy Team conducts series of three one-hour webinars on latest technology trends in education NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-17 NO COST Value-Added Benefits for NASPO ValuePoint Benefit Cost Description Track and Communicate CDW•G Software Webinars FREE CDW·G advertises to all contract holders and end users for webinars pertinent to COTS software on NASPO ValuePoint contract Technical Trainings FREE Includes two (2) trainings per calendar year WebEx trainings specific to this contract, scheduled 60 days in advance on pertinent software (approx.. 30+ hours of CDW·G backend planning/work for each session0 CDW•G Blog FREE All interested parties under the contract will receive our Solutions Blog: blog.cdw.com; internal engineers and SMEs write to relevant IT topics Partner-Funded Programs FREE Leverage CDW·G relationship with key OEMs to get business development funds for projects users are potentially unable to fund independently Marketing & Social Media FREE CDW·G collaboratively creates marketing materials and events with each participating state to promote adoption of contract Technology Roadmapping Sessions FREE Valued at $1,000, one per year Held by request with key software publishers and state customers, proctored by CDW·G sales teams Other free benefits include access to CDW-badged product specialists, dedicate contract expert resources, Media Library access, and free eligibility for state customers interested in the Microsoft Rapid Deployment and Technology Adopter programs. Each participating state’s specific account team offers additional value-added benefits, in terms of personnel and expertise, at no cost to the customer. These personnel include software licensing specialists, licensing account executives, pre-sale system engineers, software manufacturer representatives, and dedicated renewals specialists, program managers, account managers, and account executives. Snow License Management There are more comprehensive options for software license management outside of the Account Center website and your CDW·G account team. Automated tools such as Snow Software’s License Manager can identify every piece of software in a NASPO ValuePoint member’s IT systems and match them to licenses, reducing risk, cost, and complexity often found in typical software management. At this time, there are 282,800 software applications automatically recognized by Snow through its Software Recognition Service (part of the License Manager solution). For NASPO ValuePoint members, CDW·G will provide a Snow Software Proof of Concept software assessment in order to understand and agency’s current environment at no cost. The Proof of Concept includes the following:  Detailed inventory collection via Snow or using existing inventory tools (e.g., SCCM)  Software metering via Snow to understand usage  In-depth analysis of up to five Windows-based applications  Business-case documentation illustrating compliance, usage, risk areas NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-18 8. Customer Support Requirement 8. Explain how your Company will:  8.1 Retain publisher certification levels and improve on them. Response CDW•G holds the top certification levels with most major software publishers. Each of these publishers has a stringent set of criteria that must be met in order to hold this certification. Often included in this set of criteria are certification requirements for individual employees, such as sales teams, engineers, and licensing specialists. Moreover, a reseller is only as reliable as the coworkers directly serving their customers. Therefore, we have described our process for both CDW•G as a company, and the process we follow to ensure our coworkers acquire and maintain the necessary certifications to support our customer base. CDW•G Company Certifications CDW’s Product and Partner Management team manages all aspects of our partner relationships. One of the group’s primary goals is to optimize partner relationships. Included in the duties supporting this goal is the management, tracking, and administration of partner certifications across CDW•G. They work with our publisher partners to ensure we continue to meet the requirements for our certifications. If we have not reached the top certification level, they are actively engaged in monitoring and engaging the teams needed to help meet those additional requirements to reach the next certification level. Coworker Certifications We require our sales coworkers to acquire and maintain specific partner certifications. When an account manager wants to move up in their role, say from an account manager to a senior account manager, there are additional certifications we require them to obtain. This methodology ensures our coworkers continue to be experts in the solutions they are selling. To give insight into the depth of our bench of certified coworkers, we include a few examples of CDW’s total certifications for some of our publisher partners:  VMware: 1,300+ VMware Sales Professional Accreditations (VSPs)  Microsoft: 740+ coworker certifications  Adobe: 800+ sales-specific Adobe certifications  Symantec: 2,590 total coworker certifications Additionally, CDW•G compliments some of our partner certifications with CDW-designed training for our partners, such as Microsoft, which provides more in-depth knowledge than the partner created training. Requirement  8.2 Work to reduce costs to obtain publisher products? Response Two major differentiators to the CDW•G business model are tools that streamline processes and the vast number of resources we dedicate to supporting our customers. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-19 Conventional thinking might disagree considering high-touch service and investments in cutting-edge methods as cost saving attributes. However, we have repeatedly demonstrated on agreements similar to the NASPO ValuePoint software contract that our differentiators are true drivers to reducing costs; all while adding value that our competitors fail to replicate. Holding a high certification level with a publisher partner provides resellers access to favorable pricing, tools and resources, including vendor incentive programs, which resellers use to provide additional value to their customers. Because of our unique industry position and business model, CDW•G is often able to negotiate beyond these incentives because our partners see the value we offer: a cost-effective way to get their solutions to their customers. Other resellers may offer a streamlined purchasing process or a long list of personnel, but very few offer both, and even fewer in the capacity that CDW•G offers. Our systems support the coordination and synchronization demands that are required to keep costs under control for customers, supplier/OEM partners, and CDW•G. When coupling partner savings with the sheer volume of products CDW•G procures for our customer base, it is easy to understand how we can negotiate additional savings and value adds to pass on to our customers. We provide a unified customer experience, routing every customer-initiated interaction to a named account manager. Our tools and support are designed around this central concept. Our customer- facing technologies, supply chain tools, and ordering processing system are one in the same. This innovative system provides the customer transparency to the purchase process, reduces order errors, and allows us to manage the complexities of our large distribution channel. Simply put, we provide logistical capabilities typically attributed to distributors, while also providing support staff that greatly reduces the customer issues escalated to the partner. In turn, partners pass savings on to our customers with more aggressive discounts. Our software services team further drives software cost reductions. Instead of pointing our customers to a web tool to manage their licenses or a blog post to understand a software solution, we support them with a software services team. These individuals are helping customers in leveraging software benefits, ensuring customers are using the appropriate level of licensing, and helping to understand if cloud solution really is cost-effective for customers’ specific needs. Requirement  8.3 How does your Company respond to customer complaints and service issues?  8.4 What is your Company’s escalation process? Response We always direct customers first to their AM to assist with complaints and service issues. CDW•G also provides NASPO ValuePoint customers access to our US-based customer relations department as a value-added service. This support is available 7am-9pm CST, Monday through Friday. For sales-specific issues, our government and education sales support team is available Monday through Friday, 7am-6pm CST. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-20 The four no-cost general levels of support available to NASPO ValuePoint customers are the following:  Customer Relations. 866.782.4239 (M-F, 7am-9pm CST); online chat (M-F, 7am-6pm CST; customersupport@cdw.com  Government and Education Sales. 800.808.4239 (M-F, 7am-6pm CST); cdwgsales@cdwg.com  E-Support. For website questions only: 888.239.7270 (M-Th, 7am-7pm CST; F, 7am-6pm CST); online chat (M-F, 7am-6pm CST); support@cdw.com  Technical Support. 800.383.4239 (M-F, 7am-7pm CST); online chat (M-F, 7am-6pm CST); support@cdw.com Additionally, for customers who have purchased Microsoft Office 365 through the CSP program, CDW•G offers 24/7/365 support at ManS-O365@cdw.com or 888.793.2480 (option #5). The above departments all work together to help resolve any issues which may arise. CDW•G aims to resolve all cases within 24 hours. Escalation Process If a NASPO ValuePoint member feels a request is not receiving proper attention, they can reach out directly to a sales manager to resolve the issue. For non-critical incidents, sales managers typically respond within four business hours; critical issues will be escalated as appropriate to the severity of the incident. NASPO ValuePoint members should be confident this contract has the appropriate level of executive sponsorship within CDW•G. David Hutchins (VP, State & Local Sales) and Tony Sivore (Director, State & Local Sales) are both high-level points of contact focused on the success of this agreement. Both have extensive knowledge of tour government agreements and current NASPO ValuePoint reseller agreements. If an incident requires further escalation, our sales managers will quickly engage either Mr. Hutchins or Mr. Sivore, dependent on the subject of the incident. Mr. Sivore typically responds within one business day for non-critical issues; two business days for those escalated to Mr. Hutchins. If an issue arises with a manufacturer or distribution partner, both gentlemen have the best points of contact committed to quickly resolve these issues, as well. 9. Problem Resolution Requirement 9.1 Problem Resolution: Scenario 1: Describe at least one recent situation where your Company made a major error that resulted in dire consequences for a customer. Detail the error and what changes your Company has made to avoid repeating the error in the future. In this situation, the problem is not solved in time to take care of the customer, and the customer is likely lost. Response One of our longtime customers, a Washington school district, worked with CDW•G to design their new networking system. After implementing the system, the school tasked us with implementing a policy platform for the network. Due to our solution architect’s design error, the products purchased were not compatible with the network endpoints previously installed, and we could not properly implement the solution. The situation was a major error and could have resulted in the customer going elsewhere. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-21 However, the CDW•G account team quickly reacted to remedy the error. We brought on additional engineers to redesign and implement the solution on-site, while the account team handled expediting the replacement product orders. We absorbed the resource and material costs required to meet all the originally agreed upon requirements. This major error also threatened to delay the project but our quick reaction allowed us to meet the initial deadline that we had committed. The error also shook the customer’s confidence in CDW•G’s ability to fulfill the project. While the customer wavered in its decision to continue with us, they recognized our monumental effort to fix the mistake and offered a second chance. We made sure that they did not regret it and met their original implementation deadline without cutting any corners. Today, this customer is elated with their networking system and they continue to work with us for project design, to product fulfillment, to implementation and follow-up needs. Lessons Learned To mitigate future errors, CDW•G has our solution architects assigned to specific account teams. This ensures the same solution architects are designing all of the same customers’ solutions, providing them intimate knowledge of the customers’ systems. Additionally, this structure builds the solution architect/account team relationship, resulting in regular communication of important customer background information. This change in communication methodology allows the account teams and the solution architects to better anticipate customer needs and provide a greater level of customer service. Requirement 9.2 Scenario 2: Describe at least one recent situation where your Company made a major error that had potential dire consequences for a customer. Detail the error and what was done to correct the situation. To what lengths did your Company go to take care of the customer? What changes (if any) did your Company make to avoid repeating the error in the future? In this situation, the problem is solved in time to take care of the customer, and the customer is likely not lost. Response Six years ago, the County Commissioners of Pennsylvania (CCAP) awarded CDW•G its Microsoft contract. Prior to CDW•G’s award, CCAP had had been engaged with another provider. Due to CCAP’s familiarity with the incumbent, CDW•G had to work closely with Microsoft and CCAP to ensure the success of the transition from the other vendor’s services. This was a single award contract, and the contract implementation took place during the busiest month of the contract year. The issue in this scenario was that it was not yet a part of our process for us to begin working with Microsoft immediately after the award of the contract to understand upcoming renewals and annual payments. We previously waited until Microsoft’s Change of Reseller process was complete, and we were able to run reporting on our own. This resulted in many CCAP customers becoming nervous that their Microsoft Agreements would expire before we could renew them. Fortunately, due to our Microsoft relationships and experience in managing Microsoft contracts, the detailed instructions we provided for completion of the contract implementation resulted in no lapsed agreements. Our ability to stay in close contact with Microsoft and CCAP proved to be critical to the overall success of the transition. After going through a formal RFP process at the end of the original contract term, CCAP awarded their next Microsoft contract to CDW•G again. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-22 This award was due to the successful implementation of our contract management methodologies and our contract implementation plan execution. In the past three years, CDW•G has maintained a 100 percent on-time renewal rate for expiring agreements on this contract. We continue to be successful because of our proactive touch points with the customer during the license management process, our understanding of their procurement processes, and our operational excellence. Lesson Learned From this transition, we learned that it is important to begin working with our partners immediately after the award of the contract to understand past, current, and future projects. We previously waited until the Change of Reseller process was complete and were able to run reporting on our own. Now, we start immediately and proactively communicate the plan to all constituents so that no one becomes concerned that their agreement may lapse. Although this is an example that deals with Microsoft, the lessons learned are applicable to contracting as a whole. We learned that it is necessary to take preliminary steps before a contract goes into effect. This approach will be adopted as part of our methodology to ensure that any transition to NASPO ValuePoint contract is seamless to customers. This will be the tactic from the date of an award to CDW•G as a primary vendor for the NASPO ValuePoint contract. 10. Product Return Process Requirement Describe the proposed product return process in the following situations:  10.1 Scenario 1: Product was ordered. The order was filled and shipped correctly. After the order was accepted, AP discovered it ordered the wrong product and wants to return the product. Response In the context of this first scenario, a customer can submit an RMA request in a variety of methods: online via the website, via email or a call to their AM, or via the customer service team. The standard return period for all products purchased from CDW•G is 30 days from date of invoice. Once the RMA request is processed, the customer receives an automated email with return instructions. Following receipt of the instructions, the customer ships the products back to our distribution centers with the shipping label they receive automatically. Requirement  10.2 Scenario 2: Product was ordered. The order was filled and shipped. After the order was accepted, AP discovered the product delivered did not match the product that was ordered. AP would like to return the product. Response As in the previous scenario, the customer can submit an RMA request online, contacting their account manager, or reaching out to our customer service team. They receive product return instructions for processed RMAs via email. Following the instructions, the customer ships the products back to our distribution centers with the shipping label they receive automatically. The key exception is that in this situation, there are no restocking fees issued since the error was committed by CDW•G. The return period for all products purchased from CDW•G is 30 days from date of invoice. NASPO ValuePoint | Software Value-Added Reseller Services Attachment B: CDW·G Methodology | B-23 As an option during either scenario, customers can take advantage of the Advanced Order Replacement (AOR) program. This is most often used when the customer receives a defective or DOA product and cannot wait for CDW•G to receive the defective one back before the replacement is sent out. This process ensures that the customer receives the products they need as soon as a product is found to be DOA, incorrectly purchased, or incorrectly shipped. 11. SVAR Performance Requirement Describe the process to be used to track and document the SVAR’s performance, to include “Cost Savings” achieved, under this Contract. See Section 3: Scope of work, Items 3.5.3 and 3.5.4. Response Our systems record key information about order fulfillment time, quote, and order activity that can be aggregated by OEM or function, and pricing benchmarks. CDW·G contract support teams hold regular quarterly business reviews (QBRs) with many of our top customers to review activity, customer service levels, and savings under various program structures. NASPO ValuePoint customers and the LSCA will receive the same attention to detail. CDW·G will establish a regular cadence for our contract professionals and key sales leaders to meet with purchasing operations, contract administration and other representatives of the Lead State, to review spend reports and actions implemented during the previous quarter, and to discuss possible improvements to be implemented during the coming quarter. Any known issues or escalations will be addressed, as well as the review of performance surveys. Options to reduce costs, improve service, and enhance operability and future-proofing can also be determined during these QBRs. In our current contract reviews, we typically review the following: spend analysis, spend by product category (e.g., Security Software/Dbase Software/Network Management, Virtualization), spend by publisher, purchase method, and savings analysis, future forecasting, and new and emerging technologies. Our goal is to maximize a customer’s investments by giving our recommendations towards the best use of volume or enterprise license agreements, in addition to seeking ways that NASPO ValuePoint members can take advantage of publishers' promotions and incentives. NASPO ValuePoint | Software Value-Added Reseller Services Attachment C: Cost Proposal | C-1 Attachment C: Cost Proposal Requirement Any narrative explanation of the Pricing Sheet forms is to be submitted as part of Attachment C—COST PROPOSAL. Offeror shall provide pricing that includes all costs associated with the responsibilities and related services, including but not limited to, freight and delivery, cost of materials and product, travel expenses, transaction fees, overhead, profits, and other costs or expenses incidental to the Offeror’s performance. Response To confirm, CDW•G’s offer does not include any “incidentals.” There are no additional charges as described in the above requirement (e.g., freight and delivery, cost of materials and product, travel expenses). Presenting our pricing rationale, or “cost reasonableness,” illustrates the transparency with which we will approach the negotiation of establishing a Master Agreement with NASPO ValuePoint. CDW•G has the ability to provide thousands of software titles to NASPO ValuePoint members. Outside of the named Key Itemized publishers, many software OEMs only publish current Manufacturer’s Suggested Retail Price lists (MSRPs) irregularly or infrequently, despite titles going end-of-life and new titles being listed. Additionally, once an MSRP is published, the price points rarely change and are often not indicative of market pricing that is commonly available. This means a large discount off MSRP that may seem to be an ideal offer today can over time become non-competitive given normal product lifecycle and cyclical pricing declines common to the IT marketplace. In other words, the cost of IT products—including software—typically trend downward. For this reason, our presented offer to your members is a cost-plus model over CDW•G Sim Cost, which is the standard acquisition cost associated with the inventory of product, but also including the management costs with procuring, warehousing, and distributing the inventory. This model enables members to achieve the greatest long-term cost savings. The advantage of this dynamic pricing model is that as our acquisition cost is reduced, the price to the customer is reduced accordingly. Once loaded into our contract management system, price changes trigger automatically to the customer’s CDW•G website (described in Attachment B) and EDI pricing without manual intervention. Aligning with the primary objective of this RFP—to obtain best value and more favorable pricing for participating members than can be achieved independently—CDW•G strives to simplify the complexities of technology procurement across selection, integration, and management for customers large and small, acting as an extension of their IT staff. Upon award, CDW•G will continually seek out savings to offer NASPO ValuePoint members, as well as providing unmatched stewardship and service to this contract. ATTACHMENT C1 - PRICING SUBMISSION SHEET NASPO VALUEPOINT SOFTWARE VALUE-ADDED RESELLER (SVAR) MARKUP/DOWN 2 1 The price to Authorized Purchaser (AP) is calculated using the following formula: "Reseller Cost" + ("Reseller Cost" x "Markup/down") ADOBE 0.97%PROPOSER INSTRUCTIONS: CITRIX 0.97% MICROSOFT ‐1.26% NOVELL 0.97% SYMANTEC 0.97% VMWARE 0.88% AI SQUARED 2.20% AIRWATCH MOBILE DEVICE MANAGEMENT VMWARE 1.13% ALLIANCE ENTERPRISES 2.20% APPLE 2.20% ATTACHMATE – MICROFOCUS 1.25% AUTODESK 2.20% AUTONOMY – HP 2.20% BAKBONE – DELL 1.13% BARRACUDA 2.20% BOMGAR REMOTE SOFTWARE 0.75% CA TECHNOLOGIES 2.20% CISCO 2.20% COMPUTRONIX USA 1.13% COMPUWARE 2.20% COREL 2.20% DOUBLETAKE 2.20% EMC 2.20% ENCHOICE 2.20% ESET 2.20% ESRI 2.20% FREEDOM SCIENTIFIC 2.20% GUARDIAN EDGE – SYMANTEC 2.20% GW MICRO 2.20% IBM 2.20% ICM CONVERSIONS 2.20% INFOR 2.20% INTERMEDIX EMSYSTEMS 2.20% HP 2.20% HUMANWARE 2.20% INFORMATION BUILDERS 2.20% KRONOS SOFTWARE 2.20% LANDESK 2.20% LASERFISCHE 2.20% LIQUIDWARE STATUSPHERE 2.20% MICROFOCUS INC 2.20% MINJET 2.20% MPS 2.20% Enter a percentage markup or markdown for each line in column D. This is the markup/down at which proposer is offering to provide the stated publishers' titles. Percentages may be listed to two decimal points.KEY ITEMIZEDOTHER ITEMIZEDPUBLISHERS Proposer must be certified as a direct reseller for all Key Itemized publishers. Direct reseller certification is preferred for Other Itemized publishers ATTACHMENT C1 - PRICING SUBMISSION SHEET NASPO VALUEPOINT SOFTWARE VALUE-ADDED RESELLER (SVAR) MQSOFTWARE – BMC SOFTWARE 2.20% NCIRCLE 0.00% NETOP 1.25% NUANCE 2.20% ORACLE 2.20% OSAM 2.20% PASSPORT 1.25% PATCHLINK 1.25% PROOFPOINT 2.20% RSA SECURITY 2.20% REFERENCIA SYSTEMS 2.20% SAP AMERICA 2.20% SAS 1.25% SOLUTIONS SOFTWARE 1.13% SOPHOS 2.20% SPLUNK SOFTWARE 2.20% STASEEKER NETWORK INFRASTRUCTURE MONITORING 2.20% STELLENT – ORACLE 1.25% SUNGUARD 1.13% SYBASE 1.25% TECHSMITH 1.25% TREND MICRO 1.25% TRUSTWARE 0.25% ULTRABAC 1.13% VORMETRIC 1.13% WEBSENSE 0.88% any other non‐listed publisher 2.20% NASPO ValuePoint | Software Value-Added Reseller Services Attachment D: CDW·G Executive Summary | D-1 Executive Summary Requirement Attachment D-Executive Summary should highlight the major features of the Offer. Briefly describe the Offer in no more than two (2) pages. The reader should be able to determine the essence of the Offer by reading the Executive Summary. Any requirements that cannot be met by the Offeror must be included. Response The NASPO ValuePoint Cooperation Purchasing Program is the standard of excellence by which public cooperative contracting is measured in the United States. With 3,901 participating addenda, NASPO ValuePoint encourages competitive vendors to offer the most innovative technologies at the best value. CDW Government LLC (CDW·G), as the nation’s leading IT solution provider, is ideally positioned to serve as a primary software value-added reseller (SVAR) for all participating states. Qualifications Our capabilities extend beyond those of the typical SVAR, with dedicated public sector account managers, knowledgeable field executives, experienced program managers, and qualified engineers providing targeted, streamlined assistance to individual customers. These personnel are here to serve, in person, on the ground, and from the warehouse. Specifically, our Software Licensing Support Team ensures that purchases are scalable and complementary to existing customer systems. This team includes over 85 licensing specialists, 250 systems engineers, and 45 account executives—all experienced in helping agencies choose and use the best possible software solution available. CDW·G is built upon a foundation of strategic partnerships, including the listed key and secondary software publishers named in the RFP. Microsoft®, Adobe®, VMware®, Citrix®, and Symantec™ are only a few of the brands we offer. Our extensive catalog gives participating entities the luxury of choosing the best commercial-off-the-shelf software products tailored to their needs, be it state and local government, K-12, or higher education. Methodology License management is an integral component of our methodology. Through our account teams, licensing specialists, free customized websites, timely reporting, and quarterly reviews, CDW·G eases the burden of managing software licenses and maintains frequent communication to alert users of updates, renewals, and new products without prompting. A good solution begins with good people. CDW·G software engineers provide NASPO ValuePoint customers with design and consultative services at no additional charge. Other no-cost services offered to participating state agencies include threat checks, roadmapping, integration services, grant assistance, and software webinars. NASPO ValuePoint | Software Value-Added Reseller Services Exceptions to Contract Requirements CDW Government LLC (“Contractor” or “Reseller”) proposes the following changes to the terms and conditions. Insertions are underlined and deletions are stricken through. All other proposals are indicated in bold. Explanations are in comments. These proposals are for the State’s review and input. Notwithstanding what is stated in the RFP, Reseller shall not be bound to any terms and conditions of the RFP or to any contract related to the RFP until or unless: (i) the State confirms in writing its acceptance of these deviations as fully incorporated therein; or (ii) authorized representatives of both parties execute a written contract that is separate from the RFP. Section 3: Scope of Work 3.2.1.6.1 The Reseller must agree that there are no software publishers with whom, absent just cause, they will refuse to do business…[remainder as written] 3.2.1.8.3 Notwithstanding what is stated in this section, Reseller proposes all returns are subject to the manufacturer’s then-current return policy. 3.4.1 Training, if offered by manufacturer, shall be available in the form of tutorials for basic installation and web-based training for software operation, basic phone support. 3.4.2 If offered by manufacturer, Pprovision of information on how to access a Software Publisher's "Help Desk" (either telecom or web-based) for basic use questions. 3.4.5.1 Upon written request from the State, Reseller is expected to will conduct quarterly reviews of all sales volumes and report sales figures and savings from Publisher's list price, by Publisher and by PA, as well as observed trends or purchasing patterns, and to present the information to the LSCA. Section 4: NASPO ValuePoint Master Agreement Terms and Conditions 1. Notwithstanding what is stated in this section, Contractor proposes that its response to the Solicitation take precedence over all other documents forming the Master Agreement to ensure the exceptions contained herein have binding effect. 14.b.(2) The Indemnified Party shall notify the Contractor within a reasonable time … [language as written] … in the pursuit of the Intellectual Property Claim. Unless otherwise agreed in writing, this section is not subject to any limitations of liability in this Master Agreement or in any other document executed in conjunction with this Master Agreement. NEITHER PARTY SHALL BE LIABLE FOR ANY INDIRECT, CONSEQUENTIAL, PUNITIVE, OR SPECIAL DAMAGES. IN THE EVENT OF ANY LIABILITY INCURRED BY CONTRACTOR OR ANY OF ITS AFFILIATES HEREUNDER, THE ENTIRE LIABILITY OF CONTRACTOR AND ITS AFFILIATES FOR DAMAGES FROM ANY CAUSE WHATSOEVER WILL NOT EXCEED THE GREATER OF: (A) THE DOLLAR AMOUNT PAID BY THE LEAD STATE, PARTICIPATING ENTITIES, OR PURCHASING ENTITIES FOR EITHER THE SPECIFIC PURCHASED ITEM(S) GIVING RISE TO THE CLAIM; OR (B) $2,000,000.00. 17.b.1 Policy shall include bodily injury, property damage, and broad form contractual liability coverage. 17.d Prior to commencement of performance, Contractor shall provide to the Lead State a written endorsement to the Contractor's general liability insurance policy or other documentary evidence acceptable to the Lead State that (1) names includes the Participating States identified in the Request for Proposal as additional insureds, (2) provides that the General Liability policy shall by blanket endorsement by contract give a thirty (30) days prior written notice of cancellation if any of the additional described policies are cancelled before the expiration date thereof, notice will be delivered in accordance with the policy provisions no material alteration, cancellation, non-renewal, or expiration of the coverage contained in such policy shall have effect unless the named Participating State has been given at least thirty (30) days prior written notice, and (3) … [remainder left intact as written] 23. Payment for completion of a contract order is normally made within 30 days following the date the entire any partial order is delivered or the date a correct invoice is received, whichever is later. [remainder as written] 31. Notwithstanding the foregoing, title to third party software, the licenses to which are resold by Contractor, will remain with the third party. Purchasing Entity’s rights in such software are specified in the license agreement between such third party and Purchasing Entity. Upon Acceptance by the Purchasing Entity, Contractor shall convey to Purchasing Entity title to Product consisting of tangible media free and clear of all liens, encumbrances, or other security interests. Section 5: Lead State (State of Arizona) Terms and Conditions, 5.1 State of Arizona Special Terms and Conditions O. The Materials and services supplied under this Contract shall comply with all applicable Federal, state and local laws, and the Contractor shall maintain all applicable licenses and permit requirements. Contractor represents and warrants to the State that Contractor has the skill and knowledge possessed by members of its trade or profession and Contractor will apply that skill and knowledge with care and diligence so Contactor and Contractor's employees and any authorized subcontractors shall perform the Services described in this Contract in accordance with the Statement of Work. Contractor represents and warrants that the Materials provided through this Contract and Statement of Work shall be free of viruses, backdoors, worms, spyware, malware and other malicious code that will hamper performance of the Materials, collect unlawful personally identifiable information on Users or prevent the Materials from performing as required under the terms and conditions of this Contract. X. 1.5. Applicable to all General Liability insurance policies required within the Insurance Requirements of this Contract, Contractor's insurance shall not be permitted to expire, be suspended, be canceled, or be materially changed for any reason without thirty (30) days prior written notice to the State of Arizona. Within two (2) business days of receipt, Contractor must provide notice to the State of Arizona if they receive notice of a policy that has been or will be suspended, canceled, materially changed for any reason, has expired, or will be expiring. If any of the additional described policies are cancelled before the expiration date thereof, notice will be delivered in accordance with the policy provisions. Such notice shall be sent directly to the Department and shall be mailed, emailed, hand delivered or sent by facsimile transmission to (State Representative's Name, Address & Fax Number). BB. Contractor access to State facilities and resources …with an unlawful breach or harmful access committed by Contractor shall be paid by the Contractor. 5.2 State of Arizona Uniform Terms and Conditions 2. Notwithstanding what is stated in this section, Contractor proposes that its response to the Solicitation or Proposal take precedence over all other contract documents to ensure the exceptions contained herein have binding effect. 3.7. Subject to third party licensing limitations, Aany materials, including reports, computer programs and other deliverables, created under this Contract are the sole property of the State. The Contractor is not entitled to a patent or copyright on those materials and may not transfer the patent or copyright to anyone else. The Contractor shall not use or release these materials without the prior written consent of the State. The Contractor shall maintain ownership of its pre-existing work. 3.8. Subject to third party licensing limitations, Aa and all intellectual property, including but not limited to copyright, [language as written] … of the State of Arizona requesting the issuance of this contract. The Contractor shall maintain ownership of its pre-existing work. Comment [TB1]: Before services are to be performed, Reseller will create a Statement of Work (“SOW”) detailing the exact scoping and pricing of the services to be provided, which will be executed by both parties prior to the start of services. The SOW will reflect the terms and conditions as negotiated between the parties during the bidding and contracting process. Comment [TB2]: Explanation - Reseller takes pride in screening its suppliers for liquidity and longevity and therefore proposes the following clarification: Comment [TB3]: Explanations - Reseller, acting as a reseller and not the manufacturer of any proposed products and software, proposes the following clarifications, which apply to the remaining sections: Comment [TB4]: Explanations - Reseller, acting as a reseller and not the manufacturer of any proposed products and software, proposes the following clarifications, which apply to the remaining sections: Comment [TB5]: Explanations - Reseller, acting as a reseller and not the manufacturer of any proposed products and software, proposes the following clarifications, which apply to the remaining sections: Comment [TB6]: Explanations - Reseller, acting as a reseller and not the manufacturer of any proposed products and software, proposes the following clarifications, which apply to the remaining sections: City of Mesa, AZ Contract # 2018011-01 for Information Technology Solutions and Services with CDW Government, LLC Effective: March 1, 2018 The following documents comprise the executed contract between the City of Meza, AZ and CDW Government, LLC., effective March 1, 2018: I.Executed ContractII.Mayor and Council ApprovalIII.Supplier ResponseIV.Original RFP OFFICE OF THE CITY CLERK COUNCIL MINUTES February 5, 2018 The City Council of the City of Mesa met in a Regular Council Meeting in the Council Chambers, 57 East 1st Street, on February 5, 2018 at 5:45 p.m. COUNCIL PRESENT COUNCIL ABSENT OFFICERS PRESENT John Giles David Luna Mark Freeman Christopher Glover Francisco Heredia Kevin Thompson Jeremy Whittaker None Christopher Brady Dee Ann Mickelsen Jim Smith Mayor’s Welcome. Invocation by Pastor Ben Diaz with Palabra de Vida (Word of Life). Pledge of Allegiance was led by Councilmember Thompson. Awards, Recognitions and Announcements. There were no awards, recognitions or announcements. 1. Take action on all consent agenda items. All items listed with an asterisk (*) will be considered as a group by the City Council and will be enacted with one motion. There will be no separate discussion of these items unless a Councilmember or citizen requests, in which event the item will be removed from the consent agenda and considered as a separate item. If a citizen wants an item removed from the consent agenda, a blue card must be completed and given to the City Clerk prior to the Council’s vote on the consent agenda. It was moved by Councilmember Thompson, seconded by Councilmember Glover, that the consent agenda items be approved. Carried unanimously. *2. Approval of minutes from previous meetings as written. Minutes from the January 8, 11, and 22, 2018 Council meetings. Regular Council Meeting February 5, 2018 Page 2 3. Take action on the following liquor license applications: *3-a. It Ain’t Chemo This is a one-day event to be held on Saturday, February 10, 2018 from 9:00 A.M. to 9:00 P.M. at Riverview Park, 2100 West Rio Salado Parkway. (District 1) *3-b. AMC Superstition East 12 A multi-screen cinema is requesting a new Series 6 Bar License for American Multi- Cinema Inc., 1935 South Signal Butte Road - Andrea Dahlman Lewkowitz, agent. There is no existing license at this location. (District 6) *3-c. ATL Wings A restaurant that serves lunch and dinner is requesting a new Series 12 Restaurant License for Stapley Wings LLC, 1455 South Stapley Drive, Suites 22-24 - Andrea Dahlman Lewkowitz, agent. The existing license held by Mark Killian, sole proprietor, will revert to the State. (District 4) *3-d. Elgin Distillery This is a one-day craft distillery festival to be held on Saturday, March 3, 2018 from 9:00 A.M. to 4:00 P.M. at Sunland Village, 4601 East Dolphin Avenue. (District 2) *3-e. Village of Elgin Winery This is a one-day wine festival event to be held on Saturday, March 3, 2018 from 9:00 A.M. to 4:00 P.M. at Sunland Village, 4601 East Dolphin Avenue. (District 2) 4. Take action on the following off-track betting license application: *4-a. Turf Paradise, TP Racing LLLP New Off-Track Betting License for Turf Paradise, TP Racing LLLP to telecast at Moose & Bear, located at 118 East McKellips Road, Suite 103, TB Concepts LLC. Applicant: Vincent Acri Francia. (District 1) 5. Take action on the following contracts: *5-a. One-Year Renewal to the Term Contract for Executive Physicals for Citywide Departments as requested by the Human Resources Department. (Citywide) This contract provides annual physicals for the City’s executive staff as a means of maintaining optimum health. There are approximately 65-70 positions eligible to participate in this program. The Human Resources Department and Purchasing recommend authorizing the renewal contract with Banner Occupational Health Clinics, at $88,500, based on estimated usage. Regular Council Meeting February 5, 2018 Page 3 *5-b. One-Year Renewal to the Term Contract for Deceased Animal Collection Services for the Community Services Department. (Citywide) This contract provides a vendor to collect and dispose of deceased animals up to 150 pounds that are reported within the City. The contractor is responsible for the proper disposal by cremation or other means in accordance with the standards and methods approved by the Maricopa County Health Department. The Community Services Department and Purchasing recommend authorizing the renewal contract with APM/Couts Enterprises, Inc., dba Arizona Pet Mortuary, at $54,000, based on estimated usage. *5-c. Purchase of One Replacement Fire Apparatus, an Air Light/Rehab Unit, for the Fire and Medical Department (Sole Source). (Citywide) The apparatus being replaced has met established replacement criteria and will be sold by a sealed bid process or traded-in as part of the City's fire apparatus purchase agreement with Pierce Manufacturing. In addition, Fire and Medical will trade-in two units to further offset the price for the Air/Light Rehab unit. The Fire and Medical Department and Purchasing recommend authorizing the purchase using the City’s five-year purchase agreement with Pierce Manufacturing Inc., through their designated local dealer, Hughes Fire Equipment Inc., at $502,264.75. This purchase is funded by the Capital-General Fund and authorized 2013 Public Safety Bonds. *5-d. Three-Year Term Contract for Landscape Maintenance Services for Parks, Retention Basins and Sports Fields - Zones 1, 2, 3 and 4 for the Parks, Recreation and Community Facilities Department (PRCF). (Citywide) These contracts provide landscape maintenance services for sports fields, parkways, medians, parks, retention basins or grounds adjacent to City facilities. The City has divided the landscaping into geographic areas known as Zones 1, 2, 3 and 4. PRCF has done an analysis to bring the work under this contract in-house and, at this time, contracting continues to be in the best financial interest of the City. The evaluation committee recommends awarding the contract to the highest-scored proposal from Mariposa Landscape Arizona, Inc.; Zone 1, at $1,435,319.57 annually; Zone 2, at $959,183.45 annually; Zone 3, at $974,364.20 annually; and Zone 4, at $1,221,738.22 annually; based on estimated usage. *5-e. Three-Year Term Contract for Plumbing Services for the Parks, Recreation and Community Facilities Department. (Citywide) This contract will establish a list of pre-qualified plumbing contractors to perform plumbing services on various City facilities/projects on an as-needed basis. The evaluation committee recommends awarding the contract to the four, highest-scored proposals from Mesa Energy Systems Inc.; RKS Plumbing and Mechanical Inc.; Sun Mechanical Inc.; and W.D. Manor Mechanical Contractors, Inc.; cumulatively not to exceed $100,000 annually, based on estimated usage. Regular Council Meeting February 5, 2018 Page 4 *5-f. Purchase of Furniture for the Main Library as requested by the Library Services Department. (Citywide) This purchase will provide seating and tables for two new rooms at the Main Library, Teen Room and ThinkSpot. The Library worked with several vendors utilizing cooperative contracts specifying their needs and goals with this project. The Library Services Department and Purchasing recommend authorizing the purchase using the Northern Arizona University cooperative contract with Atmosphere Commercial Interiors, at $50,876.25. *5-g. Five-Year Term Contract with CDW Government, LLC and SHI International Corp. for Information Technology Solutions and Services for Various Departments throughout the City. (Citywide) This contract will provide the City and participating agencies a full range of information technology solution products and services to meet varying requirements of governmental agencies. The scope of products and services available under these contracts include standard business and high-end workstations; laptop and notebook computers; network equipment; computer and network products and peripherals; monitors; various cloud, consulting, and technical support services; financing; various software products; and the contractors' comprehensive product offering. Mesa, as the lead agency, has partnered with the National Intergovernmental Purchasing Alliance Company (National IPA) to lead this contract. The contract will be available to over 45,000 public agencies nationally. While no minimum volume is guaranteed to the suppliers, the estimated annual volume of IT Solutions purchased under this master agreement is approximately $500 million per year. The City will receive rebates annually for administering and awarding this contract. A committee representing the Police, and Information Technology Departments, City Manager’s Office, Police-Information Technology, National IPA and Purchasing evaluated responses. The evaluation committee recommends awarding the contract to the highest-scored proposals from CDW Government, LLC and SHI International Corp., at $3,100,000 annually, based on estimated usage. *5-h. One-Year Term Contract for Electrical and Lighting Supplies for the Materials and Supply Warehouse (for Citywide Departments). (Citywide) Multiple departments use this Citywide contract for their miscellaneous electrical equipment and supplies. The Business Services Department and Purchasing recommend authorizing the purchase using the State of Arizona cooperative contract with Border States Industries, Inc., at $100,000, based on estimated usage. *5-i. Re-Award the Three-Year Term Contract for Microfilm Conversion Services for the Police Department. (Citywide) This contract will provide services to convert Police Department data from microfilm to digital media. Police, Records Division use microfilm that is becoming worn and damaged. The previous vendor is unable to satisfactorily fulfill the contract requirements. Regular Council Meeting February 5, 2018 Page 5 The Police Department and Purchasing recommend re-awarding the contract to the second highest scored proposal, ICM Conversions, at $400,000 annually, based on estimated usage. *5-j. Purchase of Falcon District Brand Signage as requested by the Economic Development Department. (Citywide) Continuing to build awareness and to promote the Falcon Field Economic Activity Area, this purchase for the Falcon District signage includes the installation of two branded monument signs to be located on Greenfield and Higley Roads, south of the 202. Additionally, the City will install utility and transit signal box wraps and will mount branded banners promoting aerospace, technology, and manufacturing on light poles around the airport. The Economic Development Department and Purchasing recommend authorizing the purchase using the City of Peoria cooperative contract with YESCO Phoenix, at $146,670.49. This purchase is funded by Local Streets Sales Tax. *5-k. Purchase of Three Replacement Rollback Trailers for the Transportation Department. (Citywide) These trailers will replace three aging equipment trailers that are at the end of their service life. The trailers will meet the needs and safety requirements for transporting the large equipment required to perform street and right-of-way maintenance. The Transportation Department and Purchasing recommend authorizing the purchase using the National Joint Powers Alliance contract with Empire Southwest (a Mesa business), at $176,764.77. This purchase is funded by Local Streets Sales Tax. *5-l. One-Year Renewal to the Term Contract for Radio-Based Endpoint Encoders (for Water Meter Reading) for the Water Resources Department. (Citywide) This contract provides Itron radio-based endpoint encoders and accessories purchased directly from Itron, Inc., the manufacturer. The endpoint stores 40 days of hourly reads to ensure data integrity and offers advanced customer side leak detection and reverse flow and tamper alarms. Water Utility installs approximately 540 radio-based endpoint encoders on new and existing meters annually. The Water Resources Department and Purchasing recommend authorizing the renewal with Itron, Inc., at $100,000, based on estimated usage. *5-m. Purchase of Water Treatment Plant Shop Tools and Equipment for the New Signal Butte Water Treatment Plant as requested by the Water Resources Department. (Citywide) This purchase is for tools and equipment needed for the start-up and maintenance in the various shops at the new Signal Butte Water Treatment Plant. The Water Resources Department and Purchasing recommend awarding the contract to the lowest, responsive and responsible bidders: Copper State Bolt & Nut Co. (a Mesa business); Glendale Industrial Supply, LLC, dba UNICOA Construction and Industrial Supply; Mallory Safety & Supply LLC; and W.W. Grainger, Inc.; cumulatively not to exceed $153,000, based on estimated usage. Regular Council Meeting February 5, 2018 Page 6 *5-n. One-Year Renewal to the Term Contract for Fire Hydrant Water Meters for the Water Resources Department. (Citywide) This contract provides 3” fire hydrant water meters to accurately measure construction water use of fire hydrants. The meters are installed by Water Utility staff to serve contractors and other customers needing to connect to City fire hydrants for temporary construction water service and dust control purposes. The Water Resources Department and Purchasing recommend authorizing the renewal with Badger Meter Inc., dba National Meter Automation, at $35,000, based on estimated usage. *5-o. Greenfield Water Reclamation Plant (GWRP), Phase III Expansion Guaranteed Maximum Price (GMP) No. 2. (Citywide) The City of Mesa, Town of Gilbert, and Town of Queen Creek seek to provide an additional 14 million gallons per day annual average day flow of liquids and solids treatment capacity at the existing GWRP, complete with the required infrastructure, technology, and environmental features to ensure a reliable, efficient, and expanded plant to meet the current and future demands. Staff recommends awarding the contract for the completion of this project to McCarthy Building Companies in the amount of $120,302,333 and authorize a change order allowance $6,015,117 (5%) for a total project amount of $126,317,450. This project is funded by the Greenfield Water Reclamation Plant Joint Venture Fund, with contributions coming from its members based on usage. Mesa’s portion of this GMP is $72,229,521 and is funded by 2014 authorized Wastewater Bonds. *5-p. Sewer Pipe and Manhole Rehabilitation: Mesa Drive, Millet Avenue, Horne, and 6th Avenue. (District 4) The existing sanitary sewer lines covered by this project were built during the 1950’s and 1960’s. The age of these pipes greatly increases their risk of failure and emergency repairs. This method of construction can be completed while leaving the pipe in place and without excavation. Similarly, the sewer manholes will be cleaned, repaired, and coated in place. Only the concrete adjustment rings will be removed and replaced. Staff recommends awarding the contract for this project to the lowest, responsible bidder, B and F Contracting, Inc, in the amount of $1,394,294.67, and authorize a change order allowance in the amount of $139,430 (10%), for a total amount of $1,533,724.67. Funding for this project is available from the 2014 Wastewater Bond Program. *5-q. Sidewalks at Railroad Crossing on Alma School. (Districts 3 and 4) To continue to meet current railroad approach and clearance standards at the Alma School Road railroad crossing, additional safety improvements will need to be made. The project improvements for roadway and sidewalk approach at this location will facilitate greater public safety and needed clearances from railroad signals along with a smoother roadway crossing of the Union Pacific Railroad track. Mesa will participate in the federally-funded Railway-Highway Grade Crossing Program, and will be responsible Regular Council Meeting February 5, 2018 Page 7 for adjusting the existing concrete sidewalks around the proposed cantilevers and gates, and installing concrete medians. This project was previously awarded by Council on July 10, 2017, however, the previously selected contractor could not comply with the federal requirements and the project was released for bid a second time. Staff recommends awarding the contract to the lowest, responsible bidder, AJP Electric, in the amount of $149,494, plus an additional $14,949 (10%) as a change order allowance, for a total amount of $164,443. Funding is available from the Local Streets Sales Tax, of which 94.3% will be reimbursed by Arizona Department of Transportation (Federal) Grant under the Railway-Highway Grade Crossing. 6. Take action on the following resolutions: *6-a. Approving and authorizing the City Manager to submit the Second Substantial Amendment to the Fiscal Year 2017/2018 Annual Action Plan to the U.S. Department of Housing and Urban Development related to the allocation of funding obtained under the Community Development Block Grant (CDBG) program. This Amendment will allow for reallocation of $600,000 in CDBG funds from the Senior Center Renovation Project (247 North Macdonald) to the Eagles Park Project (828 East Broadway Road). (District 4) – Resolution No. 11088. *6-b. Approving and authorizing the City Manager to enter into a Grant Agreement with the Arizona Department of Public Safety to accept $1,335,284 in Victims of Crime Act (VOCA) grant funds. The finding will be used for salaries and expenses for the Mesa Prosecutors Office, Victim Services Unit for a three-year period. (Citywide) – Resolution No. 11089. *6-c. Approving and authorizing the City Manager to enter into a Lease Agreement with New Cingular Wireless PCS for a cellular site on a portion of 5950 East Virginia Street, also known as Mesa Fire Station 214. (District 5) – Resolution No. 11090. *6-d. Approving and authorizing the City Manager to enter into a Development Agreement for City-Share Reimbursement with PPGN-Ray, LLLP, for the reimbursement of $100,568 for regional street and street lighting improvements that are being required by the City in conjunction with a proposed residential development known as Crismon Road at PPGN, located at 5461 South Ellsworth Road. (District 6) – Resolution No. 11091. *6-e. Approving and authorizing the City Manager to enter into an Intergovernmental Agreement with the Maricopa County, Department of Transportation for the pavement rehabilitation of Adobe Road from Higley Road to Recker Road. The City will contribute an estimated $54,417 for the portion of the project that is within City boundaries that will be funded from the 2013 Streets Bond Program. (District 5) – Resolution No. 11092. *6-f. Approving and authorizing the City Manager to enter into First Amendments to the Development Agreement, Ground and Air Lease, and License Agreement with 3W Management, LLC, to facilitate the development of, and job creation and retention at, the City-owned property generally located at the southwest corner of Main Street and South Pomeroy and 34 South Pomeroy, which is the development commonly known as The GRID. (District 4) – Resolution No. 11093. Regular Council Meeting February 5, 2018 Page 8 7. Introduction of the following ordinance and setting February 26, 2018 as the date of the public hearing on this ordinance: *7-a. ZON17-00323 (District 5) The 8800 to 8900 blocks of East Main Street (south side). Located west of Red Mountain Freeway on the south side of Main Street (16.4± acres). Rezoning from RS-43 and GC to GC-PAD; and Site Plan Review. This request will allow for the development of an RV dealership and storage facility. Jeff Welker, Welker Development Resources, applicant; Roger D. Overson, owner. Staff Recommendation: Approval with conditions P&Z Board Recommendation: Approval with conditions (Vote: 6-0) 8. Discuss, receive public comment, and take action on the following ordinances: *8-a. ZON17-00309 (District 2) The 5200 block of East Inverness Avenue (south side). Located east of Higley Road south of the US60 Freeway (1.9 ± acres). Rezoning from RM-3-PAD to LC; and Site Plan Review. This request will allow for the development of a commercial building. John Schoenauer, HD Management, applicant; Sevilla, LLC, owner. – Ordinance No. 5419. Staff Recommendation: Approval with conditions P&Z Board Recommendation: Approval with conditions (Vote: 7-0) *8-b. ZON17-00283 (District 6) The 7100 to 7300 blocks of East Ray Road (north side). Located east of Power Road on the north side of Ray Road (56.0± acres). Rezone from LI-AF to LI-AF-PAD. This request will allow for the development of an industrial subdivision. Omar Cervantes, XCL Engineering, LLC, applicant; Phx-Mesa Gateway Airport 193, LLC, owner. – Ordinance No. 5420. Staff Recommendation: Approval with conditions P&Z Board Recommendation: Approval with conditions (Vote: 7-0) *8-c. ZON17-00432 (District 3) The 800 and 900 blocks of West Southern Avenue (south side), the 1200 and 1300 blocks of South Extension Road (west side), and the 800 and 900 blocks of West Grove Avenue (north side). Located at the southwest corner of Southern Avenue and Extension Road (19.3 ± acres). PAD Amendment; Site Plan Modification. This request will allow the development of a new multiple-residence building in an existing multiple-residence complex. Reese Anderson, Pew and Lake, PLC, applicant; Edward B. Frankel, Trustee of the Frankel Family Trust, owner. – Ordinance No. 5421. Staff Recommendation: Approval with conditions P&Z Board Recommendation: Approval with conditions (Vote: 7-0) 9. Take action on the following subdivision plat: *9-a. "Allred Ranch" (District 2) The 2900 to 3100 blocks of East Southern Avenue (north side), and the 900 to 1200 blocks of South Los Alamos (west side). Located east of Regular Council Meeting February 5, 2018 Page9 Lindsay Road on the north side of Southern Avenue. 108 RSL-4.5 PAD lots (25± acres). KB Home Phoenix, Inc., developer; Dan Auxier, EPS Group, engineer. Items not on the Consent Agenda 10. Items from citizens present. There were no items from citizens present. 11. Adjournment. Without objection, the Regular Council Meeting adjourned at 5:57 p.m. ATTEST: DEE ANN MICKELSEN, CITY CLERK ~ ~AYOR I hereby certify that the foregoing minutes are a true and correct copy of the minutes of the Regular Council Meeting of the City Council of Mesa, Arizona, held on the 5th day of February, 2018. I further certify that the meeting was duly called and held and that a quorum was present. DEE ANN MICKELSEN, CITY CLERK js Page 1 of 32 AGREEMENT PURSUANT TO SOLICITATION CITY OF MESA AGREEMENT NUMBER 2018011 INFORMATION TECHNOLOGY SOLUTIONS & SERVICES CITY OF MESA, Arizona (“City”) Department Name City of Mesa – Purchasing Division Mailing Address P.O. Box 1466 Mesa, AZ 85211-1466 Delivery Address 20 East Main St, Suite 400 Mesa, AZ 85201 Attention Sharon Brause, CPPO, CPPB, CPCP Senior Procurement Officer E-Mail Sharon.Brause@MesaAZ.gov Phone (480) 644-2815 Fax (480) 644-2655 AND CDW GOVERNMENT LLC, (“Contractor”) Mailing Address 230 N. Milwaukee Ave Vernon Hills, IL 60061-9740 Remit Address 75 Remittance Dr, Suite #1515 Chicago, IL 60675-1515 Attention Jumana Dihu, Program Manager E-Mail jumdihu@cdwg.com Phone (312) 547-2495 Fax (312) 705-9437 Website www.cdwg.com Page 2 of 32 CITY OF MESA AGREEMENT PURSUANT TO SOLICITATION This Agreement pursuant to solicitation (“Agreement”) is entered into this 28th day of February, 2018, by and between the City of Mesa, Arizona, an Arizona municipal corporation (“City”), and CDW GOVERNMENT LLC, an Illinois limited liability company (“Contractor”). The City and Contractor are each a “Party” to the Agreement or together are “Parties” to the Agreement. RECITALS A. The City issued solicitation number 2018011 (“Solicitation”) for INFORMATION TECHNOLOGY SOLUTIONS & SERVICES, to which Contractor provided a response (“Response”); and B. The City Selected Contractor’s Response as being in the best interest of the City and wishes to engage Contractor in providing the services/materials described in the Solicitation and Response. In consideration of the reciprocal promises contained in the Agreement, and for other valuable and good consideration, which the Parties acknowledge the receipt and sufficiency of, the Parties agree to the following Terms & Conditions. TERMS & CONDITIONS 1. Term. This Agreement is for a term beginning on March 1, 2018 and ending on February 28, 2023. The use of the word “Term” in the Agreement includes the aforementioned period as well as any applicable extensions or renewals in accordance with this Section 1. 1.1 Renewals. On the mutual written agreement of the Parties, the Term may be renewed up to a maximum of two (2), one (1) year periods. Any renewal(s) will be a continuation of the same terms and conditions as in effect immediately prior to the expiration of the then- current term. 1.2 Extension for Procurement Processes. Upon the expiration of the Term of this Agreement, including any renewals permitted herein, at the City’s sole discretion this Agreement may be extended on a month-to-month basis for a maximum of six (6) months to allow for the City’s procurement processes in the selection of a Contractor to provide the services/materials provided under this Agreement. The City will notify the Contractor in writing of its intent to extend the Agreement at least thirty (30) calendar days prior to the expiration of the Term. Any extension under this Subsection 1.2 will be a continuation of the same terms and conditions as in effect immediately prior to the expiration of the then- current term. 1.3 Delivery. Delivery shall be made to the location(s) contained in the Scope of Work within thirty (30) days after receipt of an order. Title to Products and risk of loss or damage during shipment pass from Contractor to City upon delivery to the destination specified on the applicable purchase order (F.O.B. Destination, freight prepaid and allowed). Contractor agrees to deliver all products to be delivered F.O.B. destination, freight pre-paid and allowed to various locations throughout the City. In many cases within the City, the Contractor may be asked to deliver all products to the front counter within a given department. For special orders, the Parties agree to negotiate in good faith an alternative delivery date when necessary. Notwithstanding the foregoing, title to software will remain with the applicable licensor(s), and the City's rights therein are contained in the license agreement between such licensor(s) and the City. 2. Scope of Work. The Contractor will provide the necessary staff, services and associated resources to provide the City with the services, materials, and obligations attached to this Agreement as Exhibit A (“Scope of Work”) Contractor will be responsible for all costs and expenses incurred by Contractor that are incident to the performance of the Scope of Work unless otherwise Page 3 of 32 stated in Exhibit A. Contractor will supply all equipment and instrumentalities necessary to perform the Scope of Work. If set forth in Exhibit A, the City will provide Contractor’s personnel with adequate workspace and such other related facilities as may be required by Contractor to carry out the Scope of Work. The Agreement is based on the Solicitation and Response which are hereby incorporated by reference into the Agreement as if written out and included herein. In addition to the requirements specifically set forth in the Scope of Work, the Parties acknowledge and agree that the Parties shall perform in accordance with all terms, conditions, specifications and other requirements set forth within the Solicitation and Response unless modified herein. 3. Orders. Orders must be placed with the Contractor by either a: (i) Purchase Order when for a one- time purchase; (ii) procurement card; (iii) Delivery Order or Blanket Purchase Order for a requirements contract where multiple as-needed orders will be placed with the Contractor; (iv) Executed Statement of Work (SOW); or (v) Executed Cloud Service Order (CSO) Form. The City may use the Internet to communicate with Contractor and to place orders as permitted under this Agreement. Unless explicitly stated in a separate writing executed by the Parties, the terms and conditions on any order form, quote, or similar document provided by Contractor to the City will not take precedence over the language set forth in this Agreement or any of the documents outlined in Section 4 below. 4. Document Order of Precedence. In the event of any inconsistency between the terms of the body of the Agreement, Exhibits, Solicitation, and Response, the language of the documents will control in the following order. a. Amendments to the Agreement b. Agreement c. Exhibits 1. Mesa Standard Terms & Conditions (Exhibit C) 2. Pricing (Exhibit B) 3. Scope of Work (Exhibit A) 4. Other Exhibits not listed above d. Solicitation including any addenda e. Contractor’s Response 5. Payment. Subject to the provisions of the Agreement, the City will pay Contractor the sum(s) described in Exhibit B (“Pricing”) in consideration of Contractor’s performance of the Scope of Work during the Term. 6. Pricing. Contractor’s pricing shall be in the format of a minimum percentage discount off a verifiable price index. Contractor may submit discounts for various manufacturers. At the time of purchase, Contractor may offer deeper discounts beyond the discounted price list, based on volume or other factors, as applicable. Minimum discounts will remain firm during the entirety of the Term of the Agreement, unless the Contractor requests to increase its discount percentage, and Pricing will include all charges that may be incurred in fulfilling requirement(s). In addition to decreasing prices for the balance of the Term due to a change in market conditions, a Contractor may conduct sales promotions involving price reductions for a specified lesser period. In the event a product is discontinued, Contractor will provide a product of the same or greater functionality, utilizing the discount structure. It is the Contractor’s responsibility to provide the City with an up-to-date price list for the duration of the Agreement. 6.1 Prices. All pricing discounts shall be firm for the Term and all extensions or renewals of the Term except where otherwise provided in this Agreement, and will include all costs of the Contractor providing the materials/service including transportation, insurance and Page 4 of 32 warranty costs. No fuel surcharges will be accepted unless allowed in this Agreement. The City shall not be invoiced at prices higher than those stated in the Agreement. No price modifications will be accepted without proper request by the Contractor and response by the City’s Purchasing Division. 6.2 Price Adjustment. Any requests for reasonable price adjustments must be submitted in accordance with this Section. Requests for adjustment in cost of labor and/or materials must be supported by appropriate documentation. There is no guarantee the City will accept a price adjustment; therefore, Contractor should be prepared for the Pricing to be firm over the Term of the Agreement. The City is only willing to entertain price adjustments based on an increase to Contractor’s actual expenses or other reasonable adjustment in providing the services/materials under the Agreement. If the City agrees to the adjusted price terms, the City shall issue written approval of the change. During the sixty (60) day period prior to the expiration of the then-current term date of the Agreement, the Contractor may submit a written request to the City to allow an increase to the prices in an amount not to exceed the twelve (12) month change in the Consumer Price Index for All Urban Consumers (CPI-U), US City Average, All Items, Not Seasonally Adjusted as published by the U.S. Department of Labor, Bureau of Labor Statistics (http://www.bls.gov/cpi/home.htm). The City shall review the request for adjustment and respond in writing; such response and approval shall not be unreasonably withheld. 6.3 Renewal and Extension Pricing. Any extension of the Agreement will be at the same pricing as the initial term. If the Agreement is renewed in accordance with Section 1, pricing may be adjusted for amounts other than inflation that represent actual costs to the Contractor based on the mutual agreement of the Parties. Contractor may submit a request for a price adjustment along with appropriate supporting documentation demonstrating the cost to the Contractor. Renewal prices shall be firm for the term of the renewal period and may be adjusted thereafter as outlined in the Subsection 6.2. There is no guarantee the City will accept a price adjustment. 6.4 Invoices. Payment will be made to Contractor following the City’s receipt of a properly completed invoice. Any issues regarding billing or invoicing must be directed to the City Department/Division requesting the service or material from the Contractor. A properly completed invoice should contain, at a minimum, all of the following: a. Contractor name, address, and contact information; b. City billing information; c. City contract number as listed on the first page of the Agreement; d. Invoice number and date; e. Payment terms; f. Date of service or delivery; g. Description of materials or services provided; h. If materials provided, the quantity delivered and pricing of each unit; i. Applicable taxes; and j. Total amount due. 6.5 Payment of Funds. Contractor acknowledges the City may, at its option and where available use a Procurement Card/e-Payables to make payment for orders under the Agreement; otherwise, payment will be through a traditional method of a check or Electronic Funds Transfer (EFT) as available. Page 5 of 32 6.6 Disallowed Costs, Overpayment. If at any time the City determines that a cost for which payment was made to Contractor is a disallowed cost, such as an overpayment or a charge for materials/service not in accordance with the Agreement, the City will notify Contractor in writing of the disallowance; such notice will state the means of correction which may be, but is not limited to, adjustment of any future claim/invoice submitted by Contractor in the amount of the disallowance or to require repayment of the disallowed amount by Contractor. Contractor will be provided with the opportunity to respond to the notice. 7. Insurance. 7.1 Contractor must obtain and maintain at its expense throughout the Term of the Agreement, at a minimum, the types and amounts of insurance set forth in this Section 7 from insurance companies authorized to do business in the State of Arizona; the insurance must cover the materials/service to be provided by Contractor under the Agreement. For any insurance required under the Agreement, Contractor will name the City of Mesa, its agents, representatives, officials, volunteers, officers, elected officials, and employees as additional insured, as evidenced by providing either an additional insured endorsement or proper insurance policy excerpts. 7.2 Nothing in this Section 7 limits Contractor’s responsibility to the City. The insurance requirements herein are minimum requirements for the Agreement and in no way limit any indemnity promise(s) contained in the Agreement. 7.3 The City does not warrant the minimum limits contained herein are sufficient to protect Contractor and subcontractor(s) from liabilities that might arise out of performance under the Agreement by Contractor, its agents, representatives, employees, or subcontractor(s). Contractor is encouraged to purchase additional insurance as Contractor determines may be necessary. 7.4 Each insurance policy required under the Agreement must be in effect at or prior to the execution of the Agreement and remain in effect for the Term of the Agreement. 7.5 Prior to the execution of the Agreement, Contractor will provide the City with a Certificate of Insurance (using an appropriate “ACORD” or equivalent certificate) signed by the issuer with applicable endorsements. The City reserves the right to request additional copies of any or all of the policies, endorsements, or notices relating thereto required under the Agreement. 7.6 When the City requires a Certificate of Insurance to be furnished, Contractor's insurance is primary of all other sources available. When the City is a certificate holder and/or an additional insured, Contractor agrees no policy will expire, be canceled, or be materially changed to affect the coverage available without advance written notice to the City. 7.7 The policies required by the Agreement must contain a waiver of transfer rights of recovery (waiver of subrogation) against the City, its agents, representatives, officials, volunteers, officers, elected officials, and employees for any claims arising out of the work of Contractor. 7.8 All insurance certificates and applicable endorsements are subject to review and approval by the City's Risk Management Division. 7.9 Types and Amounts of Insurance. Contractor must obtain and retain throughout the term of the Agreement, at a minimum, the following: 7.9.1 Worker’s compensation insurance in accordance with the provisions of Arizona law. If Contractor operates with no employees, Contractor must provide the City Page 6 of 32 with written proof Contractor has no employees. If employees are hired during the course of this Agreement, Contractor must procure worker’s compensations in accordance with Arizona law. 7.9.2 The Contractor shall maintain at all times during the term of this contract, a minimum amount of $1 million per occurrence/$2 million aggregate Commercial General Liability insurance, including Contractual Liability. For Commercial General Liability insurance, the City of Mesa, their agents, officials, volunteers, officers, elected officials or employees shall be named as additional insured, as evidenced by providing an additional insured endorsement. 7.9.3 Automobile liability, bodily injury and property damage with a limit of $1 million per occurrence including owned, hired and non-owned autos. 8. Requirements Contract. Contractor acknowledges and agrees the Agreement is a requirements contract; the Agreement does not guarantee any purchases will be made (minimum or maximum). Orders will only be placed when the City identifies a need and issues a purchase order or a written notice to proceed. The City reserves the right to cancel purchase orders or a notice to proceed within three (3) business days of issuance; any such cancellation will be in writing. Should a purchase order or notice to proceed be canceled, the City agrees to reimburse Contractor for any actual and documented costs incurred by Contractor. The City will not reimburse Contractor for any avoidable costs incurred after receipt of cancellation including, but not limited to, lost profits, shipment of materials, or performance of services. The City reserves the right to purchase contracted items through other sources if determined in the best interests of the City to do so. 9. Notices. All notices to be given pursuant to the Agreement will be delivered to the Contractor at the address listed on Page 1 of this Agreement. Notice will be delivered pursuant to the requirements set forth the Mesa Standard Terms and Conditions that are attached to the Agreement as Exhibit C. 10. Representations of Contractor. To the best of Contractor’s knowledge, Contractor agrees that: a. Contractor has no obligations, legal or otherwise, inconsistent with the terms of the Agreement or with Contractor’s undertaking of the relationship with the City; b. Performance of the services called for by the Agreement do not and will not violate any applicable law, rule, regulation, or any proprietary or other right of any third party; c. Contractor will not use in the performance of Contractor’s responsibilities under the Agreement any proprietary information or trade secret of a former employer of its employees (other than City, if applicable); and d. Contractor has not entered into and will not enter into any agreement, whether oral or written, in conflict with the Agreement. 11. Mesa Standard Terms and Conditions. Exhibit C to the Agreement is the Mesa Standard Terms and Conditions as modified by the Parties, which are incorporated by reference into the Agreement as though fully set forth herein. In the event of any inconsistency between the terms of the Agreement and the Mesa Standard Terms and Conditions, the language of the Agreement will control. The Parties or a Party are referred to as a “party” or “parties” in the Mesa Standard Terms and Conditions. The Term is referred to as the “term” in the Mesa Standard Terms and Conditions. 12. Counterparts and Facsimile or Electronic Signatures. This Agreement may be executed in two (2) or more counterparts, each of which will be deemed an original and all of which, taken together, will constitute one agreement. A facsimile or other electronically delivered signature to the EXHIBIT A SCOPE OF WORK Page 8 of 32 1. MINIMUM REQUIREMENTS. Contractor must meet the following minimum qualifications: a. A full range of information technology solution products and services to meet varying requirements of governmental agencies. b. Have a strong national presence as a computer solutions provider. c. Have a distribution model capable of delivering products, free of charge, in a timely manner on a nationwide basis. d. Have a demonstrated sales presence. e. Ability to provide a toll-free telephone and state of the art electronic facsimile and internet ordering and billing capabilities. f. Be able to meet the minimum requirements of the cooperative purchasing program detailed herein. 2. ORDERING. Although the City is open to alternate ordering methods, the primary methods for customers placing orders with the Contractor is through the following: a. Online b. Telephone c. Fax d. Email 3. SCOPE OF PRODUCTS. Contractor will provide the ability to purchase a comprehensive, wide variety of Information Technology Solution Products including, but not limited to, the following categories: a. Personal Computer Systems: National brand name desktop PCs, notebooks and laptops from Enterprise Tier and Middle Tier Contractors that are business related computers, manufactured by companies, such as, Apple, COMPAQ, Dell, Gateway, Hewlett Packard, IBM / Lenovo and Toshiba. b. Standard Business Workstation: These will be used for typical tasks, which will include word processing, spreadsheet analysis, database management, business graphics, statistical analysis, internet, and other office automation activities. Product will include the operating system license, software media and documentation in the hardware shipment. c. High End Workstation: These will be used by application developers using GIS, CASE or other high-level language development tools, Computer Aided Design and Drafting professional, Internet Application developers or other sophisticated application work. Product will include the operating system license, software media and documentation in the hardware shipment. d. Laptop Computer or Notebook: These will be used by traveling or remote access users for typical office automation and business productivity use. With a port replicator or docking station, it may also be used as a standard desktop. Product will include the operating system license, software media and documentation in the hardware shipment. e. Network Equipment: This includes equipment primarily used for communications over an IP network. This includes layer 2 and layer 3 switches, routers, area wireless access points, point-to-point wireless access, optics, media interfaces (i.e. serial, T1, T3, OC3) and fiber channel. Class of equipment should include home office, small and medium business, and enterprise. Contractors may include, but not limited to, Cisco Systems, Dell, Juniper Networks, HP, Extreme Networks, Enterasys Networks, D-Link, Netgear, and Brocade Communications Systems. EXHIBIT A SCOPE OF WORK Page 9 of 32 f. Monitors: These will include plug and play compatible monitors that are manufactured for the above systems and/or any other brand that may be specifically called for by the ordering entity and which meet the most current UL and OSHA requirements. g. Computer and Network Products and Peripherals: Complete availability of major manufacturers Product lines on items such as, but not limited to RAM, graphic accelerator cards, network interface cards, cables, printers, scanners, keyboards, drives, memory cards, cables, batteries, etc. h. Services: i. Services means such as, consulting, technical support, trade-ins, repair, design, analysis, configuration, implementation, installation, training, and maintenance, etc. In addition, services which are related to the design, use or operation of the Products being purchased such as system configurations, testing, hardware/software installation, upgrades, imaging, etc. as described generally in this Agreement and as more particularly described in a Statement of Work or SOW (meaning a document in electronic or written form that is signed and delivered by each of the Parties for the performance of Services. ii. Cloud Computing means third party cloud computing and storage services, where Contractor acts as a rebiller only and has no control over the delivery of the cloud computing and storage services. City acknowledges that the cloud service provider, and not Contractor, will be responsible for performance of the Cloud Services. Also, before Contractor can sell cloud computing and/or storage services from a third party to the City, City must execute an agreement governing said cloud computing and/or storage services with the third-party cloud services provider. i. Comprehensive Product Offering: Contractor’s catalog and Services set forth in Exhibit B shall be available. The City reserves the right to accept or reject any or all items offered. j. Financing: Options available such as lease programs and conditional sales contracts. 4. LICENSES. The City may be required to sign a separate agreement, rider or End User Licensing Agreement (“EULA”), or such other terms as required by manufacturers, software publisher, or cloud service provider. 5. DEFECTIVE PRODUCT. All defective Products shall be replaced and exchanged by the Contractor. The cost of transportation, re-shipping or other like expenses shall be paid by the Contractor and in the case of certain, special orders, other reasonable charges may be paid by the Contractor as defined in the order or as otherwise agreed to by the Parties. All replacement Products must be received by the City within seven (7) days of initial notification, when such products are in Contractor stock; if replacement Product is not in Contractor’s stock, Contractor will use commercially reasonable efforts to order the product within one (1) business day of the initial notification from the City and will ensure product is received within seven (7) days after Contractor’s receipt of the product. EXHIBIT B PRICING Page 10 of 32 Item # Product Product / Group Discount Manufacturer Name 1) Group 1 - Systems 1) Desktops 2.10% All 2) Notebooks 2.10% All 3) Tablets 2.25% All 4) Servers (1 Processor, 2 Processor, 4+ Processor, Blade, Tower, Unix, Handhelds, etc.) 4.00% All 2) Group 2 - Input Devices 5) Keyboards 6.75% All 6) Mice 6.75% All 7) Imaging Scanners 3.00% All 8) POS Scanners 3.00% All 9) Pointing Devices 3.50% All 10) Bar Code Readers 4.25% All 11) Audio Input 15.00% All 12) Input Adapters 5.00% All 13) PC and Network Cameras 5.50% All 14) Input Cables 15.00% All 15) Input Accessories 6.75% All 3) Group 3 - Output Devices 16) Displays 3.50% All 17) Printers 3.00% All 18) Inkjet Printers 3.00% All 19) Inkjet Photo Printers 3.00% All 20) Laser Printers 3.00% All 21) Label Printers 4.25% All 22) Dot Matrix Printers 3.00% All 23) Multi-Function Printers 3.00% All 24) Wide Format Printers 3.00% All 25) Multi-Function Inkjet Printers 3.00% All 26) Wide Format Printers 3.00% All 27) Fax Machine Printers 3.00% All 28) Printer Accessories 3.00% All 29) Projectors 3.50% All 30) Projector Accessories 3.50% All 31) Audio Input 15.00% All 32) Video Cards 3.50% All EXHIBIT B PRICING Page 11 of 32 33) Sound Cards 3.50% All 34) Output Accessories 6.75% All 35) Printer Consumables 3.00% All 4) Group 4 - Memory 36) Desktop 13.00% All 37) Flash 5.50% All 38) Networking 13.00% All 39) Notebook 13.00% All 40) Printer / Fax 13.00% All 41) Server 13.00% All 5) Group 5 - Storage Devices 42) Adapters Fiber Channel 5.50% All 43) Adapters FireWire / USB 5.50% All 44) Adapters IDE/ATA/SATA 5.50% All 45) Adapters RAID 5.50% All 46) Adapters SCSI 5.50% All 47) Bridges & Routers 5.50% All 48) Disk Arrays 5.50% All 49) Disk Arrays JBOD 5.50% All 50) Drives Magneto-Optical 5.50% All 51) Drives Removable Disks 5.50% All 52) Fiber Channel Switches 5.50% All 53) Hard Disks - External 5.50% All 54) Hard Disks - Fiber Channel 5.50% All 55) Hard Disks - IDE/ATA/S 5.50% All 56) Hard Disks - Notebook 5.50% All 57) Hard Disks - SCSI 5.50% All 58) Networking Accessories 5.50% All 59) Optical Drives - CD-ROM 5.50% All 60) Optical Drives - CD-RW 5.50% All 61) Optical Drives - DVD-CD 5.50% All 62) Optical Drives - DVD-RW 5.50% All 63) Storage Accessories 5.00% All 64) Storage - NAS 5.00% All 65) Storage - SAN 5.00% All 66) Tape Autoloaders -AIT 5.00% All 67) Tape Autoloaders - DAT 5.00% All 68) Tape Autoloaders - DLT 5.00% All 69) Tape Autoloaders - LTO 5.00% All 70) Tape Drives - 4mm 5.00% All EXHIBIT B PRICING Page 12 of 32 71) Tape Drives - 8mm/VXA 5.00% All 72) Tape Drives - AIT 5.00% All 73) Tape Drives - DAT 5.00% All 74) Tape Drives - DLT 5.00% All 75) Tape Drives - LTO/Ultrium 5.00% All 76) Tape Drives SDLT 5.00% All 77) Tape Drives - Travan 5.00% All 6) Group 6 - Network Equipment 78) 10/100 Hubs & Switches 5.50% All 79) Bridges & Routers 5.50% All 80) Gigabit Hubs & Switches 5.50% All 81) Concentrators & Multiplexers 5.50% All 82) Hardware Firewalls 5.50% All 83) Intrusion Detection 5.50% All 84) KVM 4.00% All 85) Modems 5.50% All 86) Network Test Equipment 5.50% All 87) Network Adapters 5.50% All 88) Network Cables 15.00% All 89) Network Accessories 5.50% All 90) Repeaters & Transceivers 5.50% All 91) Wireless LAN Accessories 5.50% All 92) Token Authentication 5.50% All 93) 10G Fiber Optic Transceivers 5.50% All 94) 1G Fiber Optic Transceivers 5.50% All 7) Group 7 - Software 95) Licensing Packages (e.g. Microsoft) 4.00% All 96) Licensing Backup 4.00% All 97) Licensing Barcode/OC 4.00% All 98) Licensing Business Application 4.00% All 99) Licensing CAD/CAM 4.00% All 100) Licensing - Cloning 4.00% All 101) Licensing - Computer Services 4.00% All 102) Licensee - Database 4.00% All 103) Licensing - Development 4.00% All 104) Licensing - Entertainment 4.00% All 105) Licensing - Financial 4.00% All 106) Licensing - Flow Chart 4.00% All 107) Licensing - Graphic Design 4.00% All 108) Licensing - Handheld 4.00% All EXHIBIT B PRICING Page 13 of 32 109) Licensing - Network OS 4.00% All 110) Licensing - OS 4.00% All 111) Licensing - Personal Organization 4.00% All 112) Licensing - Presentation 4.00% All 113) Licensing - Reference 4.00% All 114) Licensing - Report Analysis 4.00% All 115) Licensing - Spreadsheet 4.00% All 116) Licensing - Utilities 4.00% All 117) Licensing - Warranties 4.00% All 118) Licensing - Web Development 4.00% All 119) Licensing - Word Processing 4.00% All 120) Software - Backup 4.00% All 121) Software - Barcode / OCR 4.00% All 122) Software - Business Application 4.00% All 123) Software - CAD/CAM 4.00% All 124) Software - Cloning 4.00% All 125) Software - Computer Services 4.00% All 126) Software - Database 4.00% All 127) Software - Development 4.00% All 128) Software - Entertainment 4.00% All 129) Software - Financial 4.00% All 130) Software - Flow Chart 4.00% All 131) Software - Graphic Design 4.00% All 132) Software - Handheld 4.00% All 133) Software - OS 4.00% All 134) Software - Personal Organization 4.00% All 135) Software - Presentation 4.00% All 136) Software - Reference 4.00% All 137) Software - Report Analysis 4.00% All 138) Software - Spreadsheet 4.00% All 139) Software - Utilities 4.00% All 140) Software - Warranties 4.00% All 141) Software - Web Development 4.00% All 142) Software - Word Processing 4.00% All 8) Group 8 - Media Supplies 143) Media - 4mm tape 5.50% All 144) Media - AIT tape 5.50% All 145) Media - DAT tape 5.50% All 146) Media - DLT tape 5.50% All EXHIBIT B PRICING Page 14 of 32 147) Media LTO / Ultrium tape drive 5.50% All 148) Media - Magneto - Optical 5.50% All 149) Media - Optical 5.50% All 150) Media - SLR tape 5.50% All 151) Media - Travan tape 5.50% All 152) Media - VXA tape 5.50% All 153) Media - zip 5.50% All 9) Group 9 - Collaboration & IP Telephony 154) IP phones 4.25% All 155) Video conferencing products 4.25% All 156) Voice gateways / servers 4.25% All 157) Headsets 4.25% All 158) Audio conferencing products 4.25% All 159) Analog phones 4.25% All 160) Accessories 4.25% All 10) Group 10 - Other 161) Advanced Integration 3.00% All 162) Asset Disposal 3.00% All 163) Asset Management 3.00% All 164) Cables 15.00% All 165) Cables - custom 15.00% All 166) Cables - printer 15.00% All 167) Complex warranties 3.00% All 168) Desktop Accessories 6.75% All 169) Display Accessories 3.50% All 170) Electronic Services 3.00% All 171) Handheld Accessories 6.75% All 172) Imaging Accessories 6.75% All 173) Imaging - Camcorders 3.50% All 174) Imaging - Digital Cameras 3.50% All 175) Internal Lab Service 3.00% All 176) Lab fees 3.00% All 177) Managed Services 3.00% All 178) Miscellaneous solutions 3.00% All 179) Mounting hardware for vehicles 2.50% All 180) Networking Warranties 3.50% All 181) Notebook Accessories 2.50% All 182) Notebook Batteries 5.00% All 183) PC Lab order services 3.00% All 184) POS Accessories 4.25% All EXHIBIT B PRICING Page 15 of 32 185) POS Displays 4.25% All 186) Power Accessories 5.00% All 187) Power Surge Protection 5.00% All 188) Power UPS 5.00% All 189) Server Accessories 4.00% All 190) Service Charge 2.00% All 191) System Components 13.00% All 192) Training Courses 3.00% All 193) Training Reference Manuals 3.00% All 194) Warranties - Electronic 3.00% All 195) iPAD / Tablet Stylus 6.75% All 196) Mouse / Wrist Pads 6.75% All 197) Security Locks and Hardware 6.75% All 198) Tools 6.75% All 199) Document Scanner Accessories 3.00% All 200) Flatbed Scanners 3.00% All 201) Mobile Scanners 3.00% All 202) Network Scanners 3.00% All 203) Sheet fed Scanners 3.00% All 204) Wide Format Scanners 3.00% All 205) Workgroup / Department Scanner 3.00% All 206) Build to Order Desktops 2.10% All 207) Nettop 3.00% All 208) Point of Sale 4.25% All 209) Ultra Small Form Factor 2.10% All 210) Apple / Mac Memory Upgrades 13.00% All 211) Chips / SIMMs/SIPPs / ROMs 13.00% All 212) Computer Cases 13.00% All 213) CPUs / Fans 13.00% All 214) Memory Accessories 13.00% All 215) Motherboards / Chassis 13.00% All 216) 1 - 2 port Serial Boards 13.00% All 217) 3+ port Serial Boards 13.00% All 218) Console Server 4.00% All 219) Device Server 4.00% All 220) Terminal Server 4.00% All 221) Content Management 4.00% All 222) Firewall / VPN Appliances 5.50% All EXHIBIT B PRICING Page 16 of 32 223) Multifunction Security Appliances 5.50% All 224) Network Camera Accessories 5.50% All 225) Network Cameras 5.50% All 226) Physical/Environmental Security 5.50% All 227) Security Appliance Accessories 5.50% All 228) Security Tokens 5.50% All 229) Unified Threat Management 5.50% All 230) 2-way Radios / Walkie Talkies 6.75% All 231) Apple Notebooks 2.50% All 232) Convertible PCs / Slate PCs / iPAD 2.25% All 233) iPAD 2.25% All 234) Slate Tablet Computers 2.25% All 235) GPS / PDA 6.75% All 236) Wireless Communication Devices 2.50% All 237) Batteries 5.00% All 238) Power Supplies / Adapters 5.00% All 239) Rackmountain Equipment 5.00% All 240) Remote Power Management 5.00% All 241) Surge Suppressors 5.00% All 242) UPS / Battery Backup 5.00% All 243) 14" & smaller LCD Display 3.50% All 244) 15-19" LCD Display 3.50% All 245) 15-19" Wide LCD Display 3.50% All 246) 15-19" Wide LED Display 3.50% All 247) 20-30" LCD Display 3.50% All 248) 20-30" Wide LCD Display 3.50% All 249) 20-30" Wide LED Display 3.50% All 250) PCoIP and Zero Client Displays 3.50% All 251) Arm Mounts 3.50% All 252) Ceiling Mounts 3.50% All 253) Combo Mounts 3.50% All 254) Desktop Stands / Risers 3.50% All 255) Flat Wall Mounts 3.50% All 256) Mount Accessories 3.50% All 257) Pole Display 4.25% All 258) Stands / Carts / Feet 3.50% All 259) Tilt Wall Mounts 3.50% All EXHIBIT B PRICING Page 17 of 32 260) C-Cure Products 4.00% All 261) Istar Products 5.50% All 11) Group 11 - Services SERVICE STANDARD HOURLY RATE DISCOUNT FROM STANDARD RATE Design and Analysis Please see CDW•G's Professional Services Offering below for descriptions of CDW•G's Professional Services. Configuration % Implementation % Installation % Training % Maintenance & Support % CDW Configuration Services 5% 12) Group 12 - Additional Products/Services Not Identified Please see CDW•G's Configuration Services Pricelist below for descriptions and pricing of CDW•G's Configuration Services. Apple Products for eligible Government and Educational Entities 0.50% CDW•G has conformed to the National Pricing structure aligning to National IPA's product taxonomy, however, CDW•G will manage the resultant contract according to CDW•G's Product Tree below, which shall govern all purchases and provides more breadth and a more complete representation of the CDW•G Catalog. All discounts will be applied by product category listed below to CDW•G's Nationally Advertised Pricing which is publicly verifiable at www.cdwg.com. CDW•G Product Tree Categories Discount Accessories 6.75% Power, Cooling & Racks 5.00% Desktop Computers 3.00% PC Compatible Desktop Computer 2.10% PC Compatible Workstation 3.00% Blade PCs 3.00% RISC Processor Workstation 3.00% Thin Clients 3.00% Web TV Access Unit 3.00% EXHIBIT B PRICING Page 18 of 32 Windows Based Terminals 3.00% Data Storage / Drives 5.50% Enterprise Storage 5.00% Point of Sale/Data Capture 4.25% Servers & Server Management 4.00% Services (CDW Delivered) 0.00% Notebook/Mobile Devices 2.50% Notebook Computers 2.10% Notebook Accessories 2.50% Wireless Communication Devices 2.50% Convertible PCs/Slate PCs/iPAD 2.25% Chromebooks 0.00% Netcomm Products 5.50% Gigabit Switch 6.00% Modular Switch Chassis 6.00% Modular Switches 5.50% Carts and Furniture 5.00% Printing & Document Scanning 3.00% Services (3rd Party Delivered) 0.00% Warranties-Product Protection 3.50% Software 4.00% Collaboration Hardware 4.25% Memory/System Components 13.00% Video-Projection-Pro Audio 3.50% Cables 15.00% CDW Configuration Services 5.00% Apple Products for Eligible Entities .50% CDW•G will work with Manufacturers and the City or Participating Agencies, as applicable, post award to ensure they are aware of and participating in special manufacturer programs. CDW•G Account Managers will work with the City or Participating Agencies, as applicable, post award to determine if large orders qualify to receive additional discounts. These discounts are dependent on order size, delivery schedule and will be negotiated with Manufacturers. As Apple's largest Corporate Channel Partner in the U.S., CDW•G has negotiated to offer Apple Products to Eligible Government and Educational Entities at the discount listed above and in the pricing table in this Exhibit B. EXHIBIT B PRICING Page 19 of 32 CDW•G Professional Services Offering Major Metro Service Areas Washington, DC Raleigh Madison New York City Metro Houston Wausau Los Angeles Tampa Milwaukee San Francisco Atlanta Appleton San Diego National Grand Rapids Boston Metro Dallas Indianapolis Chicago Cincinnati Cleveland Federal Detroit Philadelphia Minneapolis Seattle St. Louis/KC Denver Nashville Portland Services apply to both CDW•G executed professional services and services which are sub-contracted through a CDW•G authorized third party provider. Hourly or fixed rates will be negotiated based on the customer, geography, scope of the professional service engagement, and level of engineer required to perform the service. CDW•G will create a Statement of Work (SOW) detailing the exact scoping and pricing of the Services to be provided, which will be executed by CDW•G and the National IPA member prior to the start of Services. Sample SOW is included in our proposal. Expenses (T and E) may be an additional consideration depending on project specifics. Solution Domain Discipline Technology Domain Role Datacenter Storage Data Migration Senior Consulting Engineer EMC Senior Consulting Engineer IBM Senior Consulting Engineer VMWare Senior Consulting Engineer NetApp Senior Consulting Engineer Datacenter Networking & Enterprise Networking Infrastructure & Networking Associate Consulting Engineer Consulting Engineer Senior Consulting Engineer Principal Consulting Engineer Technical Lead Mobility Client Management Client Virtualization Endpoint Management Mobile Device Management Associate Consulting Engineer Consulting Engineer Senior Consulting Engineer Principal Consulting Engineer Technical Lead VDI Citrix Senior Consulting Engineer Security Network Security Network Security Associate Consulting Engineer Consulting Engineer Senior Consulting Engineer Principal Consulting Engineer Technical Lead EXHIBIT B PRICING Page 20 of 32 Security Information Security Information Security Penetration Testing Gap Analysis (HIPAA gap, PCI Gap, NIST) Collaboration Communication Voice, Video Collaboration Associate Consulting Engineer Consulting Engineer Senior Consulting Engineer Principal Consulting Engineer Technical Lead Collaboration Engagement Contact Center Associate Consulting Engineer Consulting Engineer Senior Consulting Engineer Principal Consulting Engineer Technical Lead Collaboration Productivity Information Worker Associate Consulting Engineer Consulting Engineer Senior Consulting Engineer Principal Consulting Engineer Technical Lead Consulting Advisory Services Consulting Advisory Services Consulting Advisory Services CAS_Business_Analyst CAS_Consulting_Services_Architect CAS_Engagement_Manager CAS_Technology_Architect CAS_Business_Architect Project & Program Management Project & Program Management Project & Program Management Project Admin Project Manager Senior Project Manager Program Manager CDW•G Configuration Services Service Group EDC Description Advertised Price Contract Discount Contract Ceiling Price Hardware Configurations and Priority Service Priority 1625768 PRIORITY SERVICE $ 21.99 5% $ 20.89 Hardware 1706188 CDW Hardware Install for Server $ 32.99 5% $ 31.34 Hardware 1706189 CDW Hardware Install for DT-LT $ 17.99 5% $ 17.09 Hardware 1820627 CDW Hardware Install for Netcom $ 22.99 5% $ 21.84 Hardware 3558560 CDW MOBILE DEVICE SIM CARD INSTALL $ 9.99 5% $ 9.49 Hardware 2437037 CDW RACK CONFIG 1 CREDIT $ 82.99 5% $ 78.84 Hardware 3803338 CDW HARDWARE INSTALL FOR PRINTER $ 32.99 5% $ 31.34 Asset Tagging Asset Tags 322170 CDW ASSET TAGS NO INSTALL MAIL ONLY $ 0.98 5% $ 0.93 Asset Tags 338519 CDW ASSET TAG W/O INSTALL $ 9.99 5% $ 9.49 Asset Tags 338521 CUSTOMER ASSET TAG CONFIG SERVICE $ 9.99 5% $ 9.49 Asset Tags 500814 CDW CREATE CUSTOM TAG/LABEL $ 29.99 5% $ 28.49 Asset Tags 500815 BASIC CUSTOM TAG $ 9.99 5% $ 9.49 Asset Tags 500817 INTERMEDIATE CUSTOM TAG $ 17.99 5% $ 17.09 EXHIBIT B PRICING Page 21 of 32 Asset Tags 500818 ADVANCED CUSTOM TAG $ 22.99 5% $ 21.84 Asset Tags 537315 CDW CREATED CUSTOM TAG – MAIL ONLY $ 1.22 5% $ 1.16 Asset Tags 955862 CDWG UID TAG/LABEL $ 9.99 5% $ 9.49 Asset Tags 1095109 CDW RFID TAG $ 61.99 5% $ 58.89 Asset Tags 3465262 BASIC CUSTOM TAG W/BOX DUP TAG $ 10.99 5% $ 10.44 Asset Tags 3465269 CUSTOMER ASSET TAG W/BOX DUP REQ6330 $ 10.99 5% $ 10.44 Asset Tags 4347185 CUSTOMER ASSET TAG W BOX DUP REQ6247 $ 12.99 5% $ 12.34 Asset Tags 3465895 INTERMEDIATE CUSTM TAG W-BOX DUP TAG $ 21.99 5% $ 20.89 Asset Tags 3982815 ADV CUSTOM TAG W/BOX DUP $ 24.99 5% $ 23.74 Configuration Service Bundles Bundle 2342089 CDW HW IMAGE CDW ASSET TAG-REQ1173 $ 45.99 5% $ 43.69 Bundle 2342092 CDW HW IMAGE BASIC CUSTM TAG-REQ1174 $ 52.99 5% $ 50.34 Bundle 2342096 CDW HW IMAG CUSTMR ASSET TAG-REQ1175 $ 52.99 5% $ 50.34 Bundle 2342098 CDW IMAG CSTMR ASSET TAG PRI-REQ1176 $ 46.99 5% $ 44.64 Bundle 2342102 CDW IMAGE CDW ASSET TAG PRI-REQ1177 $ 39.99 5% $ 37.99 Bundle 2342106 CDW HW IMAGE PRIORITY-REQ1178 $ 53.99 5% $ 51.29 Bundle 2423730 CDW HW IMAGE CDW ASSET PRI-REQ1193 $ 53.99 5% $ 51.29 Bundle 2423732 CDW HW IMG BSC CSTM TAG PRI-REQ1194 $ 59.99 5% $ 56.99 Bundle 2423734 CDW HW IMAG CUSTMR ASSET PRI-REQ1195 $ 59.99 5% $ 56.99 Bundle 2426793 CDW IMAGE CUSTMER ASSET TAG-REQ1197 $ 39.99 5% $ 37.99 Bundle 2426795 CDW IMAGE CDW ASSET TAG-REQ1198 $ 32.99 5% $ 31.34 Bundle 2426798 CDW HARDWARE IMAGE DEPLOY-REQ1199 $ 45.99 5% $ 43.69 Bundle 2853723 CDW IMAGE BASIC CUSTOM TAG-REQ1324 $ 39.99 5% $ 37.99 Bundle 2853726 CDW IMAGE BIOS CUSTOMIZATION-REQ1325 $ 39.99 5% $ 37.99 Bundle 3269810 CDW HW IMG INTRM TAG CMPTRAC REQ1901 $ 63.99 5% $ 60.79 Bundle 3327808 CDW LIGHT TOUCH IMAGE DEPLOY W-VPN $ 42.99 5% $ 40.84 Bundle 4008018 LEVEL 1 IOS\ETCH INSERT REQ 5075 $ 39.99 5% $ 37.99 Bundle 4008025 LEVEL 1 IOS\ETCH REQ 5076 $ 33.99 5% $ 32.29 Bundle 4041681 IOS LVL1 & SRVC CUST INSERT REQ5156 $ 28.99 5% $ 27.54 Bundle 4056755 INT CUST TAG&DUP + DATA CAP CONTRACT $ 21.99 5% $ 20.89 Bundle 4086733 CDW LT IMAGE DEPLOY W/VPN&BOX LABEL $ 44.99 5% $ 42.74 Bundle 4171085 COI SPECOPS & PROJECTMANGEMENT R5611 $ 569.99 5% $ 541.49 Diagnostics Diagnostics 214266 CDW BURN IN 12 HOURS $ 21.99 5% $ 20.89 Imaging Imaging 195856 CDW INSTALLING CUSTOM SERVER IMAGE $ 113.99 5% $ 108.29 Imaging 247489 HILL ROM CREATE CUSTOM RESTORE CD $ 49.99 5% $ 47.49 Imaging 266912 CDW APPLE IMAGE DEPLOYMENT $ 32.99 5% $ 31.34 Imaging 283926 CDW MASTER IMAGE CREATION CREDIT $ 183.99 5% $ 174.79 Imaging 379370 CDW INSTALLING CUSTOM PDA IMAGE $ 17.99 5% $ 17.09 Imaging 534223 CDW STANDARD IMAGE DEPLOYMENT DT/NB $ 32.99 5% $ 31.34 Imaging 763587 FLASH DRIVE IMAGING $ 9.99 5% $ 9.49 Imaging 763593 CDW USB RESTORE UPTO 16GB $ 39.99 5% $ 37.99 Imaging 809048 CDW MAINTAIN CUSTOM PC IMAGE-CREDIT $ 31.99 5% $ 30.39 Imaging 1640342 CDW INSTALLING ALTIRIS SERVER IMAGE $ 113.99 5% $ 108.29 Imaging 1926223 CDW TERMINAL IMAGE DEPLOYMENT $ 32.99 5% $ 31.34 Imaging 2691836 CDW ZERO TOUCH IMAGE DEPLOYMENT $ 32.99 5% $ 31.34 Imaging 2798606 CDW IMAGE MODEL MIGRATION CREDIT $ 113.99 5% $ 108.29 EXHIBIT B PRICING Page 22 of 32 Imaging 2869570 CDW USB RESTORE UPTO 32GB $ 52.99 5% $ 50.34 Imaging 3652393 CDW CREATE CUSTOM RECOVERY PARTITION $ 353.99 5% $ 336.29 Imaging 3765107 SERVER RACKING ADV IMAGING SVC $ 219.99 5% $ 208.99 Imaging 3982809 CDW USB RESTORE SVC UPTO 64GB $ 63.99 5% $ 60.79 Imaging 4008336 CHROME WHITE GLOVE SERVICE TIER1 $ 22.93 5% $ 21.78 Imaging 4008354 CHROME WHITE GLOVE SERVICE TIER2 $ 24.93 5% $ 23.68 Imaging 4419882 CHROME UNMANAGED KIOSK APP INSTALL $ 28.92 5% $ 27.47 Imaging 4086723 CDW IMAGE DEPLOY W BOX LABEL REQ6281 $ 33.99 5% $ 32.29 Imaging 4086738 CDW SCCM SRV-ZERO TOUCH W/BOX LABEL $ 33.99 5% $ 32.29 Laser Etching / Color Branding Laser Etching 1461344 CDW LASER ETCHING-TIER 1 STATIC SML $ 11.00 5% $ 10.45 Laser Etching 2815190 CDW LASER ETCHING-TIER 2 STATIC LRG $ 15.00 5% $ 14.25 Laser Etching 2815191 CDW LASER ETCHING-TIER 3 DYNAMIC $ 22.00 5% $ 20.90 Color Branding 3223260 CDW COLOR BRANDING TEMPLATE $ - 5% $ - Color Branding 4100630 CDW COLOR BRANDING TIER 1 $ 15.00 5% $ 14.25 Color Branding 3223250 CDW COLOR BRANDING TIER 2 $ 22.00 5% $ 20.90 Color Branding 3436605 CDW COLOR BRANDING TIER 3 $ 30.00 5% $ 28.50 Mobile Carts Mobile Carts 4466480 CDW CHROMEBOOK WIRE CART CONFIG $ 120.00 5% $ 114.00 Netcom Netcom 311718 CDW NETWORK & SECURITY DEVICE CONFIG $ 40.00 5% $ 38.00 Netcom 1550455 CDW NETWORK & SEC CHASSIS CONFIG BUN $ 100.00 5% $ 95.00 Netcom 1550460 CDW NETWORK & SEC DEVICE CONFIG BUN $ 65.00 5% $ 61.75 Netcom 2394839 CDW NETWORK & SEC CHASSIS CONFIG $ 70.00 5% $ 66.50 Netcom 2432019 CDW VPN DOMAIN JOIN ONLY $ 8.00 5% $ 7.60 Netcom 3628500 CDW VPN DOMAIN JOIN ONLY-PCA $ 8.00 5% $ 7.60 Netcom 3651585 CDW AP/ENDPOINT PROVISIONING $ 30.00 5% $ 28.50 Netcom 4121801 CDW AP/ENDPOINT FIRMWARE UPDATE $ 16.00 5% $ 15.20 Netcom 4219966 CDW CLIENT VPN CONFIGURATION $ 12.00 5% $ 11.40 Other Other 504311 CDW HP ILO ACTIVATION $ 12.00 5% $ 11.40 Other 872360 CDW SYSTEM BIOS/FIRMWARE UPG $ 16.00 5% $ 15.20 Other 1197175 CDW CUSTOM IP CONFIGURATION $ 12.00 5% $ 11.40 Other 1197180 CDW BIOS CUSTOMIZATION $ 5.00 5% $ 4.75 Other 1369901 CDW SRVC CUSTOM ADDED INSERTS $ 5.00 5% $ 4.75 Other 1369904 CDW DDS / COMPUTRACE ACTIVATION $ 5.00 5% $ 4.75 Other 1369905 CDW DATA CAPTURE & TRACKING SRVC $ 5.00 5% $ 4.75 Other 1713539 CDW SPECIAL CONFIG REQ - 1 CREDIT $ 5.00 5% $ 4.75 Other 1713542 CDW SPECIAL CONFIG REQ - 6 CREDITS $ 30.00 5% $ 28.50 Other 1713544 CDW SPECIAL CONFIG REQ - 12 CREDITS $ 60.00 5% $ 57.00 Other 2366694 CDW APPLE IOS CUSTOMIZATION LVL 1 $ 15.00 5% $ 14.25 Other 2366709 CDW APPLE IOS CUSTOMIZATION LVL 2 $ 30.00 5% $ 28.50 Other 2613286 CDW ANDROID CUSTOMIZATION LVL 1 $15.00 5% $ 14.25 Other 2613287 CDW ANDROID CUSTOMIZATION LVL 2 $ 30.00 5% $ 28.50 Other 2671476 CDW SCREEN OVERLAY INSTALL SERVICE $ 8.00 5% $ 7.60 Other 2696504 CDW Hard Drive Data Encryption DT/NB $ 12.00 5% $ 11.40 Other 2828923 CDW SAS RAID Activation $ 12.00 5% $ 11.40 Other 2858009 CDW KINDLE AD REMOVAL REQ1329 $ 30.00 5% $ 28.50 EXHIBIT B PRICING Page 23 of 32 Other 3553290 CDW APPLE ID CREATION $ 5.00 5% $ 4.75 Other 3899153 CDW VPRO BASIC ACTIVATION REQ4717 $ 5.00 5% $ 4.75 Other 4248044 CDW LENOVO IMM ACTIVATION $ 12.00 5% $ 11.40 Other 4176320 CDW ASSET MGMNT UPDATE SVC REQ 5634 $ 1.25 5% $ 1.19 Software Software 76056 CDW APPLICATION INSTALL DT/NB $ 36.00 5% $ 34.20 Software 76980 CDW NETWORK OPERATING SYSTEM INSTALL $ 200.00 5% $ 190.00 Software 346243 CDW STD WINDOWS CLIENT OS INSTALL $ 90.00 5% $ 85.50 Software 931000 CDW NETWORK APPLICATION INSTALL $ 100.00 5% $ 95.00 Software 1197183 CDW APPLICATION UPDATES AND MAINTENANCE $ 22.00 5% $ 20.90 Software 1278296 CDW OEM MFG OS INSTALLATION $ 90.00 5% $ 85.50 Software 1291101 CDW LINUX INSTALLATION OS-ALL VERS $ 120.00 5% $ 114.00 Software 1550439 SUN SOLARIS INSTALLATION – ALL VERSIONS $ 200.00 5% $ 190.00 Software 1550447 VMWARE INSTALLATION – ALL VERSIONS $ 70.00 5% $ 66.50 Software 3803347 CDW SOFTWARE CONFIG FOR PRINTER $ 24.00 5% $ 22.80 Software 3982800 CDW HDD OS SWAP SVC REQ5012 $ 36.00 5% $ 34.20 Configuration Project Management / COI Proj. Mgmt 3110955 CDW CONFIG PROJECT COORD HRLY CREDIT $ 75.00 5% $ 71.25 Proj. Mgmt 4289890 CDW CONFIG PM 150 HRLY CHARGE $ 150.00 5% $ 142.50 Proj. Mgmt 3536706 CDW COI PROJ COORD /OPS COST $ 5,000.00 5% $ 4,750.00 Proj. Mgmt 3543509 CDW CONFIG PROJECT COORD CREDIT/UNIT $ 5.00 5% $ 4.75 Proj. Mgmt 3752290 CDW PROJ MNGMNT CONFIG AP SVC $ 7.00 5% $ 6.65 Proj. Mgmt 4086747 CONFIGS SERVICES PROJ MGMT(PER UNIT) $ 1.00 5% $ 0.95 Proj. Mgmt 4087191 CONFIGS SERVICES PROJ MGMT(PER UNIT) $ 0.50 5% $ 0.48 COI 3268855 CDW CONFIG PROJECT COORD COI SVC $ 300.00 5% $ 285.00 COI 3561536 COI OPS PALLET RECEIVING/PROCESSING $ 480.00 5% $ 456.00 COI 4439488 COI OPS PALLET/MONTH REC/PRO $ 40.00 5% $ 38.00 COI 3659769 CDW COI OPERATIONAL EXPENSE WITH SN $ 10.00 5% $ 9.50 COI 3827583 COI TEMP TAG NO INSTALL E-MAIL $ 10.00 5% $ 9.50 EXHIBIT C MESA STANDARD TERMS AND CONDITIONS Page 24 of 32 1. INDEPENDENT CONTRACTOR. It is expressly understood that the relationship of Contractor to the City will be that of an independent contractor. Contractor and all persons employed by Contractor, either directly or indirectly, are Contractor’s employees, not City employees. Accordingly, Contractor and Contractor’s employees are not entitled to any benefits provided to City employees including, but not limited to, health benefits, enrollment in a retirement system, paid time off or other rights afforded City employees. Contractor employees will not be regarded as City employees or agents for any purpose, including the payment of unemployment or workers’ compensation. If any Contractor employees or subcontractors assert a claim for wages or other employment benefits against the City, Contractor will defend, indemnify and hold harmless the City from all such claims. 2. SUBCONTRACTING. Contractor may not subcontract work under this Agreement without the express written permission of the City. If Contractor has received authorization to subcontract work, it is agreed that all subcontractors performing work under the Agreement must comply with its provisions. Further, all agreements between Contractor and its subcontractors must provide that the terms and conditions of this Agreement be incorporated therein. 3. ASSIGNMENT. This Agreement may not be assigned either in whole or in part without first receiving the City’s written consent. Any attempted assignment, either in whole or in part, without such consent will be null and void and in such event the City will have the right at its option to terminate the Agreement. No granting of consent to any assignment will relieve Contractor from any of its obligations and liabilities under the Agreement. 4. SUCCESSORS AND ASSIGNS, BINDING EFFECT. This Agreement will be binding upon and inure to the benefit of the parties and their respective permitted successors and assigns. 5. NO THIRD-PARTY BENEFICIARIES. This Agreement is intended for the exclusive benefit of the parties. Nothing set forth in this Agreement is intended to create, or will create, any benefits, rights, or responsibilities in any third parties. 6. NON-EXCLUSIVITY. The City, in its sole discretion, reserves the right to request the materials or services set forth herein from other sources when deemed necessary and appropriate. No exclusive rights are encompassed through this Agreement. 7. AMENDMENTS. There will be no oral changes to this Agreement. This Agreement can only be modified in a writing signed by both parties. No charge for extra work or material will be allowed unless approved in writing, in advance, by the City and Contractor. 8. TIME OF THE ESSENCE. Time is of the essence to the performance of the parties’ obligations under this Agreement. 9. COMPLIANCE WITH APPLICABLE LAWS. a. General. Contractor must procure all permits and licenses, and pay all charges and fees necessary and incidental to the lawful conduct of business. Contractor must stay fully informed of existing and future federal, state, and local laws, ordinances, and regulations that in any manner affect the fulfillment of this Agreement and must comply with the same at its own expense. Contractor bears full responsibility for training, safety, and providing necessary equipment for all Contractor personnel to achieve throughout the term of the Agreement. Upon request, Contractor will demonstrate to the City's satisfaction any programs, procedures, and other activities used to ensure compliance. b. Drug-Free Workplace. Contractor is hereby advised that the City has adopted a policy establishing a drug-free workplace for itself and those doing business with the City to ensure the safety and health of all persons working on City contracts and projects. Contractor will require a drug-free workplace for all Contractor personnel working under this Agreement. Specifically, all Contractor personnel who are working under this Agreement must be notified in writing by Contractor that they are prohibited from the manufacture, distribution, dispensation, possession, or unlawful use of a controlled substance in the workplace. EXHIBIT C MESA STANDARD TERMS AND CONDITIONS Page 25 of 32 Contractor agrees to prohibit the use of intoxicating substances by all Contractor personnel, and will ensure that Contractor personnel do not use or possess illegal drugs while in the course of performing their duties. c. Federal and State Immigration Laws. Contractor agrees to comply with the Immigration Reform and Control Act of 1986 (IRCA) in performance under this Agreement and to permit the City and its agents to inspect applicable personnel records to verify such compliance as permitted by law. Contractor will ensure and keep appropriate records to demonstrate that all Contractor personnel have a legal right to live and work in the United States. i. As applicable to Contractor, under the provisions of A.R.S. § 41-4401, Contractor hereby warrants to the City that Contractor and each of its subcontractors will comply with, and are contractually obligated to comply with, all federal immigration laws and regulations that relate to their employees and A.R.S. § 23-214(A) (hereinafter “Contractor Immigration Warranty”). ii. A breach of the Contractor Immigration Warranty will constitute as a material breach of this Agreement and will subject Contractor to penalties up to and including termination of this Agreement at the sole discretion of the City. iii. The City retains the legal right to inspect the papers of all Contractor personnel who provide services under this Agreement to ensure that Contractor or its subcontractors are complying with the Contractor Immigration Warranty. Contractor agrees to assist the City in regard to any such inspections. iv. The City may, at its sole discretion, conduct random verification of the employment records of Contractor and any subcontractor to ensure compliance with the Contractor Immigration Warranty. Contractor agrees to assist the City in regard to any random verification performed. v. Neither Contractor nor any subcontractor will be deemed to have materially breached the Contractor Immigration Warranty if Contractor or subcontractor establishes that it has complied with the employment verification provisions prescribed by Sections 274A and 274B of the Federal Immigration and Nationality Act and the E-Verify requirements prescribed by A.R.S. § 23-214 (A). d. Nondiscrimination. Contractor represents and warrants that it does not discriminate against any employee or applicant for employment or person to whom it provides services because of race, color, religion, sex, national origin, or disability, and represents and warrants that it complies with all applicable federal, state, and local laws and executive orders regarding employment. Contractor and Contractor’s personnel will comply with applicable provisions of Title VII of the U.S. Civil Rights Act of 1964, as amended, Section 504 of the Federal Rehabilitation Act, the Americans with Disabilities Act (42 U.S.C. § 12101 et seq.), and applicable rules in performance under this Agreement. e. State Sponsors of Terrorism Prohibition. Per A.R.S. § 35-392, Contractor must not be in violation of section 6(j) of the Federal Export Administration Act and subsequently prohibited by the State of Arizona from selling goods of services to the City. 10. SALES/USE TAX, OTHER TAXES. a. Contractor is responsible for the payment of all taxes including federal, state, and local taxes related to or arising out of Contractor’s services under this Agreement, including by way of illustration but not limitation, federal and state income tax, Social Security tax, unemployment insurance taxes, and any other taxes or business license fees as required. If any taxing authority should deem Contractor or Contractor employees an employee of the City, or should otherwise claim the City is liable for the payment of taxes that are Contractor’s responsibility under this Agreement, Contractor will indemnify the City for any tax liability, interest, and penalties imposed upon the City. EXHIBIT C MESA STANDARD TERMS AND CONDITIONS Page 26 of 32 b. The City is exempt from paying certain federal excise taxes and will furnish an exemption certificate upon request. The City is not exempt from state and local sales/use taxes. 11. AMOUNTS DUE THE CITY. Contractor must be current and remain current in all obligations due to the City during the performance of Services under the Agreement. Payments to Contractor may be offset by any delinquent amounts due the City or fees and charges owed to the City. 12. PUBLIC RECORDS. Contractor acknowledges that the City is a public entity, subject to Arizona’s public records laws (A.R.S. § 39-121 et. seq.) and that any documents related to this Agreement may be subject to disclosure pursuant to state law in response to a public records request or to subpoena or other judicial process. a. If Contractor believes document related to the Agreement contains trade secrets or other proprietary data, Contractor must notify the City and include with the notification a statement that explains and supports Contractor’s claim. Contractor also must specifically identify the trade secrets or other proprietary data that Contractor believes should remain confidential. b. In the event the City determines it is legally required to disclose pursuant to law any documents or information Contractor deems confidential trade secrets or proprietary data, the City, to the extent possible, will provide Contractor with prompt written notice by certified mail, fax, email or other method that tracks delivery status of the requirement to disclose the information so Contractor may seek a protective order from a court having jurisdiction over the matter or obtain other appropriate remedies. The notice will include a time period for Contractor to seek court ordered protection or other legal remedies as deemed appropriate by Contractor. If Contractor does not obtain such court ordered protection by the expiration of said time period, the City may release the information without further notice to Contractor. 13. AUDITS AND RECORDS. Contractor must preserve the records related to this Agreement for six (6) years after completion of the Agreement. The City or its authorized agent reserves the right to inspect any records related to the performance of work specified herein. In addition, the City may inspect any and all payroll, billing or other relevant records kept by Contractor in relation to the Agreement. Contractor will permit such inspections and audits during normal business hours and upon reasonable notice by the City. The audit of records may occur at Contractor’s place of business or at City offices, as determined by the City. Notwithstanding the foregoing, any Agreement audits must be pursuant to a signed Confidentiality Agreement agreed to by both parties which will be subject to applicable law, including the Arizona Public Records law. Contractor is not required to keep original documents and copies of relevant documents will suffice for the purposes of this provision. The audit must be conducted during regular business hours at a mutually agreeable time and location, and upon reasonable advanced notice of records to be audited. 14. BACKGROUND CHECK. The City may conduct criminal, driver history, and all other requested background checks of Contractor personnel who would perform services under the Agreement or who will have access to the City’s information, data, or facilities in accordance with the City’s current background check policies. Any officer, employee, or agent that fails the background check must be replaced immediately for any reasonable cause not prohibited by law. 15. SECURITY CLEARANCE AND REMOVAL OF CONTRACTOR PERSONNEL. The City will have final authority, based on security reasons: (i) to determine when security clearance of Contractor personnel is required; (ii) to determine the nature of the security clearance, up to and including fingerprinting Contractor personnel; and (iii) to determine whether or not any individual or entity may provide services under this Agreement. If the City objects to any Contractor personnel for any reasonable cause not prohibited by law, then Contractor will, upon notice from the City, remove any such individual from performance of services under this Agreement. 16. DEFAULT. a. A party will be in default if that party: EXHIBIT C MESA STANDARD TERMS AND CONDITIONS Page 27 of 32 i. Is or becomes insolvent or is a party to any voluntary bankruptcy or receivership proceeding, makes an assignment for a creditor, or there is any similar action that affects Contractor’s capability to perform under the Agreement; ii. Is the subject of a petition for involuntary bankruptcy not removed within sixty (60) calendar days; iii. Conducts business in an unethical manner as set forth in the City Procurement Rules Article 7 or in an illegal manner; or iv. Fails to carry out any term, promise, or condition of the Agreement. b. Contractor will be in default of this Agreement if Contractor is debarred from participating in City procurements and solicitations in accordance with Article 6 of the City’s Procurement Rules. c. Notice and Opportunity to Cure. In the event a party is in default then the other party may, at its option and at any time, provide written notice to the defaulting party of the default. The defaulting party will have thirty (30) days from receipt of the notice to cure the default; the thirty (30) day cure period may be extended by mutual agreement of the parties, but no cure period may exceed ninety (90) days. A default notice will be deemed to be sufficient if it is reasonably calculated to provide notice of the nature and extent of such default. Failure of the non- defaulting party to provide notice of the default does not waive any rights under the Agreement. d. Anticipatory Repudiation. Whenever the City in good faith has reason to question Contractor’s intent or ability to perform, the City may demand that Contractor give a written assurance of its intent and ability to perform. In the event that the demand is made and no written assurance is given within five (5) calendar days, the City may treat this failure as an anticipatory repudiation of the Agreement. 17. REMEDIES. The remedies set forth in this Agreement are not exclusive. Election of one remedy will not preclude the use of other remedies. In the event of default: a. The non-defaulting party may terminate the Agreement, and the termination will be effective immediately or at such other date as specified by the terminating party. b. The City may purchase the services required under the Agreement from the open market, complete required work itself, or have it completed at the expense of Contractor. If the cost of obtaining substitute services exceeds the contract price, the City may recover the excess cost by: (i) requiring immediate reimbursement to the City; (ii) deduction from an unpaid balance due to Contractor; (iii) collection against the proposal and/or performance security, if any; (iv) collection against liquidated damages (if applicable); or (v) a combination of the aforementioned remedies or other remedies as provided by law. Costs includes any and all, fees, and expenses incurred in obtaining substitute services and expended in obtaining reimbursement, including, but not limited to, administrative expenses, attorneys’ fees, and costs. c. The non-defaulting party will have all other rights granted under this Agreement and all rights at law or in equity that may be available to it. d. Neither party will be liable for incidental, special, or consequential damages. 18. CONTINUATION DURING DISPUTES. Contractor agrees that during any dispute between the parties, Contractor will continue to perform its obligations until the dispute is settled, instructed to cease performance by the City, enjoined or prohibited by judicial action, or otherwise required or obligated to cease performance by other provisions in this Agreement. 19. TERMINATION FOR CONVENIENCE. The City reserves the right to terminate this Agreement in part or in whole upon thirty (30) calendar days’ written notice. 20. TERMINATION FOR CONFLICT OF INTEREST (A.R.S. § 38-511). Pursuant to A.R.S. § 38-511, the City may cancel this Agreement within three (3) years after its execution, without penalty or EXHIBIT C MESA STANDARD TERMS AND CONDITIONS Page 28 of 32 further obligation, if any person significantly involved in initiating, securing, drafting, or creating the Agreement for the City becomes an employee or agent of Contractor. 21. TERMINATION FOR NON-APPROPRIATION AND MODIFICATION FOR BUDGETARY CONSTRAINT. The City is a governmental agency which relies upon the appropriation of funds by its governing body to satisfy its obligations. If the City reasonably determines that it does not have funds to meet its obligations under this Agreement, the City will have the right to terminate the Agreement without penalty on the last day of the fiscal period for which funds were legally available. In the event of such termination, the City agrees to provide written notice of its intent to terminate thirty (30) calendar days prior to the stated termination date. 22. PAYMENT TO CONTRACTOR UPON TERMINATION. Upon termination of this Agreement, Contractor will be entitled only to payment for those services performed up to the date of termination, and any authorized expenses already incurred up to such date of termination. The City will make final payment within thirty (30) calendar days after the City has both completed its appraisal of the materials and services provided and received Contractor’s properly prepared final invoice. 23. NON-WAIVER OF RIGHTS. There will be no waiver of any provision of this agreement unless approved in writing and signed by the waiving party. Failure or delay to exercise any rights or remedies provided herein or by law or in equity, or the acceptance of, or payment for, any services hereunder, will not release the other party of any of the warranties or other obligations of the Agreement and will not be deemed a waiver of any such rights or remedies. 24. INDEMNIFICATION/LIABILITY. a. To the fullest extent permitted by law, Contractor agrees to defend, indemnify, and hold the City, its officers, agents, and employees, harmless from and against any and all liabilities, demands, claims, suits, losses, damages, causes of action, fines or judgments, including costs, attorneys’, witnesses’, and expert witnesses’ fees, and expenses incident thereto, relating to, arising out of, or resulting from: (i) misconduct by Contractor personnel under this Agreement; (ii) any negligent acts, errors, mistakes or omissions by Contractor or Contractor personnel; and (iii) Contractor or Contractor personnel’s failure to comply with this Agreement. However, notwithstanding the prior sentence, any claim shall not be an indemnified claim if such claim or damage was caused in whole by the actions of the City, its employees, agents, contractors or representatives. b. Contractor will update the City during the course of the litigation to timely notify the City of any issues that may involve the independent negligence of the City that is not covered by this indemnification. c. The City assumes no liability for actions of Contractor and will not indemnify or hold Contractor or any third party harmless for claims based on this Agreement or use of Contractor-provided supplies or Services. d. IN THE EVENT OF ANY LIABILITY INCURRED BY CONTRACTOR OR ANY OF ITS AFFILIATES HEREUNDER, INCLUDING INDEMNIFICATION OF CITY BY CONTRACTOR, THE ENTIRE LIABILITY OF CONTRACTOR AND ITS AFFILIATES FOR DAMAGES FROM ANY CAUSE WHATSOEVER WILL NOT EXCEED $5,000,000.00 OVER THE ENTIRE TERM OF THE AGREEMENT. 25. WARRANTY. Contractor warrants that the services and materials will conform to the requirements of Exhibit A. Additionally, Contractor warrants that all services will be performed in a good, workman-like and professional manner, as stated below. a. Manufacturer’s Warranty. The City understands that the Contractor is not the manufacturer of the products purchased by the City hereunder and the only materials (product) warranties offered are those of the manufacturer, not the Contractor or its affiliates unless the manufacturer is the Contractor or its affiliates. THE CONTRACTOR AND ITS AFFILIATES HEREBY EXPRESSLY DISCLAIM ALL WARRANTIES EITHER EXPRESS OR IMPLIED, EXHIBIT C MESA STANDARD TERMS AND CONDITIONS Page 29 of 32 RELATED TO PRODUCTS, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OF TITLE, ACCURACY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, WARRANTY OF NONINFRINGEMENT, OR ANY WARRANTY RELATING TO THIRD PARTY SERVICES. THE DISCLAIMER CONTAINED IN THIS PARAGRAPH DOES NOT AFFECT THE TERMS OF ANY MANUFACTURER'S WARRANTY. b. Services Warranty. City's sole and exclusive remedy with respect to a warranty on the Services provided by Contractor will be, at the sole option of Contractor, to either: (a) use its reasonable commercial efforts to reperform any services not in substantial compliance with this warranty, or (b) refund amounts paid by City related to the portion of the services not in substantial compliance; provided, in each case, City notifies Contractor in writing within five (5) business days after performance of the applicable Services. City shall be solely responsible for daily back-up and other protection of its data and software against loss, damage or corruption during the performance of services and for any necessary reconstruction thereof. c. Third Party Services Warranty. In connection with the products (materials), certain services, such as extended warranty service by manufacturers, are sold by the Contractor as a distributor or sales agent ("Third Party Services"). In the case of Third Party Services, the third party will be the party responsible for providing the services to the City and the City will look to the third party for any loss, claims or damages arising from or related to the provision of such Third- Party Services. Any amounts, including, but not limited to, taxes, associated with Third Party Services which may be collected by the Contractor will be collected solely in the capacity as an independent sales agent. 26. THE CITY’S RIGHT TO RECOVER AGAINST THIRD PARTIES. Contractor will do nothing to prejudice the City’s right to recover against third parties for any loss, destruction, or damage to City property, and will at the City’s request and expense, furnish to the City reasonable assistance and cooperation, including assistance in the prosecution or defense of suit and the execution of instruments of assignment in favor of the City in obtaining recovery. 27. NO GUARANTEE OF WORK. Contractor acknowledges and agrees that it is not entitled to deliver any specific amount of materials or services or any materials or services at all under this Agreement and acknowledges and agrees that the materials or services will be requested by the City on an as needed basis at the sole discretion of the City. Any document referencing quantities or performance frequencies represent the City's best estimate of current requirements, but will not bind the City to purchase, accept, or pay for materials or services which exceed its actual needs. 28. OWNERSHIP. a. Except as it pertains to the Work Product in Subsection (b) below, all deliverables, services, and information provided by Contractor or the City pursuant to this Agreement (whether electronically or manually generated) including without limitation, reports, test plans, and survey results, graphics, and technical tables, originally prepared in the performance of this Agreement, are the property of the City and will not be used or released by Contractor or any other person except with prior written permission by the City. b. City's rights to Work Product (meaning deliverables to be provided or created individually or jointly in connection with the services, not materials, provided by Contractor, including but not limited to, all inventions, discoveries, methods, processes, formulae, ideas, concepts, techniques, know-how, data, designs, models, prototypes, works of authorship, computer programs, proprietary tools, methods of analysis and other information, whether or not capable of protection by patent, copyright, trade secret, confidentiality, or other proprietary rights, or discovered in the course of performance of this Agreement that are embodied in such work or materials) will be, upon payment in full, a non-transferable, non-exclusive, royalty-free license to use such Work Product solely for City's internal use. City obtains no ownership or other property rights thereto. City agrees that Contractor may incorporate intellectual property created by third parties into the Work Product and that City’s right to use such Work Product may be subject to the rights of, and limited by agreements with, such third parties EXHIBIT C MESA STANDARD TERMS AND CONDITIONS Page 30 of 32 29. USE OF NAME. Contractor will not use the name of the City of Mesa in any advertising or publicity without obtaining the prior written consent of the City. 30. PROHIBITED ACTS. Pursuant to A.R.S. § 38-504, a current or former public officer or employee within the last twelve (12) months shall not represent another organization before the City on any matter for which the officer or employee was directly concerned and personally participated in during their service or employment or over which they had a substantial or material administrative discretion. Further, while employed by the City and for two (2) years thereafter, public officers or employees are prohibited from disclosing or using, without appropriate authorization, any confidential information acquired by such personnel in the course of his or her official duties at the City. 31. FOB DESTINATION FREIGHT PREPAID AND ALLOWED. All deliveries will be FOB destination freight prepaid and allowed unless otherwise agreed. 32. RISK OF LOSS. Contractor agrees to bear all risks of loss, injury, or destruction of Contractor’s goods or equipment incidental to providing these services and such loss, injury, or destruction will not release Contractor from any obligation hereunder. 33. SAFEGUARDING CITY PROPERTY. Contractor will be responsible for any damage to City real property or damage or loss of City personal property when such property is the responsibility of or in the custody of Contractor or its employees. 34. WARRANTY OF RIGHTS. Contractor warrants it has title to, or the right to allow the City to use, the materials and services being provided and that the City may use same without suit, trouble or hindrance from Contractor or third parties. 35. PROPRIETARY RIGHTS INDEMNIFICATION. Without limiting the foregoing, Contractor will at its expense defend the City against all claims asserted by any person that anything provided by Contractor infringes a patent, copyright, trade secret or other intellectual property right (collectively “Claim”) and must, without limitation, pay the costs, damages and attorneys' fees awarded against the City in any Claim, or pay any settlement of such Claim. Each party agrees to notify the other promptly of any matters to which this provision may apply and to cooperate with each other in connection with such defense or settlement. If a preliminary or final judgment is obtained against the City’s use or operation of the items provided by Contractor hereunder or any part thereof by reason of any alleged infringement, Contractor will, at its sole option and its expense and without limitation, either: (a) modify the item so that it becomes non-infringing; (b) procure for the City the right to continue to use the item; (c) substitute for the infringing item other item(s) having at least equivalent capability; or (d) refund to the City an amount equal to the price paid, less reasonable usage, from the time of installation acceptance through cessation of use, which amount will be calculated on a useful life not less than five (5) years based on a five (5) year straight line amortized basis. The forgoing provisions in this Section state the entire liability of Contractor and the sole and exclusive remedy of the City with respect to any Claim. Contractor shall have no liability or obligation to the City to the extent any Claim is based upon: (i) any combination of anything provided by Contractor with other software, hardware or other materials not authorized by Contractor or manufacturer; or (ii) any addition to, or modification of, anything provided by Contractor made after delivery to the City by any person other than Contractor. 36. CONTRACT ADMINISTRATION. The contract will be administered by the Purchasing Administrator and/or an authorized representative from the using department. All questions regarding the contract will be referred to the administrator for resolution. Supplements may be written to the contract for the addition or deletion of services. Payment will be negotiated and determined by the contract administrator(s). 37. FORCE MAJEURE. Failure by either party to perform its duties and obligations will be excused by unforeseeable circumstances beyond its reasonable control, including acts of nature, acts of the public enemy, riots, fire, explosion, legislation, and governmental regulation. The party whose performance is so affected will within five (5) calendar days of the unforeseeable circumstance notify the other party of all pertinent facts and identify the force majeure event. The party whose EXHIBIT C MESA STANDARD TERMS AND CONDITIONS Page 31 of 32 performance is so affected must also take all reasonable steps, promptly and diligently, to prevent such causes if it is feasible to do so, or to minimize or eliminate the effect thereof. The delivery or performance date will be extended for a period equal to the time lost by reason of delay, plus such additional time as may be reasonably necessary to overcome the effect of the delay, provided however, under no circumstances will delays caused by a force majeure extend beyond one hundred-twenty (120) calendar days from the scheduled delivery or completion date of a task unless agreed upon by the parties. 38. COOPERATIVE USE OF CONTRACT. This contract is available through National IPA to agencies nationwide. The City has also entered into various cooperative purchasing agreements with other Arizona government agencies, including the Strategic Alliance for Volume Expenditures (SAVE) cooperative. Under the SAVE Cooperative Purchasing Agreement, any contract may be extended for use by other municipalities, school districts and government agencies through National IPA or SAVE in the State of Arizona with the approval of Contractor. Any such usage by other entities must be in accordance with the statutes, codes, ordinances, charter and/or procurement rules and regulations of the respective government agency. A contractor, subcontractor or vendor or any employee of a contractor, subcontractor or vendor who is contracted to provide services on a regular basis at an individual school shall obtain a valid fingerprint clearance card pursuant to title 41, chapter 12, article 3.1. A school district governing board shall adopt policies to exempt a person from the requirements of this subsection if the person's normal job duties are not likely to result in independent access to or unsupervised contact with pupils. A school district, its governing board members, its school council members and its employees are exempt from civil liability for the consequences of adoption and implementation of policies and procedures pursuant to this subsection unless the school district, its governing board members, its school council members or its employees are guilty of gross negligence or intentional misconduct. Additionally, Contractor will comply with the governing body’s fingerprinting policy of each individual school district and public entity. Contractor, subcontractors, vendors and their employees will not provide services on school district properties until authorized by the school district. Orders placed by other agencies and payment thereof will be the sole responsibility of that agency. The City is not responsible for any disputes arising out of transactions made by others. The City is not a party to any agreements between the Contractor and National IPA, National IPA and other agencies, the Contractor and other agencies, or any third-party contracts in any way related to this Agreement or the cooperative use of this Agreement. 39. FUEL CHARGES AND PRICE INCREASES. No fuel surcharges will be accepted. No price increases will be accepted without proper request by Contractor and response by the City’s Purchasing Division. 40. NOTICES. All notices to be given pursuant to this Agreement must be delivered to the parties at their respective addresses. Notices may be (i) personally delivered; (ii) sent via certified or registered mail, postage prepaid; (iii) sent via overnight courier; or (iv) sent via email or facsimile. If provided by personal delivery, receipt will be deemed effective upon delivery. If sent via certified or registered mail, receipt will be deemed effective three (3) calendar days after being deposited in the United States mail. If sent via overnight courier, email or facsimile, receipt will be deemed effective two (2) calendar days after the sending thereof. 41. GOVERNING LAW, FORUM. This Agreement is governed by the laws of the State of Arizona. The exclusive forum selected for any proceeding or suit in law or equity arising from or incident to this Agreement will be Maricopa County, Arizona. 42. INTEGRATION CLAUSE. This Agreement, including all attachments and exhibits hereto, supersede all prior oral or written agreements, if any, between the parties and constitutes the entire agreement between the parties with respect to the work to be performed. EXHIBIT C MESA STANDARD TERMS AND CONDITIONS Page 32 of 32 43. PROVISIONS REQUIRED BY LAW. Any provision required by law to be in this Agreement is a part of this Agreement as if fully stated in it. 44. SEVERABILITY. If any provision of this Agreement is declared void or unenforceable, such provision will be severed from this Agreement, which will otherwise remain in full force and effect. The parties will negotiate diligently in good faith for such amendment(s) of this Agreement as may be necessary to achieve the original intent of this Agreement, notwithstanding such invalidity or unenforceability. 45. SURVIVING PROVISIONS. Notwithstanding any completion, termination, or other expiration of this Agreement, all provisions which, by the terms of reasonable interpretation thereof, set forth rights and obligations that extend beyond completion, termination, or other expiration of this Agreement, will survive and remain in full force and effect. Except as specifically provided in this Agreement, completion, termination, or other expiration of this Agreement will not release any party from any liability or obligation arising prior to the date of termination. 46. A.R.S. SECTIONS 1-501 and 1-502. Pursuant to Arizona Revised Statutes Sections 1-501 and 1- 502, any person who applies to the City for a local public benefit (the definition of which includes a grant, contract or loan) must demonstrate his or her lawful presence in the United States. As the Agreement is deemed a local public benefit, if Contractor is an individual (natural) person or sole proprietorship, Contractor agrees to sign and submit the necessary documentation to prove compliance with the statutes as applicable. City of Mesa Information Technology Solutions and Services Solicitation #2018011 October 23, 2017 Original CDW Government LLC 230 N. Milwaukee Ave. Vernon Hills, IL 60061 City of Mesa Information Technology Solutions and Services Table of Contents Tab 1- Letter of Transmittal ................................................................................................ Front Page Executive Summary ............................................................................................................................. 4 Tab 2 ...................................................................................................................................................... 7 Response to National IPA Cooperative Contract ......................................................................................................... 7 Tab 3 .................................................................................................................................................... 41 Pricing Forms ................................................................................................................................................. 41 Tab 4 .................................................................................................................................................... 44 Qualifications (Abilities, Experience, and Expertise) .................................................................................. 44 Tab 5 .................................................................................................................................................... 49 Technology ..................................................................................................................................................... 49 Tab 6 .................................................................................................................................................... 59 Other Forms .................................................................................................................................................... 59 Vendor Information Form Exceptions and Confidential Information Form General Questionnaire Form Lawful Presence Affidavit Respondent Certification Form Respondent Questionnaire W-9 Form and Certificate of Insurance Tab 7 .................................................................................................................................................... 60 Appendix ......................................................................................................................................................... 60 Mark Ellis Resume Pat O'Brien Resume CDW•G Return Policy CDW Government LLC Page 3 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Executive Summary The City of Mesa, through this solicitation, has partnered with the National Intergovernmental Purchasing Alliance Company (“National IPA”) to enable public and non- public entities in Arizona to purchase all manner of IT solutions and services. Understanding that value and efficiency in procurement are hot-button issues for the City of Mesa, we have kept that as our guiding principles for the response contained herein. As states and municipalities work within constrained budgets, now more than ever, value and sound purchasing practices of utmost importance when choosing an IT solutions provider and partner. CDW Government LLC (“CDW•G”) has been a reliable partner of National IPA for over a decade with a demonstrable track record of delivering outstanding IT solutions, with efficient delivery, and all of the benefits that come from this contract. What sets our offer apart from what our competition will provide is that our approach to our customers is to treat them as a partner. Everything that we do as a company revolves around the main focus of our business: our customers. Because we provide solutions to a variety of entities (from public to private; small businesses and rural communities, to the federal government and large municipalities), we know that solutions aren’t “one-size fits all.” Tailoring our solutions to our customers requires us to get to know you and meet you where you are to gain a better understanding of what drives your business. Evidenced by our ten year successful relationship with the team at National IPA, our approach to IT solutions reflects a belief that true value comes from delivering to our customers exactly what they want, when they want it. Efficient online purchasing, dedicated support, highly certified services providers, and contract compliance are only a few of the features of what we can deliver to the City of Mesa. Contract Excellence Understanding that compliance with city policy and state financial statutes is important to the City of Mesa, we have built our response to Mesa around our approach to working with government customers. We know that the City of Mesa has legal and regulatory compliance requirements to which you have to adhere. That is why our approach incorporates your regulatory compliance needs and builds your contract around those obligations. Contract participants’ Account Center has a wealth of information which will enable them to make better informed purchasing decisions and provide them reports on purchases, updated pricing, and much more. What differentiates us from our competition is our Program Management team who oversee the administration of negotiated contracts. While some of our competition may have one or two individuals tasked to ensure contract compliance, we maintain a team of highly trained professionals whose sole goal is ensure that we meet our commitments to our contract customers. Program Managers also work with our Marketing department to promote your contract and educate our sales force on the particularities of the contract. Our Program Management teams work to make sure that our sales teams are educated on the contract requirements. CDW Government LLC Page 4 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Our Program Management team also compiles a variety of reports, ranging from updated pricing and product options to purchase history and analyses of the success of the contract. Some of the features of what we will provide you are: o Understand and Comply with all applicable statutory and contractual provisions; o Maintain consistent, contract-compliant pricing; o Comply with any security requirements; o Follow proper protocols, including obtaining customer approval, prior to making any substitutions or deviations from the original contract requirements and specifications; o Engage directly, honestly and truthfully in our discussions with agency representatives and government employees In addition to a flexible contract, contract participants will enjoy the advantages of a dynamic pricing structure. As CDW•G employs a vendor-neutral approach to IT solutions, we leverage that method to deliver better pricing to our customers. Because of our size and reputation in the IT marketplace, we have the ability to deliver volume discounts, exclusive pricing, and special promotions unavailable with other IT solution providers. National Services Presence We have over 30 offices around the United States. Meeting contract participants where they are is really important to us: We want to understand our customers’ needs, their environment, the particularities that make contract participants the unique customers they are. Understanding what drives purchasing decisions helps us provide more tailored solutions. We have a national network of service providers, all trained in the latest approaches, methodologies, and solutions, consistently carrying the highest level of OEM certifications. This means that when contract participants need us to come into their environments and provide guidance, they can be sure that they’re receiving guidance from seasoned experts with years of experience in solution deployment. Our Services model offers customers an unusual combination: the close relationship and easy access of a local provider who understands your IT environment inside and out, and the scale, efficiency and resources of a multinational provider. We have 30-plus local branch offices throughout the United States and Canada. So, chances are, we’re within driving distance of contract participants. In addition to our local branches, we have over 1,100 services professionals and a network of trusted service and solutions partners. In fact, because of our national scale, CDW•G is able to identify areas of emerging need for our customers and then ramp up our expertise and resourcing in those areas. Logistics One of the many benefits of our proposed solution is how we work with you to deliver your IT purchases. From order placement to delivery, how we bring you your purchases is almost as important to us as what you buy. Making the purchasing and delivery process easier and time-efficient, we work hard to guarantee that you receive the most cost-effective purchasing options available. Your account center will enable you to: CDW Government LLC Page 5 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services o Connect with your dedicated account manager and team of specialists; o Create and retrieve quotes and collaborate with your account manager; o Promote IT standards; o Track orders and shipments; o Manage purchases and payments; o Set shipping and billing preferences and manage contact information Factor in our two strategically-located distribution centers that hold $220M of inventory, on average, you can be sure that we have what you need when you need it, and have the ability to get it to you quickly. We maintain both a 450,000-square-foot distribution center located at our headquarters in Vernon Hills, IL and a 513,000-square-foot distribution center located in North Las Vegas, NV. The combined square footage of our distribution centers is three times greater than most of our competition. These locations facilitate quick distribution of products to our growing customer base throughout the country Breadth of Coverage CDW•G has over 840 Account Manager and 65 Field Representatives forming account teams across five verticals: Higher Education, K12 Education, Healthcare, Federal Government, and State & Local Government. In addition, our account teams are organized geographically: North, South, East, and West which facilitates their ability to be uniquely aware of the local landscape, identifying key partnerships and common local practices for contracting. These account teams are supported by technology specialists and segment technologists who can go deep into particular solution sets with our customers. No other national provider can claim the size and depth of knowledge of our highly skilled account teams, it is a particular point of pride for CDW•G. Wherever our customers are located, CDW•G invests heavily in our sales teams’ ability to meet our customers’ needs. Summary The City of Mesa can be confident that by partnering with CDW•G for the National IPA contract, we will be able to meet your needs and deliver the best value for contract participants. Evidenced by our successful ten year relationship with the City of Tucson, Mesa can expect the same level of local attention from a national IT solution provider. We stand ready to bring you a contract that will be tailored to your requirements and considerate of what’s important to you. At every stage of the lifecycle of your contract, your dedicated team of Account Managers, Program Managers, and Service providers is prepared to advise you and work with you to guarantee your total satisfaction; ensuring our commitment to you is consistently met. We are pleased to offer you the following proposal and look forward to being your trusted partner for years to come. CDW Government LLC Page 6 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Tab 2 Program Description and Method of Approach 1. Provide a response to the national program. a. Include a detailed response to Attachment D, Exhibit A, National IPA Response for National Cooperative contract. Responses should demonstrate a strong national presence, describe how offeror will educate its national sales force about the contract, describe how products and services will be distributed nationwide, include a plan for marketing the products and services nationwide, and describe how volume will be tracked and reported to National IPA. CDW•G Response: A. Method of Approach Response to National IPA Cooperative Contract 1. Provide a response to the national program. A. Include a detailed response to Attachment B, Exhibit A, National IPA Response for National Cooperative contract. Responses should demonstrate a strong national presence, describe how offeror will educate its national sales force about the contract, describe how products and services will be distributed nationwide, include a plan for marketing the products and services nationwide, and describe how volume will be tracked and reported to National IPA. 3.1 SUPPLIER QUALIFICATIONS Supplier must supply the following information in order for the Principal Procurement Agency to determine Supplier’s qualifications to extend the resulting Master Agreement to Participating Public Agencies through National IPA. 3.2 Company A. Brief history and description of your company. Founded in 1984, CDW is a leading provider of technology solutions to over 250,000 customers composed of small-, medium-, and large-sized public and private entities. CDW Government LLC (CDW•G) is a wholly owned subsidiary of CDW Corporation, incorporated in 1998 to address the specific needs of our government, education, and healthcare customers. Our unique company structure provides our customers products and services only a large national reseller can provide, combined with a local presence typical of a small business. We have a large manufacturer presence in our offices across the country and blanketed in the field with our field account executives. Account Teams are further segmented by agency type, education (K12/High Ed) or government, which allows us to provide each customer with one contact who is knowledgeable of every nuance of their organization. CDW•G is one of the largest direct marketing resellers in the U.S., currently carrying more CDW Government LLC Page 7 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services than 100,000 name-brand technology products from over 1,100 leading IT manufacturers. CDW•G delivers more than just product; we also deliver IT solutions. We offer a full range of technology services including: cloud computing, consulting, system configurations, implementation, and training. CDW•G designs and implements complete business solutions that address a full range of complex issues including, but not limited to: Business Continuity, Infrastructure Optimization, Networking, Security Management, and Unified Communications. B. Total number and location of sales persons employed by your company. CDW•G currently employs more than 1,456 coworkers, part of our larger organization of 8,800 employees nationwide and in Canada, with over 30 different locations. More than 840 of our CDW•G dedicated sales force are Account Managers, in addition to 65 Field Account Executives placed throughout communities across the nation. C. Number and location of support centers (if applicable) When CDW•G was awarded a similar contract with National IPA’s involvement in 2008, we had offices in five states and Canada. We have drastically expanded our location portfolio across 20 additional states, and have added second/multiple offices in a number of our original five states and Canada. Currently, we have over 30 separate locations. Speaking specifically to the benefit of this contract, seven of the states with new locations are also in the ten states with the highest historical spend on the contract. D. Annual sales for the three previous fiscal years. Below you can see evidence of CDW Corporation's sales growth, CDW•G’s growth, and our growth on the contract as well. CDW•G consistently drives compounding growth in both areas, and anticipates these upward trends to continue. The growth rates of National IPA CDW Government LLC Page 8 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services exceed the standard rate for CDW•G, demonstrating our results to both grow organically and promote the contract within our existing client base. Explosive Sales Growth Year Annual Revenues YOY Growth National IPA ($ Millions) CDW•G ($ Billions) CDW ($ Billions) National IPA CDW•G CDW 2013 $113 $4.2 $10.8 2014 $160.1 $4.9 $12.1 41.5% 16.7% 25.0% 2015 $253.7 $5.1 $13.0 58.5% 4.1% 7.4% 2016 $390 $5.6 $14.0 53.7% 9.8% 7.7% E.Submit your FEIN and Dun & Bradstreet report. CDW•G FEIN: 36-4230110 Dun & Bradstreet numbers: CDW Corporation 107627952 CDW Government LLC 026157235 CDW•G cannot supply a Dun & Bradstreet report, as it violates our contract with Dun and Bradstreet. The City of Mesa can obtain a report for CDW•G from Dun & Bradstreet. 3.3 Distribution, Logistics A.Describe how your company proposes to distribute the products/service nationwide. We offer more than 100,000 brand-name products from over 1,100 leading manufacturers. We carry over $200 million in inventory, and ship most in-stock products the same day they are ordered. The result is that contract purchasers receive a shipment from CDW•G in just 3-5 days, far surpassing our competitor’s capabilities CDW•G keeps a large breadth of products and fresh inventory on hand, in order to provide contract members with new technology as it becomes available. We constantly monitor trends within the IT industry to ensure that we offer our customers the latest technology and the most optimal solutions. Our inventory management system enables our purchasing department to excel at maintaining a one- to four-week supply of products in our distribution centers. Our inventory turns over 24-26 times per year. The distribution centers’ automated system scans bar-code labels on each product, pick list, and shipping label, resulting in increased delivery speed and accuracy. Some of smaller items require coworker assembly; “Ready Ship” products (items that ship in their original carton) move through the system even faster. Once the order shipment is ready for loading, a final scan determines the correct truck and sends it down the designated conveyor into the truck. The automated systems even help to load the trucks in ways that optimize shipment- processing speeds. CDW Government LLC Page 9 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services CDW•G’s strategic relationships with industry leading original equipment manufacturer (OEM) technology partners, such as HP, Cisco, Lenovo, and Apple, means that we not only have access to steep product discounts, but also greater access to the products and a more efficient procurement processes. We receive notification regarding product changes, including advance notification of product shortages, and products nearing end of life. When there is a product shortage and other vendors do not have access to these products, we can often procure them from another source. When CDW•G receives notification of an upcoming stock outage, we utilize our distribution centers' large capacity for volume purchases, keeping stock on hand for our customer’s present and future needs. B.Identify all other companies that will be involved in processing, handling or shipping the products/service to the end user. CDW•G has positioned ourselves very closely with the major carriers, in order to provide a wide range of delivery options to meet our customers' varying needs. We ship the majority of our products via UPS and FedEx. Both companies have employees on site at our warehouses, individuals with a long history of supporting CDW•G. We can also leverage the carrier’s intermodal transport options. Additionally, we have contracts with truckload (TL) and less than truckload (LTL) carriers for large orders and heavy products. If a carrier is not meeting our on-time delivery requirements, we remove the carrier from our preferred shipper list. C.Provide the number, size and location of your company’s distribution facilities, warehouses and retail network as applicable. CDW•G’s two strategically located distribution centers have a combined size of almost one million square feet. Our Central Distribution Center in Vernon Hills, IL, ships primarily to customers in the eastern half of the U.S. Our Western Distribution Center, in Northern Las Vegas, NV, ships primarily to customers in the western half of the U.S. Each distribution center serves as backup for the other. A state-of-the-art Warehouse Management System (WMS) controls both of these centers, ensuring speed and accuracy throughout the order fulfillment and distribution processes. In addition to working with OEM partners to supplement our direct purchasing model, CDW•G has developed strong affiliations with principal distributors: Synnex, Tech Data, and Ingram Micro. Our OEM partners send us daily electronic data interchange (EDI) downloads, giving us visibility to inventory at their locations. Our top three distribution partners provide real time inventory information. Using this multi-layered procurement structure, we secure out-of- stock product(s) within as little as 24-48 hours, depending on customer requirements. D.State any return and restocking policy and fees, if applicable, associated with returns. CDW•G offers a 30-day return policy on most products sold. Of the returns we accept, a minimum 15% restocking fee applies for non-defective product returns. For our complete return policy, please see Tab 7, Appendix of this response. Customers may also obtain CDW Government LLC Page 10 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services additional information by contacting their Account Manager or CDW customer relations at 866.SVC.4CDW, returns@cdw.com. 3.4 Marketing and Sales A. Provide a detailed ninety-day plan beginning from award date of the Master Agreement describing the strategy to immediately implement the Master Agreement as your company’s primary go to market strategy for Public Agencies to your teams nationwide, to include, but not limited to: I. Executive leadership endorsement and sponsorship of the award as the public sector go-to- market strategy within first 10 days Per Arizona Revised Statues § 44-405, the following information is confidential and proprietary and it might contain trade secrets therefore not subject to disclosure in case there is a request. Part of CDW•G’s commitment to our customer base is constantly seeking out opportunities to strengthen our national partner relationships. We view executive alignment as a key part of a successful contract strategy. We bring senior leaders from across our public-sector management team together with National IPA 2-3 times per year to review contract initiatives and customer feedback. Our ongoing efforts with National IPA in seven specific target accounts highlights this unique and longstanding collaboration. We meet monthly to review the current state of business and execution of each account’s growth strategy. In 2017, we have already seen success in Los Angeles World Airports and the City of Kansas City. The combined teams will continue to drive contract adoption amongst non-participating agencies. CDW•G’s leadership team is securely behind the growth and strategy of this program – both to the benefit of the City of Mesa and also across the nation. Key members of the leadership team include: David Hutchins, CDW•G’s VP of Education Sales, is an executive sponsor of the City’s contract. He continues to focus sales teams on the success of the contract, and continually collaborates with manufacturer partners, allowing CDW•G to provide the latest technology solutions to help further the mission of ‘the connected classroom’ across the nation. Robert F. Kirby, CDW•G’s VP of Federal and State & Local Sales, is an executive sponsor for this contract. He will ensure that sales teams work towards the success of the contract and consistently works with manufacturer partners to allow CDW•G to bring contract participants further benefits through targeted solution campaigns, like our public safety initiative. Tara Barbieri, CDW•G’s Director of Capture, is also an executive sponsor for the contract. She has endorsed and sponsored this contract since the inception in 2008, and shall continue this role upon award. In her position, she is dedicated exclusively to our company’s contractual sales, and leads CDW Government LLC Page 11 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services with the knowledge and experience in cooperative purchasing contracts. Internally, she has promoted this contract to CDW’s President Tom Richards and, externally, to HPE’s Meg Whitman. This is to say that for over ten years, she has worked tirelessly to champion this contract and has been integral to growing this contract into what it is today. To facilitate our growth strategy, CDW•G holds many public agreements, some with mandatory use requirements within individual states. We cannot agree to market the City’s contract as our primary public sector go-to-market strategy; however, we have included an appropriate marketing plan and pledge to continue focusing on the contract's success and awareness. We believe this pledge should not be viewed lightly, as with our support, this contract’s volume has surpassed the $350M mark as of last year in yearly sales. We understand through competitive research that our competitors rarely take issue with similar requests for commitments; yet we can easily find evidence that they too hold plenty of public contracts. CDW•G takes our partner commitments very seriously and Mesa is our partner in delivering on the accompanying National IPA Agreement. In the first ten days post-award, our CDW•G Program Management team will provide a company-wide contract award announcement, as well as develop a contract training program for all SLED Account Managers to attend. CDW•G has a successful contract launch history where we focus on five areas of the contract which are: Intake, Set-Up & Compliance, Education, Measure and Growth. By focusing on these areas specifically, we are able to launch contracts to the CDW•G teams with the most powerful and applicable details to make the new National IPA agreement more successful than the one currently in place II.Training and education of your national sales force with participation from the executive leadership of your company, along with the National IPA team within Dell Zones WWT Connection Carahsoft National Cooperative Purchasing Alliance (NCPA) National Joint Powers Alliance (NJPA) California CMAS Texas DIR US Communities NASPO Value Point (NVP) Texas DIR State of MO PC Prime Vendor Contract Massachusetts ITC47 National Cooperative Purchasing Alliance (NCPA) Midwestern Higher Ed Compact (MHEC) California CMAS Ohio Hardware, Software & Services National Cooperative Purchasing Alliance PEPPM Texas Dept of Information Resources PEPPM Texas DIR TIPS/TAPS MiCTA Massachusetts ITC47 National Cooperative Purchasing Alliance Massachusetts ITC47 Public Sourcing Solutions (PSS) Massachusetts Higher Ed Consortium CDW Government LLC Page 12 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services first 90 days Our Public Sector Account Managers are actively marketing the current contract to their customers and are very familiar with the structure of the contract. This is an enormous benefit to the City, National IPA, and the immediate momentum of the new contract. A ‘refresh’ training to enhance understanding of the new National Program, it’s updates and nuances with City of Mesa as lead agency will be conducted within the first 30 days post award. Familiarizing a completely new management team and educating a new group of Account Managers to a new contract is unnecessary with CDW•G. Other vendors, even after training, are likely to experience a significant period of growing pains, acclimating their sales staff to the offering. This ramp-up time will certainly have an impact on contract sales. This is often the case with new contracts, as National IPA and the City are aware. The current contract saw success atypical of most, quickly achieving $4 million dollars in purchases within the first four months from inception. We believe this success was due in large part to CDW•G’s experience in managing contracts and National IPA’s commitment to sound marketing strategies. The contract is now supporting almost fifty-eight times its 2009 purchases (the first full year of the contract). We believe that CDW•G is uniquely qualified to deliver growth over $400 million in 2018. All aspects of transitioning to the new contract will be seamless. The City and National IPA do not have to worry about member confusion or orders lost during training and setup time. Business will continue to flourish and training time will be used as a refresher, providing contract updates and focusing on strategies to increase business. B.Provide a detailed ninety-day plan beginning from award date of the Master Agreement describing the strategy to market the Master Agreement to current Participating Public Agencies, existing Pubic Agency customers of Supplier, as well as to prospective Public Agencies nationwide immediately upon award, to include, but not limited to: I.Creation and distribution of a co-branded press release to trade publications within first 10 days CDW•G’s Marketing contact will work with National IPA to create and distribute this announcement at the transition of the new award. II.Announcement, contract details and contact information published on the company website within first 30 days CDW•G can reload the new contract pricing structure within a matter of minutes and will have our website operation on the 1st day of the new contract. CDW•G will be able to seamlessly transition all agencies buying off of our current National Cooperative contract to the new contract, upon contract launch. III.Design, publication and distribution of co-branded marketing materials within first 90 days CDW Government LLC Page 13 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services CDW•G already has much of this material. We are poised to perform updates to the material and shall accomplish this well within the 90-day time frame. We propose a marketing strategy meeting with National IPA to discuss a refreshed approach and specific goals/targets for the new contract. CDW•G is eager to share our current marketing processes for the contract, including our attendance at the National IPA Regional Summit, aimed at increasing contract awareness; our Sales Wiki site, giving account teams easy access to marketing strategy and materials; and our monthly email campaigns to all National IPA members. We also look forward to talking about our ideas to gain a better contract understanding, with an increased focus in the K12 sector and our top OEM partners. IV.Commitment to attendance and participation with National IPA at national (i.e. NIGP Annual Forum, NPI Conference, etc.), regional (i.e. Regional NIGP Chapter Meetings, etc.) and supplier- specific trade shows, conferences and meetings throughout the term of the Master Agreement In 2018, CDW•G’s schedule includes over 100 regional and nearly as many national events. In past years, we have attended many events in which we promoted the contract, including NIGP, NASPO, CAPPO, and FAPPO. We will continue this practice with the new agreement, as well. For 2018, we are already committed to attend NASPO, and the National IPA Partner Summit. We are willing to continue to share our best practices with other non- competing National IPA vendors. Sales Manager Pat O’Brien has agreed to share some of these practices with other National IPA vendors at the Partner Summit, helping increase the success of all National IPA’s contracts. V.Commitment to attend, exhibit and participate at the NIGP Annual Forum in an area reserved by National IPA for partner suppliers. Booth space will be purchased and staffed by your company. In addition, you commit to provide reasonable assistance to the overall promotion and marketing efforts for the NIGP Annual Forum, as directed by National IPA. CDW•G has enjoyed participating in the NIGP Annual Forum and will continue to do so. We believe in the theme “Building Together” and look forward to sharing our best practices with other National IPA vendors. VI.Design and publication of national and regional advertising in trade publications throughout the term of the Master Agreement CDW•G advertises the contract in our own highly viewed publications and our contract specific email campaign. We will continue to promote the contract via avenues such as our EdTech and StateTech publication sites, while continuing to penetrate the market with a live- touch approach. CDW Government LLC Page 14 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services VII.Ongoing marketing and promotion of the Master Agreement throughout its term (case studies, collateral pieces, presentations, etc.) CDW•G continues to market and promote the contract, through various avenues such as announcements in our publications, email campaigns, as well as on the contract's CDW•G premium page. We look forward to working with National IPA to develop our marketing strategies even further. VIII.Dedicated National IPA internet web-based homepage with: •National IPA standard logo; •Copy of original Request for Proposal; •Copy of contract and amendments between Principal Procurement Agency and Supplier; •Summary of Products and pricing; •Marketing Materials •Electronic link to National IPA’s online registration page; •A dedicated toll free number and email address for National IPA CDW•G exceeds this requirement, as our current National IPA Premium Page, www.cdwg.com/nationalipasolutions presently includes these elements. The page includes the National IPA logo and a description of the contract, with multiple direct links to National IPA’s Home Page and Registration Page. We provide members with categories that mirror the contract, easily allowing them to locate the product or service they are looking for. We include “featured products” highlighting solutions that we select for their excellent value or popularity among purchasers. We have a toll-free number and address for National IPA members, and feature a dedicated Account Team included on the website, which highlights when they are available for customers. In conjunction with National IPA, we will continue to develop this site, increasing functionalities and promotion of the contract. CDW Government LLC Page 15 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services C. Describe how your company will transition any existing Public Agency customers’ accounts to the Master Agreement available nationally through National IPA. Include a list of current Jumana Dihu Program Manager Phone: 312-547-9437 Sydney Donahue Account Manager Phone: 877- 705-4975 Pat O’Brien Sales Manager Phone: 877-898-2997 Contacts CDW Government LLC Page 16 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services cooperative contracts (regional and national) your company holds and describe how the Master Agreement will be positioned among the other cooperative agreements. As the City and National IPA are both well aware, CDW•G currently holds a significant number of cooperative purchasing contracts including National Intergovernmental Purchasing Agency (National IPA), Association of Educational Purchasing Agencies (AEPA), and National Joint Powers Alliance (NJPA) . CDW•G is solutions-focused, vendor agnostic and provides consultation to assist our customers to select the contract best suited for their specific procurement needs. For all of our national contracts, we have maintained the transparency of our contract portfolio to our customer and negotiated the removal of language such as “most favored customer” and requirements such as this. CDW•G continues to prove without a doubt that we can keep our commitment to making this contract prosperous amongst our portfolio of offerings. We have transitioned a number of customers and their solicitation opportunities to this contract, in the form of participating agreements. Some of these customers include the City of New York, City of Phoenix, City of Atlanta, University of Colorado, and DeKalb County. Moving forward, we will continue to loop new members in to the contract and sustain the growth. D. Acknowledge that your company agrees to provide its company/corporate logo(s) to National IPA and agrees to provide permission for reproduction of such logo in marketing communications and promotions. National IPA has several CDW•G logos at their disposal under our general guidelines for intended use, they are included here for ease of evaluation. Logos & Guidelines CDW welcomes customers, media and other entities to use our corporate logo, as needed. The core component of CDW’s brand identity is its corporate logo; therefore, we ask that you carefully consider the following guidelines when using it. When using the CDW logo, you agree to the following: 1. You may use the logo(s) only in the exact form provided by CDW and only to accurately and actively link from a website that is under your control to the home page of CDW.com (or another address provided by CDW) and for no other purpose. 2. You may not incorporate the logo(s) into any other logo or design. 3. You may not to use the logo(s) in a way that suggests that you or your company or products are affiliated with CDW or its products or services in any way. 4. You may not display the logo(s) on any website that disparages CDW or its products or services, infringes any CDW intellectual property or other rights, or violates any law or regulation. 5. No other logo or design element should appear within 0.5 inches of the CDW logo. 6. You may not frame or alter the CDW website in any way. 7. At CDW’s direction, you will immediately remove the logo(s). 8. Your limited right to use the logo(s) does not constitute a grant of any other right or license. All other rights are reserved by CDW. 9. CDW disclaims all warranties, express and implied, regarding the logo(s), including warranties against infringement. You agree to indemnify CDW from and against any and all claims and liabilities arising out of your use of the logo(s). E. Supplier is responsible for proactive direct sales of Supplier’s goods and services to Public Agencies nationwide and the timely follow up to leads established by National IPA. All sales materials are to use the National IPA logo. At a minimum, the Supplier’s sales initiatives should communicate: I. Master Agreement was competitively solicited by a Principal Procurement Agency CDW Government LLC Page 17 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services II. Best government pricing III. No cost to participate IV. Non-exclusive contract We are happy to update our current National IPA flyer with the new contract information. We would like to further discuss the inclusion of II and IV, and will revise our marketing pieces to include mutually agreeable message that best represents the value of the contract. CDW Government LLC Page 18 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services 2. Provide a description of the product lines that can be provided by your firm. CDW•G Response: CDW•G is offering our entire catalogue, including our complete portfolio of product offerings which includes over 100,000+ products from more than 1,100 vendors. We also offer a full suite of professional services to users of this contract. Given the landscape of the IT industry and its rapid changes, we have defined these categories broadly to easily facilitate adding new technologies and services to the resulting Agreement over the contract period. We intend to be your go-to supplier for all of your IT solution needs; so, whatever your need may be, you can be sure we have the solution that works for you. We are the largest, direct reseller in the US for many of our OEM partners which include: Adobe, Cisco, HP, Lenovo, and Panasonic. Based on the strength of our success and our product portfolio, we are able to offer our customers the newest technologies, more robust discounts, and OEM support unavailable with our competition. Additionally, as technology is constantly evolving, we are always on the lookout for new vendors and new technologies to add to our offerings. Our product line cards, organized by product category and manufacturer, follows this page. CDW Government LLC Page 19 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services 3. Provide a description of the services that can be provided by your firm. CDW•G Response: Our services portfolio that we bring to our customers encompasses a wide array of both standard and specialized services. With over 1,600 highly trained and certified engineers in 30 locations nationwide, we offer the City of Mesa and National IPA contract participants the most optimal services in the IT industry. Below is a sampling of the services we provide to our customers: Cloud Computing: We know how important cloud computing is to our customer base, and are determined to lead the industry in mastering this complex, highly customizable service. Our internal cloud campaign is educating our Account Managers on how to assist our customers in determining the best-valued cloud option for their needs, while our technicians continue training to master the solution, and working with our manufacturer partners to expand our portfolio. Our Cloud offerings do require an additional Cloud Services form, but your Account Manager will walk you through the process. CDW•G offers a cafeteria-style set of cloud solutions. Our portfolio includes public, private, community, and hybrid deployment options. Our broad cloud offering currently includes over thirty different manufacturers, and we continue investigating other manufacturer solutions to add to this portfolio. Our cloud computing solutions; Software as a Service (SaaS), Infrastructure as a Service (IaaS), and Platform as a Service (PaaS), cater to the specific needs of the span of our entire customer makeup Consulting and Analysis: Most of our projects begin with either an assessment or planning and design session. CDW•G technical specialists and field solution architects are experts in many areas including unified communications, networking, wireless, network and physical security and server/storage solutions. CDW•G will save contract members staff time and effort because our experts have already initiated the due diligence process. We share our knowledge of the latest technologies as well as our expertise regarding the pros and cons of each potential solution. We also offer a variety of more complex consulting/analysis solutions for those customers who need a more in-depth evaluation of their systems. Technical Support: CDW•G’s Staff Augmentation services offering includes assisting customers with onsite help desk and technical support services. This service provides skilled, temporary staffing to assist with IT challenges CDW Government LLC Page 20 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Trade-Ins: CDW•G coordinates with our manufacturer partners to provide trade-in services to our customers. Repair: In addition to offering onsite repair, we have our own repair center. CDW’s Repair Center offers fast turnaround time and low cost out‑of‑warranty repair prices, as well as great in‑warranty service. Our factory certified repair technicians complete typical repairs on an average of 7-10 business days. We are an authorized Service Center for the following Manufacturers: o Acer o Apple o Fujitsu o HP o IBM o Lenovo o Service Net o Sony o Toshiba Please note: due to manufacturer policies, limitations, and agreements, CDW may not be able to service all computer models or lines made by these manufacturers. Design: Most of our projects begin with either an assessment or planning and design session. Our architects review your needs and perform an evaluation of your existing environment to develop a comprehensive solution to meet your particular project objectives. Configuration/System Configurations: While onsite configuration services are available, CDW•G often recommends our in-house configuration services. CDW•G builds preconfigured technology solutions in our two ISO 2008- certified configuration centers, so they arrive at their correct location(s) ready to plug and play. We have a 25,000- square-foot configuration center in our North Las Vegas distribution center and a 24,000-square-foot configuration center in our Vernon Hills, IL distribution center, including an 8,000-square-foot enclosed area for enterprise configurations. To complement this space, CDW•G has more than 150 configuration technicians, providing a spectrum of customized configuration services. CDW•G’s configuration services include: CDW Government LLC Page 21 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services •Hardware and software installation and configuration •Customized imaging •Asset tagging, custom labeling, and laser etching •Router/switch configuration •Server rack configuration Implementation: Our national footprint is expansive, with over 600 engineers on staff in more than 26 service offices, complimented by a national traveling team. Additionally, we have capabilities to ship 3,000+ custom-configured systems daily; we configure over 750,000 custom solutions in our two state-of-the art distribution centers annually. Our large number of engineers, paired with our configuration capabilities, allows CDW•G to handle any rollout project that contract members may have. Training: CDW•G’s project methodology ensures technicians and project managers work with the mindset of being an extension of the customer’s IT staff. Throughout the project our team not only focus on designing bullet- proof solutions, but continually engaging the IT staff; sharing knowledge, and ensuring the staff knows how to navigate the solution in which the customer vested their resources. Should a customer require training outside of this transfer of knowledge, we have a blended solution of CDW•G offerings, manufacturer standard trainings, and technology training companies. Maintenance: CDW•G recognizes that maintenance/support contracts are of great importance to many customers because uptime is vital to their success. Our strong partnerships with the industry’s top technology manufacturers, paired with our own maintenance solutions, offers a variety of viable options to our customers. Our maintenance options include the following: •Warranty extensions and upgrades •Post-warranty support •Accidental damage protection •Maintenance contract agreements (coterminous, break/fix, and retainer) •Post-sale technical support •Product and certification •Help desk services Hardware and Software Installation: Our installation services encompass the following solutions. Installation services can include installing and deploying new systems; moving existing equipment; assessing systems and testing installed equipment; and advanced IT support. We also offer staging options, should a customer need to complete their installation in numerous rollouts. •Client Computing Installation •Data Center Installation •Network Installation •Security Installation •Microsoft Configuration and Installation •Microsoft Accelerators •Visual Solutions Installation System Testing: All of CDW•G’s service projects incorporate testing every aspect of the final solution, ensuring all acceptance criteria is met. CDW Government LLC Page 22 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Upgrades: Many products offer a variety of system upgrades. Our dedicated Account Managers work with their customers to explain the benefits of each upgrade, and help determine if these upgrades would be a wise purchase for the customer’s needs. The Account Manager then collaborates with CDW•G dedicated manufacturer partner specialists to incorporate the upgrades into the final product build. Additionally, CDW•G performs a number of upgrades, such as asset tagging and laser etching, in house in our configuration center. Imaging: In addition to our configuration services, CDW•G performs imaging services in house in our configuration centers as well. Our A+ certified imaging technicians routinely image the following products: •Laptops •Desktops •Workstations •Flash Drives •Servers •Hard drives •Apple products, including iPods and iPads Customers can provide their own image or CDW•G can create one for them. As with all services completed in our configuration centers, each piece of equipment goes through a comprehensive quality assurance check prior to shipping to ensure the unit is function properly. CDW•G also stores images on our secure server, completely isolated from other networks, and only accessible to a few authorized individuals. Many times customers choose to have us store their images as it allows CDW•G to load custom configured images quickly on their machines. 4.Provide a detailed description of any programs available for Participating Agencies seeking to set and meet goals for historically underutilized businesses (e.g. minority, woman, veteran, disabled, etc.). Discuss how transaction is between offeror and tier one suppliers and Participating Agencies and tier one suppliers will be tracked and accounted for and any quality assurance measures that are in place to assure a high-performance standard for tier one suppliers. CDW Government LLC Page 23 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services . 5. Describe how your firm proposes to distribute the products/services nationwide. CDW Government LLC Page 24 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services CDW•G Response: We have access to more than 100,000 top brand-name products from more than 1,000 manufacturers. We carry over $220 million in inventory, and ship most in- stock products the same day they are ordered. Because of our distribution centers are strategically located in Vernon Hills, IL and Las Vegas, NV; we have the capability to deliver a wide array of shipping options that best fit your needs. Because of our position as one of the largest direct resellers in the U.S., we work closely with all of the major shipping companies to ensure you receive your orders on time. We work with UPS, FedEx, CEVA, UPS Freights, Dynamex, and Veterans Messenger service to get you what you need, when you need it. We offer overnight, same day, 2 day, 3 day, and ground shipping options to best meet your needs. On average, we ship up to 54,000 boxes per day and contract purchasers receive a shipment from CDW•G in just 3-5 days, far surpassing our competitor’s capabilities. Our two distribution centers have a combined square footage of almost a million square feet. Every stage of our distribution process is automated, with our custom-designed sorting systems, built to optimize the shipping process. Packed boxes are sorted and weighed onto the conveyor system. Combined, our distribution centers have almost twelve miles of conveyor belts that feed the sorting system. The barcode scanner reads the shipping label and the packed box’s correct loading dock is determined. Once the order shipment is ready for loading, a final scan determines the correct truck (for instance, FedEx overnight) and sends it down the designated conveyor into the truck. The automated systems even help to load the trucks in ways that optimize shipment-processing speeds. When your package reaches the correct shipping portal, the sorting system drops your package down a chute that brings your order to the door dock to be loaded onto the correct carrier’s truck and then your package is on its way for delivery. The benefits of our automated distribution systems are that the City of Mesa will receive the right products, configured to your specifications and ready to use out of the box, and delivered on time 6. Identify all subcontractors that will be involved in processing agency orders under this contract and describe their distribution/delivery processes. CDW•G Response: CDW•G believes another important step in successful order fulfillment is utilizing shipping partners that are as focused on customer service excellence as we are. CDW•G processes all purchase orders. If our customers have customized agreement that CDW Government LLC Page 25 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services include a Tier 1 diversity requirement, we work with diverse supplier partners local to customers, to deliver your products and your orders on time. Distribution Partners. Our Distribution Partner Network includes over 130 different suppliers, meaning we can provide any product National IPA members would need. Like our OEM partners, we’re the largest partner for many of our Distributors. And like our manufacturer partner relationships, this results in direct benefits for CDW•G and our customers. Most send us EDI downloads or real time information on their available inventory, resulting in access to products usually in as little as a day. As another example, we are a top Ingram Micro partner and hold Elite Partner status. This partnership provides a customized and exclusive support resource to our Account Teams and customers, among other benefits. The CDW dedicated priority phone queue has an average wait time of less than two minutes. We ship the majority of our products via UPS and FedEx, due to their extensive service capabilities, excellent record for on-time delivery and competitive pricing. In fact, both companies have employees on site at our warehouses, individuals with a long history of supporting CDW•G. We can also leverage the carrier’s intermodal transport options. Additionally, we have contracts with truck load (TL) and less than truck load (LTL) carriers for large orders and heavy products. If a carrier is not meeting our on-time delivery requirements, we remove the carrier from our preferred shipper list. Shipping Partners. We have a number of shipping partners to provide our customers their products, fast. In fact, both companies have employees on site at our warehouses. These individuals have a long history of supporting our logistics operation, ensuring efficient processing and movement of customer orders. This helps us keep our carrier goal of 99.04%, beating the industry standard of 98%. Some additional benefits of our UPS partnership includes a customized Loss Prevention Program to ensure integrity of customer packages; a collaborative tracking program with our customer relations department; and IT automation between All contract management functions will continue to be handled by Mark Ellis and his Program Management team. When any of our partners are involved, CDW•G manages the relationship and liability involved. We do ask customers to mutually agree to and sign Statements of Work for all service engagements through CDW•G. This is to ensure we keep Members apprised of the responsibilities, timelines, and progress of the project. In instances where customers would like to integrate their e-Pro applications with our own, CDW•G will provide the integration assistance; however, the relationship the member has CDW Government LLC Page 26 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services with their e-Pro application vendor is their own, any applicable vendor fees resulting from the integration will be the responsibility of the member 7. Provide the number, size, and location of your firm’s distribution facilities, warehouses, and retail network as applicable. Provide information on the productivity of your facilities and systems as follows: a. How many orders are processed daily on an average b. How many devices does your facility configure daily on an average c. What is the highest number of orders processed in a single day d. What is the highest number of devices configured in a single day from the facilities described CDW•G Response A: Our two distribution centers process an average of 54,000 units per day. CDW•G Response B: Our configuration staff, which includes 200+ Technicians, Engineers, Management, and Support Staff, complete an average of 7,000 custom configurations per day. CDW•G Response C: At peak times, our two distribution centers process a combined average of 135,000 units per day. CDW•G Response D: During seasonal spikes, our configuration staff configures almost 12,000 devices per day. CDW•G’s two strategically located distribution centers have a combined size of almost one million square feet. Our Central Distribution Center in Vernon Hills, IL, ships primarily to customers in the eastern half of the U.S. Our Western Distribution Center, in Northern Las Vegas, NV, ships primarily to customers in the western half of the U.S. However, each distribution center serves as backup for the other. They receive inventory valued at about $21.0 million per day, or between 78 to 80 truckloads a day, processing a combined average of 135,000 units daily. A state-of- the-art Warehouse Management System (WMS) controls both of these centers, ensuring speed and accuracy throughout the order fulfillment and distribution processes. CDW•G’s Configuration Centers, also located in Vernon Hills and Las Vegas, maintain a combined square footage of over 100,000 feet. CDW Government LLC Page 27 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services In addition to working with OEM partners to supplement our direct purchasing model, CDW•G has developed strong affiliations with principal distributors. Like our OEM partners, they send us daily electronic data interchange (EDI) downloads, giving us visibility to inventory at their locations. Further, our top three distribution partners provide real time inventory information. Using this multi-layered procurement structure, we secure out-of-stock product(s) within as little as 24-48 hours, depending on customer requirements. 8. State any return and restocking policy, and any fees, if applicable associated with returns. CDW•G Response: CDW•G offers a 30-day return policy on most products sold. Of the returns we accept, a minimum 15% restocking fee applies for non-defective product returns. Please see Tab 7 “Appendix” for our full return policy. 9. Describe your invoicing process. Is electronic invoicing available? Is summary invoicing available? Are there other options on how an agency receives an invoice? CDW•G Response: CDW•G mails invoices the day after the product(s) is shipped out of one of our distribution centers or, if you prefer an electronic invoice, you can request that invoices be sent via PDF instead. We send the PDF the same day that the system generates the invoice. When a product is drop-shipped from a vendor, CDW•G invoices the customer once we receive the invoice from the vendor. As an added convenience, you can also print copies of original invoices via your CDW•G Extranet. Our standard invoices include the information listed below. • CDW•G remit to address • Invoice date • Invoice number • PO number affiliated with invoice • Payment due date • Order date • Shipping method • CDW•G part number • Description of product • Quantity ordered/shipped • Unit price (based off of pricing structure agreed to in the contract) • Extended price • Ship to address All of the information pertaining to the customer’s specific requirements are included on the invoice as well. CDW•G supports many EDI formats and can customize invoices to reflect customers’ required data fields. For more information regarding our EDI capabilities, we encourage the City to visit www.cdwg.com/edi. 10. Describe your delivery commitment: a. What is your fill rate guarantee? CDW•G Response: CDW•G’s same-day fill rate is between 97-99% for credit-approved orders and in-stock product, depending on the complexity of the order and this is our best effort and therefore, not a guarantee. Should an item be out of stock, it typically takes 2-10 days, after receipt of order, to receive the product (subject to availability). We receive timely notification regarding product changes, including advance notification of product shortages, and products nearing end of life. When there is a product shortage and other vendors do not have access to these products, we can often procure them from another source. Many times when CDW•G receives notification of an upcoming stock outage, we utilize our distribution center’s large capacity for volume purchases, keeping stock on hand for our customer’s present and future needs. CDW Government LLC Page 28 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services b. What are your delivery days? CDW•G Response: CDW•G’s standard delivery is M-F excluding Thanksgiving, Christmas, and New Year’s Day. Arrangements can be made based on need to fulfill orders on weekends and holidays for an additional fee. Customers should provide at least a 48-hour notice in order to allow time to properly set up any weekend or holiday deliveries. c. Do you offer next day delivery? CDW•G Response: Yes, CDW•G can ship same day, overnight, 2nd day, 3rd day, and ground. An expedited freight charge may be added for this service. d. How do you facilitate emergency orders? CDW•G Response: Whenever a contract member’s order requires expediting, CDW•G treats it with priority. We direct all customers to contact their dedicated Account Manager if an emergency situation arises. They focus on placing the order and arranging for expedited delivery. Due to our very large inventory at our two distribution centers, we usually have the products in stock and available for immediate shipping. Our vast distribution capabilities means that we can draw from our OEM partners to ensure that, if we do not have your item in stock, we can still procure and deliver your order. e. Are shipping charges exempt for ALL who use this contract? CDW•G Response: Prices include lowest ground freight for shipments/packages less than 70 pounds within the 48 contiguous United States when referencing this Agreement. All orders are subject to Seller’s standard shipping policies in effect at the time of order placement. In those instances that are larger than 70 pounds or call for express or overnight delivery, shipping costs will be pre-paid by Seller and added to the customer invoice. There is no additional fee assessed for smaller orders, unlike some of our competitors. Since inception of this contract, we have become authorized for increasingly complex technologies, including large storage arrays where freight costs must be considered in the overall quote to the customer. In separating shipping costs for heavier items, it removes the need to consider the costs in the entire category discount, and allows us to provide customers deeper discounts for all products that fall within the category f. Describe how problems (such as a customer ordering a wrong product or a customer receiving a defective product; etc.) are resolved. CDW•G Response: CDW•G encourages customers to contact their Account Manager to assist with any such issues. If the Account Manager evaluates the issue and if they cannot personally assist the customer, they will engage and collaborate with our Customer Relations Department to assist. Customers may also reach out to Customer Relations directly. If a wrong product is ordered, the customer’s dedicated CDW•G Account Manager will work with the customer to determine the best solution to resolve the issue. For any products returned, whether defective or incorrect item, CDW•G requires customers to provide a Return Merchandise Authorization (RMA) number before shipping back any product. This process allows us to expedite the process and helps ensure the proper action or credit, CDW Government LLC Page 29 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services upon processing. Customers can get the RMA request form from their Account Manager, online via their CDW•G Extranet Account, or by contacting Customer Relations. CDW•G tracks the reason for all returns, allowing us to make appropriate changes, as necessary. For example, a high volume of returns damaged in shipment would lead us to audit the carrier and review product packaging. CDW•G also monitors how quickly and efficiently the Customer Relations staff handles RMA requests, aiming to respond to requests within 24 hours or less. 11. Describe the types of customer service available to agencies that use this contract: CDW•G Response: Your Account Manager stands ready to assist you in any type of query you may have and is available, during business hours and beyond, to assist you and your customer service needs. Their sole goal is to ensure your complete satisfaction. If you experience any type of technical issue, your Account Manager will facilitate a timely resolution. In the event that your Account Manager is unavailable, CDW•G’s customer service team is well-equipped to help you resolve your problem. All customer support is based in the United States. All Help Desk technicians are CompTIA certified; hold at a minimum A+ and Network+ certifications, and many are accredited in various engineering and manufacturing training courses. Our customer service team assists customers to ensure the product is working as the manufacturer intended. CDW•G provides this value added support, at no charge, for up to two years or manufacturers end of life, whichever comes first. We offer our customers Sales Support, Technical Support, and Website Support. All of our customer support options can be accessed via phone, fax, email or chat. For all of our support options and hours of operation, please visit: https://www.cdw.com/content/contact- us/support.aspx. a. Is online support available? CDW•G Response: Yes, CDW•G’s online technical and customer support services include live chat and E-support, and remote support. Live chat and E-support To supplement our industry leading toll-free technical support, we provide access to online live chat, accessible through the customer’s Extranet site. We staff this support by our CDW Government LLC Page 30 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services trained technicians from 6am to 5pm MST. This site also provides support case management. Remote Login Our technicians have access to LogMeIn, a remote login utility, which allows them to connect to the end users computer for more in-depth troubleshooting and quicker resolution. b. Is phone support available? CDW•G Response: Customers can use our toll free phone number 800.383.4239, Monday – Friday from 6 am – 6 pm MST, to reach our dedicated technical support team. c. Can agencies request a dedicated service representative and/or a dedicated service team? If a dedicated customer service representative and/or team are assigned, what types of services does the representative/team provide? How do you help the customer manage our account? CDW•G Response: With CDW•G every customer is automatically provided one single point of contact, their Account Manager, from the very first inquiry for service. Irrespective of the size of your order or what your needs might be, every CDW•G customer receives a dedicated Account Manager who will see to ensuring your satisfaction. Account Managers are assigned to customers based on a specific segment (State and Local government, Higher Education, K12, etc.), as well as a specific region in the country. CDW•G Account Managers attend onboarding training, known as the “Account Manager Academy,” for three months before they begin interacting with customers on their own. This training program focuses on sales consulting, product training, operational systems, and customer service. This process is much longer than industry standard practices, providing a higher level of support that our customers are quick to notice. Our Account Managers also participate in the Sales Residency Program which delivers another layer of customer-focused training to your Account Manager. On average, our customer relationship is 11.1 years which means our Account Managers dedicate their time to getting to know our customers and what drives their purchasing decisions. This means that our customers, particularly in the public sector, choose to work with us, year after year. This is a testament to our dedication to our customers’ satisfaction. CDW Government LLC Page 31 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Account managers focus on learning their customers’ processes, requirements, needs, and challenges. For larger, enterprise class accounts, there are multiple Account Managers assigned to those accounts. These teams work as a team to make sure you receive the highest level of customer service. This allows them to provide expertly the following services to agencies: o Registration assistance to participate in National IPA o Contacting customers and notifying them of the benefits of the contract o Pre-sales consultation, including providing product and system compatibility information o Providing industry - specific insight on technology solutions o Acting as a quality control check by reviewing and approving all quote requests o Keeping customers abreast of availability issues and assisting with any needed alternative sourcing options o Coordinating any special delivery requests, including emergency orders o Working with available CDW•G resources, and coordinating contact for any needed subject matter expert insight o Keeping updated and available to assist in developing a service solution o Facilitating communication between the customer and National IPA, as needed CDW•G ensures Account Managers are supported by a network of subject matter experts. Account Managers utilize these resources to provide complete guidance to their customers. This network includes: Sales Manager Sales Managers lead a team of Account Managers and Account Specialists to provide comprehensive solutions and outstanding sales support. They visit customer site(s) for business planning and discussions of future projects, as needed. They also assist Account Managers with expedited orders and problem remediation. Business Development Manager Our public sector also has Business Development Managers who focus on aligning with our customers. Their main role is to work with customers’ procurement teams to review current contracts, align with strategic initiatives that the procurement team is looking to roll out, act as project manager for B2B integrations and a main point of contact to help resolve issues. Field Account Executive Field Account Executives (“FAE”) work in tandem with Account Managers and Account Specialists to provide comprehensive solutions and outstanding sales support. Each FAE is dedicated to a specific region and industry, and provide onsite visits to customers in communities across the country. Their site visits include business reviews and other meetings, as needed. FAEs also work with System Engineers to provide onsite road mapping, project development, and technical expertise. Solution Architects Customers also have dedicated Solution Architects (SA) for each of their service solution needs. Solution Architects are dedicated to specific Account Teams and are the expert in supporting our customers with the appropriate service resources and tools including deployment technicians, project management and implementation engineers. The Solution Architect works closely with CDW•G customers to accurately CDW Government LLC Page 32 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services scope project requirements, making certain we provide the specific skills, proper staff and solution needed to fully service the customer. Upon agreement to move forward with the service offering, the Solution Architect hands off the service delivery to the customer’s dedicated CDW•G Project Coordinator and/or Project Manager to ensure successful execution. OEM Specific Resources Account Managers utilize an integrated network of both internal and external sales force. Many OEMs have pre-sales engineers and channel account managers (often onsite at CDW•G) providing consultation and immediate support to Account Managers. CDW•G badged Brand Managers, Field Solution Architects, and Partner Business managers work with both Account Managers and the external teams mentioned, providing further support. Program Manager Program Managers launch and manage contracts once awarded. They are a valuable resource to Account Managers, training Account Managers in the contracts scope and guidelines, provide contract information and updates, and assist with Extranet/Premium page issues. d. How are problems resolved? CDW•G Response: CDW•G Account Managers assist their customers in resolving any issues and is the primary point of contact for problem resolution. Your Account Manager has extensive relationships with our OEM partners and have internal processes to escalate your problem to the appropriate resource with our partners. Your Account Manager, being your primary point of contact, will address or route to his support team issues regarding:  Customer service requests  Quote and order issues  Billing problems If your Account Manager is unavailable to assist you, he/she will escalate your issue to their Sales Manager. If for any reason their Sales Manager is unable to resolve the issue, they will escalate the problem to their Director or the segment Vice President, if needed. You may contact CDW•G’s Customer Relations department at either 866-782-4239 or CustomerRelations@web.cdw.com. A representative will be assigned to your case, based on their skills and expertise, who will then engage the resources necessary to resolve your issue. CDW•G tries to resolve all issues within 24 hours. If a problem is in regards to an Account Manager, we encourage customers to contact the Account Managers Sales Manager. e. What are the location and hours of your call centers? CDW•G Response: We have call CDW Government LLC Page 33 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services centers in North Las Vegas, NV; Vernon Hills, IL; Phoenix, AZ; Shelton, CT; Tampa, FL; Reston, VA; and Eatontown, NJ. Their hours of operation are 6am-8pm MST. We strive to make it easy for our customers to get in touch with us. From your dedicated Account Manager to our customer service team, we have multiple options available to our customers to address your needs. CDW•G provides post-sales customer support Monday – Friday from 6am – 6pm Mountain Standard Time. Our customer service team assists customers to ensure the product is working as the manufacturer intended and work with them in case of any issue. CDW•G provides this value added support, at no charge, for up to two years or manufacturers end of life, whichever comes first f. What response time is guaranteed when a customer service request is made? CDW•G Response: Response depends on the seriousness of the request made but typically CDW•G makes every effort to respond to all Customer Service Requests (CSRs) within 24 hours. CDW•G understands some requests are more urgent than others, and utilizes a detailed incident management process for critical systems. Severity level dictates the response time of this practice and employed for issues with our own network services, co-located systems, hosted solutions, websites, or our Internet services. We constantly monitor our customer service process, ensuring we are continuing to meet the needs of our customers. The Customer Relations Supervisor reviews all CSRs at the end of the day to ensure that each CSR is being handled promptly. Additionally, Customer Relations Quality Analysts audit 30 cases per Customer Relations Representative per month to ensure representatives meet quality standards and that we provide proper training. We make adjustments and evaluate process changes as needed when we see high volumes for particular types of Customer Service Requests (CSRs). g. Do you measure/track the success of your customer service program? If so, how do you do this, and what are your findings? CDW•G Response: Yes, we focus continually on improving our ability to provide the best service and products in the industry to our customers. Most inquiries and issues are resolved by your Account Manager. We have an internal customer assistance network (ICAN) that supports your Account Manager in providing you with optimal customer service. Our internal network helps your Account Manager resolve issues with: purchasing, drop ship, new items, and distribution. This internal network strives to resolve issue in 3 hours or less. Beyond your Account Manager, we have a number of corrective processes in place which include: o Our Purchasing Department monitors return rates on purchased products to look for quality issues. o We aim to respond to Return Merchandise Authorization (RMA) requests within 24 hours. o When we see high volumes for particular types of Customer Service Requests (CSRs), or RMAs we make adjustments and evaluate process changes, as needed. o The Customer Relations Supervisor reviews all CSRs at the end of the day to ensure that we handle each CSR right away. CDW Government LLC Page 34 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services o Customer Relations Quality Analysts audit 30 cases per Customer Relations Representative each month to ensure our representatives are meeting quality standards and that we are providing proper training. We offer many ways for our customers to provide us with their feedback, the primary avenue being the website (www.cdwg.com/content/about/cdw-reviews.aspx). The results have been overwhelmingly positive, with customers rating their experience with CDW•G 4.6 stars out of 5. We also survey our customers to understand how we can meet their needs better. In 2016 we added three additional surveys to better respond to our customers. We’ve begun to specifically survey our customers’ opinions in the following additional areas: o Sales Contact Center o Customer Relations o Advance Technology Services CDW•G conducts monthly loyalty surveys to measure the customer’s perception of CDW•G. We utilize these surveys to collect information for several internal departments including shipping, billing, and customer relations. We select customers on a random basis to participate in the surveys. If a customer ranks us “poor” or “fair”, then the appropriate CDW•G department contacts the customer to determine the reason for their unsatisfactory response and offer additional action to rectify the problem. This fortunately is rare, as the majority of end-users express favorable survey comments. The positive comment that we receive most often is “CDW•G is extremely customer focused”. h. Describe in detail your company’s ability to hold/warehouse customers’ orders and if there are any costs associated. CDW•G Response: We will work with you to hold and warehouse your products in our distribution center for a pre-arranged period of time, depending on your project needs. CDW•G will purchase your products from the OEM or distribution channel partners and perform any required configurations. At that point, we will hold your products at our distribution center until you are ready for them. With 48 hour notification, we will prepare your order for shipment and release your order based on your schedule. Typically customers will pay upfront for this service: one charge for the space to hold your purchase and one charge for the labor. Space and labor fees are based on the factors such as the pallet space required, the amount of time you request to hold your products in our warehouse, and the timeline for your product shipments. These fees are negotiated prior to warehousing your purchases and your Account Manager can provide you with more information on our holding and warehousing capabilities 12. Describe how your company will assist customers in navigating OEM warranty process. CDW•G Response: Your Account Manager will assist you in navigating the OEM warranty process. Products sold by CDW•G come with the manufacturer’s standard warranty and the City of Mesa customers can contact our Technical Support Department for technical support on hardware purchased from CDW•G. We provide technical support on the products that we sell for up to two years from the date of purchase. If the Technical Support representative CDW Government LLC Page 35 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services determines the customer needs warranty support, they connect them to the manufacturer’s warranty department. CDW•G offers a number of product lifecycle support options in addition to manufacturer warranties. This suite includes: • Warranty extensions and upgrades • Post warranty support • Accidental damage protection • Maintenance contract agreements • Post-sale technical support • Product and certification training • Help desk services We send warranty expiration emails to our Account Managers, who then inform their customers when their hardware protection is about to expire. Account Managers assist their customers in determining the best warranty and coverage solutions to keep IT investments up and running, or finding a best-valued replacement. 13. Describe how your firm will notify customer of new products. CDW•G Response: As technology is constantly evolving, there are always new products and services coming to market. Our customers depend on the latest technologies to make their enterprises run more efficiently and CDW•G prides ourselves on being on the forefront of technical development in the IT industry and our relationships with top manufacturers often results in advanced notification of upcoming releases of new products. Our website, www.cdwg.com, is constantly updating with new products and services that we offer to our customers. Our live catalogue is updated daily and you can browse our most current products and services. As a contract customer, we deploy a number of ways to keep you informed. Via our website (www.cdwg.com) and your Premium Page, you will be able to view the latest technologies available to you and pricing options to help you make better-informed purchasing decisions. They are constantly up-to-date on the most current and emerging technologies. Be it your Account Manager, our website, or your Premium Page, you can be sure that we will work tirelessly to keep you informed of ways to improve how your do business and which solutions best fit your needs. 14. Describe how your company will assist and support customers when their standardized is reaching EOL (end of life). CDW Government LLC Page 36 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services CDW•G Response: We often receive advance notification from manufacturers when a product is nearing end of life, and we make every attempt to communicate these changes to customers who may be affected. Your Account Manager will be the first source of updates on products that are nearing end of life. Because we maintain a live catalogue on our website, you will also be able to see in real time which products that we offer are nearing end of life. Your Account Manager also has visibility into our distribution partners’ warehouses through EDI feeds updated at least twice daily. As part of their value-added service, they assist customers in finding substitute products that will help customers achieve the same business results. 15. Describe if technical support questions are handled the same way as a customer service request? If not, describe the type(s) of technical support available, the location of technical support, and the hours of technical support. Is it the intent to use employees of your company or will this be an outsourced function? CDW•G Response: Your Account Manager stands ready to help you navigate this process. They receive regular trainings on new products and technologies from OEMs, receiving OEM certifications as trained, certified experts which enable them to assist their customers. We encourage customers to contact their Account Manager when technical support is necessary. If the Account Manager is unable to assist, he/she determine the best next steps. They may work with the customer and dedicated manufacturer support coworker to resolve the issues, solicit assistance from their Sales Manager, or connect the customer to our help desk. CDW•G customers can also contact our technical support team directly from our website or their Extranet site, in a variety of ways including email, chat, and telephone. Our technical support team is available Monday – Friday from 6am – 6pm Mountain Standard Time. All customer support is based in the United States. All Help Desk technicians are CompTIA certified; hold at a minimum A+ and Network+ certifications, and many are accredited in various engineering and manufacturing training courses. Our customer service team assists customers to ensure the product is working as the manufacturer intended. CDW•G provides this value added support, at no charge, for up to two years or manufacturers end of life, whichever comes first. 16. Describe what other services you offer that would be applicable to this contract (e.g. cloud, services, maintenance, implementation, design, analysis, training, repair, etc.) CDW•G Response: Available Services Cloud Our cloud services will enable you to grow as cloud solutions change and evolve over time. We have been at the forefront of the emerging virtualization technology and are well-positioned to advise you on the Cloud Solution that best fits your needs. We are vendor neutral and we currently work with over 40 cloud solution providers. We offer a range of Cloud Solutions and will work to make sure that you receive the most cost- CDW Government LLC Page 37 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services effective solution. Some of our Cloud Solution services include: • Planning Services • Migration Services • Integration Services • Managed Services Maintenance CDW•G recognizes that maintenance/support contracts are of great importance to many customers because uptime is vital to their success. Our strong partnerships with the industry’s top technology manufacturers, paired with our own maintenance solutions, offers a variety of viable options to our customers. Our maintenance options include the following: • Warranty extensions and upgrades • Post-warranty support • Accidental damage protection • Maintenance contract agreements (conterminous, break/fix, and retainer) • Post-sale technical support • Product and certification training • Help desk services Implementation Our national footprint is expansive, with over 600 engineers on staff in more than 15 service offices, complimented by a national traveling team. Additionally, we have capabilities to ship 3,000+ custom-configured systems daily; we configure over 750,000 custom solutions in our two state-of-the art distribution centers annually. Our large number of engineers, paired with our configuration capabilities, allows CDW•G to handle any rollout project that contract members may have. Design Most of our projects begin with either an assessment or planning and design session. Our architects review your needs and can perform an evaluation of your existing environment to develop a comprehensive solution to meet your particular project objectives. Consulting and Analysis Most of our projects begin with either an assessment or planning and design session. CDW•G technical specialists and field solution architects are experts in many areas including unified communications, networking, wireless, network and physical security and server/storage solutions. CDW•G will save contract members staff time and effort because our experts have already initiated the due diligence process. We share our knowledge of the latest technologies as well as our expertise regarding the pros and cons of each potential solution. We also offer a variety of more complex consulting/analysis solutions for those customers who need a more in-depth evaluation of their system. Training CDW•G’s project methodology ensures technicians and project managers work with the mindset of being an extension of the customer’s IT staff. Throughout the project our team not only focuses on designing bullet- proof CDW Government LLC Page 38 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services solutions, but continually engaging the IT staff; sharing knowledge, and ensuring the staff knows how to navigate the solution in which the customer vested their resources. Should a customer require training outside of this transfer of knowledge, we have a blended solution of CDW•G offerings, manufacturer standard trainings, and technology training companies. Repair In addition to offering onsite repair, we have our own repair center. CDW’s Repair Center offers fast turnaround time and low cost out-of-warranty repair prices, as well as great in-warranty service. Our factory certified repair technicians complete typical repairs on an average of 7-10 business days. We are an authorized Service Center for the following Manufacturers: • Acer • Apple • Fujitsu • HP • IBM • Lenovo • Service Net • Sony • Toshiba Asset Tagging/ Configuration We provide asset tagging and configuration services To better help our customers protect their assets and to ensure that you have an accurate accounting of your inventory. We provide multiple asset tagging options: From serial or part numbers, to location or manufacturer, your equipment can be asset tagged using our CDW•G asset tags or your own tags, customized to your specifications. We can configure your equipment in our Configuration Centers according to your needs so that your products come ready to use out-of-the-box. These services will save you time and increase productivity. Your Account Manager will help you determine which options are the best fit for you. Please note: due to manufacturer policies, limitations, and agreements, CDW may not be able to service all computer models or lines made by these manufacturers. 17. Describe options for leasing and financing and the various payment methods accepted. CDW•G Response: CDW•G has a department dedicated solely to assisting our customers with their leasing needs. We take a vendor agnostic approach and CDW•G’s leasing team can work with the City to find the best leasing option that fits within any unique budget constraints the City may be experiencing. Leasing allows the City to procure needed equipment now, so you do not have to wait years down the road when your budget allows a large- scale purchase. With leasing and financing, CDW Government LLC Page 39 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services the City also has the ability to bundle costs. Therefore, if you are also working with outdated software, you can purchase it with your products, and even services, all in one fell swoop. Budgeting for leasing is easier than purchasing outright, as your monthly payments are agreed upon upfront. With a lease, you can choose to add to your lease term; and once you choose to end the lease, you often have the option between purchasing and returning the equipment. CDW•G’s Leasing Team helps members navigate through all the available leasing providers to select the best option to fit the customer’s needs. For members with a Master Lease Agreement established, we more than likely have a partnership in place with their provider, or can establish one, to extend their existing agreement to incorporate purchases from CDW•G. We are a recognized force with many of our leasing partners, such as our 2014 HP PartnerOne Financial Services Partner of the Year Award. Often, we are able to leverage our relationship with our partners with more advantageous rates or terms. For Members that have diversity requirements to meet, we can recommend our WBE certified leasing partner, Commonwealth Capital Corporation. We’ll incorporate leasing into our sales team trainings for the contract, so that sales can recognize opportunities where leasing would benefit the members and to be able to speak to the different lease options available. We are also able to accept payment via the following methods: Credit Cards (American Express, Discover, MasterCard, Visa), Checks, EDI, EFT (Electronic Funds Transfer), and Procurement Cards. CDW Government LLC Page 40 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Tab 3 Pricing Forms 1. Provide price proposal as requested on the Pricing Document (Attachment A- “National TAB”) attached herein. In addition to indicating your proposed discounts on the Price Page, you must also apply those discounts to the sample items listed in the City’s Market Basket listed in Attachment A. CDW•G Response: The central metric in a pricing structure is the index from which that price is derived. CDW•G utilizes our Nationally Advertised Price (NAP) as the starting point in our price proposal. Contrasted with traditional MSRP (Manufacturer’s Suggested Retail Pricelists) which does not reflect market conditions and therefore does not change, our NAP pricing is scaled and adjusted to remain competitive in the marketplace. Our customers can be sure that the pricing quoted is the most up-to-date and competitive available. To provide National IPA with a complete catalog offering, CDW•G is proposing contractual pricing to be factored by applying discounts to CDW•G’s product taxonomy. This approach ensures a complete catalog offering, provides the greatest breadth of product offering, as well as an easy “on-ramping” as new product and technologies are introduced. For ease of evaluation and to be compliant with the RFP requirements, CDW•G has conformed to the City of Mesa’s product taxonomy in the market basket as well as the National Discount sections of the price proposal, however the resultant contract will be managed utilizing the CDW•G Category table listed below: CDW•G Categories Discount Accessories 6.75% Power, Cooling & Racks 5.00% Desktop Computers 3.00% PC Compatible Desktop Computer 2.10% Data Storage / Drives 5.50% Enterprise Storage 5.00% Point of Sale/Data Capture 4.25% Servers & Server Management 4.00% Services (CDW Delivered) 0.00% Notebook/Mobile Devices 2.50% Notebook Computers 2.10% Convertable PCs/Slate PCs/iPAD 2.25% Chromebooks 0.00% Netcomm Products 5.50% Gigabit Switch 6.00% Modular Switch Chassis 6.00% CDW Government LLC Page 41 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Modular Switches 5.50% Carts and Furniture 5.00% Printing & Document Scanning 3.00% Services (3rd Party Delivered) 0.00% Warranties-Product Protection 3.50% Software 4.00% Collaboration Hardware 4.25% Memory/System Components 13.00% Video-Projection-Pro Audio 3.50% Cables 15.00% CDW Configuration Services 5.00% Apple Products for Eligible Entities .50% CDW Government LLC Page 42 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services 2.Propose and provide details of additional discounts or rebates for volume orders, special manufacturers’ offers, free goods program, the total annual spend, etc. CDW•G Response: Under the contract, individual clients who purchase significantly larger amounts may qualify for an additional discount on individual purchases. Additionally, as a partner on the contract, CDW-G will be leveraging its influence on manufacturer partners for additional cost saving programs based on contract spend. With our dedicated Account manager model, CDW•G Account Managers are tasked with providing exceptional customer service and excellent value to each customer who purchases from National IPA. With that goal in mind, if a customer were to forecast larger quantities, the Account manager will work with manufacturer partners on behalf of his/her customer to achieve greater than contract discounts. The discounts and effective savings will be dependent on manufacturer support as well as the size and volume of the order. Depending on the product type the discounts can be anywhere from 2- 20% additional savings. CDW Government LLC Page 43 of 61 October 23, 2017 Per the requirements of the solicitation, Attachment A- Pricing Forms is included and attached in Excel format. City of Mesa Information Technology Solutions and Services Tab 4 Qualifications (Abilities, Experience, and Expertise) 1. Provide a brief history and description of your firm. Discuss firm’s national presence in the IT solutions industry. CDW•G Response: In 1982, 28-year-old, strapped-for-cash Michael Krasny placed a $3 classified ad in the Chicago Tribune for his IBM personal computer. After a flood of offers and a $200 profit, he had an idea. Krasny formed MPK Computers and he became a computer broker. This company later became CDW. Krasny’s goal was to make CDW the most successful seller of IT products in the U.S. Some of his first tasks to solve customers’ problems include establishing a computerized database of product and customer info, creating algorithms to gauge product sales and demand, and a hand-operated warehouse roller to fill backlogged orders. Michael Krasny compiled a list of guiding principles—principles that remain at the core of every decision CDW makes today. We believe the reason the National IPA/CDW•G relationship is so successful is because our values and philosophies practically mirror the values that make up the National IPA Way. Our values begin with the belief that “People do business with people they like.” This is why we recruit top IT graduates, hire the industry’s most experienced technology experts, partner with business entrepreneurs and educators, and engage military veterans with battlefield experience. It’s because we want to support our customers with talented people who have not only walked a mile in their shoes but are committed to providing solutions that work. CDW’s way of business hasn’t changed much since ’82. We are still recognized by the hybrid business model developed by Krasny, a perfect blend of distribution and IT solutions provider in one knowledgeable force. We still practice a healthy dose of self and competitor evaluation, going from area to area looking for our weakest links and turning them into strengths. In fact, it is from this idea that CDW•G was born. We realized that neither we, nor or competitors, we’re doing a great job of providing the segment-specific support to our public customers that they needed, or deserved. So in 1998, CDW•G was established, providing our government and education customers insight and expertise that fit their specific needs. In 2005, we incorporated healthcare segment into this mix. We continue to use our innovative tools and our deep relationships with our customers and vendor partners to evolve our business as our customer needs dictate, such as our CDW Government LLC Page 44 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services expansive cloud portfolio. Proof this approach is working is our $13.9 billion in sales for 2016 and our growing customer base of over 350,000 valued organizations. Many customers have remained loyal to CDW•G for decades because they know we aren’t satisfied with past successes. Instead, we’ve been focusing on providing advanced solutions and service in areas like cloud computing, mobility, security, virtualization and networking. 2.Provide the total number and location of sales persons employed by your firm. CDW•G Response: CDW•G currently employees 1456 coworkers in 43 different locations nationwide. Over 840 of our CDW•G sales force are Account Manager, with an additional 65 Field Account Executives dispersed throughout the country. 3.Provide the number and location of support centers (if applicable). CDW•G Response: Currently, we have 43 separate locations. Speaking specifically to the benefit of this contract, seven of the states with new locations are also in the ten states with the highest historical spend on the contract. CDW Government LLC Page 45 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services 4.Provide public sector sales figures for 2014, 2015, and 2016 and the percentage mix of hardware, software, and services. CDW•G Response: Below you can see evidence of National IPA Contract sales growth. The growth rates of National IPA exceed the standard rate for CDW•G, verifying our good faith effort to promote the contract within our existing client base. National IPA Contract Sales Year Sales In Millions % of Growth 2008 $4 N/A 2009 $21.7 442.50% 2010 $44.1 103.20% 2011 $83.3 88.90% 2012 $99.4 19.30% 2013 $113 13.68% 2014 $160.1 41.68% CDW Government LLC Page 46 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services 2015 $253.7 58.46% 2016 $390 53.72% 5.Please submit you FEIN and Dun & Bradstreet report. CDW•G Response: CDW•G FEIN: 36-4230110. Dun & Bradstreet numbers: CDW LLC: 10-762-7952; CDW Government LLC: 02-615-7235 CDW•G cannot supply a Dun & Bradstreet report, as it violates our contract with Dun and Bradstreet. The City of Mesa can obtain a report for CDW•G from Dun & Bradstreet. 6.Provide a summarization of your experience in performing work similar to that outlined in this solicitation. CDW•G Response: CDW•G holds a number of similarly structured contracts. Since 2008, we have grown our contract with National IPA, as evidenced in the chart above, and have demonstrated success in broadening and promoting the National IPA contract. Over the past eight years, National IPA contract sales have consistently grown, year after year, most recently reaching $390M. For our references we provide customers that can attest to our abilities of both managing this contract, and to addressing and meeting their needs as our customer. We provide contact information for these customers in a separate, confidential file. 7.Provide a minimum of three references for which your firm has provided the same solution (please include company name, address, contact person, phone number, email address and dates of service). References from other public agencies, particularly municipal governments are preferred. CDW•G Response: Kern High School District- Business Services Contact Address 5801 Sundale Avenue, Bakersfield CA 93309 Phone Date of Service 2014-today Culpeper School District Contact Address 450 Radio Lane, Culpeper VA 22701-1521 Phone Email Date of Service 2005-today Los Angeles Superior Court Contact Address 111 North Hill Street, RM 105D Los Angeles, CA 90012-3219 Phone Email Date of Service 2013-today CDW Government LLC Page 47 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services 8.Provide resumes and three references (preferably from the public sector) for the primary customer service representative(s). Resume(s) shall include their title within the organization, a description of the type of work they would perform, the individuals’ credentials, background, years of experience and relevant experience, etc. References should include the contact’s name, phone number, email, position, organization, and the work which the Offeror performed for the reference. CDW•G Response: The City’s two primary customer service representatives’ resumes can be found in Tab 7 “Appendix.” Below are the references for each: Mark Ellis, Manager- Program Management Pat O’Brien, Field Sales Manager Ohio Council of Educational Purchasing Consortium Elmo Kallner- Contact ekallner@mail.mecdc.org 614-579-2669 City of Tucson Marcheta Gillespie- Contact Marcheta.Gillespie@tucsonaz.gov 520-791-4217 Green River Regional Educational Cooperative Ann Burden- Contact Ann.burden@grrec.org 270-563-2113 National IPA Ken Heckman- Contact Ken.heckman@nationalipa.org 615-289-8561 National Joint Powers Alliance David Duhn- Contact David.duhn@njpacoop.org 218-894-5469 City of Jacksonville/Jacksonville Transit Authority Bursey Armstrong- Contact bjarmstrong@jtafla.com 904-630-3167 9.Provide information regarding if your organization ever failed to complete any work awarded. CDW•G Response: At the time of submission and to the best of our knowledge, CDW•G has never had a contract terminated for cause 10. Provide information regarding if your firm, either presently or in the past, has been involved in any litigation, bankruptcy, or reorganization. CDW•G Response: Though CDW•G has been involved in litigation, it has not nor is it expected to impact our ability to provide products and services on this agreement. We have not filed any bankruptcies. References CDW Government LLC Page 48 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Tab 5 Technology 1.Describe your website and the ease-of-use for customers to perform the following types of tasks: a.to search for products b.to find alternate products (if a certain product is not available) c.to perform side-by-side price comparison of products d.to order products e.to track order status, to include backordered items f.to determine when an item was received and who received it g.to restrict/block the ordering of certain line items and to restrict/block the ordering of groups h.to create approval paths/levels for orders, to include creating an approval path for restricted items i.to create “favorites” list or subscribed purchases other personalized list of frequently ordered items j.to create a “shared” list for an agency to use k.to obtain online customer service l.to receive online training m.to accept credit card payment (and describe the level of data offered; also describe your security measure for credit card orders) n.to track their budget for purchases o.to generate reports CDW•G Response: Each Agency utilizing the contract has their own customized Extranet that is available to users 24 hours per day, seven days a week. This value-added tool makes working with CDW•G easy, convenient and efficient. We have been the pioneers in tapping the power of the web – and we continue to develop enhancements based on customer feedback. Our extensive suite of extranet tools is provided to contract users at no additional cost. We have enabled more interactive information about updates to the website via http://www.cdwsiteinfo.com/. Our web capabilities provide an extra level of convenience, customization, and efficiency for all users. Our award-winning e-Procurement tool brings customers: CDW Government LLC Page 49 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Speed — Customers can research, purchase and track technology easier and faster than ever. CDW•G makes the buying process simple and more efficient. With one click, authorized purchasers can procure the best solutions at the best price from one of the industry’s largest inventories of brand-name products. Consolidating purchases through our “one-stop shop” saves customers both time and money. Information — Our extranets provide the industry’s most comprehensive suite of e- Procurement tools to gather the breadth and depth of detail to help make the right purchasing decisions. The site puts customers in direct contact with their Account Manager who can personally guide with suggestions and recommendations to help make informed purchase decisions. Reporting — As a rich source of detail on purchase history, license agreements, and asset tracking, your Extranet site lightens the burden of report generation. This customizable extranet is a productivity-enhancing tool, giving the exact detail customers require whenever they need it. As detailed in Question #10 of this section, customers can also download reports into a variety of formats, including Microsoft Excel, CSV and tab-delimited files. The value-added benefit of a customized extranet is the ability to manage data and information that will enable customers to make more cost-effective decisions. It also reduces the administrative and purchasing costs involved in procurement. Extranet Features We provide specific features of a customized extranet below: Contract Pricing — View Negotiated Contracts in Real-Time, Receive Bids Quickly Agencies can view the City’s contract pricing, right from their extranet. City of Tucson contract users can view all eligible contract pricing as they shop. Their extranet automatically provides their special prequalified pricing and discounts on tens of thousands of products. Authorized users can access contract and/or special pricing in real-time, as the site is constantly updated to reflect the latest status. Buyers from any location can view approved contract pricing to ensure this pricing structure holds true throughout the entire organization. Account Team — Access Expert Support with a Personal Touch Your extranet page allows customers to work directly with your dedicated Account Manager and team of sales support, as well as customer service professionals and certified technicians during every step of the purchasing cycle. The page displays pictures of the customer’s Account Team, view their contact information and check their availability in and out of the office. Online Quotes — Create, Review and Place Orders in Minutes Purchasers can review quotes online just moments after their Account Manager create it. From here, users can print it, forward it to colleagues or manager for pre-authorization, or convert it to a live order. This feature also lets customers create their own quote right from their shopping cart, in addition to viewing contracts, volume and bid pricing online. Company Solutions — Compare and Buy Single or Bundled Products with One Click This capability enables agencies to customize their extranet home page to show the products and configurations their organization uses, and to streamline standard product orders. They can choose a variety of formats to view products individually, in bundles, by manufacturer or even in side-by-side comparisons. By grouping products into bundles, there is no guesswork when making repeat purchases on your standardized solutions. The CDW Government LLC Page 50 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services extranet page also allows customers to perform quick product searches and to “comparison shop” by viewing side-by-side, detailed product descriptions before they even place an order. This takes the hassle out of downloading data from multiple manufacturer websites. Catalogs and Custom Catalogs – Limit Product Purchase Rights The catalog feature allows agencies to create customized catalogs. Customized catalogs can be used to limit the purchasing ability of end-users based on: Purchase History, Corporate Solutions, Contract(s), Manufacturer Part Number, the CDW•G EDC, and through the Search function. The same engine and keywords that drive the Search Engine are also available to search for product. This allows purchasers to refine items listed before making them a part of their agency’s custom catalog for one or multiple users. These rules can be used to add product to a catalog or exclude items from one as well. Once applied to a group or PAS workflow, they can really help control the spending habits of end users and help keep IT budgets on only the standard of items approved. Asset Management — Follow Asset-Tagged Hardware throughout Agencies Your extranet page provides an online asset management tool to track asset tagged products. Products are searchable by serial number, order number, date of purchase, product description, warranty length, invoice number, or location. Users can even create their own custom fields and add or enter products purchased from other vendors. This extranet feature also allows customers to modify their records to reflect the transfer of equipment from one location to another, a real plus for customers with multiple locations. Asset Management then lets the user create and download a detailed report of their hardware assets. Account Linking — View, Place and Track Orders from Multiple Addresses Account Linking lets customers view, place and track orders, including historical purchases across multiple bill-to addresses. A single login gives authorized users a way to efficiently access their order status from across the enterprise to anywhere in the world. This eases the challenge of multiple purchases from disparate locations by centralizing the purchasing process, yet offering the flexibility to place and track orders by address and location. My Purchases — Track Order Status and Purchasing History Instantly This feature offers a full breadth of tools to track order status, purchasing history and financing options. Original invoices can be printed; giving a view into outstanding balances and invoices, credits, adjustments and/or payments. Agencies can download their purchasing history in preferred time increments (such as month-to date, last six months, prior year, etc.) in any number of formats. The system lets users automatically save this data in spreadsheet or database applications. Authorized users can readily search their order, get a tracking number, check shipping status, and request a Return Merchandise Authorization (RMA). Purchasing Authorization System (PAS) — Streamline Purchasing Approvals CDW Government LLC Page 51 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services The extranet page also automates the approval process. PAS enables customers to restrict their employees’ purchasing power and to automate required approvals before they place any order. PAS bypasses the laborious step of having a purchasing administrator personally place each order. This process allows for multiple levels of approval, as well as multiple approval systems, which can all function independently for many departments/locations within the procurement process. This system also allows for reporting that is specific to orders which have moved through the requisition process setup through PAS. All reporting is as dynamic and editable as the other tools on their extranet. Product Finders — Easily Find the Right Accessories and Supplies CDWG.com now offer Product Finders to make it even easier to find supplies for printers, fax machines, copiers, multi-functions, and other devices. Customers can also search for desktops and notebooks. Product Finders guides to the technology solutions that fit agencies needs and will even help find information for discontinued models. These Finders were designed to ensure compatibility for product categories including cables, desktops, ink and toner, memory, notebooks, power protection, and cases and bags. 2. Describe additional functionality offered by your website. Provide screenshots, a demo “CD/jump drive,” demo URL, a manual, etc., or any other format that will aid the City in our evaluation of your website. CDW•G Response: The City can review the current contract’s CDW•G Premium Page at www.cdwg.com/nationalipasolutions. When placing an order, agency members log into their own personal CDW•G Extranet to complete the procurement. This account is available twenty-four hours a day, seven days a week. On this site, agencies can compare products, quickly find compatible accessories, and select from a number of shipping options. However, this account offers more than just ordering functions. Agencies can track spend history, manage assets, and create customized reports. If they are in need of customer service assistance, they can reach their account manager, chat with or email a representative, and even place an RMA request. For an Extranet tour, visit http://www.cdwsiteinfo.com/extranet-video/. The Extranet is not the only site we offer helpful tools to our customers, our main page, cdwg.com has a plethora as well. For a tour of this site’s functionalities, visit http://www.cdwsiteinfo.com/cdw-site-tour/. CDW•G will continue to build new e-Procurement solutions and feature enhancements based on customer feedback. We strive to regularly incorporate new features and capabilities that ease inventory headaches. 3. Describe any national awards and/or other recognition that your website has received. CDW•G Response: In October 2015 CDW•G was ranked No. 8 on the list of America’s 500 largest e-retailers by Internet Retailer’s Top 500 Retail Web Sites Guide. 4. Describe the hours your website is available? What are your hours of downtime, such as for system maintenance? CDW Government LLC Page 52 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services CDW•G Response: CDW•G does not have any scheduled extranet down time. Our website’s availability is above 99.95%. We are constantly imaging and activating revisions while the site is fully operational. CDW•G works to ensure that there is redundancy in place to minimize any risk of downtime for contract purchasers. We typically inform our customers of scheduled extranet outages 24-48 hours in advance. When these outages must occur, which is not often, we tend to schedule them on weekends when there is the least impact on the customer. We advise our customers on any significant changes 45 days ahead of the scheduled change. Customers can let their Account team know if they would like to be added to this notification list. 5. Does your website offer real time product availability? CDW•G Response: Yes, most manufacturers send us daily Electronic Data Interchange (EDI) downloads with pricing and product availability information. Our channel distributor partners send us daily EDI downloads, which allows us visibility to inventory items and pricing broken down by local or remote facilities. Furthermore, our top three distribution partners provide real time inventory information. Using a Just-In-Time inventory management system, our purchasing department excels at keeping a one-to-four-week supply of products in our distribution centers (depending on current sales volume trends for each product). We scan inventory as it enters the distribution center, as it moves through the fulfillment process, and before it leaves the centers. This allows us to maintain near perfect inventory accuracy. The system processes and transmits each scan in real-time, providing immediate inventory updates. 6. How does your company leverage your website to inform customers of the additional savings that may be available? CDW•G Response: Our website has a dedicated tab for informing our customers of additional savings and deals that are available to them. Under the “Deals” header, as shown below, we advertise discounted products and pass this on to our customers. Deals span all product categories and manufacturers, and we inform our customers if a specific OEM is running a particular deal. We strive to pass on value and savings to our customers, and this is another way our website keeps our customers updated and apprised of our latest offerings. CDW Government LLC Page 53 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services 7. Describe the types of email confirmations that your website generates. What events trigger an email going to the customer? CDW•G Response: CDW•G’s website generates a number of customer email confirmations including quote and order confirmations, notification of back orders, and shipment notifications. National IPA members can enroll in paperless billing to receive credit card invoices via email, and reminders to order frequently used products. Order status information is available 24 hours a day on our Quick Order Status tool. 8. Describe the registration process to set up new customers for you online ordering process. Is self-registration available? If an agency does not want self-registration, are you available to assist in the registration process? CDW•G Response: Yes, self-registration is available. Additionally, your Account Manager will be happy to walk you through the registration process and ensure that you’re properly entered into the system. Your Account Manager are trained to enroll new customers to access the National IPA contract, should our customers need immediate access. A confirmation number is generated and sent to your Account Manager who will then then provide this confirmation and the customer’s CDW•G account number to your dedicated Program Manager, who immediately adds them to the system for contract access. Jumana Dihu, your Program Manager, adds new members to the contract typically within a week of receiving a new member list from National IPA. If the agency does not already have an Extranet account, there are a few short steps for them to create an account. Once the customer creates their account, they simply log on to access the contract. Account Managers will provide any registration assistance. 9. Describe if your website can be customized for an agency’s specific needs, such as placing our logo on your website, associating an agency blanket purchase order number on all orders, creating a bulletin board or other place to display customized messages, displaying approved configurations, naming certain fields (i.e., user defined fields, ability to include budget information), etc. CDW•G Response: Your Extranet account can be customized to your exact specifications. We can include your favorite items, frequently purchased products, bundled items. Your site will be tailored to your needs. The site currently displays the National IPA logo, displays a customized message, highlights appropriate products, and has fields named as specified by the City. Agencies customized extranet home page will provide authorized users with quick and easy access to the following features: Quick Cart – Enables users to add items directly to their cart by typing in the CDW part number. Account Team – Displays the “In/Out” status of your dedicated Account Manager and provides immediate and direct access to your dedicated Account Manager via phone fax and email. Also, provides a link to your entire dedicated Account Team. News – Provides additional information on extranet tools and enhanced features. Promotions and Updates - Shows current promotions and updates to technology solutions. Featured Products – Highlights specific products and solutions. CDW Government LLC Page 54 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Recent Orders – Displays information for orders for the past 45 days including order status, purchase date, purchase order number, purchaser, and sub-total. Contracts – Provides details of pricing contracts for your organization and enables you to download pricing for your contracts. Bundles – Takes the guesswork out of repeat purchases. Administrators can create custom bundles containing their company’s standardized solutions. Individual Products – Allows administrators to highlight products for quick and easy access. Comparison Charts – Helps users to compare the features and prices of multiple products during the shopping process and save those comparisons for future reference. Links – Lets users maintain easy access to manufacturer websites and other helpful online destinations. There are links to additional extranet features that are only a click away. These features include: My Purchases – Offers a full breadth of tools to track order status, purchase history, and financial information. Security Settings – Enables administrators to restrict users’ access to specific functions. Asset Management – Enables you to create and download a detailed report of your organization’s hardware assets that have been asset tagged. Software License Tracker – Simplifies software license management and reduces the risk of noncompliance. Quotes – Enables you to create your own quote right from your shopping cart, forward it for preauthorization, and convert it to a live order. Purchase Authorization – Automates approval process and manages users’ purchasing power. Custom Catalogs – Displays only products approved for purchase by your organization. Online Chat – Puts users in direct contact with customer relations, technical support, and e- support team representatives. 10. Describe the types of online reporting that are available. Is customized reporting available? CDW•G Response: CDW•G’s reporting capabilities are extremely flexible and comprehensive. CDW•G Extranet provides access to real-time information in a way that is convenient and easy to use. The City of Mesa authorized users have access to your extranet 24 hours per day, 7 days per week. Authorized users have the ability to generate a variety of reports via their agency’s extranet. Data fields include, but are not limited to: • Product name • Item description • Part number • Cost per unit • Order quantity • Delivery location • Date ordered CDW Government LLC Page 55 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services •Purchase Order# •Purchased by Agencies can view standard reports, and create and save custom reports. Reports can also be generated for a variety of timeframes; differentiated by site, division, department, buyer, city, state, product, etc. Users can select from Microsoft Excel, CSV and tab-delimited files for report downloading. 11. Describe your online return process (if available). CDW•G Response: In order to return any product to CDW•G, including damaged or defective products, contract users must request a Return Merchandise Authorization (RMA) number. The most efficient way to request an RMA number is via the customer’s CDW•G Extranet. When an RMA request is entered, the system automatically checks several factors to see if the RMA can be automatically approved. If the return meets these factors, the RMA number is emailed directly to the customer. Should the auto-approval criteria not be met, the RMA will route to Customer Relations for processing. The benefit of our automated system is faster turnaround time on most RMA approvals. Once CDW•G has processed the request, the customer receives an email with the RMA number. The approved RMA number must be clearly noted on the shipping label of each box. CDW•G carries many more highly customizable products than what we have historically carried on this contract. A uniquely customized product is not as simple to return as an off- the-shelf product. Once a product has been customized, we are unable to return it to the OEM ourselves; that activity must be handled directly between the purchaser and the OEM. Therefore, CDW•G proposes the following return policy: o Except for certain products that are uniquely customized to City specifications, which shall be indicated at the time of Quote, all defective products shall be identified within thirty (30) days of receipt and will then be replaced and exchanged by the Contractor. The cost of transportation, unpacking, inspection, re-packing, re-shipping or other like expenses shall be paid by the Contractor. All replacement products must be received by the City within seven (7) days of initial notification. o Uniquely customized products are typically indicated by the inclusion of the designation “CTO,” “BTO” or “Customer’s Name” in the product description of the item. When providing a quote for products that are uniquely customized to City specifications, Contractor shall include the following statement on the quote: “This quote contains a custom item, this item may not be able to be returned, depending on manufacturer restrictions.” More often than not, we are able to find a return remedy - even in the case of customized products. To ensure customer clarity around returning customized items, we will instruct our Account Managers to discuss the return policy with the customer during the building process for customized solutions, if they are not already doing so. 12. Describe any third-party integration that you have successfully implemented. For example, is your website integrated with any third- party procurement, financial, or purchasing/credit card systems? Is there a cost for these services? CDW Government LLC Page 56 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services CDW•G Response: CDW•G has implemented eCommerce solutions with over 72 eProcurement partners, for over five thousand customers on most of the major purchasing platforms. There is no charge for integration support, unlike some of our competitors. CDW•G has overseen cXML and OCI Punch-Out solutions since 2001, with over 8,000 integrations to date. These integrations make up a quarter of our web business. There are three teams that span the eCommerce/IT/Sales departments that are solely dedicated to eProcurement integration projects. We likewise provide level III/tier 3 credit card reporting and provide financial reports (invoices and histories) in different automated formats for compatibility with financial systems. While our website is compatible with third party e-commerce solutions, the CDW•G is owned and managed in-house without reliance on third party support for our key web systems. There is no additional charge for these services. Below are examples of ecommerce methods CDW•G currently supports with our customers: FTP (File Transfer Protocol) CDW•G’s FTP processing is flexible; we can exchange fixed length, wrapped or unwrapped files, with or without CR/LF. We can also exchange stream files – one continuous stream of data (variable length).Naming conventions for files and the number of files exchanged are flexible. CDW•G or the customer can host the FTP site. UserID and Password are required to access our FTP site. CDW can delete files that have been retrieved. Partners will be expected to delete files after they are retrieved. CDW•G uses PGP to encrypt data exchanged FTP. PGP (Pretty Good Privacy) is widely available and uses public-key cryptography to exchange files, with both privacy and authentication, over all kinds of networks. CDW•G can also support FTP using SSH or SSL session encryption. EDIINT-AS1 This communication method uses the e-mail system to transfer encrypted data over the internet. The partner needs to have an AS1 compliant software package that can encrypt and decrypt EDIINT AS1 data. EDIINT-AS2 This method uses the internet to exchange data. This communication method uses an HTTP post (language of web sites) to transfer encrypted data over the internet. The partner needs to have an AS2 compliant software package that can encrypt and decrypt EDIINT AS2 data. HTTPS (HyperText Transmission Protocol, Secure) This method allows CDW to send and receive data through a Web Server using HTTP/S. HTTP is traditionally used for displaying interactive Web pages, but can also be used as a communication method. VAN (Value Added Network) A VAN is the least desirable method due to the fees incurred for this third-party service. CDW•G will be happy to work with you in any capacity to eliminate the use of VANs as a communication method. If necessary, we can establish a secure connection to a VAN and the VAN should exchange in a secure fashion as well. CDW Government LLC Page 57 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services 13. Describe your strategic vision for your website – i.e., Is new functionality expected to be added? If so, describe the functionality and the timeline for implementation. How often is the web redesigned? As technology evolves (for example, new search engines are more robust), does your website evolve, too? Etc. CDW•G Response: The CDW•G website is the 10th largest website in the world measured by revenue volume. While we no longer release specific website sales numbers, past numbers indicate that our website is now processing over $2 billion per year in transactions. Additionally, the website is estimated to assist with another $4 billion in sales that are finalized on the phone or via purchase order. The extreme volume and business-critical nature of the CDW•G website means we must focus on usability and uptime at all times. CDW•G employs over 200 in house IT personnel to keep the website accurate and running; their success is reflected in the less than 6 minutes of unplanned downtime last year - an uptime exceeding 99.997%. Because the website processes such volume, new functionality is constantly in the works but never fully implemented until we have conducted rigorous testing for usability, compatibility and perceived value to our customers. We have also added a new Solutions & Services section, which contains streaming content and white papers that cover all the comprehensive categories where our software and hardware solutions pair with best in class support and advanced technology services. As a world-leading website, the CDW•G site has the functionality to be compatible with our most advanced customer needs, including advanced security, multi-level approvals, asset tracking and others. Our staff of 200 will always be expanding these capabilities as advancements in technology and customer needs dictate. CDW Government LLC Page 58 of 61 October 23, 2017 City of Mesa Information Technology Solutions and Services Tab 6 Other Forms The following forms should be completed and signed: 1. Vendor Information Form 2. Exceptions & Confidential Information Form 3. General Questionnaire Form 4. Lawful Presence Affidavit 5. Respondent Certification Form (Offer and Acceptance) 6. Respondent Questionnaire 7. W-9 Form. All responses should include a fully completed, current W-9 form. Failure to include the W-9 will not disqualify your response, however the W-9 must be submitted to the City prior to the execution of any contract pursuant to this Solicitation. CDW•G Response: CDW•G’s response to these forms follow this page. CDW Government LLC Page 59 of 61 October 23, 2017 REQUIRED RESPONSE FORMS V7/14/2015 Required Response Forms – Page 1 of 5 2018011 VENDOR INFORMATION Company Legal/Corporate Name: CDW Government LLC Doing Business As (if different than above): Address: 230 North Milwaukee Avenue City: Vernon Hills State: IL Zip: 60061-9740 Phone: 800-808-4239 Fax: 847-419-6200 E-Mail Address: Website: www.cdwg.com DUNS # 02-615-7235 State Where Business Entity Was Formed: Illinois Remit to Address (if different than above): Address: 75 Remittance Drive, Ste #1515 City: Chicago State: IL Zip: 60675-1515 Contact for Questions about this bid: Name: Cale LaSalata Phone: 203-851-7211 Day-to-Day Project Contact (if awarded): Order from Address (if different from above): Address: City: State: Zip: Title: Proposal Specialist E-Mail Address: calelas@cdw.com Title: Field Sales Manager E-Mail Address:patobri@cdwg.com Name: Pat O'Brien Phone: 847-371-5584 Sales/Use Tax Information (check one). Respondent is located outside Arizona and does NOT collect Arizona State Sales/Use Tax. (The City will pay use tax directly to the Arizona Department of Revenue.) Respondent is located outside Arizona, but is authorized to collect Arizona Sales/Use Taxes. (Respondent will invoice the City the applicable sales tax and remit the tax to the appropriate taxing authorities.) State Sales Tax Number: City Sales Tax Number: City of: AZ Applicable Tax Rate: % Respondent is located in Arizona. (Respondent will invoice the City the applicable sales tax and remit the tax to the appropriate taxing authorities) State Sales Tax Number: City Sales Tax Number: City of: AZ Applicable Tax Rate: % x 07637419- State of Arizona EXCEPTIONS & CONFIDENTIAL INFORMATION Exceptions (mark one). Respondents shall indicate any and all exceptions taken to the provisions or specifications in this Solicitation. Exceptions that surface elsewhere in the Response and that do not also appear under this section shall be considered rejected by the City, invalid and of no contractual significance. Other Forms or Documents: If the City is required by the awarded Respondent to complete and execute any other forms or documents in relation to this Solicitation, the terms, conditions, and requirements in this Solicitation shall take precedence to any and all conflicting or modifying terms, conditions or requirements of the Respondents forms or documents. *Special Note – Any material exceptions taken to the City’s Specifications and/or Standard Terms and Conditions may render a Bid Non-responsive. No exceptions Exceptions Taken: Please describe exact sections to which exception is taken. If proposing new or modified language, your firm shall identify the requested language below or provide as additional attachment. The City reserves the right to accept or reject any requested exceptions listed in the below section or attached to the solicitation. Confidential/Proprietary Information (mark one). No confidential/proprietary materials have been included with this Response. Confidential/Proprietary materials included with Response. Respondent must identify below any portion of their Response deemed confidential or proprietary and attach additional pages if necessary (See Mesa Standard Terms and Conditions related to Public Records). Requests to deem the entire bid as confidential will not be considered. The disclosure by the City of information deemed by Respondent as confidential or proprietary is governed by City of Mesa Procurement Rules. V7/14/2015 Required Response Forms – Page 2 of 5 2018011 x x TAB 6 - Other Forms—Exceptions & Confidential Information Exceptions & Confidential Information | 1 Exceptions Exceptions Section/Page Term, Condition, or Specification Exception/Deviation City Accepts 9 / Scope of Work page 16 DEFECTIVE PRODUCT. All defective products shall be replaced and exchanged by the Supplier. The cost of transportation, unpacking, inspection, re-packing, re-shipping or other like expenses shall be paid by the Supplier. All replacement products must be received by the City within seven (7) days of initial notification. CDW•G seeks the following alternate language: All defective products shall be replaced and exchanged by the Supplier. The cost of transportation, unpacking, inspection, re-packing, re-shipping or other like expenses shall be paid by the Supplier. All replacement products must be received by the City within seven (7) days of initial notification, when such products are in Supplier stock. 1.2/ Attachment D, National IPA Requirements for Cooperative Contract, Exhibit A, page 3 Suppliers are required to pay an administrative fee of 3.0 % of the greater of the Contract Sales under the Master Agreement and Guaranteed Contract Sales under this Request for Proposal. Supplier will be required to execute the National IPA Administration Agreement (refer to Exhibit B). CDW•G seeks the following alternate language: Suppliers are required to pay an administrative fee of 3.02 % (Administrative Fee Percentage hereinafter defined) of the greater of the Contract Sales under the Master Agreement and Guaranteed Contract Sales under this Request for Proposal. . . . 2.2/ Attachment D, National IPA Requirements for Cooperative Contract, Exhibit B, page 5 Pricing Commitment Supplier commits the not-to-exceed pricing provided under the Master Agreement pricing is its lowest available (net to buyer) to Public Agencies nationwide and further commits that if a Participating Public Agency is eligible for lower pricing through a national, state, regional or local or cooperative contract, that the Supplier will match such lower pricing to that Participating Public Agency under the Master Agreement. CDW•G seeks the following alternate language for this section: Supplier commits the not-to- exceed pricing provided under the Master Agreement pricing is its lowest available (net to buyer) to Public Agencies nationwide and further commits that if a Participating Public Agency is eligible for lower pricing through a national, state, regional or local or cooperative contract, that the Supplier will match such lower pricing to that Participating Public Agency under the Master Agreement. 2.3/ Attachment D, National IPA Requirements for Cooperative Contract, Exhibit A, page 5 Sales Commitment Supplier commits to aggressively market the Master Agreement as its go to market strategy in this defined sector and that its sales force will be trained, engaged and committed to offering the Master Agreement to Public Agencies through National IPA nationwide. Supplier commits that all Master Agreement sales will be accurately and timely reported to National IPA in accordance with the National IPA Administration CDW•G seeks the following alternate language for this first sentence: Supplier commits to aggressively market the Master Agreement as its go to market strategy in this defined sector and that its sales force will be trained, engaged and committed to offering the Master Agreement to Public Agencies through National IPA nationwide. Exceptions & Confidential Information | 2 Exceptions Section/Page Term, Condition, or Specification Exception/Deviation City Accepts Agreement. Supplier also commits that its sales force will be compensated, including sales incentives, for sales to Public Agencies under the Master Agreement in a consistent or better manner compared to sales to Public Agencies if the Supplier were not awarded the Master Agreement. 3.3. E / Attachment D, National IPA Requirements for Cooperative Contract, Exhibit A, page 7 E. Supplier is responsible for proactive direct sales of Supplier’s goods and services to Public Agencies nationwide and the timely follow up to leads established by National IPA. All sales materials are to use the National IPA logo. At a minimum, the Supplier’s sales initiatives should communicate: i.Master Agreement was competitively solicited and publicly awarded by a Principal Procurement Agency ii.Best government pricing iii.No cost to participate iv.Non-exclusive contract CDW•G seeks the following alternate language: Supplier is responsible for proactive direct sales of Supplier’s goods and services to Public Agencies nationwide and the timely follow up to leads established by National IPA. All sales materials are to use the National IPA logo. At a minimum, the Supplier’s sales initiatives should communicate: i.Master Agreement was competitively solicited and publicly awarded by a Principal Procurement Agency ii.No cost to participate iii.Non-exclusive contract 7 / Attachment D, National IPA Requirements for Cooperative Contract, Exhibit B, page 10 WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, NATIONAL IPA EXPRESSLY DISCLAIMS ALL EXPRESS OR IMPLIED REPRESENTATIONS AND WARRANTIES REGARDING NATIONAL IPA’S PERFORMANCE AS A CONTRACT ADMINISTRATOR OF THE MASTER AGREEMENT. NATIONAL IPA SHALL NOT BE LIABLE IN ANY WAY FOR ANY SPECIAL, INCIDENTAL, INDIRECT, CONSEQUENTIAL, EXEMPLARY, PUNITIVE, OR RELIANCE DAMAGES, EVEN IF NATIONAL IPA IS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. CDW•G Seeks the following alternative language to replace existing language: Each Party (“Indemnifying Party”) shall defend the other party and the other party’s officers, directors and employees (each, an “Indemnified Party”) from and against any claims, demands, actions, lawsuits, and proceedings asserted or made against the Indemnified Party (each, a “Claim”) and shall indemnify and hold harmless the Indemnified Party from and against any loss, damage, cost, and expense (including reasonable attorneys' fees) finally awarded by a court of competent jurisdiction or included as part of a final settlement to the extent that the Claim is proximately caused by the gross negligence or willful misconduct of the Indemnifying Party during the performance of the Services and that the Claim arises either from an action brought by an unaffiliated third party for death or personal physical injury, or from damage to tangible personal property suffered or incurred by the Indemnified Party. Claims do not include any damages or liability that are otherwise excluded from this Agreement or that arise from the good(s) or software or from the data processed thereby. The obligation of the Indemnifying Party under this Section is TAB 6 - Other Forms—Exceptions & Confidential Information Exceptions & Confidential Information | 3 Exceptions Section/Page Term, Condition, or Specification Exception/Deviation City Accepts contingent upon the Indemnified Party providing the Indemnifying Party with: (i) sole authority in any Claim’s defense or settlement; (ii) all reasonable assistance, at the Indemnifying Party’s expense, in any such defense; and (iii) prompt written notice of and description of each Claim; provided, however, that the Indemnified Party's failure to provide prompt notice will relieve the Indemnifying Party of its obligations only if and to the extent that the Indemnifying Party is materially prejudiced by such delay. In no event shall the Indemnifying Party settle any Claim that involves a remedy other than the payment of money without the prior consent of the Indemnified Party. NEITHER CONTRACTOR, ITS AFFILIATES OR ITS OR THEIR SUPPLIERS, SUBCONTRACTORS OR AGENTS SHALL BE LIABLE FOR ANY INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE OR CONSEQUENTIAL DAMAGES. IN THE EVENT OF ANY LIABILITY INCURRED BY CONTRACTOR OR ANY OF ITS AFFILIATES HEREUNDER, THE ENTIRE LIABILITY OF CONTRACTOR AND ITS AFFILIATES FOR DAMAGES FROM ANY CAUSE WHATSOEVER WILL NOT EXCEED THE LESSER OF: (A) THE DOLLAR AMOUNT PAID BY CITY FOR EITHER THE SPECIFIC PURCHASED ITEM(S) GIVING RISE TO THE CLAIM; OR (B)$1,000,000.00 OVER THE ENTIRE TERM OF THE AGREEMENT. 12/ Attachment D, National IPA Requirements for Cooperative Contract, Exhibit B, page 11 An “Administrative Fee” shall be defined and due to National IPA from Supplier in the amount of __ percent (__%) (“Administrative Fee Percentage”) multiplied by the total purchase amount paid to Supplier, less refunds, credits on returns, rebates and discounts, for the sale of products and/or services to Principal Procurement Agency and Participating Public Agencies pursuant to the Master Agreement (as amended from time to time and including any renewal thereof) (“Contract Sales”). From time to time the parties may mutually agree in writing to a lower Administrative Fee Percentage for a specifically identified Participating Public CDW•G Seeks the following alternative language to replace existing language: All sales shall be subject to aAn “Administrative Fee” shall beas defined and due to National IPA from Supplier in the amount of two __ percent (__%) (2%), except Software and Chromebook product categories which will incur no fee (“Administrative Fee Percentage”), , multiplied by the total purchase amount paid to Supplier, less refunds, credits on returns, rebates and discounts, for the sale of products and/or services to Principal Procurement Agency and Participating Public Agencies pursuant to the Master Agreement (as amended from time to time and including any renewal thereof) (“Contract Sales”). From time to time the parties may mutually agree in writing to a lower Administrative Fee Percentage for a specifically Exceptions & Confidential Information | 4 Exceptions Section/Page Term, Condition, or Specification Exception/Deviation City Accepts Agency’s Contract Sales. identified Participating Public Agency’s Contract Sales. 13/ Attachment D, National IPA Requirements for Cooperative Contract, Exhibit B, page 12 13. Supplier shall provide National IPA with an electronic accounting report monthly, in the format prescribed by National IPA, summarizing all Contract Sales for each calendar month. The Contract Sales reporting format is provided as Exhibit C (“Contract Sales Report”), attached hereto and incorporated herein by reference. Contract Sales Reports for each calendar month shall be provided by Supplier to National IPA by the 10th day of the following month. Failure to provide a Contract Sales Report within the time and manner specified herein shall constitute a material breach of this Agreement and if not cured within thirty (30) days of written notice to Supplier shall be deemed a cause for termination of the Master Agreement, at Principal Procurement Agency’s sole discretion, and/or this Agreement, at National IPA’s sole discretion Due to the high volume of transactions anticipated on this program, CDW respectfully requests 15 business days to produce reporting and payment of any Administrative Fees, and therefore seeks the following alternative language to replace existing language: Supplier shall provide National IPA with an electronic accounting report monthly, in the format prescribed by National IPA, summarizing all Contract Sales for each calendar month. The Contract Sales reporting format is provided as Exhibit C (“Contract Sales Report”), attached hereto and incorporated herein by reference. Contract Sales Reports for each calendar month shall be provided by Supplier to National IPA by the 10th 15th business day of the following month. . . . 15/ Attachment D, National IPA Requirements for Cooperative Contract, Exhibit B, page 12 Supplier shall maintain an accounting of all purchases made by Participating Public Agencies under the Master Agreement. National IPA, or its designee, in National IPA’s sole discretion, reserves the right to compare Participating Public Agency records with Contract Sales Reports submitted by Supplier for a period of four (4) years from the date National IPA receives such report. In addition, National IPA may engage a third party to conduct an independent audit of Supplier’s monthly reports. In the event of such an audit, Supplier shall provide all materials reasonably requested relating to such audit by National IPA at the location designated by National IPA. In the event an underreporting of Contract Sales and a resulting underpayment of Administrative Fees is revealed, CDW•G Seeks the following alternative language to replace existing language: Supplier shall maintain an accounting of all purchases made by Participating Public Agencies under the Master Agreement. National IPA, or its designee, in National IPA’s sole discretion, reserves the right to compare Participating Public Agency records with Contract Sales Reports submitted by Supplier for a period of four (4) years from the date National IPA receives such report. Auditing is solely for the purpose of verifying Supplier’s compliance with this Agreement. The audit must be pursuant to a signed Supplier’s Confidentiality Agreement. An audit can be done only once a year and no auditing can be done for the same time period more than once. No audit may be conducted for any period which begins more than twelve months prior to the date the audit is requested. Supplier is not required to keep original documents and copies of relevant documents will suffice for the purposes of this provision. The sole right for damages determined by the audit is TAB 6 - Other Forms—Exceptions & Confidential Information Exceptions & Confidential Information | 5 Exceptions Section/Page Term, Condition, or Specification Exception/Deviation City Accepts National IPA will notify the Supplier in writing. Supplier will have thirty (30) days from the date of such notice to resolve the discrepancy to National IPA’s reasonable satisfaction, including payment of any Administrative Fees due and owing, together with interest thereon in accordance with Section 13, and reimbursement of National IPA’s costs and expenses related to such audit. limited to the actual discrepancies. The audit must be conducted during regular business hours at a mutually agreeable time and upon reasonable advanced notice. In addition, National IPA may engage a third party to conduct an independent audit of Supplier’s monthly reports. In the event of such an audit, Supplier shall provide all materials reasonably requested relating to such audit by National IPA at the location designated by National IPA Supplier. In the event an underreporting of Contract Sales and a resulting underpayment of Administrative Fees is revealed, National IPA will notify the Supplier in writing. Supplier will have thirty (30) days from the date of such notice to resolve the discrepancy to National IPA’s reasonable satisfaction, including payment of any Administrative Fees due and owing, together with interest thereon in accordance with Section 13, and reimbursement of National IPA’s costs and expenses related to such audit. 16/ Attachment D, National IPA Requirements for Cooperative Contract, Exhibit B, page 12 This Agreement, the Master Agreement and the exhibits referenced herein supersede any and all other agreements, either oral or in writing, between the parties hereto with respect to the subject matter hereto and no other agreement, statement, or promise relating to the subject matter of this Agreement which is not contained or incorporated herein shall be valid or binding. In the event of any conflict between the provisions of this Agreement and the Master Agreement, as between National IPA and Supplier, the provisions of this Agreement shall prevail. CDW•G Seeks the following alternative language to replace existing language: This Agreement, the Master Agreement and the exhibits referenced herein supersede any and all other agreements, either oral or in writing, between the parties hereto with respect to the subject matter hereto and no other agreement, statement, or promise relating to the subject matter of this Agreement which is not contained or incorporated herein shall be valid or binding. In the event of any conflict between the provisions of the CSO (hereinafter defined), this Agreement, and the Master Agreement, as between National IPA and Supplier, the provisions of the documents will control in the following order: the CSO, this Agreement, and the Master Agreement shall prevail. With regard to third party cloud computing and storage services, the Third Party Cloud Computing and Storage Services terms, as set forth in Attachment B shall govern. CDW Government LLC (“CDW”) acts as a rebiller only and has no control over the delivery of the cloud computing and storage services. 10/ Attachment D, National IPA WITHOUT LIMITING THE GENERALITY OF THE CDW•G Seeks to add the following sentence to the end of this paragraph: Notwithstanding the Exceptions & Confidential Information | 6 Exceptions Section/Page Term, Condition, or Specification Exception/Deviation City Accepts Requirements for Cooperative Contract, Exhibit C, page 16 FOREGOING, THE NATIONAL IPA PARTIES EXPRESSLY DISCLAIM ALL EXPRESS OR IMPLIED REPRESENTATIONS AND WARRANTIES REGARDING ANY PRODUCT, MASTER AGREEMENT AND GPO CONTRACT. THE NATIONAL IPA PARTIES SHALL NOT BE LIABLE IN ANY WAY FOR ANY SPECIAL, INCIDENTAL, INDIRECT, CONSEQUENTIAL, EXEMPLARY, PUNITIVE, OR RELIANCE DAMAGES, EVEN IF THE NATIONAL IPA PARTIES ARE ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. FURTHER, THE PROCURING PARTY ACKNOWLEDGES AND AGREES THAT THE NATIONAL IPA PARTIES SHALL HAVE NO LIABILITY FOR ANY ACT OR OMISSION BY A SUPPLIER OR OTHER PARTY UNDER A MASTER AGREEMENT OR GPO CONTRACT. foregoing, CDW Government LLC is not a party to this Agreement nor is it a third -party beneficiary thereto. Furthermore, it is the express intent of the National IPA Parties that the Agreement shall not establish any third party beneficiaries or third party rights and that the Agreement shall only benefit the National IPA Parties (and the Affiliates thereof). 4/ Exhibit 1, Draft Agreement, City of Mesa Agreement Pursuant to Solicitation, page 25 In the event of any inconsistency between the terms of the body of the Agreement, the Exhibits, the Solicitation, and Response, the language of the documents will control in the following order: 1. Agreement (Master Agreement or City of Mesa Agreement Pursuant to Solicitation); 2. Exhibits: a. Mesa Standard Terms & Conditions (Exhibit C); b. National IPA Agreement (Exhibit D); c. Scope of Work (Exhibit A); d. Other Exhibits not listed above; 3. Solicitation including any addenda; and 4. Contractor Response CDW•G Seeks the following alternative language to replace existing language: In the event of any inconsistency between the terms of the body of the Agreement, the Exhibits, the Solicitation, and Response, the language of the documents will control in the following order: 1. Contractor Response 2. Agreement (Master Agreement or City of Mesa Agreement Pursuant to Solicitation); 3. Exhibits: a. Mesa Standard Terms & Conditions (Exhibit C); b. National IPA Agreement (Exhibit D); c. Scope of Work (Exhibit A); d. Other Exhibits not listed above; 4. Solicitation including any addenda; and 8/ Exhibit 1, Draft Agreement, City of Mesa Agreement Pursuant to 8. Requirements Contract. Contractor acknowledges and agrees the Agreement is a requirements contract; the Agreement does not guarantee any purchases will be made (minimum CDW•G Seeks to add the following sentence to the end of this paragraph: For purposes of this Section, a “reasonable period of time” shall mean 24-48 hours after Supplier receives a purchase order. TAB 6 - Other Forms—Exceptions & Confidential Information Exceptions & Confidential Information | 7 Exceptions Section/Page Term, Condition, or Specification Exception/Deviation City Accepts Solicitation, page 28 or maximum). Orders will only be placed when the City identifies a need and issues a purchase order or a written notice to proceed. The City reserves the right to cancel purchase orders or a notice to proceed within a reasonable period of time of issuance; any such cancellation will be in writing. Should a purchase order or notice to proceed be canceled, the City agrees to reimburse Contractor for any actual and documented costs incurred by Contractor. The City will not reimburse Contractor for any avoidable costs incurred after receipt of cancellation including, but not limited to, lost profits, shipment of product, or performance of services. The City reserves the right to purchase contracted items through other sources if determined in the best interests of the City to do so. 9.c.iv/ Exhibit 1, Draft Agreement, Exhibit C, Mesa Terms & Conditions, page 33 The City may, at its sole discretion, conduct random verification of the employment records of Contractor and any subcontractor to ensure compliance with the Contractor Immigration Warranty. Contractor agrees to assist the City in regard to any random verification performed. CDW•G Seeks to add the following sentence to the end of this paragraph: Notwithstanding the foregoing, any Contract audits must be pursuant to a signed Contractor’s Confidentiality Agreement. An audit can be done only once a year and no auditing can be done for the same time period more than once. No audit may be conducted for any period which begins more than twelve months prior to the date the audit is requested. Contractor is not required to keep original documents and copies of relevant documents will suffice for the purposes of this provision. The sole right for damages determined by the audit is limited to the actual discrepancies. The audit must be conducted during regular business hours at a mutually agreeable time and upon reasonable advanced notice. 13/ Exhibit 1, Draft Agreement, Exhibit C, Mesa Terms & Conditions, page 34 AUDITS AND RECORDS. Contractor must preserve the records related to this Agreement for six (6) years after completion of the Agreement. The City or its authorized agent reserves the right to inspect any records related to the performance of work specified herein. In addition, the City may inspect any and all payroll, billing or other relevant records kept by CDW•G Seeks to add the additional language proposed in Section 9.c.iv above to the end of this paragraph. Exceptions & Confidential Information | 8 Exceptions Section/Page Term, Condition, or Specification Exception/Deviation City Accepts Contractor in relation to the Agreement. Contractor will permit such inspections and audits during normal business hours and upon reasonable notice by the City. The audit of records may occur at Contractor’s place of business or at City offices, as determined by the City 24/ Exhibit 1, Draft Agreement, Exhibit C, Mesa Terms & Conditions, page 36 INDEMNIFICATION/LIABILITY. a.To the fullest extent permitted by law, Contractor agrees to defend, indemnify, and hold the City, its officers, agents, and employees, harmless from and against any and all third party liabilities, demands, claims, suits, losses, damages, causes of action, fines or judgments, including costs, attorneys’, witnesses’, and expert witnesses’ fees, and expenses incident thereto, relating to, arising out of, or resulting from: (i) the services provided by Contractor personnel under this Agreement; (ii) any negligent acts, errors, mistakes or omissions by Contractor or Contractor personnel; and (iii) Contractor or Contractor personnel’s failure to comply with or fulfill the obligations established by this Agreement. b. Contractor will update the City during the course of the litigation to timely notify the City of any issues that may involve the independent negligence of the City that is not covered by this indemnification. c. The City assumes no liability for actions of Contractor and will not indemnify or hold Contractor or any third party harmless for claims based on this Agreement or use of Contractor-provided supplies or services. Notwithstanding what is stated in this section, CDWG proposes that the terms and conditions proposed above in Section 7 / Attachment D, National IPA Requirements for Cooperative Contract, Exhibit B, page 10. 25/ Exhibit 1, Draft Agreement, Exhibit C, Mesa Terms & Conditions, page 36 WARRANTY. Contractor warrants that the services and materials will conform to the requirements of the Agreement. Additionally, Contractor warrants that all services will be performed in a good, workman-like and CDW•G Seeks the following alternative language to replace existing language: The City understands that the Contractor is not the manufacturer of the products purchased by the City hereunder and the only warranties offered are those of the manufacturer, not the Contractor TAB 6 - Other Forms—Exceptions & Confidential Information Exceptions & Confidential Information | 9 Exceptions Section/Page Term, Condition, or Specification Exception/Deviation City Accepts professional manner. The City’s acceptance of service or materials provided by Contractor will not relieve Contractor from its obligations under this warranty. If any materials or services are of a substandard or unsatisfactory manner as determined by the City, Contractor, at no additional charge to the City, will provide materials or redo such services until in accordance with this Agreement and to the City’s reasonable satisfaction. Unless otherwise agreed, Contractor warrants that materials will be new, unused, of most current manufacture and not discontinued, will be free of defects in materials and workmanship, will be provided in accordance with manufacturer's standard warranty for at least one (1) year unless otherwise specified, and will perform in accordance with manufacturer's published specifications. or its affiliates. In purchasing the products, the City is relying on the manufacturer's specifications only and is not relying on any statements, specifications, photographs or other illustrations representing the products that may be provided by the Contractor or its affiliates. THE CONTRACTOR AND ITS AFFILIATES HEREBY EXPRESSLY DISCLAIM ALL WARRANTIES EITHER EXPRESS OR IMPLIED, RELATED TO PRODUCTS, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OF TITLE, ACCURACY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, WARRANTY OF NONINFRINGEMENT, OR ANY WARRANTY RELATING TO THIRD PARTY SERVICES. THE DISCLAIMER CONTAINED IN THIS PARAGRAPH DOES NOT AFFECT THE TERMS OF ANY MANUFACTURER'S WARRANTY. The City expressly waives any claim that it may have against the Contractor or its affiliates based on any product liability or infringement or alleged infringement of any patent, copyright, trade secret or other intellectual property rights (each a “Claim”) with respect to any product and also waives any right to indemnification from the Contractor or its affiliates against any such Claim made against the City by a third party. The City acknowledges that no employee of the Contractor or its affiliates is authorized to make any representation or warranty on behalf of the Contractor or any of its affiliates that is not in this Contract. In connection with the products, certain services, such as extended warranty service by manufacturers, are sold by the Contractor as a distributor or sales agent ("Third Party Services"). In the case of Third Party Services, the third party will be the party responsible for providing the services to the City and the City will look solely to the third party for any loss, claims or damages arising from or related to the provision of such Third Party Services. The City hereby releases the Contractor and its affiliates from any and all claims arising from or relating to the purchase or provision of any such Third Party Services. Any amounts, including, but not limited to, taxes, associated with Third Party Services which may be collected by the Contractor will be collected Exceptions & Confidential Information | 10 Exceptions Section/Page Term, Condition, or Specification Exception/Deviation City Accepts solely in the capacity as an independent sales agent. If in connection with the provision of products, the City desires to have the Contractor provide installation of custom software images, the City will be required to execute an Installation Indemnity Agreement, a form of which is provided at http://www.cdw.com/forms/indemnity/app.asp. 32/ Exhibit 1, Draft Agreement, Exhibit C, Mesa Terms & Conditions, page 37 RISK OF LOSS. Contractor agrees to bear all risks of loss, injury, or destruction of goods or equipment incidental to providing these services and such loss, injury, or destruction will not release Contractor from any obligation hereunder. CDW•G seeks the following alternate language for this section: Title to Products and risk of loss or damage during shipment pass from Contractor to City upon delivery to the destination specified on the applicable purchase order (F.O.B. Destination, freight prepaid and added). TAB 6 - Other Forms—Exceptions & Confidential Information Exceptions & Confidential Information | 11 Exceptions Section/Page Term, Condition, or Specification Exception/Deviation City Accepts 35/Exhibit 1, Draft Agreement, Exhibit C, Mesa Terms & Conditions, page 37 PROPRIETARY RIGHTS INDEMNIFICATION. Without limiting the foregoing, Contractor will without limitation, at its expense defend the City against all claims asserted by any person that anything provided by Contractor infringes a patent, copyright, trade secret or other intellectual property right and must, without limitation, pay the costs, damages and attorneys' fees awarded against the City in any such action, or pay any settlement of such action or claim. Each party agrees to notify the other promptly of any matters to which this provision may apply and to cooperate with each other in connection with such defense or settlement. If a preliminary or final judgment is obtained against the City’s use or operation of the items provided by Contractor hereunder or any part thereof by reason of any alleged infringement, Contractor will, at its expense and without limitation, either: (a) modify the item so that it becomes non- infringing; (b) procure for the City the right to continue to use the item; (c) substitute for the infringing item other item(s) having at least equivalent capability; or (d) refund to the City an amount equal to the price paid, less reasonable usage, from the time of installation acceptance through cessation of use, which amount will be calculated on a useful life not less than five (5) years, plus any additional costs the City may incur to acquire substitute supplies or services. The City's sole rights to the work product, materials and other deliverables to be provided or created (individually or jointly) in connection with the services, including but not limited to, all inventions, discoveries, methods, processes, formulae, ideas, concepts, techniques, know-how, data, designs, models, prototypes, works of authorship, computer programs, proprietary tools, methods of analysis and other information (whether or not capable of protection by patent, copyright, trade secret, confidentiality, or other proprietary rights) or discovered in the course of performance of this Contract that are embodied in such work or materials (‘Work Product”) will be, upon payment in full, a non-transferable, non- exclusive, royalty-free license to use such Work Product solely for the City's internal use. The City will have no ownership or other property rights thereto, and the City shall have no right to use any such Work Product for any other purpose whatsoever. The City acknowledges that the Contractor may incorporate intellectual property created by third parties into the Work Product (“Third Party Intellectual Property”). The City agrees that its right to use Work Product containing Third Party Intellectual Property may be subject to the rights of third parties and limited by agreements with such third parties. Exceptions & Confidential Information | 12 Confidential Information The following parts of our response are exempt from public disclosure. Subject to applicable state law, we request that the information detailed below be treated as confidential. Excemptions from Public Disclousre Confidential Information Page Lines Reasoning Tab #2 Pages 23-24 Page #: Requirement #4, p. 23 -24 Starting at “CDW-G’s Supplier” Page #: p. 23 (Requirement #4) Ending at “Reporting Capabilities,” p. 24 Per Arizona Revised Statues § 44-405, the following information is confidential and proprietary and it might contain trade secrets therefore not subject to disclosure in case there is a request. GENERAL QUESTIONNAIRE 1.Compliance with Applicable Laws. Respondent complies with Exhibit 1, Draft Agreement, Exhibit C, Mesa Standard Terms & Conditions, 9. “Compliance with Applicable Laws”? Yes No 2.Delivery. Delivery, as stated in Detailed Specifications, can be met. Yes No If no, specify number of days for delivery 3.Payment terms. Payment Due (Not less than net 30 days): Payment Discount of % if invoices are paid within days of receipt. 4.Procurement Card. Does Respondent allow payment of invoices using a Procurement Card? Yes No (Marking a “no” answer will not disqualify your Response.) Discount for Procurement Card Purchases? % 5.Cooperative Purchasing. The use of this Agreement as a cooperative purchasing agreement available to other governmental agencies is described in the Mesa Standard Terms and Conditions. The use of this Agreement as a cooperative purchasing agreement is subject to approval by the Respondent as designated below. 6.Does Respondent agree to extend the prices, terms and conditions of the Agreement to other agencies as specified in the Standard Terms and Conditions? Yes No (Marking a “no” answer will not disqualify your Response.) Addenda. Respondents are responsible for verifying receipt of any addenda issued by checking the City’s website at www.mesaaz.gov/business/purchasing or the Vendor Self Service portal prior to the Response Due date and time. Failure to acknowledge any addenda issued may result in a response being deemed non- responsive. Failure to review addenda does not negate Respondent’s initial offer and holds Respondent for any changes prior to Response Due date and time. Acknowledgement of Receipt and Consideration of Addenda (if applicable): Addenda # 1 2 3 4 V7/14/2015 Required Response Forms – Page 3 of 5 2018011 x x 30 days x ATTACHMENT C RESPONDENT QUESTIONNAIRE Respondent Company Name/ DBA: CDW Government LLC Years in business providing similar services:33 years Contractor’s License No(s): N/A Type: (Submit a copy with the Response) Number of employees at location that would serve under a contract from the Solicitation: N/A Provide names, contact and telephone numbers of three (3) organizations that have received similar services from your company. At least one reference should be comparable in size to the City’s proposed contract. Firm/Government Agency Name: Kern High School District- Business Services Contact Person: Sandy Castorena Phone: 661-827-3321 Address: 5801 Sundale Avenue Bakersfield, CA 93309 Fax: E-Mail Address: Sandy_Castorena@kernhigh.org $ Value of Work, Supplies/Services and Dates Provided: CDW•G respects the privacy of our customers and therefore cannot disclose the value of the work, supplies/services provided. Dates provided: 2014-today. Firm/Government Agency Name: Culpeper School District Contact Person: Maria Weiss Phone: 540-829-2120 Address: 450 Radio Lane Culpeper, VA 22701-1521 Fax: E-Mail Address: mweiss@culpeperschools.org $ Value of Work, Supplies/Services and Dates Provided: CDW•G respects the privacy of our customers and therefore cannot disclose the value of the work, supplies/services provided. Dates provided- 2005-today Firm/Government Agency Name: Los Angeles Superior Court Contact Person: Rachel Cavazos Phone: 213-633-0136 Address: 111 North Hill Street, RM 105D Los Angeles, CA 90012-3219 Fax: E-Mail Address: RCavazos@lacourt.org $ Value of Work, Supplies/Services and Dates Provided: CDW•G respects the privacy of our customers and therefore cannot disclose the value of the work, supplies/services provided. Dates provided- 2005-today List any other information which may be helpful in determining your qualifications for a potential contract: 75 Tri-State International Lincolnshire, IL 60069 CDW.com January 1, 2017 To CDW Government LLC Customers: CDW Government LLC is your supplier/vendor. CDW Government LLC’s FEIN is 36-4230110. This is the number displayed on our invoices. CDW Government LLC is treated as a disregarded entity for federal income tax purposes. The Internal Revenue Service requires the W-9 to be completed by an entity that is not a disregarded entity for federal tax purposes. For CDW Government LLC, that entity is the parent corporation, CDW LLC, FEIN 36-3310735. Consequently, CDW Government LLC’s W-9 lists CDW LLC as the “Name (as shown on the income tax return)” and the “Business name” as CDW Government LLC. The address on our W-9, (230 N. Milwaukee Ave. Vernon Hills, IL 60061), is our mailing address registered with the IRS. CDW Government LLC requests your payments to be mailed to another address, (75 Remittance Dr, Suite 1515, Chicago, IL 60675). This is merely for payment processing and is not a CDW Government LLC physical location. We apologize for any confusion our organizational structure may cause you; however, we have completed the W-9 as required by the Internal Revenue Service. Please feel free to contact us at taxteam@cdw.com should you have any questions or require additional documentation. Thank you, CDW Tax Department City of Mesa Information Technology Solutions and Services Tab 7 Appendix CDW Government LLC Page 60 of 61 October 23, 2017 Mark A. Ellis Work Experience CDW•G CDW•G Manager, Program Management October 2016 - Present •Manages a team of 15 people responsible for State & Local, Higher Education and K-12 Contracts •Responsible for Program Manager deliverables below as well as signature authority on behalf of the Program Management team CDW•G Program Manager March 2005 – September 2016 •Manages a contract portfolio and team that includes; Healthcare, Higher Education, K-12 and State & Local Segments. •Provides Program Management support for contract vehicles to ensure compliance, minimize risk, and maximize contract revenue and profitability. •Manages and develops direct reports to include: Deputy Program Managers and Contract Analyst. •Responsible for a full range of contracts which face customers and/or partners (E.g., Master Purchase Agreements, Subcontractor Agreements, Stretch Agreements, and others.) •Initiates and responds to requests for contract changes, product substitutions and/or technical refreshments. •Drafts or reviews completed drafts of appropriate amendments and other contract documents throughout the contract life-cycle. •Facilitates preliminary dispute resolution and coordinates with the CDW Legal department as necessary, to maintain customer satisfaction and bring prompt closure to certain contract disputes. •Takes hands-on, developmental roles in all facets of proposal development, making bid/no-bid suggestions/determinations. •Ensured contract deliverables reports are prepared, keeps abreast of contractual terms and conditions. •Managed contracts to ensure maximum contract revenue and profitability •Made contract modifications including price reductions, additions, discontinued products, replacements as well as version changes. •Ensured price and supply agreements are in place from award through completion. •Ensured that CDW•G is in compliance with government regulations, as applicable. CDW•G Proposal Specialist March 2003 – March 2005 •Delegated tasks among account managers, sales managers, systems engineers, field reps, vendors, service partners etc. throughout the proposal process. •Analyzed RFPs and document potential gains, liabilities, terms and conditions •Prepared a written response, articulating company capabilities, thoroughly addressing explicit and implicit customer needs. •Crafted professionally written responses to proposal documents that specifically address customer requirements while positioning CDW•G for success •Managed proposal schedule to meet deadlines •Researched the customer to understand their environment, politics, limitations, hot points and other factors that will translate to a response that wins •Reviewed and flags Proposal Documents for opportunities, liabilities, terms and conditions •Reviewed responses for compliance, accuracy, content and impact to business; participates in review sessions with teammates to ensure the integrity of all documents and solutions •Oversaw completion of pricing and non-cost items in the cost proposal, such as representations and certifications CDW•G Account Manager October 2001 – March 2003 •Handled and grew account portfolio that included all SLED customers in CDW•G Ohio Valley •Served as lead Account Manager for Warren County, Ohio a $1.7M account per year Education Indiana University - Bloomington Bachelor of Arts – History Minor – Business Major Projects CDW Emerging Leaders Program Participant October 2015 – July 2016 • Participated and won the 2015-2016 Emerging Leaders Program with my team where we covered how we can better serve our CDW customers by providing a better experience with DCS Services. • Worked with 4 other people, all in different locations collaborating on our goal of delivering a presentation to CDW’s Executives on our final solution. Patrick T. O’Brien Education University of Illinois 1990-1995 Bachelor of Science – Sports Management Florida Gulf Coast University 1997 Secondary Education Mathematics Accreditation Work Experience CDW•G Vernon Hills, IL 2001-Present Field Sales Manager, Government 2014-Present •Responsible for customer relationships, territory strategy, partner alignment, and Coworker Development for all State and Local Field Sellers in Eastern US. •Assist in developing short- and long-term performance goals, strategic direction, and business initiatives of our East State and Local SalesTeam.Regional Sales Manager, Government 2007-2014 •Driving force in successful awards to CDW•G of several state contracts including Ohio, Florida, and California. •Manage a team of State and Local account managers in the Pacific region •Responsible for Government sales across all technologies in the region •Work with account managers to ensure customers are being properlyserviced Strategic Accounts Sales Manager, Healthcare 2006-2007 •Founding member of CDW Healthcare Division •Lead Subject Matter Expert for contract proposal resulting in thenlargest contract in company history •Responsible for developing, coaching, and supervising National Field and Inside Sales Staff Sales Manager, Education 2004-2006 •Driving force in regionalization of Education sales team. •Consistently managed highest percent of goal sales team in thedivision. Account Manager, Government & Education 2001-2004 •Assisted in the development of new Account Managers •Focused on helping customers with their technology purchases •Focused on building relationships with customers to ensure they mettheir technology goals •Developed new relationships within existing customers to bring them the value and benefits of CDW Last Revised: 03/26/2010 CDW PRODUCT RETURN POLICY Seller offers a 30-day return policy on most products sold. Manufacturer restrictions apply to certain merchandise, as detailed below and as updated from time to time. Customer may obtain additional details and any applicable updates from the dedicated Seller account manager and may obtain manufacturer contact information by contacting CDW Customer Relations, which may be reached by calling 866.SVC.4CDW or by emailing returns@cdw.com. 1.Return Restrictions. •Defective Product Returns. Customer may return most defective Products directly to Seller within fifteen (15) days of invoice date and receive, at Seller’s option, credit, replacement, exchange, or repair. After fifteen (15) days, only the manufacturer warranty applies. •Non-Defective Product Returns. Customer may return most non-defective Products directly to Seller within thirty (30) days of invoice date and receive, at Customer’s option, credit or exchange, except that an automatic Seller restocking charge will reduce the value of any such credit or exchange by a minimum of fifteen percent (15%). •Restricted, Repair-Only Returns. Certain Products can only be returned for repair—not for exchange, replacement or credit—based on current manufacturer requirements. Such Products should be returned to Seller, shipped directly to the manufacturer, or taken to an authorized service center in Customer’s vicinity. More information may be provided by the dedicated Seller account manager or by CDW Customer Relations. •Restricted, Manufacturer-Only Assistance. Certain Products cannot be returned to Seller for any reason—without exception—and Customer must contact the manufacturer directly for any needed assistance. More information may be provided by the dedicated Seller account manager or by CDW Customer Relations. •Special Orders. Products that are specially ordered may be non-returnable or may have unique return restrictions provided at the time of sale. More information may be provided by the dedicated Seller account manager or by CDW Customer Relations. Last Revised: 03/26/2010 •Return of Software or DVDs. Seller offers refunds only for unopened, undamaged software and DVD movies that are returned within 30 days of invoice date. Seller offers only replacement for software products and DVD movies that either: (i) are defective but are returned within thirty (30) days of invoice date; or (ii) are unopened and undamaged, but are returned more than 30 days after invoice date; such replaceable merchandise may be exchanged only for the same software or DVD movie title. Multiple software licenses may be returned for refund or exchange only (i) if specifically authorized in advance by the manufacturer; and (ii) if returned within thirty (30) days of invoice date. 2.Customer Shipment of Returned Merchandise. •Return Merchandise Authorization (RMA) Number. No returns of any type will be accepted by Seller unless accompanied by a unique RMA number, which Customer may obtain by providing the following information to CDW Customer Relations: customer name, applicable invoice number, product serial number, and details of Customer’s issue with the product. Customer has five (5) days to return a Product after the applicable RMA is issued. CDW reserves the right to refuse any UNAUTHORIZED returns: those that occur after the five (5) day period or those involving Products that are unaccompanied by valid RMA’s. •Returned Products Must Be Complete. All Products MUST BE returned one hundred percent (100%) complete, including all original boxes, packing materials, manuals, blank warranty cards, and other accessories provided by the manufacturer. CDW reserves the right to refuse the return of incomplete Products. In addition, CDW will charge a minimum fifteen percent (15%) restocking fee for returns that are accepted. •Responsibility for Shipping Costs. Customer is responsible for the cost of shipping returned items; Seller is responsible for the cost of shipping replacements or exchanges of returned items and will match Customer’s shipping method. •Customer Shipping Insurance. Customer is strongly advised to purchase full insurance to cover loss and damage in transit for shipments of returned items and to use a carrier and shipping method that provide proof of delivery. Seller is not responsible for loss during such shipment. Last Revised: 03/26/2010 3. Merchandise Damaged in Transit. • Refusal/Receipt of Damaged Products. If a package containing items purchased from Seller arrives at Customer’s address DAMAGED, Customer should REFUSE to accept delivery from the carrier. If Customer does accept delivery of such a package, Customer must: (i) note the damage on the carrier's delivery record so that Seller may file a claim; (ii) save, as is, the merchandise AND the original box and packaging it arrived in; and (iii) promptly notify Seller either by calling CDW Customer Relations or by contacting the Seller account manager to arrange for carrier’s inspection and pickup of the damaged merchandise. If Customer does not so note the damage and save the received merchandise and does not so notify Seller within fifteen (15) days of delivery acceptance, Customer will be deemed to have accepted the merchandise as if it had arrived undamaged, and Seller’s regular return policy, as described in sections 1 and 2 above, and all current manufacturer warranties and restrictions will apply. 4. Credits Any credit issued by Seller to Customer under this return policy must be used within two (2) years from the date that the credit was issued and may only be used for future purchases of Product and/or Services. Any credit or portion thereof not used within the two (2) year period will automatically expire. City of Mesa Information Technology Solutions and Services CDW Government LLC Page 61 of 61 October 23, 2017 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8135 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Public Utilities Agenda Number: 7.17 SUBJECT/RECOMMENDATION: Authorize the award of Invitation to Bid 43-20, Laboratory Services, to Flowers Chemical Laboratories, Inc of Altamonte Springs, FL and Pace Analytical Services, LLC of Oldsmar, FL for an annual not-to-exceed amount of $400,000.00 with the option for two, one-year extensions at the City’s discretion, and authorize the appropriate officials to execute same. (consent) SUMMARY: Invitation to Bid (ITB) #43-20, Laboratory Services was issued on June 17, 2020. Three of the five bids received were considered responsive to the requirements set forth in the solicitation . Flowers Chemical Laboratories, Inc. and Pace Analytical Services, LLC were selected as the lowest, responsible bidders for Laboratory Services, award as follows: Flowers Chemical Laboratories, Inc.- Group 1 Water Reclamation Facilities Pace Analytical Services, LLC - Group 1-Drinking Water-DEP and SWFWMD Sampling WPT & RO WTP Discharge and Group 2 Industrial Pretreatment The Public Utilities Department requests the flexibility to use either vendor as a secondary provider and will allocate an annual not-to-exceed amount of $400,000 between these contractors to provide laboratory services as needed. Laboratory services are used by the Public Utilities Department for water treatment, wastewater treatment, water distribution, wastewater collection systems and the Industrial Pretreatment Program. The City contracts third-party laboratories to provide services when the City’s laboratory cannot be used due to required after hours analysis, to perform analysis that the City is not currently certified to perform, and to aid in the volume of testing required. The initial contract period will be September 4, 2020 through September 3, 2021, with the option for two, one-year term renewal terms available to the City. APPROPRIATION CODE AND AMOUNT: Budgeted funds for FY20 are available in Public Utilities’ cost centers, cost code 530300 Other Contractual Services. Funding for future fiscal years (FY21 through FY23) will be requested within contract calendar and spending limits. Page 1 City of Clearwater Printed on 9/3/2020 v. 11.2018 Procurement Office 100 S Myrtle Ave 33756-5520 PO Box 4748 33758-4748 Clearwater FL 727-562-4633 INVITATION TO BID #43-20 Laboratory Services June 17, 2020 NOTICE IS HEREBY GIVEN that sealed bids will be received by the City of Clearwater (City) until 10:00 A.M., Local Time, July 29, 2020 to provide Laboratory Services. Brief Description: The City of Clearwater Public Utilities Department is soliciting sealed bids to establish a term contract for laboratory services for potable and non-potables, analysis, wastewater residuals testing and other environmental testing, as needed. Bids must be in accordance with the provisions, specifications and instructions set forth herein and will be received by Procurement until the above noted time, when they will be publicly acknowledged and accepted. Bid packets, any attachments and addenda are available for download at: https://www.myclearwater.com/business/rfp Please read the entire solicitation package and submit the bid in accordance with the instructions. This document (less this invitation and the instructions) and any required response documents, attachments, and submissions will constitute the bid. General, Process or Technical Questions concerning this solicitation should be directed, IN WRITING, to the following Procurement Analyst: Valerie Craig Sr. Procurement Analyst Valerie.Craig@myclearwater.com This Invitation to Bid is issued by: Lori Vogel, CPPB Procurement Manager lori.vogel@myclearwater.com INSTRUCTIONS Laboratory Services 2 ITB #43-20 i.1 VENDOR QUESTIONS: All questions regarding the contents of this solicitation, and solicitation process (including requests for ADA accommodations), shall be directed solely to the contact listed on page 1. Questions should be submitted in writing via letter, fax or email. Questions received less than ten (10) calendar days prior to the due date and time may be answered at the discretion of the City. i.2 ADDENDA/CLARIFICATIONS: Any changes to the specifications will be in the form of an addendum. Addenda are posted on the City website no less than seven (7) days prior to the Due Date. Vendors are cautioned to check the Purchasing Website for addenda and clarifications prior to submitting their bid. The City cannot be held responsible if a vendor fails to receive any addenda issued. The City shall not be responsible for any oral changes to these specifications made by any employees or officer of the City. Failure to acknowledge receipt of an addendum may result in disqualification of a bid. VENDOR CONFERENCE / SITE VISIT: Yes No Mandatory Attendance: Yes No Date: Wednesday, June 24, 2020 Time: 10:00 A.M. (Local Time) Location: 1650 N. Arcturas Ave., Bldg. A, Clearwater, FL 33765 NOTE: This meeting will be held under current US Centers for Disease Control and Prevention (CDC) guidelines for the prevention of the spread of coronavirus disease 2019 (COVID-19). Face masks are required. If so designated above, attendance is mandatory as a condition of submitting a bid. The conference/site visit provides interested parties an opportunity to discuss the City's needs, inspect the site and ask questions. During any site visit you must fully acquaint yourself with the conditions as they exist and the character of the operations to be conducted under the resulting contract. i.3 DUE DATE & TIME FOR SUBMISSION AND OPENING: Date: July 29, 2020 Time: 10:00 A.M. (Local Time) The City will open all bids properly and timely submitted and will record the names and other information specified by law and rule. All bids become the property of the City and will not be returned except in the case of a late submission. Respondent names, as read at the bid opening, will be posted on the City website. Once a notice of intent to award is posted or 30 days from day of opening elapses, whichever occurs earlier, bids are available for inspection by contacting the Procurement Division. i.4 BID FIRM TIME: 120 days from Opening Bid shall remain firm and unaltered after opening for the number of days shown above. The City may accept the bid, subject to successful contract negotiations, at any time during this time. i.6 BID SECURITY: Yes No If so designated above, a bid security in the amount specified must be submitted with the bid. The security may be submitted in any one of the following forms: an executed surety bond issued by a firm licensed and registered to transact such business with the State of Florida; cash; certified check, or cashier's check payable to the City of Clearwater (personal or company checks are not acceptable); certificate of deposit or any other form of deposit issued by a financial institution and acceptable to the City. Such bid security shall be forfeited to the City of Clearwater should the bidder selected fail to execute a contract when requested. PERFORMANCE SECURITY: Yes No If required herein, the Contractor, simultaneously with the execution of the Contract, will be required to furnish a performance security. The security may be submitted in one-year increments and in INSTRUCTIONS Laboratory Services 3 ITB #43-20 any one of the following forms: an executed surety bond issued by a firm licensed and registered to transact such business with the State of Florida; cash; certified check, cashier's check or money order payable to the City of Clearwater (personal and company checks are not acceptable); certificate of deposit or any other form of deposit issued by a financial institution and acceptable to the City. If the Contractor fails or refuses to fully comply with the terms and conditions of the contract, the City shall have the right to use all or such part of said security as may be necessary to reimburse the City for loss sustained by reason of such breach. The balance of said security, if any, will be returned to Contractor upon the expiration or termination of the contract. i.7 SUBMIT BIDS TO: It is recommended that responses are submitted electronically through our bids website at https://www.myclearwater.com/business/rfp. Firms may mail or hand-deliver responses to the address below. Use label at the end of this solicitation package. E-mail or fax submissions will not be accepted. City of Clearwater Attn: Procurement Division 100 S Myrtle Ave, 3rd Fl, Clearwater FL 33756-5520 or PO Box 4748, Clearwater FL 33758-4748 No responsibility will attach to the City of Clearwater, its employees or agents for premature opening of a bid that is not properly addressed and identified. i.8 LATE BIDS. The bidder assumes responsibility for having the bid delivered on time at the place specified. All bids received after the date and time specified shall not be considered and will be returned unopened to the bidder. The bidder assumes the risk of any delay in the mail or in handling of the mail by employees of the City of Clearwater, or any private courier, regardless whether sent by mail or by means of personal delivery. You must allow adequate time to accommodate all registration and security screenings at the delivery site. A valid photo I.D. may be required. It shall not be sufficient to show that you mailed or commenced delivery before the due date and time. All times are Clearwater, Florida local times. The bidder agrees to accept the time stamp in the City Procurement Office as the official time. i.9 COMMENCEMENT OF WORK. If bidder begins any billable work prior to the City’s final approval and execution of the contract, bidder does so at its own risk. i.10 RESPONSIBILITY TO READ AND UNDERSTAND. Failure to read, examine and understand the solicitation will not excuse any failure to comply with the requirements of the solicitation or any resulting contract, nor shall such failure be a basis for claiming additional compensation. If a vendor suspects an error, omission or discrepancy in this solicitation, the vendor must immediately and in any case not later than seven (7) business days in advance of the due date notify the contact on page one (1). The City is not responsible for and will not pay any costs associated with the preparation and submission of the bid. Bidders are cautioned to verify their bids before submission, as amendments to or withdrawal of bids submitted after time specified for opening of bids may not be considered. The City will not be responsible for any bidder errors or omissions. i.11 FORM AND CONTENT OF BIDS. Unless otherwise instructed or allowed, bids shall be submitted on the forms provided. An original and the designated number of copies of each bid are required. Bids, including modifications, must be submitted in ink, typed, or printed form and signed by an authorized representative. Please line through and initial rather than erase changes. If the bid is not properly signed or if any changes are not initialed, it may be considered non-responsive. In the event of a disparity between the unit price and the extended price, the unit price shall prevail unless obviously in error, as determined by the City. The City may require that an electronic copy of the bid be submitted. The bid must provide all information requested and must address all points. The City does not encourage exceptions. The City is not required to grant exceptions and depending on the exception, the City may reject the bid. INSTRUCTIONS Laboratory Services 4 ITB #43-20 i.12 SPECIFICATIONS. Technical specifications define the minimum acceptable standard. When the specification calls for “Brand Name or Equal,” the brand name product is acceptable. Alternates will be considered upon demonstrating the other product meets stated specifications and is equivalent to the brand product in terms of quality, performance and desired characteristics. Minor differences that do not affect the suitability of the supply or service for the City’s needs may be accepted. Burden of proof that the product meets the minimum standards or is equal to the brand name, product, is on the bidder. The City reserves the right to reject bids that the City deems unacceptable. i.13 MODIFICATION / WITHDRAWAL OF BID. Written requests to modify or withdraw the bid received by the City prior to the scheduled opening time will be accepted and will be corrected after opening. No oral requests will be allowed. Requests must be addressed and labeled in the same manner as the bid and marked as a MODIFICATION or WITHDRAWAL of the bid. Requests for withdrawal after the bid opening will only be granted upon proof of undue hardship and may result in the forfeiture of any bid security. Any withdrawal after the bid opening shall be allowed solely at the City’s discretion. i.14 DEBARMENT DISCLOSURE. If the vendor submitting this bid has been debarred, suspended, or otherwise lawfully precluded from participating in any public procurement activity, including being disapproved as a subcontractor with any federal, state, or local government, or if any such preclusion from participation from any public procurement activity is currently pending, the bidder shall include a letter with its bid identifying the name and address of the governmental unit, the effective date of this suspension or debarment, the duration of the suspension or debarment, and the relevant circumstances relating the suspension or debarment. i.15 RESERVATIONS. The City reserves the right to reject any or all bids or any part thereof; to rebid the solicitation; to reject non-responsive or non-responsible bids; to reject unbalanced bids; to reject bids where the terms, prices, and/or awards are conditioned upon another event; to reject individual bids for failure to meet any requirement; to award by item, part or portion of an item, group of items, or total; to make multiple awards; to waive minor irregularities, defects, omissions, technicalities or form errors in any bid. The City may seek clarification of the bid from bidder at any time, and failure to respond is cause for rejection. Submission of a bid confers on bidder no right to an award or to a subsequent contract. The City is charged by its Charter to make an award that is in the best interest of the City. All decisions on compliance, evaluation, terms and conditions shall be made solely at the City’s discretion and made to favor the City. No binding contract will exist between the bidder and the City until the City executes a written contract or purchase order. i.16 OFFICIAL SOLICITATION DOCUMENT. Changes to the solicitation document made by a bidder may not be acknowledged or accepted by the City. Award or execution of a contract does not constitute acceptance of a changed term, condition or specification unless specifically acknowledged and agreed to by the City. The copy maintained and published by the City shall be the official solicitation document. i.17 COPYING OF BIDS. Bidder hereby grants the City permission to copy all parts of its bid, including without limitation any documents and/or materials copyrighted by the bidder. The City’s right to copy shall be for internal use in evaluating the proposal. i.18 CONTRACTOR ETHICS. It is the policy of the City to promote courtesy, fairness, impartiality, integrity, service, professionalism, economy, and government by law in the Procurement process. The responsibility for implementing this policy rests with each individual who participates in the Procurement process, including Respondents and Contractors. To achieve the purpose of this Article, it is essential that Respondents and Contractors doing business with the City also observe the ethical standards prescribed herein. It shall be a breach of ethical standards to: a. Exert any effort to influence any City employee or agent to breach the standards of ethical conduct. INSTRUCTIONS Laboratory Services 5 ITB #43-20 b. Intentionally invoice any amount greater than provided in Contract or to invoice for Materials or Services not provided. c. Intentionally offer or provide sub-standard Materials or Services or to intentionally not comply with any term, condition, specification or other requirement of a City Contract. i.19 GIFTS. The City will accept no gifts, gratuities or advertising products from bidders or prospective bidders and affiliates. The City may request product samples from vendors for product evaluation. i.20 PROTESTS AND APPEALS. If a Respondent believes there is a mistake, impropriety, or defect in the solicitation, believes the City improperly rejected its proposal, and/or believes the selected proposal is not in the City’s best interests, the Respondent may submit a written protest. All protests and appeals are governed by the City of Clearwater Purchasing Policy and Procedures. If any discrepancy exists between this Section and the Purchasing Policy, the language of the Purchasing Policy controls. Protests based upon alleged mistake, impropriety, or defect in a solicitation that is apparent before the bid opening must be filed with the Procurement Officer no later than five (5) business days before Bid Opening. Protests that only become apparent after the Bid Opening must be filed within ten (10) business days of the alleged violation of the applicable purchasing ordinance. The complete protest procedure can be obtained by contacting Procurement. ADDRESS PROTESTS TO: City of Clearwater – Procurement Office 100 S Myrtle Ave, 3rd Fl Clearwater FL 33756-5520 or PO Box 4748 Clearwater FL 33758-4748 INSTRUCTIONS – EVALUATION Laboratory Services 6 ITB #43-20 i.21 EVALUATION PROCESS. Bids will be reviewed by the Procurement Office and representative(s) of the respective department(s). The City staff may or may not initiate discussions with bidders for clarification purposes. Clarification is not an opportunity to change the bid. Bidders shall not initiate discussions with any City employee or official. i.22 PRESENTATIONS/INTERVIEWS. The bidder must provide a formal presentation/interview upon request. i.23 CRITERIA FOR EVALUATION AND AWARD. The City evaluates three (3) categories of information: responsiveness, responsibility, and price. All bids must meet the following responsiveness and responsibility criteria to be considered further. a) Responsiveness. The City will determine whether the bid complies with the instructions for submitting bids including completeness of bid which encompasses the inclusion of all required attachments and submissions. The City must reject any bids that are submitted late. Failure to meet other requirements may result in rejection. b) Responsibility. The City will determine whether the bidder is one with whom it can or should do business. Factors that the City may evaluate to determine "responsibility" include, but are not limited to: excessively high or low priced bids, past performance, references (including those found outside the bid), compliance with applicable laws-including tax laws, bidder's record of performance and integrity - e.g. has the bidder been delinquent or unfaithful to any contract with the City, whether the bidder is qualified legally to contract with the City, financial stability and the perceived ability to perform completely as specified. A bidder must at all times have financial resources sufficient, in the opinion of the City, to ensure performance of the contract and must provide proof upon request. City staff may also use Dun & Bradstreet and/or any generally available industry information. The City reserves the right to inspect and review bidder’s facilities, equipment and personnel and those of any identified subcontractors. The City will determine whether any failure to supply information, or the quality of the information, will result in rejection. c) Price. We will then evaluate the bids that have met the requirements above. i.24 COST JUSTIFICATION. In the event only one response is received, the City may require that the bidder submit a cost proposal in sufficient detail for the City to perform a cost/price analysis to determine if the bid price is fair and reasonable. i.25 CONTRACT NEGOTIATIONS AND ACCEPTANCE. Bidder must be prepared for the City to accept the bid as submitted. If bidder fails to sign all documents necessary to successfully execute the final contract within a reasonable time as specified, or negotiations do not result in an acceptable agreement, the City may reject bid or revoke the award, and may begin negotiations with another bidder. Final contract terms must be approved or signed by the appropriately authorized City official(s). No binding contract will exist between the bidder and the City until the City executes a written contract or purchase order. i.26 NOTICE OF INTENT TO AWARD. Notices of the City’s intent to award a Contract are posted to Purchasing’s website. It is the bidder’s responsibility to check the City of Clearwater’s website at https://www.myclearwater.com/business/rfp to view relevant bid information and notices. i.27 BID TIMELINE. Dates are tentative and subject to change. Release ITB: 06/17/20 Advertise Tampa Bay Times: 06/17/20 Pre-Bid Meeting: 06/24/20 Bids due: 07/29/20 Review bids: 07/30/20-08/13/20 Award recommendation: 08/14/20 Council authorization: 09/03/20 Contract begins: September 2020 STANDARD TERMS AND CONDITIONS Laboratory Services 7 ITB #43-20 S.1 DEFINITIONS. Uses of the following terms are interchangeable as referenced: “vendor, contractor, supplier, proposer, company, parties, persons”, “purchase order, PO, contract, agreement”, “city, Clearwater, agency, requestor, parties”, “bid, proposal, response, quote”. S.2 INDEPENDENT CONTRACTOR. It is expressly understood that the relationship of Contractor to the City will be that of an independent contractor. Contractor and all persons employed by Contractor, either directly or indirectly, are Contractor’s employees, not City employees. Accordingly, Contractor and Contractor’s employees are not entitled to any benefits provided to City employees including, but not limited to, health benefits, enrollment in a retirement system, paid time off or other rights afforded City employees. Contractor employees will not be regarded as City employees or agents for any purpose, including the payment of unemployment or workers’ compensation. If any Contractor employees or subcontractors assert a claim for wages or other employment benefits against the City, Contractor will defend, indemnify and hold harmless the City from all such claims. S.3 SUBCONTRACTING. Contractor may not subcontract work under this Agreement without the express written permission of the City. If Contractor has received authorization to subcontract work, it is agreed that all subcontractors performing work under the Agreement must comply with its provisions. Further, all agreements between Contractor and its subcontractors must provide that the terms and conditions of this Agreement be incorporated therein. S.4 ASSIGNMENT. This Agreement may not be assigned either in whole or in part without first receiving the City’s written consent. Any attempted assignment, either in whole or in part, without such consent will be null and void and in such event the City will have the right at its option to terminate the Agreement. No granting of consent to any assignment will relieve Contractor from any of its obligations and liabilities under the Agreement. S.5 SUCCESSORS AND ASSIGNS, BINDING EFFECT. This Agreement will be binding upon and inure to the benefit of the parties and their respective permitted successors and assigns. S.6 NO THIRD-PARTY BENEFICIARIES. This Agreement is intended for the exclusive benefit of the parties. Nothing set forth in this Agreement is intended to create, or will create, any benefits, rights, or responsibilities in any third parties. S.7 NON- EXCLUSIVITY. The City, in its sole discretion, reserves the right to request the materials or services set forth herein from other sources when deemed necessary and appropriate. No exclusive rights are encompassed through this Agreement. S.8 AMENDMENTS. There will be no oral changes to this Agreement. This Agreement can only be modified in a writing signed by both parties. No charge for extra work or material will be allowed unless approved in writing, in advance, by the City and Contractor. S.9 TIME OF THE ESSENCE. Time is of the essence to the performance of the parties’ obligations under this Agreement. S.10 COMPLIANCE WITH APPLICABLE LAWS. a. General. Contractor must procure all permits and licenses and pay all charges and fees necessary and incidental to the lawful conduct of business. Contractor must stay fully informed of existing and future federal, state, and local laws, ordinances, and regulations that in any manner affect the fulfillment of this Agreement and must comply with the same at its own expense. Contractor bears full responsibility for training, safety, and providing necessary equipment for all Contractor personnel to achieve throughout the term of the Agreement. Upon request, Contractor will demonstrate to the City's satisfaction any programs, procedures, and other activities used to ensure compliance. b. Drug-Free Workplace. Contractor is hereby advised that the City has adopted a policy establishing a drug-free workplace for itself and those doing business with the City to ensure the safety and health of all persons working on City contracts and projects. Contractor will require a drug-free workplace for all Contractor personnel working under this Agreement. Specifically, all Contractor personnel who are working under this Agreement must be notified STANDARD TERMS AND CONDITIONS Laboratory Services 8 ITB #43-20 in writing by Contractor that they are prohibited from the manufacture, distribution, dispensation, possession, or unlawful use of a controlled substance in the workplace. Contractor agrees to prohibit the use of intoxicating substances by all Contractor personnel and will ensure that Contractor personnel do not use or possess illegal drugs while in the course of performing their duties. c. Federal and State Immigration Laws. Contractor agrees to comply with the Immigration Reform and Control Act of 1986 (IRCA) in performance under this Agreement and to permit the City and its agents to inspect applicable personnel records to verify such compliance as permitted by law. Contractor will ensure and keep appropriate records to demonstrate that all Contractor personnel have a legal right to live and work in the United States. (i) As applicable to Contractor, under this provision, Contractor hereby warrants to the City that Contractor and each of its subcontractors will comply with, and are contractually obligated to comply with, all federal immigration laws and regulations that relate to their employees (hereinafter “Contractor Immigration Warranty”). (ii) A breach of the Contractor Immigration Warranty will constitute as a material breach of this Agreement and will subject Contractor to penalties up to and including termination of this Agreement at the sole discretion of the City. (iii) The City retains the legal right to inspect the papers of all Contractor personnel who provide services under this Agreement to ensure that Contractor or its subcontractors are complying with the Contractor Immigration Warranty. Contractor agrees to assist the City in regard to any such inspections. (iv) The City may, at its sole discretion, conduct random verification of the employment records of Contractor and any subcontractor to ensure compliance with the Contractor Immigration Warranty. Contractor agrees to assist the City in regard to any random verification performed. (v) Neither Contractor nor any subcontractor will be deemed to have materially breached the Contractor Immigration Warranty if Contractor or subcontractor establishes that it has complied with the employment verification provisions prescribed by Sections 274A and 274B of the Federal Immigration and Nationality Act. d. Nondiscrimination. Contractor represents and warrants that it does not discriminate against any employee or applicant for employment or person to whom it provides services because of race, color, religion, sex, national origin, or disability, and represents and warrants that it complies with all applicable federal, state, and local laws and executive orders regarding employment. Contractor and Contractor’s personnel will comply with applicable provisions of Title VII of the U.S. Civil Rights Act of 1964, as amended, Section 504 of the Federal Rehabilitation Act, the Americans with Disabilities Act (42 U.S.C. § 12101 et seq.), and applicable rules in performance under this Agreement. S.11 SALES/USE TAX, OTHER TAXES. Contractor is responsible for the payment of all taxes including federal, state, and local taxes related to or arising out of Contractor’s services under this Agreement, including by way of illustration but not limitation, federal and state income tax, Social Security tax, unemployment insurance taxes, and any other taxes or business license fees as required. If any taxing authority should deem Contractor or Contractor employees an employee of the City, or should otherwise claim the City is liable for the payment of taxes that are Contractor’s responsibility under this Agreement, Contractor will indemnify the City for any tax liability, interest, and penalties imposed upon the City. The City is exempt from paying state and local sales/use taxes and certain federal excise taxes and will furnish an exemption certificate upon request. S.12 AMOUNTS DUE THE CITY. Contractor must be current and remain current in all obligations due to the City during the performance of services under the Agreement. Payments to Contractor may be offset by any delinquent amounts due the City or fees and charges owed to the City. STANDARD TERMS AND CONDITIONS Laboratory Services 9 ITB #43-20 S.13 OPENNESS OF PROCUREMENT PROCESS. Written competitive proposals, replies, oral presentations, meetings where vendors answer questions, other submissions, correspondence, and all records made thereof, as well as negotiations or meetings where negotiation strategies are discussed, conducted pursuant to this Invitation to Bid (ITB), shall be handled in compliance with Chapters 119 and 286, Florida Statutes. Proposals or replies received by the City pursuant to this ITB are exempt from public disclosure until such time that the City provides notice of an intended decision or until 30 days after opening the proposals, whichever is earlier. If the City rejects all proposals or replies pursuant to this ITB and provides notice of its intent to reissue the ITB, then the rejected proposals or replies remain exempt from public disclosure until such time that the City provides notice of an intended decision concerning the reissued ITB or until the City withdraws the reissued ITB. A proposal or reply shall not be exempt from public disclosure longer than 12 months after the initial City notice rejecting all proposals or replies. Oral presentations, meetings where vendors answer questions, or meetings convened by City staff to discuss negotiation strategies, if any, shall be closed to the public (and other proposers) in compliance with Chapter 286 Florida Statutes. A complete recording shall be made of such closed meeting. The recording of, and any records presented at, the exempt meeting shall be available to the public when the City provides notice of an intended decision or until 30 days after opening proposals or final replies, whichever occurs first. If the City rejects all proposals or replies pursuant to this ITB and provides notice of its intent to reissue the ITB, then the recording and any records presented at the exempt meeting remain exempt from public disclosure until such time that the City provides notice of an intended decision concerning the reissued ITB or until the City withdraws the reissued ITB. A recording and any records presented at an exempt meeting shall not be exempt from public disclosure longer than 12 months after the initial City notice rejecting all proposals or replies. In addition to all other contract requirements as provided by law, the contractor executing this agreement agrees to comply with public records law. IF THE CONTRACTOR HAS QUESTIONS REGARDING THE APPLICATION OF CHAPTER 119, FLORIDA STATUTES, TO THE CONTRACTOR’S DUTY TO PROVIDE PUBLIC RECORDS RELATING TO THIS CONTRACT, CONTACT THE CUSTODIAN OF PUBLIC RECORDS, Rosemarie Call, phone: 727-562-4092 or Rosemarie.Call@myclearwater.com, 600 Cleveland Street, Suite 600, Clearwater, FL 33755. The contractor’s agreement to comply with public records law applies specifically to: a) Keep and maintain public records required by the City of Clearwater (hereinafter “public agency”) to perform the service being provided by the contractor hereunder. b) Upon request from the public agency’s custodian of public records, provide the public agency with a copy of the requested records or allow the records to be inspected or copied within a reasonable time at a cost that does not exceed the cost provided for in Chapter 119, Florida Statutes, as may be amended from time to time, or as otherwise provided by law. c) Ensure that the public records that are exempt or confidential and exempt from public records disclosure requirements are not disclosed except as authorized by law for the duration of the contract term and following completion of the contract if the contractor does not transfer the records to the public agency. d) Upon completion of the contract, transfer, at no cost, to the public agency all public records in possession of the contractor or keep and maintain public records required by the public agency to perform the service. If the contractor transfers all public records to the public agency upon completion of the contract, the contractor shall destroy any duplicate public records that are exempt or confidential and exempt from public records disclosure requirements. If the STANDARD TERMS AND CONDITIONS Laboratory Services 10 ITB #43-20 contractor keeps and maintains public records upon completion of the contract, the contractor shall meet all applicable requirements for retaining public records. All records stored electronically must be provided to the public agency, upon request from the public agency’s custodian of public records, in a format that is compatible with the information technology systems of the public agency. e) A request to inspect or copy public records relating to a public agency’s contract for services must be made directly to the public agency. If the public agency does not possess the requested records, the public agency shall immediately notify the contractor of the request and the contractor must provide the records to the public agency or allow the records to be inspected or copied within a reasonable time. f) The contractor hereby acknowledges and agrees that if the contractor does not comply with the public agency’s request for records, the public agency shall enforce the contract provisions in accordance with the contract. g) A contractor who fails to provide the public records to the public agency within a reasonable time may be subject to penalties under Section 119.10, Florida Statutes. h) If a civil action is filed against a contractor to compel production of public records relating to a public agency’s contract for services, the court shall assess and award against the contractor the reasonable costs of enforcement, including reasonable attorney fees, if: 1. The court determines that the contractor unlawfully refused to comply with the public records request within a reasonable time; and 2. At least eight (8) business days before filing the action, the plaintiff provided written notice of the public records request, including a statement that the contractor has not complied with the request, to the public agency and to the contractor. i) A notice complies with subparagraph (h)2. if it is sent to the public agency’s custodian of public records and to the contractor at the contractor’s address listed on its contract with the public agency or to the contractor’s registered agent. Such notices must be sent by common carrier delivery service or by registered, Global Express Guaranteed, or certified mail, with postage or shipping paid by the sender and with evidence of delivery, which may be in an electronic format. A contractor who complies with a public records request within 8 business days after the notice is sent is not liable for the reasonable costs of enforcement. S.14 AUDITS AND RECORDS. Contractor must preserve the records related to this Agreement for five (5) years after completion of the Agreement. The City or its authorized agent reserves the right to inspect any records related to the performance of work specified herein. In addition, the City may inspect any and all payroll, billing or other relevant records kept by Contractor in relation to the Agreement. Contractor will permit such inspections and audits during normal business hours and upon reasonable notice by the City. The audit of records may occur at Contractor’s place of business or at City offices, as determined by the City. S.15 BACKGROUND CHECK. The City may conduct criminal, driver history, and all other requested background checks of Contractor personnel who would perform services under the Agreement or who will have access to the City’s information, data, or facilities in accordance with the City’s current background check policies. Any officer, employee, or agent that fails the background check must be replaced immediately for any reasonable cause not prohibited by law. STANDARD TERMS AND CONDITIONS Laboratory Services 11 ITB #43-20 S.16 SECURITY CLEARANCE AND REMOVAL OF CONTRACTOR PERSONNEL. The City will have final authority, based on security reasons: (i) to determine when security clearance of Contractor personnel is required; (ii) to determine the nature of the security clearance, up to and including fingerprinting Contractor personnel; and (iii) to determine whether or not any individual or entity may provide services under this Agreement. If the City objects to any Contractor personnel for any reasonable cause not prohibited by law, then Contractor will, upon notice from the City, remove any such individual from performance of services under this Agreement. S.17 DEFAULT. a. A party will be in default if that party: (i) is or becomes insolvent or is a party to any voluntary bankruptcy or receivership proceeding, makes an assignment for a creditor, or there is any similar action that affects Contractor’s capability to perform under the Agreement; (ii) is the subject of a petition for involuntary bankruptcy not removed within sixty (60) calendar days; (iii) conducts business in an unethical manner or in an illegal manner; or (iv) fails to carry out any term, promise, or condition of the Agreement. b. Contractor will be in default of this Agreement if Contractor is debarred from participating in City procurements and solicitations in accordance with the City’s Purchasing Policy and Procedures Manual. c. Notice and Opportunity to Cure. In the event a party is in default then the other party may, at its option and at any time, provide written notice to the defaulting party of the default. The defaulting party will have thirty (30) days from receipt of the notice to cure the default; the thirty (30) day cure period may be extended by mutual agreement of the parties, but no cure period may exceed ninety (90) days. A default notice will be deemed to be sufficient if it is reasonably calculated to provide notice of the nature and extent of such default. Failure of the non- defaulting party to provide notice of the default does not waive any rights under the Agreement. d. Anticipatory Repudiation. Whenever the City in good faith has reason to question Contractor’s intent or ability to perform, the City may demand that Contractor give a written assurance of its intent and ability to perform. In the event that the demand is made and no written assurance is given within five (5) calendar days, the City may treat this failure as an anticipatory repudiation of the Agreement. S.18 REMEDIES. The remedies set forth in this Agreement are not exclusive. Election of one remedy will not preclude the use of other remedies. In the event of default: a. The non-defaulting party may terminate the Agreement, and the termination will be effective immediately or at such other date as specified by the terminating party. b. The City may purchase the services required under the Agreement from the open market, complete required work itself, or have it completed at the expense of Contractor. If the cost of obtaining substitute services exceeds the contract price, the City may recover the excess cost by: (i) requiring immediate reimbursement to the City; (ii) deduction from an unpaid balance due to Contractor; (iii) collection against the proposal and/or performance security, if any; (iv) collection against liquidated damages (if applicable); or (v) a combination of the aforementioned remedies or other remedies as provided by law. Costs includes any and all, fees, and expenses incurred in obtaining substitute services and expended in obtaining reimbursement, including, but not limited to, administrative expenses, attorneys’ fees, and costs. c. The non-defaulting party will have all other rights granted under this Agreement and all rights at law or in equity that may be available to it. d. Neither party will be liable for incidental, special, or consequential damages. S.19 CONTINUATION DURING DISPUTES. Contractor agrees that during any dispute between the parties, Contractor will continue to perform its obligations until the dispute is settled, instructed to cease performance by the City, enjoined or prohibited by judicial action, or otherwise required or obligated to cease performance by other provisions in this Agreement. STANDARD TERMS AND CONDITIONS Laboratory Services 12 ITB #43-20 S.20 TERMINATION FOR CONVENIENCE. The City reserves the right to terminate this Agreement in part or in whole upon thirty (30) calendar days’ written notice. S.21 TERMINATION FOR CONFLICT OF INTEREST Florida Statutes Section 112. Pursuant to F.S. Section 112, the City may cancel this Agreement after its execution, without penalty or further obligation, if any person significantly involved in initiating, securing, drafting, or creating the Agreement for the City becomes an employee or agent of Contractor. S.22 TERMINATION FOR NON-APPROPRIATION AND MODIFICATION FOR BUDGETARY CONSTRAINT. The City is a governmental agency which relies upon the appropriation of funds by its governing body to satisfy its obligations. If the City reasonably determines that it does not have funds to meet its obligations under this Agreement, the City will have the right to terminate the Agreement without penalty on the last day of the fiscal period for which funds were legally available. In the event of such termination, the City agrees to provide written notice of its intent to terminate thirty (30) calendar days prior to the stated termination date. S.23 PAYMENT TO CONTRACTOR UPON TERMINATION. Upon termination of this Agreement, Contractor will be entitled only to payment for those services performed up to the date of termination, and any authorized expenses already incurred up to such date of termination. The City will make final payment within thirty (30) calendar days after the City has both completed its appraisal of the materials and services provided and received Contractor’s properly prepared final invoice. S.24 NON-WAIVER OF RIGHTS. There will be no waiver of any provision of this agreement unless approved in writing and signed by the waiving party. Failure or delay to exercise any rights or remedies provided herein or by law or in equity, or the acceptance of, or payment for, any services hereunder, will not release the other party of any of the warranties or other obligations of the Agreement and will not be deemed a waiver of any such rights or remedies. S.25 INDEMNIFICATION/LIABILITY. a. To the fullest extent permitted by law, Contractor agrees to defend, indemnify, and hold the City, its officers, agents, and employees, harmless from and against any and all liabilities, demands, claims, suits, losses, damages, causes of action, fines or judgments, including costs, attorneys’, witnesses’, and expert witnesses’ fees, and expenses incident thereto, relating to, arising out of, or resulting from: (i) the services provided by Contractor personnel under this Agreement; (ii) any negligent acts, errors, mistakes or omissions by Contractor or Contractor personnel; and (iii) Contractor or Contractor personnel’s failure to comply with or fulfill the obligations established by this Agreement. b. Contractor will update the City during the course of the litigation to timely notify the City of any issues that may involve the independent negligence of the City that is not covered by this indemnification. c. The City assumes no liability for actions of Contractor and will not indemnify or hold Contractor or any third party harmless for claims based on this Agreement or use of Contractor-provided supplies or services. S.26 WARRANTY. Contractor warrants that the services and materials will conform to the requirements of the Agreement. Additionally, Contractor warrants that all services will be performed in a good, workman-like and professional manner. The City’s acceptance of service or materials provided by Contractor will not relieve Contractor from its obligations under this warranty. If any materials or services are of a substandard or unsatisfactory manner as determined by the City, Contractor, at no additional charge to the City, will provide materials or redo such services until in accordance with this Agreement and to the City’s reasonable satisfaction. Unless otherwise agreed, Contractor warrants that materials will be new, unused, of most current manufacture and not discontinued, will be free of defects in materials and workmanship, will be provided in accordance with manufacturer's standard warranty for at least one (1) year unless otherwise specified, and will perform in accordance with manufacturer's published specifications. STANDARD TERMS AND CONDITIONS Laboratory Services 13 ITB #43-20 S.27 THE CITY’S RIGHT TO RECOVER AGAINST THIRD PARTIES. Contractor will do nothing to prejudice the City’s right to recover against third parties for any loss, destruction, or damage to City property, and will at the City’s request and expense, furnish to the City reasonable assistance and cooperation, including assistance in the prosecution or defense of suit and the execution of instruments of assignment in favor of the City in obtaining recovery. S.28 NO GUARANTEE OF WORK. Contractor acknowledges and agrees that it is not entitled to deliver any specific amount of materials or services or any materials or services at all under this Agreement and acknowledges and agrees that the materials or services will be requested by the City on an as needed basis at the sole discretion of the City. Any document referencing quantities or performance frequencies represent the City's best estimate of current requirements, but will not bind the City to purchase, accept, or pay for materials or services which exceed its actual needs. S.29 OWNERSHIP. All deliverables, services, and information provided by Contractor or the City pursuant to this Agreement (whether electronically or manually generated) including without limitation, reports, test plans, and survey results, graphics, and technical tables, originally prepared in the performance of this Agreement, are the property of the City and will not be used or released by Contractor or any other person except with prior written permission by the City. S.30 USE OF NAME. Contractor will not use the name of the City of Clearwater in any advertising or publicity without obtaining the prior written consent of the City. S.31 PROHIBITED ACTS. Pursuant to Florida Constitution Article II Section 8, a current or former public officer or employee within the last two (2) years shall not represent another organization before the City on any matter for which the officer or employee was directly concerned and personally participated in during their service or employment or over which they had a substantial or material administrative discretion. S.32 FOB DESTINATION FREIGHT PREPAID AND ALLOWED. All deliveries will be FOB destination freight prepaid and allowed unless otherwise agreed. S.33 RISK OF LOSS. Contractor agrees to bear all risks of loss, injury, or destruction of goods or equipment incidental to providing these services and such loss, injury, or destruction will not release Contractor from any obligation hereunder. S.34 SAFEGUARDING CITY PROPERTY. Contractor will be responsible for any damage to City real property or damage or loss of City personal property when such property is the responsibility of or in the custody of Contractor or its employees. S.35 WARRANTY OF RIGHTS. Contractor warrants it has title to, or the right to allow the City to use, the materials and services being provided and that the City may use same without suit, trouble or hindrance from Contractor or third parties. S.36 PROPRIETARY RIGHTS INDEMNIFICATION. Without limiting the foregoing, Contractor will without limitation, at its expense defend the City against all claims asserted by any person that anything provided by Contractor infringes a patent, copyright, trade secret or other intellectual property right and must, without limitation, pay the costs, damages and attorneys' fees awarded against the City in any such action, or pay any settlement of such action or claim. Each party agrees to notify the other promptly of any matters to which this provision may apply and to cooperate with each other in connection with such defense or settlement. If a preliminary or final judgment is obtained against the City’s use or operation of the items provided by Contractor hereunder or any part thereof by reason of any alleged infringement, Contractor will, at its expense and without limitation, either: (a) modify the item so that it becomes non-infringing; (b) procure for the City the right to continue to use the item; (c) substitute for the infringing item other item(s) having at least equivalent capability; or (d) refund to the City an amount equal to the price paid, less reasonable usage, from the time of installation acceptance through cessation of use, which amount will be calculated on a useful life not less than five (5) years, plus any additional costs the City may incur to acquire substitute supplies or services. S.37 CONTRACT ADMINISTRATION. The contract will be administered by the Procurement Administrator and/or an authorized representative from the using department. All questions STANDARD TERMS AND CONDITIONS Laboratory Services 14 ITB #43-20 regarding the contract will be referred to the administrator for resolution. Supplements may be written to the contract for the addition or deletion of services. Payment will be negotiated and determined by the contract administrator(s). S.38 FORCE MAJEURE. Failure by either party to perform its duties and obligations will be excused by unforeseeable circumstances beyond its reasonable control, including acts of nature, acts of the public enemy, riots, fire, explosion, legislation, and governmental regulation. The party whose performance is so affected will within five (5) calendar days of the unforeseeable circumstance notify the other party of all pertinent facts and identify the force majeure event. The party whose performance is so affected must also take all reasonable steps, promptly and diligently, to prevent such causes if it is feasible to do so, or to minimize or eliminate the effect thereof. The delivery or performance date will be extended for a period equal to the time lost by reason of delay, plus such additional time as may be reasonably necessary to overcome the effect of the delay, provided however, under no circumstances will delays caused by a force majeure extend beyond one hundred-twenty (120) calendar days from the scheduled delivery or completion date of a task unless agreed upon by the parties. S.39 COOPERATIVE USE OF CONTRACT. The City has entered into various cooperative purchasing agreements with other Florida government agencies, including the Tampa Bay Area Purchasing Cooperative. Under a Cooperative Purchasing Agreement, any contract may be extended for use by other municipalities, school districts and government agencies in the State of Florida with the approval of Contractor. Any such usage by other entities must be in accordance with the statutes, codes, ordinances, charter and/or procurement rules and regulations of the respective government agency. Orders placed by other agencies and payment thereof will be the sole responsibility of that agency. The City is not responsible for any disputes arising out of transactions made by others. S.40 FUEL CHARGES AND PRICE INCREASES. No fuel surcharges will be accepted. No price increases will be accepted without proper request by Contractor and response by the City’s Procurement Division. S.41 NOTICES. All notices to be given pursuant to this Agreement must be delivered to the parties at their respective addresses. Notices may be (i) personally delivered; (ii) sent via certified or registered mail, postage prepaid; (iii) sent via overnight courier; or (iv) sent via facsimile. If provided by personal delivery, receipt will be deemed effective upon delivery. If sent via certified or registered mail, receipt will be deemed effective three (3) calendar days after being deposited in the United States mail. If sent via overnight courier or facsimile, receipt will be deemed effective two (2) calendar days after the sending thereof. S.42 GOVERNING LAW, VENUE. This Agreement is governed by the laws of the State of Florida. The exclusive venue selected for any proceeding or suit in law or equity arising from or incident to this Agreement will be Pinellas County, Florida. S.43 INTEGRATION CLAUSE. This Agreement, including all attachments and exhibits hereto, supersede all prior oral or written agreements, if any, between the parties and constitutes the entire agreement between the parties with respect to the work to be performed. S.44 PROVISIONS REQUIRED BY LAW. Any provision required by law to be in this Agreement is a part of this Agreement as if fully stated in it. S.45 SEVERABILITY. If any provision of this Agreement is declared void or unenforceable, such provision will be severed from this Agreement, which will otherwise remain in full force and effect. The parties will negotiate diligently in good faith for such amendment(s) of this Agreement as may be necessary to achieve the original intent of this Agreement, notwithstanding such invalidity or unenforceability. STANDARD TERMS AND CONDITIONS Laboratory Services 15 ITB #43-20 S.46 SURVIVING PROVISIONS. Notwithstanding any completion, termination, or other expiration of this Agreement, all provisions which, by the terms of reasonable interpretation thereof, set forth rights and obligations that extend beyond completion, termination, or other expiration of this Agreement, will survive and remain in full force and effect. Except as specifically provided in this Agreement, completion, termination, or other expiration of this Agreement will not release any party from any liability or obligation arising prior to the date of termination. DETAILED SPECIFICATIONS Laboratory Services 16 ITB #43-20 1. INTRODUCION. The City of Clearwater (City) is located on the West Coast of Florida in the Tampa Bay region. It is the third largest city in the region with an estimated population of 116,585 residents. The City of Clearwater is a major tourist destination – Clearwater Beach was recently rated #1 U.S. Beach by TripAdvisor, previously named “Florida’s Best Beach Town 2013” by USA Today, and was on the “Top Ten List of Best Beaches from Maine to Hawaii”. The City of Clearwater is home to the Philadelphia Phillies Spring Training and Clearwater Threshers Minor League Baseball and hosts several sports tournaments through the year that attract visitors from across the country. Clearwater is home for Winter the Dolphin and the Clearwater Marine Aquarium. Winter’s story has made it all the way to Hollywood in the motion pictures “Dolphin Tale” and “Dolphin Tale 2”, both filmed here in Clearwater. 2. INTENT. It is the intent of this solicitation to establish a contract(s) whereby comprehensive laboratory analytical services for potables, non-potables, wastewater residuals and any other required environmental testing, will be accomplished for the City of Clearwater (City), by a qualified firm(s) in accordance with these specifications and under the terms of all applicable Federal, State, and local regulations. All services are to be performed for fixed pricing in an accurate, reliable, and timely manner, using approved methodology. 3. SCOPE OF WORK. The awarded Contractor shall provide all labor, supplies, materials, professional equipment, vehicles, tools and supervision necessary to perform the laboratory services and sampling procedures as specified in these technical specifications. All work must be performed in a manner satisfactory to and acceptable by the City and in accordance with all Federal, State, or local regulations in their most recent form. Samples that require courier services shall be picked up at the City of Clearwater Public Utilities Lab or another agreed upon location. The physical address of the City of Clearwater Public Utilities Lab is 1605 Harbor Drive, Clearwater, Florida, 33755. The locations of the City groups to be served by this contract are presented in the table below: Facility Name Facility Address East Water Reclamation Facility 3141 Gulf to Bay Blvd. Clearwater, FL 33759 Marshall Street Water Reclamation Facility 1605 Harbor Drive Clearwater, FL 33755 Northeast Water Reclamation Facility 3290 State Road 580 Clearwater, FL 34695 City of Clearwater Industrial Pretreatment Program 1605 Harbor Drive Clearwater, FL 33755 Clearwater - RO1 1657 Palmetto Street Clearwater, FL 33765 Clearwater – RO2 21133 US 19 N Clearwater, FL 33765 Clearwater – WTP3 2721 State Road 580 Clearwater, FL 33761 4. MINIMUM QUALIFICATIONS. Bidders may be required to demonstrate that they have the resources and capability to provide laboratory services as prescribed herein. The following criteria must be met in order to be eligible for this contract. If any of the following qualifiers are not met a bidder will be found non-responsible: a. Must be certified by the Florida Department of Health (FDOH) according to the Florida Administrative Code Chapter 64E-1: Certification of Environmental Testing Laboratories b. Must be National Environmental Laboratory Accreditation Program (NELAP) certified DETAILED SPECIFICATIONS Laboratory Services 17 ITB #43-20 c. Have at least five (5) years of experience providing laboratory services to the water and wastewater industry d. Provide a minimum of four (4) current, comparable references, preferably governmental. At least one (1) water and one (1) wastewater reference must be within a 100-mile radius of the Florida Department of Environmental Protection (FDEP) Southwest District office e. Have a fully functional Laboratory Information Management System (LIMS) f. Have the ability to upload results to the City’s Accelerated Technology Laboratories Inc. (ATL) Sample Master LIMS system g. Subcontract no more than fifty percent (50%) of the services required 5. SUBMITTALS. Bidder shall submit the following documentation with their bid response: a. A copy of certification(s), from the Florida Department of Health (FDOH) in accordance with all National Environmental Laboratory Accreditation Program (NELAP) requirements (for the analytes and sample matrices bidder is providing pricing for in Exhibit A- Bid Pricing). Any analyte for which a current certification is not held must be listed on the Exceptions/Additional Materials/Addenda form with a listing of the subcontractor(s) that the work is to be subcontracted to. b. A Scope of Accreditation issued by/as provided to the Laboratory Accreditation Bureau (L- A-B) c. Copies of FDOH Proficiency Testing for the past two (2) years d. A summary of any litigation filed against the laboratory in the past five (5) years that is related to the services to be provided. The summary should state the nature of the litigation, a brief description of the case, the outcome or projected outcome, and the monetary amounts involved. NOTE: this is not considered Confidential or Proprietary information –any response indicating such maybe deemed non-responsive to the bid. e. A qualifications statement listing history of the firm, description of firm’s business structure (partnership, sole ownership, corporation, etc.) current staff and instrumentation, and any other statements or information on the firm’s qualifications as deemed appropriate f. References as noted in item 4.d. above g. If subcontractors are utilized, any such laboratories that are subcontracted should be identified by name and location and a copy of their FDOH/NELAP Certification and scope of accreditation provided at the time of bid h. Exhibit A- Bid Pricing must be submitted in a Microsoft Excel worksheet (hard copy submitssion should include Exhibit A on CD or Thumb Drive)  All yellow and blue highlighted cells in all tabs of the “Exhibit A- Bid Pricing” spreadsheet must be completed. Bidders that do not complete all cells will be deemed non-responsive and disqualified. 6. CITY RESPONSIBILITY. a. City shall collect all samples at designated locations unless specifically noted in Exhibit A- Bid Pricing. b. City will provide contact information for primary and secondary contact persons. c. City will provide a digital copy of the current permit(s) and/or regulatory limits. 7. CONTRACTOR RESPONSIBILITIES. A. GENERAL PROCEDURES. a. Contractor shall perform analytical work including, but not limited to, the analytes noted in Exhibit A- Bid Pricing. b. Contractor shall provide all necessary material for collection, storage, and shipping. All materials must be in accordance with the standard requirements for each sample, i.e., proper bottle and proper preservative (as necessary). c. Contractor will provide sampling kit bottles which shall be clearly labeled. Each kit should include any special packing material for proper storage and shipping. Any sample kits that require preservatives must be properly prepared and sealed to ensure that no leakage occurs prior to drop off to the City. DETAILED SPECIFICATIONS Laboratory Services 18 ITB #43-20 d. The City requires samples to be picked up daily, seven (7) days a week including holidays. e. Contractor will perform special sampling procedures where applicable in accordance with FDEP Standard Operating Procedures (SOP)s, including documenting chain of custody. f. For all samples, all work shall be in accordance with applicable Florida Administrative Code. g. The Contractor shall conform to all Federal, State, and local regulations during the performance of thecontract. Any fines levied due to inadequacies or failure of Contractor to comply with any and all requirements will be the sole responsibility of the Contractor. Any person found not in conformance with any laws, statutes, rules, or regulations will not be allowed on the job site. Continued violations by a Contractor could constitute cause for immediate termination of the contract. h. If award is made to include courier services, a schedule of pick-up and delivery times for samples and/or containers from the laboratory to the City’s designated locations and from the City’s designated locations to the laboratory or agreed upon location shall be established and adhered to. Variations to the courier schedule shall be approved by the City’s primary or secondary contact. i. Upon award of the contract, the Contractor shall provide all physical locations that analysis are performed. This stipulation applies to both analyses performed by the Contractor and by their subcontractors. j. Within thirty (30) days of the award of the contract, the Contractor shall facilitate a kickoff meeting at their facility between the City and the Contractor. k. The Contractor shall report all sample results to the designated City contact within two (2) weeks of receipt of sample(s). The Contractor acknowledges that time is of the essence to complete the work as specified in the contract. The Contractor agrees that all work shall be processed regularly, diligently, and uninterrupted at such a rate of progress as will ensure full completion thereof within the time specified. l. In the event that samples are lost, spilled, not analyzed within proper holding time, or take longer than two (2) weeks to report, the contractor shall reanalyze the sample or analyze replacement samples at no additional cost to the City. Continued violations by a Contractor could constitute cause for immediate termination of the contract. m. Contractor must provide a written narrative with any revised report related to sampling issues that explain an unusual result or analytical complication. This narrative shall identify the cause of the unusual result(s). n. Contractor must provide the City with all Discharge Monitoring Report Quality Analysis (DMRQA) results and analyte list as they are received. o. Contractor must provide the City with the lab’s master DEP/NELAP qualifier list. p. The Contractor must have and maintain a Florida Department of Environmental Protection/Department of Health approved Quality Assurance/Quality Manual. This manual shall be submitted electronically upon request by the City. q. The Contractor must have and maintain a Florida Department of Environmental Protection approved Field Sampling Quality Manual. In lieu of having an approved manual, the laboratory may use the most recent version of Florida Department of Environmental Protection’s Field Sampling Manual. This manual shall be submitted electronically upon request by the City. r. The Contractor must provide to the City an updated Lab Certificate annually or upon request. B. EMERGENCY AVAILABILITY. The Contractor must be able to provide services for the City during an emergency event such as a terrorist attack, natural calamities, a sanitary sewer overflow, and unsafe drinking water alert. The qualified firm must provide a list of contact numbers for a twenty-four (24) hour emergency event. The emergency contact list shall have the person’s work phone number and cellular number. DETAILED SPECIFICATIONS Laboratory Services 19 ITB #43-20 C. NOTIFICATIONS. a. The City will provide awarded Contractor(s) with names and contact information for primary contact and secondary contacts. Secondary contacts will vary due to sampling location and sample type. b. Contractor must immediately notify the primary and appropriate secondary contact of any preliminary total and fecal positive results and perform confirmation on all positive fecal results. Immediate notification shall be made by telephone call(s) and email notification(s). Voice mail messages are not considered appropriate notification. c. Contractor must provide email notification to primary and secondary contacts for permit exceedances within twenty-four (24) hours of occurrence, even if sample is being re-run. d. IMPORTANT: In the event that any sample result exceeds the established provided permit limitations (see section item 6.c above) or levels provided by the City, the Contractor shall notify the City’s primary and appropriate secondary contacts via email notification within twenty-four (24) hours. Certain analytes may require notification at levels less than established permit requirements. The City will provide any notification requirements for analytes that are detectable, but less that permit requirements. e. In the event testing results are incomplete, or not in accordance with these specifications or Federal or State guidelines, due to the actions of the Contractor, the Contractor shall immediately notify the City’s designated contact and re-testing will be done at no additional cost to the City. The City shall not be charged for analyses performed beyond regulatory standard holding times and shall be provided written documentation as to why the hold time was exceeded. f. In the event that the Contractor changes analytical methods, the City shall be notified prior to method change. All analysis shall be performed using an approved method. 8. REPORTING. A. ANALYTICAL DATA REPORTING. After the test/analysis has been completed, the Contractor shall provide the following information, in accordance with NELAP requirements, to the City’s primary and appropriate secondary contact: a. Time sample prepared b. Parameter c. Project name d. Lab manager signature e. Sample dilution f. Time received g. Analyst h. Analytical Results Concentration units i. Results of Analysis j. Definitions for abbreviations used k. Date and Time sampled l. Date and Time analyzed m. Method used for each analysis n. Method Detection limits (MDL) o. Location or Sample ID #, Sample Location and Name p. NELAP Certification # q. Sample matrix r. Practical Quantification Limits (PQL) s. Qualifiers/Footnotes and any specific problems encountered during analysis (i.e. insufficient sample, etc.) These results shall be transmitted via electronic report as approved by the City for uploading into the City’s Laboratory Information Management System (LIMS) software. The electronic report shall be formatted in ".xls" (Microsoft Excel) and shall also include a signed, Portable Document Format (PDF) version and a PDF chain of custody (COC) form. DETAILED SPECIFICATIONS Laboratory Services 20 ITB #43-20 Upon Award, the City will provide a Microsoft Excel template file containing predetermined column naming and formatting requirements for use by the Contractor. The Contractor shall maintain and, as necessary, provide all of the historical laboratory results and associated documentation for the length of the contract. B. LABORATORY PROJECT FILE. The Lab project file shall include a printout of all raw analytical data, electronic copy, and other information not included in the analytical data report. The file shall be available for review by the City upon seven (7) calendar days’ notice, if requested. Information in the Lab project file (in addition to the material contained in the analytical data report) shall include, but not be limited to: a. Printout of all analytical Quality Analysis/Quality Control (QA/QC) data; b. Copy of shipping manifest; c. Standard logs, Lab notebooks, and instrument logs; d. Results of Lab blanks; e. Results of instrument calibration; f. Raw analytical data, charts, and chromatograms for samples, standards, and blanks; and g. Raw data calculation worksheets. 9. PRICING. The Contractor shall bid on a per sample, per specimen basis. Any other type of bid shall not be considered and will not be accepted. This ITB is for work not currently being performed by the City’s laboratory as well as back-up in the event that the City’s laboratory cannot perform analysis for any reason. The samples normally run by the City’s laboratory have been identified in the pricing worksheets of Exhibit A- Bid Pricing in Column E with an “X”. Exhibit A- Bid Pricing, is provided in Microsoft Excel format:  There is one (1) workbook with six (6) tabs. Only the “Cost per Sample”, the “cost per item” cells, and the vendor name are editable on the first five (5) tabs.  These sheets will automatically calculate the unit costs and total each sheet accordingly.  Provide “Cost per Sample” and any per hour rates.  Only the “Cost per Sample” fields that are highlighted in yellow will be calculated and added to the “SUMMARY” tab. The individual “Cost per Sample” items that make up a group, highlighted in blue, will not be calculated.  Save the Microsoft Excel workbook and upload on the website if submitting electronically or transfer onto a CD or thumb drive as “Bid 43-20 VENDOR NAME”, if submitting a hard copy.  The City reserves the right to make multiple awards if in the best interest of the City to do so. For Exhibit A – Bid Pricing: ATTENTION: ALL yellow and blue highlighted cells in ALL tabs must be completed to be deemed responsive to this bid. a. For Groups 1, 2 and 3:  Pricing shall include all necessary labor and materials for testing of the sample collected by the City using Contractor supplied sample kits and delivered to the Contractor.  Column C delineates grouped and ungrouped analysis.  The City may elect to request analysis results of one (1) compound even if it is run in a group or the analysis for the whole group.  Ungrouped items and the sum of a group will be used for award purposes.  Individual analytes that comprise a group are highlighted in blue. The blue highlighted individual analysis is the price the vendor would charge to run an analyte ungrouped. These individual analytes will not be considered as a basis for award. DETAILED SPECIFICATIONS Laboratory Services 21 ITB #43-20  Contractor must provide a price for ungrouped analysis, grouped analysis, and individual analysis. b. For Group 4:  Courier & Sample shall include all costs associated with the description outlined in Column B. The City intends to select a combination of services.  While the majority of samples will be picked up at the City Lab, there will be occasion for the samples to be picked up by the Contractor at an alternate agreed upon location within Clearwater, or for the samples to be collected and picked up by the Contractor at an agreed upon location other than the City Lab. c. For Group 5 Contingency on the SUMMARY:  Contains a fixed amount that will not be altered and remains constant for all bidders. This contingency will be used for sampling and analysis not specifically priced in the other tabs on the pricing spreadsheet. 10. ORDER OF PRECEDENCE. All work is subject to the terms and conditions of the contract, specifications and all bid documents. In the event of a conflict between a Work Order and the contract, the contract/bid documents shall have precedence. Work orders must accompany each invoice detailing the date of service and type of test provided. Invoices must be legibly prepared showing the full description and price of services performed. 11. CONTRACTOR’S REPRESENTATIVE. During the term of the contract, the Contractor shall have a representative available who is qualified to explain testing procedures and results, and to provide written documentation of such to City staff in case of questions or discrepancies. Said representative will be available within a twenty-four (24) hour notification. 12. PERFORMANCE MONITORING. The City will provide regular feedback to the Contractor on their performance as outlined above and a quarterly update status report of any issues that arise. Additionally, the City reserves the right for a quarterly meeting with the Contractor to discuss performance. The Contractor will provide accessibility for City representatives to perform annual quality assessment of the lab(s) and subcontracted labs. The City reserves the right to perform periodic on- site audits to ensure compliance with analytical method requirements, QA/QC program requirements, and to evaluate the general quality of the work. The Lab shall cooperate and make available records and personnel to facilitate the audits. Audits will be scheduled with sufficient notice and conducted during normal business hours. The Contractor will notify the City of any certification or accreditation changes before any work affected by the change is performed. The Contractor will provide copies of Proficiency testing results to the City upon request. The City reserves the right to contract with an alternate laboratory (third-party), duly certified, for split sampling in order to verify the analytical performance of the Contractor. The results from the split samples shall be compared to the Service Providers analytical data to determine if there is a deficiency in performance. Any resulting deficiency or concerns shall then be addressed and a corrective action plan submitted by the Contractor to the City for consideration. 13. PAYMENTS AND INVOICING. The Contractor shall email an invoice to the City of Clearwater Public Utilities Accounting Division for payment upon their schedule but not more frequently than once every thirty-day period. The invoice must be reconciled between the Contractor and the Utilities Lab Manager/designee before payment on any disputed invoice will be authorized. Contractor shall provide any and all reports and/or data required by any applicable Federal, State, and/or Local DETAILED SPECIFICATIONS Laboratory Services 22 ITB #43-20 regulatory agency rule and/or regulation. City of Clearwater Public Utilities Accounting Division PubUtilAccounting@MyClearwater.com 1650 N. Arcturas Ave., Bldg. C Clearwater, FL 33765 14. REFERENCES. Bidder shall provide with bid, via Exhibit B- References, a minimum of four (4) current customer references, preferably from another governmental agency. At least one (1) water and one (1) wastewater reference must be within a 100-mile radius of the Florida Department of Environmental Protection (FDEP) Southwest District. Vendors that do not meet the reference requirements of this bid shall not be considered and will not be accepted. 15. INSURANCE REQUIREMENTS. The Vendor shall, at its own cost and expense, acquire and maintain (and cause any subcontractors, representatives or agents to acquire and maintain) during the term with the City, sufficient insurance to adequately protect the respective interest of the parties. Coverage shall be obtained with a carrier having an AM Best Rating of A-VII or better. In addition, the City has the right to review the Contractor’s deductible or self-insured retention and to require that it be reduced or eliminated. Specifically the Vendor must carry the following minimum types and amounts of insurance on an occurrence basis or in the case of coverage that cannot be obtained on an occurrence basis, then coverage can be obtained on a claims-made basis with a minimum three (3) year tail following the termination or expiration of this Agreement: a. Commercial General Liability Insurance coverage, including but not limited to, premises operations, products/completed operations, products liability, contractual liability, advertising injury, personal injury, death, and property damage in the minimum amount of $1,000,000 (one million dollars) per occurrence and $2,000,000 (two million dollars) general aggregate. b. Commercial Automobile Liability Insurance coverage for any owned, non-owned, hired or borrowed automobile is required in the minimum amount of $1,000,000 (one million dollars) combined single limit. c. Unless waived by the State of Florida and proof of waiver is provided to the City, statutory Workers’ Compensation Insurance coverage in accordance with the laws of the State of Florida, and Employer’s Liability Insurance in the minimum amount of $500,000 (five hundred thousand dollars) each employee each accident, $500,000 (five hundred thousand dollars) each employee by disease, and $500,000 (five hundred thousand dollars) disease policy limit. Coverage should include Voluntary Compensation, Jones Act, and U.S. Longshoremen’s and Harbor Worker’s Act coverage where applicable. Coverage must be applicable to employees, contractors, subcontractors, and volunteers, if any. d. Professional Liability Insurance coverage appropriate for the type of business engaged in by the Contractor with minimum limits of $1,000,000 (one million dollars) per occurrence. If a claims made form of coverage is provided, the retroactive date of coverage shall be no later than the inception date of claims made coverage, unless prior policy was extended indefinitely to cover prior acts. Coverage shall be extended beyond the policy year either by a supplemental extended reporting period (ERP) of as great a duration as available, and with no less coverage and with reinstated aggregate limits, or by requiring that any new policy provide a retroactive date no later than the inception date of claims made coverage. e. Pollution Liability Insurance coverage, which covers any and all losses caused by pollution conditions (including sudden and non-sudden pollution conditions) arising from the servicing and operations of Vendor (and any subcontractors, representatives, or agents) involved in the work/transport, in the minimum amount of $1,000,000 (one million dollars) per occurrence and $2,000,000 (two million dollars) general aggregate. DETAILED SPECIFICATIONS Laboratory Services 23 ITB #43-20 The above insurance limits may be achieved by a combination of primary and umbrella/excess liability policies. Other Insurance Provisions. a. Prior to the execution of this Agreement, and then annually upon the anniversary date(s) of the insurance policy’s renewal date(s) for as long as this Agreement remains in effect, the Vendor will furnish the City with a Certificate of Insurance(s) (using appropriate ACORD certificate, SIGNED by the Issuer, and with applicable endorsements) evidencing all of the coverage set forth above and naming the City as an “Additional Insured” on the Commercial General Liability Insurance and Auto Liability policies. In addition, when requested in writing from the City, Vendor will provide the City with certified copies of all applicable policies. The address where such certificates and certified policies shall be sent or delivered is as follows: City of Clearwater Attn: Procurement Division, ITB #43-20 P.O. Box 4748 Clearwater, FL 33758-4748 b. Vendor shall provide thirty (30) days written notice of any cancellation, non-renewal, termination, material change or reduction in coverage. c. Vendor’s insurance as outlined above shall be primary and non-contributory coverage for Vendor’s negligence. d. Vendor reserves the right to appoint legal counsel to provide for the Vendor’s defense, for any and all claims that may arise related to Agreement, work performed under this Agreement, or to Vendor’s design, equipment, or service. Vendor agrees that the City shall not be liable to reimburse Vendor for any legal fees or costs as a result of Vendor providing its defense as contemplated herein. The stipulated limits of coverage above shall not be construed as a limitation of any potential liability to the City, and City’s failure to request evidence of this insurance shall not be construed as a waiver of Vendor’s (or any contractors’, subcontractors’, representatives’ or agents’) obligation to provide the insurance coverage specified. MILESTONES Laboratory Services 24 ITB #43-20 1. BEGINNING AND END DATE OF INITIAL TERM. September 2020 - August 2021 If the commencement of performance is delayed because the City does not execute the contract on the start date, the City may adjust the start date, end date and milestones to reflect the delayed execution. 2. EXTENSION. The City reserves the right to extend the term of this contract, provided however, that the City shall give written notice of its intentions to extend this contract no later than thirty (30) days prior to the expiration date of the contract. 3. RENEWAL. At the end of the initial term of this contract, the City may initiate renewal(s) as provided. The decision to renew a contract rests solely with the City. The City will give written notice of its intention to renew the contract no later than thirty (30) days prior to the expiration. Two (2), one (1) year renewals possible at the City’s option. 4. PRICES. All pricing shall be firm for the initial term of one (1) year; except where otherwise provided by the specifications, and include all transportation, insurance and warranty costs. The City shall not be invoiced at prices higher than those stated in any contract resulting from this bid. The Contractor certifies that the prices offered are no higher than the lowest price the Contractor charges other buyers for similar quantities under similar conditions. The Contractor further agrees that any reductions in the price of the goods or services covered by this bid and occurring after award will apply to the undelivered balance. The Contractor shall promptly notify the City of such price reductions. During the sixty (60) day period prior to each annual anniversary of the contract effective date, the Contractor may submit a written request that the City increase the prices in an amount for no more than the twelve month change in the Consumer Price Index for All Urban Consumers (CPI-U), US City Average, All Items, Not Seasonally Adjusted as published by the U.S. Department of Labor, Bureau of Labor Statistics (http://www.bls.gov/cpi/home.htm), and limited to 3% annually. The City shall review the request for adjustment and respond in writing; such response and approval shall not be unreasonably withheld. At the end of the initial term, pricing may be adjusted for amounts other than inflation based on mutual agreement of the parties after review of appropriate documentation. Renewal prices shall be firm for at least one year and may be adjusted thereafter as outlined in the previous paragraph. No fuel surcharges will be accepted. BID SUBMISSION Laboratory Services 25 ITB #43-20 1. BID SUBMISSION. It is recommended that bids are submitted electronically through our bids website at https://www.myclearwater.com/business/rfp. For bids mailed and/or hand-delivered, bidder must submit one (1) signed original bid and one (1) electronic format on a CD or Thumb Drive, in a sealed container using label provided at the end of this solicitation. 2. BIDDER RESPONSE CHECKLIST. This checklist is provided for your convenience. It is not necessary to return a copy of this solicitation’s Instructions, Terms and Conditions, or Detailed Specifications with your bid response. NOTE: Every bid received by the City will be considered a public record pursuant to Chapter 119, Florida Statutes. Any response marked confidential may be deemed non-responsive to this ITB. Submit the following requested forms and requested documents or descriptive literature: Bid container properly labeled Original and proper number of copies with electronic format: for mail or hand delivery of bid Exceptions/Additional Materials/Addenda form completed Vendor Information form completed Scrutinized Companies form Offer Certification form completed W-9 Request for Taxpayer Identification Number and Certification form completed (http://www.irs.gov/pub/irs-pdf/fw9.pdf) Bid Pricing form (Exhibit A- Bid Pricing) completed, submitted electronic on MS Excel spreadsheet or a copy on CD or Thumb Drive and properly labeled for mail or hand delivery of bid References form (Exhibit B- References) completed A copy of certification(s) from the Florida Department of Health (FDOH) under 64E-1 A Scope of Accreditation issued by/as provided to the Laboratory Accreditation Bureau (L-A-B Copies of FDOH Proficiency Testing for the past two (2) years Litigation Information - A summary of any litigation filed against the laboratory in the past five (5) years that is related to the services to be provided. The summary should state the nature of the litigation, a brief description of the case, the outcome or projected outcome, and the monetary amounts involved. A qualifications statement listing history of the firm, description of firm’s business structure (partnership, sole ownership, corporation, etc.) current staff and instrumentation, and any other statements or information on the firm’s qualifications as deemed appropriate A copy of the National Environmental Laboratory Accreditation Program (NELAP) certification(s) for the analytes and sample matrices for which bidder is providing pricing. Subcontractor Information - identify subcontracted laboratories, provide a copy of their FDOH/NELAP Certification and Approved Analyte Sheet BID PRICING Laboratory Services 26 ITB #43-20 Pursuant to all the contract specifications enumerated and described in this solicitation, we agree to furnish Laboratory Services to the City of Clearwater at the price(s) stated in Exhibit A- Bid Pricing (attached). DELIVERY REQUIREMENTS FOB: Destination, Freight Prepaid and Allowed Freight Costs: Unit prices should include all shipping and transportation charges. Delivery, as stated in Detailed Specifications, can be met _____ Yes _____ No If no, specify number of days for delivery PAYMENT TERMS City of Clearwater’s standard payment terms are NET30 Vendor: _________________________________________ Date: _______________________________ EXCEPTIONS/ADDITIONAL MATERIALS/ADDENDA Laboratory Services 27 ITB #43-20 Bidders shall indicate any and all exceptions taken to the provisions or specifications in this solicitation document. Exceptions that surface elsewhere and that do not also appear under this section shall be considered invalid and void and of no contractual significance. Exceptions (mark one): Note – Any material exceptions taken to the City’s Standard Terms and Conditions will render a Bid Non-responsive. No exceptions Exceptions taken (describe--attach additional pages if needed) Additional Materials submitted (mark one): No additional materials have been included with this bid Additional Materials attached (describe--attach additional pages if needed) Addenda Bidders are responsible for verifying receipt of any addenda issued by checking the City’s website at http://www.myclearwater.com/business/bid-information/ prior to the bid opening. Failure to acknowledge any addenda issued may result in a response being deemed non-responsive. Acknowledgement of Receipt of Addenda (initial for each addenda received, if applicable): Addenda Number Initial to acknowledge receipt Vendor Name ____ Date: ____ VENDOR INFORMATION Laboratory Services 28 ITB #43-20 Company Legal/Corporate Name: Doing Business As (if different than above): Address: City: State: Zip: - Phone: Fax: E-Mail Address: Website: DUNS # Remit to Address (if different than above): Order from Address (if different from above): Address: Address: City: State: Zip: City: State: Zip: Contact for Questions about this bid: Name: Fax: Phone: E-Mail Address: Day-to-Day Project Contact (if awarded): Name: Fax: Phone: E-Mail Address: Certified Small Business Certifying Agency: Certified Minority, Woman or Disadvantaged Business Enterprise Certifying Agency: SCRUTINIZED COMPANIES Laboratory Services 29 ITB #43-20 SCRUTINIZED COMPANIES THAT BOYCOTT ISRAEL LIST CERTIFICATION FORM THIS FORM MUST BE COMPLETED AND SUBMITTED WITH THE BID/PROPOSAL. FAILURE TO SUBMIT THIS FORM AS REQUIRED MAY DEEM YOUR SUBMITTAL NONRESPONSIVE. The affiant, by virtue of the signature below, certifies that: 1. The vendor, company, individual, principal, subsidiary, affiliate, or owner is aware of the requirements of section 287.135, Florida Statutes, regarding companies on the Scrutinized Companies that Boycott Israel List, or engaged in a boycott of Israel; and 2. The vendor, company, individual, principal, subsidiary, affiliate, or owner is eligible to participate in this solicitation and is not listed on the Scrutinized Companies that Boycott Israel List, or engaged in a boycott of Israel; and 3. “Boycott Israel” or “boycott of Israel” means refusing to deal, terminating business activities, or taking other actions to limit commercial relations with Israel, or persons or entities doing business in Israel or in Israeli-controlled territories, in a discriminatory manner. A statement by a company that it is participating in a boycott of Israel, or that it has initiated a boycott in response to a request for a boycott of Israel or in compliance with, or in furtherance of, calls for a boycott of Israel, may be considered as evidence that a company is participating in a boycott of Israel; and 4. If awarded the Contract (or Agreement), the vendor, company, individual, principal, subsidiary, affiliate, or owner will immediately notify the City of Clearwater in writing, no later than five (5) calendar days after any of its principals are placed on the Scrutinized Companies that Boycott Israel List, or engaged in a boycott of Israel. __________________________________________ Authorized Signature __________________________________________ Printed Name __________________________________________ Title __________________________________________ Name of Entity/Corporation STATE OF _____________________ COUNTY OF ___________________ The foregoing instrument was acknowledged before me on this ______ day of _____________________, 20____, by _________________________________ (name of person whose signature is being notarized) as the ________________________ (title) of ________________________________________ (name of corporation/entity), personally known to me as described herein _____________________, or produced a _________________________ (type of identification) as identification, and who did/did not take an oath. ______________________________________ _ Notary Public ____________________________________ Printed Name My Commission Expires: __________________ NOTARY SEAL ABOVE OFFER CERTIFICATION Laboratory Services 30 ITB #43-20 By signing and submitting this Bid, the Vendor certifies that: a) It is under no legal prohibition on contracting with the City of Clearwater. b) It has read, understands, and is in compliance with the specifications, terms and conditions stated herein, as well as its attachments, and any referenced documents. c) It has no known, undisclosed conflicts of interest. d) The prices offered were independently developed without consultation or collusion with any of the other respondents or potential respondents or any other anti-competitive practices. e) No offer of gifts, payments or other consideration were made to any City employee, officer, elected official, or consultant who has or may have had a role in the procurement process for the services and or goods/materials covered by this contract. f) It understands the City of Clearwater may copy all parts of this response, including without limitation any documents and/or materials copyrighted by the respondent, for internal use in evaluating respondent’s offer, or in response to a public records request under Florida’s public records law (F.S. 119) or other applicable law, subpoena, or other judicial process; provided that Clearwater agrees not to change or delete any copyright or proprietary notices. g) Respondent hereby warrants to the City that the respondent and each of its subcontractors (“Subcontractors”) will comply with, and are contractually obligated to comply with, all Federal Immigration laws and regulations that relate to their employees. h) Respondent certifies that they are not in violation of section 6(j) of the Federal Export Administration Act and not debarred by any Federal or public agency. i) It will provide the materials or services specified in compliance with all Federal, State, and Local Statutes and Rules if awarded by the City. j) It is current in all obligations due to the City. k) It will accept such terms and conditions in a resulting contract if awarded by the City. l) The signatory is an officer or duly authorized agent of the respondent with full power and authority to submit binding offers for the goods or services as specified herein. ACCEPTED AND AGREED TO: Company Name: Signature: Printed Name: Title: Date: MAILING LABEL CUT ALONG THE LINE AND AFFIX TO THE FRONT OF YOUR BID CONTAINER Laboratory Services 31 ITB #43-20 --------------------------------------------------------------------------------- For US Mail ------------------------------------------------------------------------------ SEALED BID Submitted by: Company Name: Address: City, State, Zip: ITB #43-20, Laboratory Services Due Date: July 29, 2020 at 10:00 A.M. City of Clearwater Attn: Procurement PO Box 4748 Clearwater FL 33758-4748 --------------------------------------------------------------------------------- For US Mail ------------------------------------------------------------------------------ ---------------------------------------------- For Hand Deliveries, FEDEX, UPS or Other Courier Services ------------------------------------------------ SEALED BID Submitted by: Company Name: Address: City, State, Zip: ITB #43-20, Laboratory Services Due Date: July 29, 2020 at 10:00 A.M. ---------------------------------------------- For Hand Deliveries, FEDEX, UPS or Other Courier Services ------------------------------------------------ City of Clearwater Attn: Procurement 100 S Myrtle Ave 3rd Fl Clearwater FL 33756-5520 CITY OF CLEARWATER ITB # 43-20, Laboratory Services DUE DATE: August 5, 2020; 10:00 AM BID TABULATION Group No Description Advanced Environmental Laboratories Flowers Chemical Laboratories, Inc.Pace Analytical Total Price Total Price Total Price 1 Water Reclamation Facilities $222,546.00 $153,282.00 $247,466.00 2 Drinking Water - DEP and SWFWMD Sampling WTP & RO WTP Discharge $99,471.00 $89,756.00 $78,785.00 3 Industrial Pretreatment $17,914.00 $23,781.00 $16,997.00 4 Courier and Sample Collection $20,675.00 $24,650.00 $16,125.00 Mandatory Contingency $60,000.00 $60,000.00 $60,000.00 $420,606.00 $ 351,469.00 $419,373.00 No.Description $500.00 $110.00 $95.00 per hour per hour per hour $75.00 $85.00 $75.00 per hour (Mon-Fri) Normal Hours per hour (Mon-Fri) Normal Hours per hour (Mon-Fri) Normal Hours $250.00 $120.00 $100.00 per hour (after hrs, weekends, holidays)per hour (after hrs, weekends, holidays)per hour (after hrs, weekends, holidays) 100.00%85.00%100.00% In add. To line item cost In add. To line item cost In add. To line item cost $250.00 $40.00 $200.00 per sample per sample per sample TOTAL: Additional Items - NOT BASIS FOR AWARD 1 Training for field sample collection, preservation, and documentation: Please list hourly rate for On-Site training to include all necessary charges: 4 Rush Rates 5 Total & Fecal Coliforms for water breaks and/or sanitary sewer overflows (AFTER NORMAL BUSINESS HOURS) Cost per hour for field sampling of ground water and surface water events, to include Field Parameters:2 Cost per hour for field sampling of ground water and surface water events, to include Field Parameters:3 Page 1 of 1 August 19, 2020 NOTICE OF INTENT TO AWARD Public Utilities and the Procurement Division recommend award of ITB #43-20, Laboratory Services, in accordance with the bid specifications, to the following vendors for an annual not-to- exceed amount of $400,000 annually: Company: Flowers Chemical Laboratories, Inc. Award: Group 1- Water Reclamation Facilities Company: Pace Analytical Services, LLC. Award: Group 2- Drinking Water - DEP and SWFWMD Sampling WTP & RO WTP Discharge Group 3- Industrial Pretreatment The awarded vendors may be used as secondary sources for laboratory services, at the City’s discretion, for continuity of testing and analysis. This Award recommendation will be considered by the City Council at the August 31, 2020 Work Session (9:00 a.m.) and voted on at the September 3, 2020 Council Meeting (6:00 p.m.). These meetings are held at Clearwater Main Library, at 100 N. Osceola Ave., Clearwater, FL 33755. Inquiries regarding this Intent to Award can be directed to the City’s Senior Procurement Analyst at Valerie.Craig@myclearwater.com, or mailed to City of Clearwater, Attn: Procurement, PO Box 4748, Clearwater, FL 33758-4748. Posted on this date by: Valerie Craig Valerie Craig, CPPB Sr. Procurement Analyst City of Clearwater Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8102 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Customer Service Agenda Number: 7.18 SUBJECT/RECOMMENDATION: Approve the renewal agreement and purchase order to Cayenta, a division of N. Harris Computer Corporation, for support and maintenance related to the Utility Management System, for a total not-to-exceed amount of $774,366.15 for the 5-year term beginning November 1, 2020 through October 31, 2025, per Clearwater Code of Ordinances Section 2.564 (1)(e) Impractical to bid and authorize the appropriate officials to execute same. (consent) SUMMARY: Utility Customer Service has used Cayenta’s software utility management system to bill a wide range of services for water, sewer, reclaim water, stormwater, solid waste, recycling and gas to over 50,000 customers at approximately $180 million annually. The system is also utilized by various other departments throughout the city (Gas, Public Utilities, Solidwaste, and Police). Utility Customer Service recommends that the City continue to use Cayenta’s Utility Management System because it is a mission critical system, the software is proprietary and thus supported and maintained by Cayenta and reinvesting in our utility system allows us to keep pace with ever changing demands. The regular annual support and maintenance costs total $574,366.20 over the five-year period. This represents increases at a maximum of 2% annually for the next four years. UCS also anticipates additional costs to support a major system upgrade beginning in FY20/21. While the base upgrade is covered by the annual support and maintenance costs, Cayenta will provide professional services to support the CIS upgrade and upgrade/replacement of the report writing software These additional costs are estimated to not exceed $200,000 over the five year period and will be in the form of billable support services based on the rates in the provided contract. APPROPRIATION CODE AND AMOUNT: Funds for fiscal year 2020/21 have been requested in cost code 5559884-530500, maintenance contracts, for the annual maintenance agreement and cost code 5559887-530100, professional services, for annual funding of billable support services. Funding for billable support services related to the system upgrade are available in capital project 94829, CIS Upgrades/Replacement. Funding for future years will be requested as part of the annual budget process. Page 1 City of Clearwater Printed on 9/3/2020 File Number: ID#20-8102 USE OF RESERVE FUNDS: Page 2 City of Clearwater Printed on 9/3/2020 -1- SUPPORT AND MAINTENANCE AGREEMENT THIS AGREEMENT made as of the 1st day of November 2020. BETWEEN: N. HARRIS COMPUTER CORPORATION (“Harris”) with a business address of 4200 North Fraser Way, Suite 201, Burnaby, BC, Canada V5J 5K7 - And - City of Clearwater , Florida, USA (“Organization”) RECITALS 1. Harris has licensed to Organization certain Software pursuant to a Software License Agreement; 2. The Organization wishes to receive support and maintenance services related to the Software; 3. Harris shall provide the support and maintenance services related to the Software; NOW THEREFORE, in consideration of the mutual covenants set out in this support and maintenance agreement (the “Support and Maintenance Agreement”) and for other good and valuable consideration (the receipt and sufficiency of which is hereby acknowledged), the parties agree as follows: Definitions Throughout the Support and Maintenance Agreement, except as otherwise expressly provided, the following words and expressions shall have the following meaning (a) “Designated Computer System” shall mean the City of Clearwater ’s platform and operating environment which is operating the Software. (b) “Documentation” means collectively: (i) all of the written, printed, electronic or other format materials published or otherwise made available by Harris that related to the functional, operations and/or performance capabilities of the -2- Designated Computer System and/or any Software: and (ii) all user guides, operator manuals, educational materials, product descriptions and specifications, technical manuals, supporting manuals and materials, system administration manuals, and other manuals and information regardless of the media on which it is provided, and all other written, printed, electronic or other format materials published or otherwise made available by Harris that describe the functional, operational, and/or performance capabilities of the Designated Computer System and/or any Software; and (iii) any and all amendments, modifications, and supplements thereto. Documentation shall not include Source Code. (c) “Software” means the Cayenta Utilities software products 7.9.0 and newer including releases of upgrades. (d) “Third Party Software” means the third party software products licensed to the City of Clearwater by Actuate, MicroFocus (AcuCobol) and Loris. Future Releases of the Software may require alternate Third Party Software to be licenced by the City of Clearwater , which will be subject to a third party license agreement between the City of Clearwater and the relevant Third Party Software licensor. (e) “Update” means a minor modification or enhancement to the Software related to a bug fix, minor additional functionality or legislative changes. (f) “Upgrade” means a major overhaul of the Software which is a completely new version of the Software 1. This Support and Maintenance Agreement is the exclusive statement of the entire support and maintenance agreement between Harris and Organization. 2. Harris shall provide software support primarily via telephone, electronic mail and Cayenta.com in addition to site visits only when necessary. The Organization shall be provided After Hours Support in addition to Support Services described in Exhibit 2 hereto for effective 24 hour coverage which are in effect as of the Start Date (as defined below. Services may, by mutual agreement, be modified or supplemented from time to time. An after hours Support telephone number will be provided. To enable Harris to provide effective support, the Organization will establish remote access procedures compatible with Harris’s then current practices which may be revised over time. 3. In consideration for the support services specified in Exhibit 2, Organization shall pay the “Support and Maintenance Fee” as detailed in Exhibit 1 below. The Support and Maintenance Fee will be billed annually in advance per the schedule in Exhibit 1 and thereafter on November 1st or on an alternative date mutually agreed to by both parties. If the Organization would like to match the annual invoicing of the Support and Maintenance Fee to its fiscal year or any other period it may request, during the initial term of this Support and Maintenance Agreement, that Harris issue a prorated invoice for -3- the portion of the year remaining during the initial term. Organization shall only be billed once per year per the schedule in Exhibit 1 through 2024. The Support and Maintenance fee shall not increase more than 2% per annum thereafter. 4. In addition to the Support and Maintenance Fee, Organization shall reimburse Harris for its direct expenses in providing support services (“Billable Fees”) pursuant to this Support and Maintenance Agreement which include as of the Start Date: (1) (1) Its direct travel expenses that are excluded from the total fees amount including hotel, airfare, car rental, tolls, meal per diem, parking and airline and travel agents fees will be reimbursed based on the City of Clearwater’s Travel policy 4004.7. Meal per diem is limited to IRS and GSA reimbursement guidelines for our region. Harris may update its reimbursement policies and rates related to the Billable Fees from time to time, in which case such updated policies shall apply for purposes of this Support and Maintenance Agreement, provided that such updated reimbursement policies must generally apply to all clients of Harris. Harris will provide notice of any changes in rates. 5. Harris shall supply all Upgrades to Organization at no additional charge other than the payment of the Support and Maintenance Fee. Upgrades may require additional services to be performed by Harris outside of the scope of those services provided by Harris including additional training not covered by the Software Implementation Services Agreement and professional services for the installation and implementation of the Upgrade that will be subject to the Harris’s then-prevailing policies, terms and Billable Fees related to pricing and hourly rates. All such services shall be performed subject to a newly negotiated Scope of Work that will be subject to the terms of the Software Implementation Services Agreement. 6. All Updates of the Software and all those services listed in Exhibit 2 which are included as part of Organization’s Software support will be made available to Organization at no additional charge other than the payment of the Support and Maintenance Fee. 7. All payments hereunder shall be in U.S. dollars Insurance N. Harris Computer Corporation will maintain the following minimum levels of insurance: a. Commercial General Liability Insurance coverage, including but not limited to, premises operations, products/completed operations, products liability, contractual liability, advertising injury, personal injury, death, and property damage in the minimum -4- amount of $1,000,000 (one million dollars) per occurrence and $2,000,000 (two million dollars) general aggregate. b. Commercial Automobile Liability Insurance coverage for any owned, non-owned, or hired automobile is required in the minimum amount of $1,000,000 (one million dollars) combined single limit. c. Professional Liability/Errors or Omissions Insurance coverage appropriate for the type of business engaged in by the Respondent with minimum limits of $2,000,000 (two million dollars) per claim. If a claims-made form of coverage is provided, the retroactive date of coverage shall be no later than the inception date of claims made coverage, unless the prior policy was extended indefinitely to cover prior acts. Coverage shall be extended beyond the policy year either by a supplemental extended reporting period (SERP) of six years, and with no less coverage and with reinstated aggregate limits, or by requiring that any new policy provide a retroactive date no later than the inception date of claims made coverage. d. Cyber Liability coverage in an amountof $2,000,000 (two million dollars) per claim, including notification and monitoring, as required under Florida Statute 501.171. e. Theft or Loss coverage shall be maintained with minimum limits of $1,000,000 (one million dollars) per occurrence. Coverage shall be provided using ISO form CR 00 01 Employee Dishonestly Coverage Form or its equivalent and shall include ISO endorsement CR 04 01 Clients’ Property or its equivalent. f. Unless waived by the State of Florida and proof of waiver is provided to the City, statutory Workers’ Compensation Insurance coverage in accordance with the laws of the State of Florida, and Employer’s Liability Insurance in the minimum amount of $500,000 (five hundred thousand dollars) each employee each accident, $500,000 (five hundred thousand dollars) each employee by disease, and $500,000 (five hundred thousand dollars) disease policy limit. Coverage should include Voluntary Compensation, and U.S. Longshoremen’s and Harbor Worker’s Act coverage where applicable. Coverage must be applicable to employees Other Insurance Provisions a. Annually upon the anniversary date(s) of the insurance policy’s renewal date(s) for as long as this Agreement remains in effect, N. Harris Computer Corporation will furnish the City with a Certificate of Insurance(s) (using appropriate ACORD certificate, SIGNED by the Issuer, and with applicable endorsements) evidencing all of the coverage set forth above and naming the City as an “Additional Insured” on the Commercial General Liability Insurance and the Commercial Automobile Liability Insurance. In addition when requested in writing from the City, N. Harris Computer Corporation will provide the City with certified copies of all applicable policies. The -5- address where such certificates and certified policies shall be sent or delivered is as follows: City of Clearwater Attn: Gail Rini, Customer Service 100 S. Myrtle Ave Clearwater, FL 33756 Or Gail.Rini@myclearwater.com b. N. Harris Computer Corporation shall provide thirty (30) days written notice of any cancellation, non-renewal, termination, material change or reduction in coverage. c. N. Harris Computer Corporation’s insurance as outlined above shall be primary and non-contributory coverage for N. Harris Computer Corporation’s negligence. d. N. Harris Computer Corporation reserves the right to appoint legal counsel to provide for the N. Harris Computer Corporation’s defense, for any and all claims that may arise related to Agreement, work performed under this Agreement, or to N. Harris Computer Corporation’s design, equipment, or service. N. Harris Computer Corporation agrees that the City shall not be liable to reimburse N. Harris Computer Corporation for any legal fees or costs as a result of N. Harris Computer Corporation providing its defense as contemplated herein. The stipulated limits of coverage above shall not be construed as a limitation of any potential liability to the City, and City’s failure to request evidence of this insurance shall not be construed as a waiver of N. Harris Computer Corporation (or any contractors’, subcontractors’, representatives’ or agents’) obligation to provide the insurance coverage specified. Indemnity In consideration of the sum of One Hundred Dollars ($100.00), the receipt and sufficiency of which is acknowledged, payable as part of the first payment for services, Harris agrees to defend, save and hold Organization, its agents, assigns and employees, harmless from all claims or causes of action, including costs and attorney's fees, and all judgements whatsoever, involving property damage, arising out of any negligent act or omission, or the violation of any federal, state or local law or regulations by Harris, its subcontractors, agents, assigns, invitees or employees in connection with this Agreement. Harris agrees to indemnify and hold harmless Organization from losses, damages or lawsuits resulting from Harris intentional misconduct or intentional torts committed during the performance of this contract. Harris hereby further agrees to indemnify, defend, save and hold harmless Organization from all claims, demands, liabilities and suits caused by any negligent act, error or omission of Harris, Harris’s subcontractors, agents, or employees in rendering the professional services called for -6- herein. It is specifically understood and agreed, however, that this indemnification agreement does not cover or indemnify Organization for its own negligence. Harris hereby further agrees to indemnify, defend, save and hold harmless Organization from any and all fines, costs, and expenses caused by, directly or indirectly, with Harris failure to comply with any applicable laws, statutes, ordinances, or government regulations. Harris hereby further agrees to indemnify and hold harmless Organization, and its officers and employees, from liabilities, damages, losses, and costs, including, but not limited to, reasonable attorneys' fees, to the extent caused by the negligence, recklessness, or intentionally wrongful conduct of Harris and other persons employed or utilized by Harris in the performance of the contract. -7- Term. 8. This Agreement shall commence on the Effective Date and shall continue for a period of five (5) years (the “Initial Term”). Thereafter, this Support and Maintenance Agreement shall automatically renew for further one year periods (each a “Renewal Term”) unless one party gives written notice to the other party not less thanninety (90) days prior to the end of the then current term of its intention not to renew. The Initial Term and the Renewal Terms shall collectively be referred to as the “Term”. 9. Title to and ownership of all proprietary rights in the Releases and all related proprietary information supplied by Harris in providing the services pursuant to this Support and Maintenance Agreement shall at all times remain with Harris, and Organization shall acquire no proprietary rights by virtue of this Support and Maintenance Agreement. 10. Unless otherwise agreed to by the parties, all notices required hereunder shall be made in accordance with the provisions of the License Agreement. 11. Either party’s lack of enforcement of any provision in this Support and Maintenance Agreement in the event of a breach by the other shall not be construed to be a waiver of any such provision and the non-breaching party may elect to enforce any such provision in the event of any repeated or continuing breach by the other. 12. The parties agree that the terms and conditions contained herein shall prevail notwithstanding any variations on any orders, e-mails or other correspondence submitted by Organization. 13. The particular provisions of this Support and Maintenance Agreement shall be deemed confidential in nature and neither Organization nor Harris shall divulge any of its provisions as set forth herein to any third party except as may be required by law. 15 Termination 1. Harris shall have the right to terminate this Support and Maintenance Agreement immediately if: (a) Organization attempts to assign this Support and Maintenance Agreement or any of its rights hereunder, or undergoes a Reorganization, without complying with the License Agreement; or -8- (b) Organization has not paid an invoice within ninety (90) days of the start of a renewal term. 2. “ TERMINATION FOR LACK OF FUNDING a. The Organization’s performance and obligation to pay under this Agreement is contingent upon an annual appropriation by the Clearwater City Council. In the event the Clearwater City Council does not appropriate funds in a sufficient amount for Organization to perform its obligations hereunder, Organization terminate this Agreement upon thirty (30) days written notice to Harris.” 3. This Agreement may be terminated as follows: i. In addition to any other rights and remedies available to it, either party may immediately terminate this Agreement in the event of material breach by the other party of its obligations hereunder that is not cured within thirty (30) days of receipt of written notice from the other party to that effect; ii. If Organization has failed to pay the Fees or other amounts due then Harris shall have the right to terminate this Agreement effective immediately upon written notice to Organization that effect; iii. Upon sixty (60) days written notice prior to expiration of a Term; and iv. Either party may terminate this Agreement effective immediately upon written notice to the other party if the other party: (i) becomes insolvent; (ii) becomes the subject of any proceeding under any bankruptcy, insolvency or liquidation law, whether domestic or foreign, and whether voluntary or involuntary, which is not resolved favourably to the subject party within ninety (90) days of commencement thereof; or (iii) becomes subject to property seizure under court order, court injunction or other court order which has a material adverse effect on its ability to perform hereunder. 4. Effects of Termination. In the event of termination of this Agreement: Organization shall immediately pay all outstanding Fees and other amounts owing to Harris under this Agreement at a pro-rated payment for “Term used” The termination of -9- this Support and Maintenance Agreement by Organization shall not affect the License or the Software License Agreement. (a) Termination of this Support and Maintenance Agreement shall not affect any right of action of either party arising from anything which was done or not done, as the case may be, prior to the termination taking effect. (b) The Organization and Harris recognize that circumstances may arise entitling the Organization to damages for breach or other fault on the part of Harris arising from this Support and Maintenance Agreement. The parties agree that in all such circumstances the Organization’s remedies and Harris’s liabilities will be limited as set forth below and that these provisions will survive notwithstanding the termination or other discharge of the obligations of the parties under this Support and Maintenance Agreement. (c) FOR BREACH OR DEFAULT BY HARRIS OR OTHERWISE IN CONNECTION WITH THIS SUPPORT AND MAINTENANCE AGREEMENT, REGARDLESS OF THE NATURE OF THE CAUSE OF ACTION WHETHER IN CONTRACT OR IN TORT, INCLUDING FUNDAMENTAL BREACH OR NEGLIGENCE OR STRICT LIABILITY, THE ORGANIZATION’S EXCLUSIVE REMEDY, IN ADDITION TO ELECTING IF SO ENTITLED TO RESCIND OR BE DISCHARGED FROM THE PROVISIONS OF THIS SUPPORT AND MAINTENANCE AGREEMENT, SHALL BE (1) ACCESS TO THE ESCROWED SOURCE CODE IN ACCORDANCE WITH SCHEDULE“ A” (2) PAYMENT BY HARRIS OF THE ORGANIZATION’S DIRECT DAMAGES TO A MAXIMUM AMOUNT EQUAL TO, AND HARRIS SHALL IN NO EVENT BE LIABLE IN EXCESS OF, THE AMOUNT OF FEES ACTUALLY PAID BY THE ORGANIZATION TO HARRIS UNDER THIS SUPPORT AND MAINTENANCE AGREEMENT DURING THE THEN-CURRENT TERM (NOT TO EXCEED 12 MONTHS) OF THE SUPPORT AND MAINTENANCE AGREEMENT UP TO AND INCLUDING THE DATE OF TERMINATION, EXCLUDING COSTS AND EXPENSES (INCLUDING REASONABLE ATTORNEY’S FEES) INCURRED BY THE ORGANIZATION IN CONNECTION WITH OBTAINING A COPY OF THE SOURCE CODE IN ACCORDANCE WITH THE ESCROW AGREEMENT BETWEEN THE PARTIES WHICH SHALL BE REIMBURSED BY HARRIS IF AN EVENT OF DEFAULT OCCURS. IN NO EVENT SHALL ANY DAMAGES INCLUDE, NOR SHALL HARRIS BE LIABLE FOR, ANY SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES EVEN IF HARRIS HAS BEEN ADVISED OF THE POSSIBILITY THEREOF. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, HARRIS SHALL NOT BE LIABLE FOR LOST PROFITS, LOST BUSINESS REVENUE, FAILURE TO REALIZE EXPECTED SAVINGS, OTHER COMMERCIAL OR -10- ECONOMIC LOSS OF ANY KIND, OR FOR ANY CLAIM WHATSOEVER AGAINST THE ORGANIZATION BY ANY OTHER PARTY. 16. The parties hereby confirm that the waivers and disclaimers of liability, releases from liability, limitations and apportionments of liability, and exclusive remedy provisions expressed throughout this Support and Maintenance Agreement shall apply even in the event of default, negligence (in whole or in part), strict liability or breach of contract of the person released or whose liability is waived, disclaimed, limited, apportioned or fixed by such remedy provision, and shall extend to such person’s affiliates and to its shareholders, directors, officers, employees and affiliates. 17. Where remedies are expressly afforded by this Support and Maintenance Agreement, such remedies are intended by the parties to be the sole and exclusive remedies of the Organization for liabilities of the Harris arising out of or in connection with this Support and Maintenance Agreement, notwithstanding any remedy otherwise available at law or in equity. 18. The Organization may, at Organization’s option, enter into an escrow arrangement with Harris. Upon the Organization’s request: (i) Organization shall be presented with the standard escrow beneficiary enrollment document for participation in Harris’s source code escrow arrangement with an escrow agent (the “Escrow Arrangement”) (ii) By entering into this Escrow Arrangement, the Organization shall have all the rights as stipulated in escrow agreement together with those rights which are more specifically 19. outlined in Exhibit This Agreement shall be governed by the laws of the State of Florida. Any legal action taken by either party arising out of this Agreement shall be filed in a court of competent jurisdiction in the State of Florida. 20. This Support and Maintenance Agreement may not be assigned by the Organization unless, concurrently with any such assignment, the Organization assigns its rights under, and complies with the provisions of the License Agreement. 21. This Support and Maintenance Agreement shall be binding upon the successors and assigns of the parties and enure to the benefit of the successors and permitted assigns of the parties. 22. The invalidity or unenforceability of any provision or covenant contained in this Support and Maintenance Agreement shall not affect the validity or enforceability of any other provision or covenant herein contained and any such invalid provision or covenant shall be deemed to be severable. 23. This Support and Maintenance Agreement may be executed in counterparts (whether by facsimile signature or in PDF format via e-mail or otherwise), each of which when so executed shall constitute an original and all of which together shall constitute one and the same agreement. -11- -12- IN WITNESS WHEREOF, the Parties have executed this Support and Maintenance Agreement to be effective as of the date first written above. City of Clearwater, FL N. Harris Computer Corporation. Name: Cynthia Boyd Name: Craig Morrison Title: Utility Customer Service Director Title: Vice President, Support Services Signature: Signature: Date: 7-20-20 Date: 7-20-20 Countersigned: CITY OF CLEARWATER, FLORIDA ___________________________ By: __________________________ George N. Cretekos William B. Horne II Mayor City Manager Approved as to form: Attest: ___________________________ ________________________________ Rosemarie Call Assistant City Attorney City Clerk Exhibit 1 Annual Support and Maintenance Fee APPLICATIONS SUPPORT & MAINTENANCE COSTS/YEAR FOR EACH APPLICATION (Name of Application/Product) 2020 2021 2022 2023 2024 Cayenta Utilities CIS $82,953.84 $84,612.92 $86,305.18 $88,031.28 $89,791.91 sub-total $82,953.84 $84,612.92 $86,305.18 $88,031.28 $89,791.91 3rd Party Products Loris File Nexus $18,455.52 $18,824.63 $19,201.12 $19,585.14 $19,976.84 Actuate Maintenance $8,100.00 $8,262.00 $8,427.24 $8,595.78 $8,767.70 AcuCOBOL Software Maintenance $859.92 $877.12 $894.66 $912.55 $930.80 sub-total $27,415.44 $27,963.75 $28,523.02 $29,093.47 $29,675.34 TOTAL COST $110,369.28 $112,576.67 $114,828.20 $117,124.75 $119,467.25 Payment Schedule – Year 1 All products (3rd Party and Cayenta) Due on Nov 1, 2020…………..…..$110,369.28 Payment Schedule – Year 2 All products (3rd Party and Cayenta) Due on Nov 1, 2021…………..…..$112,576.67 Payment Schedule – Year 3 All products (3rd Party and Cayenta) Due on Nov 1, 2022…………..…..$114,828.20 Payment Schedule – Year 4 All products (3rd Party and Cayenta) Due on Nov 1, 2023…………..…..$117,124.75 Payment Schedule – Year 5 All products (3rd Party and Cayenta) Due on Nov 1, 2024…………..…..$119,467.25 Exhibit 2 Standard Support and Maintenance Services – Standard Guidelines The purpose of this Exhibit 2 is to provide our customers with information on our standard coverage, the services which are included as part of your annual software support, a listing of Support Ticket priorities, an outline of our escalation procedures and other important details. Harris reserves the right to make modifications to this document as required; provided, however, Harris shall not reduce the scope of support provided hereunder without the prior written consent of the Organization. The services listed below are services that are included as part of your software support. • 800 Toll Free Telephone support • Scheduled assistance for installations, upgrades & other special projects (there may be charges depending on the scope of work) • Technical & Functional troubleshooting & issue resolution • E-mail support Ticket logging and notification • Free Cayenta Support Portal access 24 x 7 with the following on-line benefits: - Log & close Tickets - View & update Tickets - Update contact information - Access published documentation - Access available downloads - Access Support knowledge base - Participate in Discussion Forums - Report on metrics • Standard software releases and updates - Defect corrections (as warranted) - Planned enhancements - State and/or Federal mandated changes - Payroll regulated changes - Participation in BETA program, optional at CPU’s discretion - Release notes - Updated documentation as available • Limited training questions (15 minute guideline) • Customer Care Program - Quarterly News Letter with support tips - Technical support bulletins - Communication on new products and services - On-site visits (as required) • Design review for potential enhancements or custom modifications • Design review for potential configuration changes • Outstanding Tickets Report with conference call (as required) • Ability to attend the annual customer conference (attendance fees apply) Helpdesk Hours Our standard hours of support are from 8:00 a.m. EST to 8:00 p.m. EST, Monday to Friday, excluding designated statutory holidays. After Hours Support is available from 8:00 p.m. EST through to 8:00 a.m. EST and is billable on an hourly basis. Weekend assistance is available and must be scheduled in advance and in most cases is billable. Response Times Response times will vary and are dependent on the priority of the call. We do our best to ensure that we deal with incoming Tickets in the order that they are received, however Tickets will be escalated based on the urgency of the issue reported. Our response time guidelines are as follows: Priority 1: Within 1 hour Priority 2: 1 - 4 hours Priority 3: 1 - 8 hours Priority 4: 1 - 24 hours Ticket Priorities In an effort to assign our resources to incoming Tickets as effectively as possible, we have identified four types of Ticket priorities, 1, 2, 3 and 4. A Priority 1 Ticket is deemed by our support staff to be an Urgent or High Priority Ticket, Priority 2 is classified as a Medium Priority and Priority 3 is deemed to be a Low Priority. The criteria used to establish guidelines for these Tickets are as follows: Priority 1 – Critical • System Down (Software Application, Hardware, Operating System, Database) • Inability to process payroll checks • Inability to process accounts payable checks • Inability to process bills • Inability to process work orders • Inability to process payments Priority 2 - High • Program errors without workarounds • Incorrect calculation errors impacting a majority of the current bill cycle records • Aborted postings or error messages preventing data integration and update • Performance issues of severe nature impacting critical processes • Hand-held interface issues preventing billing or creating billing errors • Security issues Priority 3 – Medium • System errors that have workarounds • Calculation errors impacting a minority of records • Reports calculation issues • Printer related issues (related to interfaces with our software and not the printer itself) • Hand-held issues not preventing billing • Performance issues not impacting critical processes • Usability issues • Workstation connectivity issues (Workstation specific) Priority 4 - Low • Report formatting issues • Training questions, how to, or implementing new processes • Aesthetic issues • Issues with workarounds for large majority of accounts • Recommendations for enhancements on system changes • Questions on documentation Support Ticket Process All issues or questions reported to support are tracked via a support Ticket; our support analysts cannot provide assistance unless a support Ticket is logged. Our current process for logging Tickets includes the following: Cayenta Support Portal (via website), email, and phone. • Your Ticket must contain at a minimum: your organization name, contact person, software product and version, module and/or menu selection, nature of issue, detailed description of your question or issue and any other information you believe pertinent. • Our support system or one of our support analysts will provide you with a Ticket id to track your issue and your Ticket will be logged into our support tracking database. • Your Ticket will be stored in a queue and the first available support representative will be assigned to deal with your issue. • As the support representative assigned to your Ticket investigates your issue, you will be contacted and advised as to where the issue stands and the course of action that will be taken for resolution. If we require additional information, you will be contacted by the assigned support representative to supply the information required. • All correspondence and actions associated with your Ticket will be tracked against your all in our support database. At any time, if available to you, you may log onto our website to see the status of your Ticket. • Once your Ticket has been resolved, you will receive an automated notification by email that your Ticket has been closed. This email will contain the entire event history of the Ticket from the time the Ticket was created and leading up to the resolution of the Ticket. You also have the option of viewing both your open and closed Tickets, if available to you, via our website. • If your issue needs to be escalated to a development resource or programmer for resolution, your issue will be logged into our development tracking database and you will be provided with a separate id number to track the progress of the issue. Your Support Ticket is linked to your Development issue. The development issue id number will remain open until your issue has been completely resolved. Issues escalated to development will be scheduled for resolution and may not be resolved immediately depending on the nature and complexity of the issue. • Contact the support department at your convenience for a status update on your development issues, or log onto our website (if available to you) to view your issues on- line. Escalation Process Our escalation process is defined below. This process has been put in place to ensure that issues are being dealt with appropriately. If at any time you are not completely satisfied with the resolution of your issue, you are encouraged to escalate with the support department as follows: Level 1: Contact the support representative working on your issue Level 2: Contact the support supervisor or group lead Level 3: Contact the director of support Level 4: Contact the vice president of support Level 5: Contact the CEO of Harris Holiday Schedule Below is a listing of statutory holidays. Please note that support services will be closed on designated days as outlined below. New Year’s Eve Early Closure New Year's Day Closed Labor Day Closed Christmas Eve Early Closure Christmas Day Closed Billable Support Services The services listed below are services that are out of scope of your support and maintenance agreement and are therefore considered billable services. • Extended telephone training (beyond 15 minutes per call) • Performing Forms redesign or creation (includes Bill Prints, Notice Prints and Letters) • Performing Setup & changes to hand-held interface or creation of new interface • Performing Setup of new services or changes to services ( PAP, ACH, etc) • Setup or Creating File imports/exports - Interfaces to other applications • Performing Refreshes, backups, restores, setting up test areas • Setup of new printers, printer setup changes • Performing Custom modifications (reports, bills, forms, reversal of customizations) • Setting up additional companies / agencies / tokens / general ledgers • Performing Data conversions / global modification to setup table data • Performing Database maintenance, repairs & optimization • Extended Hardware & Operating System support • Performing Upgrades & support of third party software • Performing Installations / re-installations (workstations, servers) Test Databases & Environments We support customers in the maintenance of independent Test Environments for testing purposes. This allows customers the opportunity to test fixes, modifications, new business processes and/or scenarios without risking any potentially unwanted changes to the live environment. The creation of Test Databases & Environments is a billable service unless otherwise noted in the implementation SOW, quotations & incremental maintenance rates will be provided on request. Connection Methods To ensure we can effectively support our clients, we require that a communication link is established and maintained between our two sites. It is the client’s responsibility to ensure the connection is valid at your location so that we can connect to your site and resolve any issues. Our supported methods of connection are: Direct internet, Virtual Private Network (VPN), Remote Access Server (RAS), Direct Connection (modem) and Terminal Services (a backup connection may be required for file transfers). Hardware and Third Party Support – if applicable The purpose of this section is to provide our customers with information on our standard coverage and the services which are included as part of your annual hardware and third party software support (if applicable). This section serves as a guideline for the support department but is superseded by an existing third party or other agreement. Standard Hardware and Third Party Software Support Services • 800 telephone support – first line phone support for troubleshooting (note more complex issues will be escalated to the actual vendor of the products) • “on call” after hours support (scheduled assistance for installations, upgrades and other special projects – there may be charges depending on the scope of work) • remote connection support • technical troubleshooting • limited training questions (15 minute guideline) • assistance with creation of backup scripts / backup recovery • assistance with recovering data resulting from system crashes (charges may apply) • recommendations on specific hardware requirements • support provided for installed database issues (30 minute guideline) • ODBC installation and connection to database assistance • updating databases to support new versions of installed applications • assistance with database installation, configuration and updating The services listed below are services that are out of scope and are therefore considered billable – please note that we do not provide hardware support for any printers: • on-site installation or upgrade of hardware and third party software • extended telephone training (beyond 15 minutes) • performing reconfiguration of hardware and fileservers • recovering data resulting from client error • upgrading of hardware systems • preventative maintenance monitoring or other services • recommending or assisting with disaster recovery plans • re-establishment of ODBC connection if connection was lost due to actions of customer • ODBC connections to other third party products due to the customer or third party software • creation of custom reports • report writer training, upgrades and installations (other than at time of initial purchase) Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8191 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Solid Waste/General Services Agenda Number: 7.19 SUBJECT/RECOMMENDATION: Approve a Purchase Order increase to Clearwater Towing Service, Inc., of Clearwater, FL, in the amount of $15,000 for a total not to exceed amount of $75,000 for remainder of this term ending September 30, 2020, to accommodate towing services for all city-wide equipment, and authorize the appropriate officials to execute same. (consent) SUMMARY: The City’s Fleet Maintenance utilizes Clearwater Towing for the transportation, extraction, and the movement of vehicles and equipment to auction. On September 1, 2016, Council approved an agreement between Clearwater Towing Services, Inc., and the City of Clearwater to provide full-service vehicle removing, towing, storage and impound services to accommodate the needs of the Police Department and the Fleet Maintenance Division. The amount approved for Fleet Maintenance Division was $45,000 annually. On November 16, 2017, Council approved an increase to the original contract from $45,000 annually to $60,000 annually. Based on the additional services needed this final term, we are requesting an increase of $15,000 bringing the total to $75,000. APPROPRIATION CODE AND AMOUNT: Funds are available in cost code 5666611-530300, Contractual Services, for this increase Page 1 City of Clearwater Printed on 9/3/2020 Cover Memo City of Clearwater City Hall 112 S. Osceola Avenue Clearwater, FL 33756 File Number: ID#16-2726 Agenda Date: 9/1/2016 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Police Department Agenda Number: 7.9 SUBJECT/RECOMMENDATION: Approve an agreement between Clearwater Towing Service, Incorporated and the City of Clearwater to provide full service vehicle removal, towing, storage, and transport services to accommodate all needs of the Clearwater Police Department and the City’s Fleet Services Department and authorize the appropriate officials to execute same. (consent) SUMMARY: On June 3, 2016, a Request for Proposal (RFP 32-16) was issued seeking proposals from qualified vendors to provide full service vehicle recovery, towing, storage, transport, and impound services for the Police Department and the Fleet Services Department. A five-member committee, which was comprised of members of the Police Department, General Services, and Traffic Engineering, evaluated the two responses to RFP 32-16. The Evaluation Committee evaluated and ranked the two responses. Each response was judged based upon several factors, which included, but was not limited to: qualifications and experience, facilities and equipment, and capacity to fulfill the contract. During the evaluation phase, one vendor was eliminated from consideration as not meeting the scope of the issued RFP. Clearwater Towing Service Incorporated (of 1955 Carroll Street, Clearwater) was the only vendor that provided a proposal that met the scope of the RFP. The agreement will meet the required needs of the Police Department and the City’s Fleet Services Department, but would not prohibit a citizen from requesting towing services from a company of their choice, such as AAA. Under the terms of this contract, vehicles would be seized or impounded at no cost to the Police Department. The agreement calls for an initial one-year term, effective October 1, 2016 through September 30, 2017, with three optional one-year extensions. There will be a minimal impact to the Police Department’s current and future operating budget(s) as a result of the agreement. Under the terms of the agreement, the respective vendor is to be paid the sum of $100.00 per vehicle, which is stored on behalf of the Police Department for investigative purposes (maximum of five days storage). The vendor will collect, and transfer to the Police Department, a $20.00 fee for administrative costs associated Page 1 City of Clearwater Printed on 8/30/2016 File Number: ID#16-2726 with vehicles which are impounded by the Police Department. Payments will be funded from the Police Department’s operating budget (projected: $1500.00) (Appropriation Code: 0010-01155-548000-521-000-0000). Administrative fees collected will be credited to the General Fund. Under the terms of this contract, the vendor will provide 24 hours, seven days a week towing services (towing, recovery, and roadside service) for the City’s Fleet Operations. Under the terms of the agreement, the City’s Fleet Operations will pay the vendor for towing services based on the following rate chart. Payment will be funded from the Fleet Operations Department’s operating budget (projected: $45,000.00) (Appropriation Code: 0566-06611-530300-519-000-0000). Staff recommendation is to approve and enter into the proposed agreement with Clearwater Towing Service Incorporated. APPROPRIATION CODE AND AMOUNT: There will be a minimal impact to the Police Department’s current and future operating budget(s) as a result of the agreement. Under the terms of the agreement, the respective vendor is to be paid the sum of $100.00 per vehicle, which is stored on behalf of the Police Department for investigative purposes (maximum of five days storage). The vendor will collect, and transfer to the Police Department, a $20.00 fee for administrative costs associated with vehicles which are impounded by the Police Department. Payments will be funded from the Police Department’s operating budget (projected: $1500.00) (Appropriation Code: 0010-01155-548000-521-000-0000). Administrative fees collected will be credited to the General Fund. Under the terms of the agreement, the City’s Fleet Operations will pay the vendor for towing services based on the following rate chart. Payment will be funded from the Fleet Operations Department’s operating budget (projected: $45,000.00) (Appropriation Code: 0566-06611-530300-519-000-0000). USE OF RESERVE FUNDS: N/A Page 2 City of Clearwater Printed on 8/30/2016 Attachment 2 SERVICE CHARGES Item No.Description Class “A” Wrecker Unit Price Class “B” Wrecker Unit Price Class “C” Wrecker Unit Price Class “D” Wrecker Unit Price Service Unit 1 Towing Service Base Charge $ 35.00 $ 75.00 $ 95.00 $ 150.00 Per tow 2 Use of Dolly in tow service $ 0.00 $ 0.00 $ 0.00 $ 0.00 Per tow 3 Use of Flatbed in tow service $ 0.00 $ 0.00 $ 0.00 $ 0.00 Per tow 4 Road Service $ 35.00 $ 35.00 $ 35.00 $ 35.00 Per call 5 Recovery $ 35.00 $ 50.00 $ 50.00 $ 50.00 Per call 6 Truck Time w/Driver $ 35.00 $ 35.00 $ 75.00 $ 75.00 Per hour 7 Extra mileage outside Clearwater city limits $ 2.00 $ 3.00 $ 4.00 $ 4.00 Per mile Cover Memo City of Clearwater City Hall 112 S. Osceola Avenue Clearwater, FL 33756 File Number: ID#16-2734 Agenda Date: 9/1/2016 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Police Department Agenda Number: 7.10 SUBJECT/RECOMMENDATION: Reappoint the following individuals to the Board of Trustees, Clearwater Police Supplementary Pension Plan as follows: Harvey Huber with a term to expire October 31, 2016; Paul E. Maser with a term to expire October 31, 2017; and Jeffrey DiVincent with a term to expire January 31, 2020. (consent) SUMMARY: In keeping with the provisions of Florida Statute 185.05, which states in part…"the board of trustees shall consist of five members, two of whom, unless otherwise prohibited by law, shall be legal residents of the municipality, who shall be appointed by the legislative body of the municipality…" Clearwater resident Harvey Huber (2621 Brandywine Drive, Clearwater) was approved by the City Council for reappointment to the Board of Trustees of the Police Supplementary Pension with his term expiring on October 31, 2012. Due to an oversight, Mr. Huber's reappointment term should have been extended for an additional four years. Accordingly, it is requested that Mr. Huber be approved for reappointment to the Board of Trustees through October 31, 2016. Clearwater resident Paul E. Maser (1125 Fairwood Avenue, Clearwater) was approved by City Council for reappointment to the Board of Trustees of the Police Supplementary Pension with his term expiring October 31, 2013. Due to an oversight sight, Mr. Maser's reappointment term should have been extended for four additional years to October 31, 2017. Accordingly, it is requested that Mr. Maser be approved for reappointment to the Board of Trustees to October 31, 2017. Florida Statute 185.05 states in part, "The fifth member shall be chosen by a majority of the previous four members, and such person's name shall be submitted to the legislative body of the municipality. Upon receipt of the fifth person's name, the legislative body shall, as a ministerial duty, appoint such person to the board of trustees as its fifth member…" At a meeting of the Board of Trustees held on December 11, 2015, Jeffrey DiVincent agreed to serve a full four-year term as the fifth Trustee. Due to an oversight, Mr. DiVincent's reappointment term should have been extended on February 1, 2016 for an additional four years to January 31, 2020. Mr. DiVincent is a Clearwater police officer with over 21 years experience and has agreed to serve the term February 1, 2016 to January 31, 2020. The Board of Trustees of the Clearwater Police Supplementary Pension Fund recommends that Harvey, Paul E. Maser and Jeffrey DiVincent be appointed to the Board of Trustees. Mr. Huber, Mr. Maser and Mr. DiVincent have stated they will accept the reappointment. APPROPRIATION CODE AND AMOUNT: N/A Page 1 City of Clearwater Printed on 8/30/2016 Cover Memo City of Clearwater City Hall 112 S. Osceola Avenue Clearwater, FL 33756 File Number: ID#17-4048 Agenda Date: 11/16/2017 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Solid Waste/General Services Agenda Number: 7.10 SUBJECT/RECOMMENDATION: Approve a Purchase Order increase to Clearwater Towing Service, Inc., of Clearwater, FL, increasing the current annual term amount by $2,500, and an annual increase from $45,000 to $60,000 for the two remaining renewal terms, to accommodate towing services for all city-wide equipment, and authorize the appropriate officials to execute same. (consent) SUMMARY: On June 3, 2016, Request for Proposals 32-16 was issued seeking proposals from qualified vendors to provide full service vehicle recovery, towing, storage, and impound services for the Police Department and the Fleet Services Department. In August 2016, Council approved the agreements with Clearwater Towing for both Police and Fleet Services. The annual purchase order authorized for Fleet Services was in the amount of $45,000, and a 10% increase has already been applied. Fleet requests an additional $2,500 to complete payment of the remaining services for the annual term ending September 30, 2017, bringing the authorized amount to $52,500. The City’s Fleet Operations utilizes Clearwater Towing for the transport of surplus vehicles and equipment to auction, as well as movement of broken down vehicles and equipment. Services required for the current annual term were projected to be $45,000. In 2016/17 the transport of vehicles and equipment exceeded projections and minor issues stemming from Hurricane Irma caused additional service requirements. Staff is also requesting to increase the renewal terms’ annual amount from $45,000 to $60,000 in anticipation of additional service requirements. APPROPRIATION CODE AND AMOUNT: Fleet department’s operating budget 566-06611-530300-519-000-0000 Page 1 City of Clearwater Printed on 11/16/2017 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8109 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Solid Waste/General Services Agenda Number: 7.20 SUBJECT/RECOMMENDATION: Approve an increase to Contract 900048, Hose and Hydraulics, Inc. of Clearwater, FL, in the amount of $100,000 for the remainder of the third year term, bringing the total amount to $325,000, increase the final two terms of the contract expiring August 10, 2022 to $325,000 for the purchase of replacement hydraulic parts, repairs and service for vehicles and equipment used by city departments, in accordance with Clearwater Code of Ordinances Sec. 2.564(1) (d), Other Government Entities Bids, and authorize the appropriate officials to execute same. (consent) SUMMARY: This contract was approved by Council on September 18, 2017 for an original amount of $225,000 annually. This blanket purchase order is a piggyback of Pinellas County Contract 167-0444-Q(RF); contract term through August 10, 2022 and covers the purchase of replacement hydraulic parts, repairs, and services for use on city vehicles and equipment, however the scope of the original contract amount was for hydraulic service at the fleet shop. Fleet subsequently expanded use of H&H to include road services and the clean-up of hydraulic spills associated with that road service. Fleet also started “pit stop” Wednesdays, where H&H will come on site to the SW complex or Fleet Maintenance to do preventive maintenance. Under that program, Hose & Hydraulics comes out and checks the integrity of the hydraulic hose lines weekly and replaces as needed. This is beneficial to the City as this lowers the amount of roadside service calls and prevents hydraulic leaks and their associated environmental impacts. In addition, $50,000 of the increase is related to the purchase of parts, which is being deducted from another contract for parts. The services include hydraulic hoses, fittings, pumps, and motors for various heavy equipment vehicles, which include but not limited to; refuse vehicles, dump trucks, beach rakes and streetsweepers. APPROPRIATION CODE AND AMOUNT: 566-06611-550600-519-000 $100,000 FY19/20 Future year funding will be requested as part of the annual budget process. Page 1 City of Clearwater Printed on 9/3/2020 File #:ID#17-3775 Version:1 Name:Hose & Hydraulics Parts, Repairs & Service Contract Type:Action Item Status:Passed File created:8/9/2017 In control:Solid Waste/General Services On agenda:9/18/2017 Final action:9/18/2017 Title: Approve a Contract (Blanket Purchase Order) to Hose and Hydraulics, Inc. of Clearwater, FL in the amount of $225,000 annually for the purchase of replacement hydraulic parts, repairs and service for vehicles and equipment used by city departments, in accordance with Sec. 2.564(1)(d), Other Government Entities Bids, and authorize the appropriate officials to execute same. SUBJECT/RECOMMENDATION: Title Approve a Contract (Blanket Purchase Order) to Hose and Hydraulics, Inc. of Clearwater, FL in the amount of $225,000 annually for the purchase of replacement hydraulic parts, repairs and service for vehicles and equipment used by city departments, in accordance with Sec. 2.564(1)(d), Other Government Entities Bids, and authorize the appropriate officials to execute same. Body SUMMARY: This blanket purchase order is a piggyback off of Pinellas County Contract 167-0444-Q(RF); contract term through August 2022 and covers the purchase of replacement hydraulic parts, repairs and services for use on city vehicles and equipment. The services include hydraulic hoses, fittings, pumps, and motors for various heavy equipment vehicles, which include but not limited to; refuse vehicles, dump trucks, beach rakes and streetsweepers. APPROPRIATION CODE AND AMOUNT: 566-06611-550600-519-000 $225,000 This is budgeted in the operating expenses for Fiscal Year 16/17 and Fiscal Year 17/18 Sign In Home Legislation Calendar City Council Departments People Archived Meetings Details Reports History (1)Text Blanket Purchase Agreement: 427924 Revision No: 0 Page 1 of 4 Pinellas County Purchasing Department Board of County Commissioners Pinellas County 400 S Ft Harrison Ave 6th Floor Annex Bldg Clearwater FL 33756 The Standard Purchase Order Number must appear on all packages, shipping notices, invoices and correspondence PO Date 10-AUG-2017 Revision Date Buyer/Phone No Suzanne Otocki-Pascarella 727-464-4123 Sales Tax Exempt No 85-8013287050C-7 Requisitioner Director Approval Quote/Contact Supplier:Ship To:Invoice To: Hose & Hydraulics Inc 504 S Myrtle Ave Clearwater FL 33756 727-461-2079 BLANK_SPACE?> Fleet Management 9685 Ulmerton Rd Largo, FL 33771 727-582-3000 Finance Division Accounts Payable Board of County Commissioners Pinellas County PO Box 2438 Clearwater, FL 33757 727-464-8389 Notes: 167-0444-Q(RF) Hydraulic Repair, Parts & Service The contracted hourly rates include all labor, supervision, materials, supplies, equipment, tools, disposal, freight charges and travel necessary to provide all contracted services. Response to Road Service (field repair) requests required within thirty (30) minutes of call from County Representative and provide time commitment for field repair. Pick-up and delivery of parts shall be provided within twenty-four (24) hours of request, from and to all Fleet Management locations. Repairs shall be completed with new, quality brand replacement parts. Time commitment for completion shall be provided to County Representative for all shop repairs. Invoices must be itemized to show Purchase Order Number, amount of time spent on repair, part information including part numbers with list price, discount percentage and discounted price to Pinellas County. Notes: Supplier No Payment Terms Freight Terms FOB Ship Via 194 Net 45 Freight Included Destination Best Way Effective Start Date Effective End Date Delivery Date Amount Agreed 11-AUG-2017 10-AUG-2022 $230,000.00 This Blanket Purchase Agreement (BPA) is not a guaranteed amount. It may be increased or decreased during the contract period internally. Standard Purchase Order(s) will be issued against the BPA as services or goods are needed. The SPO will contain a statement "This PO Line references BPA Number" so you may identify that services should begin. Any other direction to provide goods or services other than a SPO authorized by the Purchasing Department may result in non-payment. Line County Item Number / Description Quantity UOM Unit Price Amount 1 Hydraulic Repair, Parts & Service Dollar (s)1.0000 .0000 Fixed hourly labor rate is $55.00 for general hydraulic shop work performed at Vendor's or County Fleet location, hydraulic machine shop work, and/or field repair (Road Service). 40% Discount off List Price for parts. TOTAL Blanket Purchase Agreement: 427924 Revision No: 0 Page 2 of 4 It is hereby certified that all provisions of the laws of Florida were complied with in issuing this order, and that there are sufficient and properly appropriated funds to liquidate this obligation. This purchase order is governed by the terms and conditions below. Notice: Vendors doing business with Pinellas County are required to show proof of current Pinellas Construction licenses, if applicable Board of County Commissioners Pinellas County, Florida (Authorized Signature) Blanket Purchase Agreement: 427924 Revision No: 0 Page 3 of 4 TERMS AND CONDITIONS ACCEPTANCE -ENTIRE AGREEMENT -Acceptance of this Purchase Order will be unqualified,unconditional,and subject to and expressly limited by the Terms and Conditions hereon.Pinellas County and the Contractor shall not be bound by additional provisions or provisions at variance herewith that may appear in the Contractor's quotation,acknowledgement in force,or any other communication from Contractor to Pinellas County unless such provision is expressly agreed to and confirmed to in writing. ASSIGNMENT/SUBCONTRACTING -The Contractor shall provide the Services required by this Agreement.No assignment or subcontracting shall be allowed without prior written consent of the Pinellas County.In the event of a corporate acquisition and/or merger,the Contractor shall provide written notice to the Pinellas County,within (30)business days of Contractor's notice of such action or upon the occurrence of said action,whichever occurs first.In that event,the Pinellas County may terminate this Agreement in those instances in which a corporate acquisition and/or merger represents a conflict of interest or contrary to any local,state or federal laws. CAPTIONS -Captions have been provided for the benefit of the parties,and for referenceonly,and are not deemed to be part of the agreement created. COMPENSATION - Pinellas County shall pay Contractor upon Contractor's completion of, and Pinellas County's acceptance of, the services required herein, as specified. All payments shall be made in accordance with the Local Government Prompt Payment Act, Florida Statutes Section 218.70. ·Invoicing - Invoice(s) must be submitted to the billing address indicated on the face of the Standard Purchase Order. Each invoice shall include, at a minimum, the Supplier's name, contact information and the standard purchase order number. The County may dispute any payments invoiced by Supplier in accordance with the County's Dispute Resolution Process for Invoiced Payments, established in accordance with Section 218.76, Florida Statutes, and any such disputes shall be resolved in accordance with the County's Dispute Resolution Process. ·Name Changes - The successful contractor is responsible for immediately notifying the Purchasing Department of any company name change, which would cause invoicing to change from the name used at the time of the original purchase order or solicitation. ·ePayables -Pinellas County offers a credit card payment process (ePayables)through Bank of America.Pinellas County does not charge vendors to participate in the program;however,there may be a charge by the company that processes your credit card transactions. For more information please visit Pinellas County purchasing website at www.pinellascounty.org/purchase COMPLIANCE WITH APPLICABLE LAWS -Contractor certifies that all of the products and services to be furnished hereunder will be manufactured or supplied by Contractor in accordance with all applicable provisions of State,Local and Federal laws,as of this date. The laws of the State of Florida apply to any and all purchases made.Contractors shall comply with all local,state,and federal directives,orders and laws including,but not limited to,Equal Employment Opportunity (EEO),Minority Business Enterprise (MBE),and OSHA. DISCOUNTS -Delay in receiving an invoice,invoicing for materials shipped ahead of specified schedule,or invoices rendered with errors or omissions will be considered just cause for Pinellas County to withhold payment without losing discount privileges. Discount privilege will apply from date of scheduled delivery,the date or receipt of goods,or the date of approved invoice,whichever is later. FISCAL NON-FUNDING -In the event that sufficient budgeted funds are not available for a new fiscal period,the Pinellas County shall notify the Contractor of such occurrence and the Agreement shall terminate on the last day of then current fiscal period without penalty or expenseto the Pinellas County. GOVERNING LAW -The laws of the State of Florida shall govern this agreement. INDEMNITY PROVISION -Contractor shall indemnify,pay the costs of defense, including attorney's fees and hold harmless the Pinellas County from all suits,actions or claims of any character brought on account of any injuries or damages received or sustained by any person,persons or property,by or from said Contractor;or by or in consequence of any neglect in safeguarding the work;or through the use of unacceptable materials in the construction or improvements;or by,or on account of, any act of omission,neglect or misconduct of the said Contractor,on account of any act or amounts recovered under the "Workers Compensation Law"or of any other laws,bylaws,ordinance,order of decrees,except only such injury or damage as shall have been occasioned by the sole negligence of the Pinellas County.The first ten dollars ($10.00)of compensation received by the Contractor represents specific considerationfor thisindemnification obligation. The successful bidder(s)agrees to indemnify the Pinellas County and hold it harmless from and against all claims,liability,loss,damage or expense,including counsel fees,arising from or by reason of any actual or claimed trademark,patent or copyright infringement or litigation based thereon,with respect to the goods or any part thereof covered by this order,and such obligation shall survive acceptance of the goods and payment thereof by the Pinellas County. INDEPENDENT CONTRACTOR STATUS AND COMPLIANCE WITH THE IMMIGRATION REFORM AND CONTROL ACT OF 1986 -The Contractor is and shall remain an independent contractor and is neither agent,employee,partner,nor joint venture of the Pinellas County.Contractor acknowledges that it is responsible for complying with the provisions of the Immigration Reform and Control Act of 1986 located at 8 U.S.C.1324 et.seq.,and regulations thereto,as either may be amended from time to time.Failure to comply with the above provisions shall be considered a material breach and shall be grounds for immediate termination of the agreement,at the discretion of the Pinellas County. INQUIRIES -Any inquiries relative to Purchase Order should be directed to the Purchasing Department.Collect telephone calls will not be accepted. INSPECTION -Goods rejected due to inferior quality orworkmanship will be returned to Contractor with charge for transportation both ways,plus labor,loading,packing, etc.,and are not to be replaced except upon receipt of written instructions from Pinellas County. INSURANCE -The Contractor shall maintain insurance acceptable to Pinellas County,in full force and effect throughout the term of this Agreement.The Contractor must provide a Certificate of Insurance in accordance with the insurance requirements,evidencing such coverage prior to the commencement of any work under this agreement. MATERIAL QUALITY -All materials purchased and delivered against this agreement will be of first quality and not damaged and/or factory seconds.Any materials damaged or not in first quality condition upon receipt will be exchanged within twenty-four (24)hours of notice to the Contractor at no charge to the Pinellas County. MATERIAL SAFETY DATA -In accordance with OSHA Hazardous Communications Standards,it is the seller's duty to advise if a product is a toxic substance and to provide a Material Safety Data Sheet at time of delivery. NON-EXCLUSIVE AGREEMENT -Award of this Agreement shall impose no obligation on the Pinellas County to utilize the vendor for all work of this type,which may develop during the agreement period.This is not an exclusive agreement. Pinellas County specifically reserves the right to concurrently agree with other companies to provide similar work if it deems such action to be in the Pinellas County's best interest.In the case of multiple-term agreements,this provision shall apply separately to each term. PERMITS,FEES AND COSTS IMPOSED BY PINELLAS COUNTY TO BE OBTAINED BY AND/OR BORNE BY CONTRACTOR -The Contractor is responsible for (1)determining and paying any fees that may be necessary to perform this agreement and (2)determining and acquiring any and all permits and licenses required by any Federal,State or local government entity,agency or board that may be necessary to perform this agreement. The Contractor shall maintain any and allpermits and licenses required to complete this agreement. Blanket Purchase Agreement: 427924 Revision No: 0 Page 4 of 4 PRICES -Prices are F.O.B.destination unless otherwise specified and agreed to by the Pinellas County. ·DELIVERY/CLAIMS -Prices quoted shall be F.O.B.Destination, FREIGHT INCLUDED and unloaded to location(s)within Pinellas County. Actual delivery address (es)shall be identified at time of order. Successful bidder(s)will be responsible for making any and all claims againstcarriers for missing or damaged items PURCHASE ORDER NUMBER -Purchase Order Number must appear on all packing slips,invoices and all correspondence relating to the Order.Pinellas County will not be responsible for goods delivered without a Purchase Order Number. REMEDIES -Buyer and Seller shall have all remedies afforded by the Uniform Commercial Code and applicable law. RIGHT TO AUDIT -The Contractor shall retain records relating to this agreement for a period of at least three (3)years after final payment is made.All records shall be kept in such a way as will permit their inspection pursuant to Chapter 119,Florida Statutes.In addition,Pinellas County reserves the right to audit such records pursuant to Pinellas CountyCode,§2-176(j). SEVERABILITY -If any section,subsection,sentence,clause,phrase,or portion of this Agreement is for any reason held invalid or unconstitutional by any court of competent Jurisdiction,such portion shall be deemed separate,distinct,and independent provision,and such holding shall not affect the validity of the remaining portion thereof. TAX EXEMPTION -The Florida State Sales Tax Exemption Number for Pinellas County is on page one of the purchase order.Federal Excise Tax Exemption Number is available by contacting the Purchasing Department. TAXES -Payments to Pinellas County are subject to applicable Florida taxes. TERMINATION -Pinellas County reserves the right to terminate this agreement, without cause by giving thirty (30)days prior written notice to the Contractor of the intention to terminate or with cause if at any time the Contractor fails to fulfill or abide by any of the terms or conditions specified. Failure of the Contractor to comply with any of the provisions of this Agreement shall be considered a material breach of Agreement and shall be cause for immediate termination of the Agreement at the sole discretion of Pinellas County. In addition to all other legal remedies available to the Pinellas County,the Pinellas County reserves the right to terminate and obtain from another source any services which have not been provided within the period of time stated in the proposal,or if no such time is stated,within a reasonable period of time from the date of request,as determined by the Pinellas County. In the event that sufficient budgeted funds are not available for a new fiscal period, the Pinellas County shall notify the Contractor of such occurrence and the Agreement shall terminate on the last day of the then current fiscal year period without penalty or expense to the Pinellas County. VARIATION IN QUANTITY -Pinellas County assumes no liability for material produced,processed or shipped in excess of theamount specified herein. WARRANTY -Seller warrants that the goods are merchandisable and as described in Purchase Order. Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8134 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Official Records & Legislative Services Agenda Number: 7.21 SUBJECT/RECOMMENDATION: Appoint Janelle Branch to the Brownfields Advisory Board, as a business owner or representative, with a term to expire September 30, 2024. (consent) SUMMARY: APPOINTMENT WORKSHEET BOARD: Brownfields Advisory Board TERM: 4 years APPOINTED BY: City Council FINANCIAL DISCLOSURE: Not Required RESIDENCY REQUIREMENT: ** MEMBERS: 9 CHAIRPERSON: Joseph DeCicco MEETING DATE: As Called PLACE: Determined when called STAFF LIAISON: Charles Lane APPTS. NEEDED: 1 SPECIAL QUALIFICATIONS: ** Three members will be Clearwater residents who live within or adjacent to the Brownfields Area; Three members will be owners or representatives of businesses operating in the Brownfields area and need not be residents of Clearwater; Three members will be representatives of federal or state agencies or local governments involved with the Brownfields remediation process within Pinellas County and need not be Clearwater residents THE FOLLOWING BROWNFIELDS ADVISORY BOARD MEMBER’S TERM HAS EXPIRED AND DOES NOT WISH REAPPOINTMENT: 1. Phyllis Franklin - 511 Palm Dr., Largo, FL 33767 - Realtor Original Appointment: 9/06/07 (Ended 3rd term 5/31/19) Interested in Reappointment: No (Business owner or rep) Page 1 City of Clearwater Printed on 9/3/2020 File Number: ID#20-8134 THE NAME BELOW IS BEING SUBMITTED FOR CONSIDERATION TO FILL THE ABOVE VACANCY: 1. Janelle Branch - 711 S. Lincoln Ave., Apt. A2, 33756 - Chief Operating Officer Office: The Ring Workspaces, 600 Cleveland St., Suite 308, 33755 (Business owner or rep) (Currently we have no other nominees on file) Zip codes of current members: 4 at 33755 1 at 33756 1 at 33770 1 at 33773 Current Categories: 3 Agency or Government rep. 1 Business Owner or rep. 3 Residents Page 2 City of Clearwater Printed on 9/3/2020 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8121 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Legal Department Agenda Number: 7.22 SUBJECT/RECOMMENDATION: Increase the amount of the contract with Manson Bolves Donaldson Varn for outside counsel representation in Seminole Boat Docks land ownership issues for a not exceed amount of exceed $25,000, for a new contract total of not to exceed $75,000, approve the amendment to the Legal Services Agreement increasing the contract amount, and authorize the appropriate officials to execute same. (consent) SUMMARY: On March 7, 2019, City Council authorized hiring the law firm of Manson Bolves Donaldson Varn as outside counsel to provide expertise as it relates to water law/submerged lands and act as liaison to the FDEP and other parties as may be necessary to assist in clearing any cloud on title of the lands being developed under the Seminole Street Boat Ramp - North Marina District Improvements Project and approved a Legal Services Agreement for an amount not to exceed $50,000.00. The land ownership issues have proven more complex than originally anticipated and will now require litigation to complete. In the litigation phase, outside counsel will prepare and file motions for default, prepare and file Motions for Summary Judgement and attend hearing, negotiate and file Final Judgements as needed. APPROPRIATION CODE AND AMOUNT: Funds are available in cost code 0109600-530100, Professional Services, to fund this contract. Page 1 City of Clearwater Printed on 9/3/2020 FIRST AMENDMENT TO LEGAL SERVICES AGREEMENT THIS AGREEMENT is made on the ____ day of September, 2020 by and between the CITY OF CLEARWATER, FLORIDA (the "City") and the law firm of Manson, Bolves, Donaldson, Varn P.A. (“Counsel"). W I T N E S S E T H: WHEREAS, the City retained Counsel in connection with matters pertaining to provide expertise as it relates to water law/submerged lands and act as liaison to the FDEP and other parties as may be necessary to assist in clearing any cloud on title of the lands being developed under the Seminole Street Boat Ramp – North Marina District Improvements Project; and WHEREAS, it has become necessary to enter into litigation to clear title on the lands; NOW, THEREFORE, in consideration of the promises and mutual covenants herein contained, the parties hereto do hereby agree as follows: SECTION 1. THE LEGAL SERVICES AGREEMENT DATED MARCH, 12, 2019 IS HEREBY AMENDED AS FOLLOWS: SECTION 2. SCOPE OF SERVICES. Counsel hereby agrees to provide its professional services in connection with the following matter: Prepare and file motions for default, prepare and file Motion for Summary Judgements and attend hearing, negotiate and file Final Judgements as needed. SECTION 3. PROFESSIONAL FEES FOR SERVICES. The City and Counsel agree to a rate of $300.00 per hour for attorney services for Jacob D. Varn and other partners and $200.00 per hour for attorney services for associate attorneys. Professional fees for services shall not exceed $75,000.00 for the term of this Agreement. SECTION 4. All other terms and conditions of the original Legal Services Agreement remain in full force and effect. REMAINDER OF PAGE LEFT INTENTIONALLY BLANK [GM18-1313-111/258213/1] 2 IN WITNESS WHEREOF, the City and Counsel have executed this Agreement as of the date first written above. Countersigned: CITY OF CLEARWATER, FLORIDA ___________________________ By: __________________________ Frank Hibbard William B. Horne II Mayor City Manager Approved as to form: Attest: ___________________________ ________________________________ Pamela K. Akin Rosemarie Call City Attorney City Clerk MANSON, BOLVES, DONALDSON, VARN P.A. By: _____________________________ Jacob D. Varn, Esq. Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8127 Agenda Date: 9/3/2020 Status: Consent AgendaVersion: 1 File Type: Action ItemIn Control: Legal Department Agenda Number: 7.23 SUBJECT/RECOMMENDATION: Approve a Special Magistrate Services Agreement with Nancy Mag, Esq. and authorize the appropriate officials to execute same. (consent) SUMMARY: The Clearwater Community Development Code allows the use of special magistrates for code enforcement proceedings in section 5-406. The special magistrate’s powers include the ability to hear code enforcement proceedings under section 7-102, Clearwater Community Development Code, and the City’s civil citation appeals hearings under section 7-103.H.2, Clearwater Community Development Code. The recommended agreement retains Nancy Mag, a Florida licensed attorney, to serve as the City’s special magistrate and exercise those powers granted to special magistrates in the Development Code. The Office of the City Attorney has reviewed the proposed agreement and recommends that Council approve it. APPROPRIATION CODE AND AMOUNT: Funds are available in cost code 0101432-530100 (professional services) to fund this agreement. USE OF RESERVE FUNDS: N/A Page 1 City of Clearwater Printed on 9/3/2020 1 SPECIAL MAGISTRATE SERVICES AGREEMENT THIS AGREEMENT is made on the ____ day of _______, 2020, by and between the CITY OF CLEARWATER, FLORIDA, P.O. Box 4748, Clearwater, Florida 33758-4748 (the "City") and NANCY B. MAG, ESQ., 304 Old Mill Pond Rd., Palm Harbor, FL 34683 ("Attorney"). W I T N E S S E T H: WHEREAS, the City wishes to retain Attorney to provide Special Magistrate Services to the City of Clearwater for the purpose of conducting hearings pursuant to § 162.07, Florida Statutes and Sects. 7-102 and 7-103(H)(2), Clearwater Community Development Code. NOW, THEREFORE, in consideration of the promises and mutual covenants herein contained, the parties hereto do hereby agree as follows: SECTION 1. AUTHORIZATION TO PROCEED AS SPECIAL MAGISTRATE. Attorney is hereby authorized to provide Special Magistrate services as described in and for the professional fees described in this Agreement. SECTION 2. SCOPE OF SERVICES. Attorney accepts designation by the CITY as the “special magistrate” (“Special Magistrate”) for the purpose of conducting hearings pursuant to § 162.07, Florida Statutes and Sects. 7-102 and 7-103(H)(2), Clearwater Community Development Code. (1) All hearings conducted by Special Magistrate shall be held in the Clearwater City Council chambers, located on the 1st floor of the Clearwater Main Library, 100 N. Osceola Avenue, Clearwater, FL 33755, or at such other location designated by the City. (2) The hearings shall be held monthly on the second Tuesday of each month at 1:30 p.m. unless the hearings are rescheduled upon the mutual agreement of the parties. (3) The City Clerk shall be the clerk for the Special Magistrate and shall be responsible for scheduling all hearings, sending all notices, attending all hearings, and for all of the costs associated with completing the clerk’s duties. (4) At the hearing, the Special Magistrate shall take testimony from a code enforcement officer employed by the CITY and from the person requesting the hearing (hereinafter “petitioner”), and may take testimony from others. All testimony at the hearing will be under oath and will be recorded at the CITY’S expense. Formal rules of evidence do not apply, but the Special 2 Magistrate shall ensure that due process is observed and governs the proceedings. (5) At the conclusion of the hearing, the Special Magistrate shall determine whether a violation under the CITY’S code has occurred; in which case, the Special Magistrate shall uphold or dismiss the violation. If the Special Magistrate upholds the violation, the Special Magistrate shall require the petitioner to pay the penalty assessed by the CITY and may also require the petitioner to pay CITY costs. The Special Magistrate may also exercise any powers authorized under Part I, Chapter 162, Florida Statutes and Sections 5-406, 7-102, and 7-103, Clearwater Community Development Code. The CITY Clerk will prepare the final administrative order for the Special Magistrate containing the Special Magistrate’s determinations. The Special Magistrate will sign the final administrative order within 48 hours from the date of the hearing. SECTION 3. TERM. This Agreement will be effective September 1, 2020 and will continue until terminated in accordance with Section 9 herein. SECTION 4. RETAINER FEE. The City and Attorney agree to a flat rate retainer of $500.00 per month for any month where hearings are held. SECTION 5. CONFLICT OF INTEREST. It is understood by the City and Attorney that Attorney is not aware of any clients of the Attorney that currently present any conflict between the interests of the City and other clients of Attorney. If any potential conflict of interest arises during the time Attorney is acting as the Special Magistrate, Attorney will promptly inform the City. The City is under no obligation to agree to permit the conflict representation. SECTION 6. INDEPENDENT CONTRACTOR; PUBLIC RECORDS LAW. Attorney agrees that Attorney and any persons employed by Attorney for purposes related to this agreement are not employees of the City for any purpose whatsoever, including unemployment tax, social security contributions, income tax withholding or workers compensation, whether state or federal. Attorney agrees to pay and be solely responsible for all applicable taxes, both state and federal, in connection with this agreement. In addition to all other contract requirements as provided by law, the contractor executing this agreement agrees to comply with public records law. IF THE CONTRACTOR HAS QUESTIONS REGARDING THE APPLICATION OF CHAPTER 119, FLORIDA STATUTES, TO THE CONTRACTOR’S DUTY TO PROVIDE PUBLIC RECORDS RELATING TO THIS CONTRACT, CONTACT THE CUSTODIAN OF PUBLIC RECORDS AT: 727-562-4092, Rosemarie.Call@myclearwater.com, 600 Cleveland Street, Suite 600 Clearwater, FL 33755. 3 The contractor’s agreement to comply with public records law applies specifically to: a) Keep and maintain public records required by the City of Clearwater (hereinafter “public agency”) to perform the service being provided by the contractor hereunder. b) Upon request from the public agency’s custodian of public records, provide the public agency with a copy of the requested records or allow the records to be inspected or copied within a reasonable time at a cost that does not exceed the cost provided for in Chapter 119, Florida Statutes, as may be amended from time to time, or as otherwise provided by law. c) Ensure that the public records that are exempt or confidential and exempt from public records disclosure requirements are not disclosed except as authorized by law for the duration of the contract term and following completion of the contract if the contractor does not transfer the records to the public agency. d) Upon completion of the contract, transfer, at no cost, to the public agency all public records in possession of the contractor or keep and maintain public records required by the public agency to perform the service. If the contractor transfers all public records to the public agency upon completion of the contract, the contractor shall destroy any duplicate public records that are exempt or confidential and exempt from public records disclosure requirements. If the contractor keeps and maintains public records upon completion of the contract, the contractor shall meet all applicable requirements for retaining public records. All records stored electronically must be provided to the public agency, upon request from the public agency’s custodian of public records, in a format that is compatible with the information technology systems of the public agency. e) A request to inspect or copy public records relating to a public agency’s contract for services must be made directly to the public agency. If the public agency does not possess the requested records, the public agency shall immediately notify the contractor of the request and the contractor must provide the records to the public agency or allow the records to be inspected or copied within a reasonable time. f) The contractor hereby acknowledges and agrees that if the contractor does not comply with the public agency’s request for records, the public agency shall enforce the contract provisions in accordance with the contract. g) A contractor who fails to provide the public records to the public agency within a reasonable time may be subject to penalties under Section 119.10, Florida Statutes. h) If a civil action is filed against a contractor to compel production of public records relating to a public agency’s contract for services, the court shall assess and award against the contractor the reasonable costs of enforcement, including reasonable attorney fees, if: 1. The court determines that the contractor unlawfully refused to comply with 4 the public records request within a reasonable time; and 2. At least 8 business days before filing the action, the plaintiff provided written notice of the public records request, including a statement that the contractor has not complied with the request, to the public agency and to the contractor. i) A notice complies with subparagraph (h)2. if it is sent to the public agency’s custodian of public records and to the contractor at the contractor’s address listed on its contract with the public agency or to the contractor’s registered agent. Such notices must be sent by common carrier delivery service or by registered, Global Express Guaranteed, or certified mail, with postage or shipping paid by the sender and with evidence of delivery, which may be in an electronic format. A contractor who complies with a public records request within 8 business days after the notice is sent is not liable for the reasonable costs of enforcement. SECTION 7. DUAL OFFICE-HOLDING PROHIBITED. It is understood by the City and Attorney that Attorney may not act as a Special Magistrate for any other municipality or county while this agreement is in effect. SECTION 8. CONSTRUCTION AND AMENDMENTS. This Agreement shall be governed by and construed in accordance with the laws of the State of Florida. This Agreement may be amended only by a writing duly entered into by the City and the Special Magistrate. SECTION 9. CANCELLATION OF AGREEMENT. The City may cancel or terminate this Agreement upon ten days advance written notice to the Special Magistrate. In the event of cancellation, the Special Magistrate shall immediately cease work hereunder and shall be reimbursed for eligible and documented reimbursable expenses incurred prior to the date of cancellation. The Special Magistrate may cancel this Agreement by giving 30 days written notice to the city. IN WITNESS WHEREOF, the City and Attorney have executed this Agreement as of the date first written above. THE CITY OF CLEARWATER By: _____________________________ Frank V. Hibbard Mayor 5 Approved as to form: Attest: ______________________________ ___________________________________ Michael Fuino Rosemarie Call Assistant City Attorney City Clerk Attest: NANCY MAG, ESQ. ______________________________ ___________________________________ Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: 9407-20 Agenda Date: 9/3/2020 Status: Public HearingVersion: 1 File Type: OrdinanceIn Control: Office of Management & Budget Agenda Number: 8.1 SUBJECT/RECOMMENDATION: Set final millage rate of 5.9550 mills for fiscal year 2020/21 against non-exempt real and personal property within the City of Clearwater and pass Ordinance 9407-20 on first reading. (APH) SUMMARY: In accordance with Chapter 200 of the Florida Statutes, which defines requirements for the Determination of Millage and the rules governing Truth in Millage (TRIM) compliance, the City Council must hold two public hearings to adopt a final millage rate for the new fiscal year. The adoption of this ordinance to establish the millage rate and the two related budget ordinances are an integral part of fulfilling these requirements. The City Council set a tentative millage rate of 5.9550 mills on July 16, 2020, which is the rate that appeared on the TRIM bill notices mailed to taxpayers in August. The millage rate of 5.9550 mills represents a 5.12% increase from the rolled back rate of 5.6649 mills. Ordinance 9407-20 is presented in order to adopt the millage rate of 5.9550 mills to support the operating and capital improvement budgets for the 2020/21 fiscal year. Page 1 City of Clearwater Printed on 9/3/2020 Ordinance No. 9407-20 MILLAGE ORDINANCE ORDINANCE NO. 9407-20 AN ORDINANCE OF THE CITY OF CLEARWATER, FLORIDA, DECLARING THE MILLAGE RATE TO BE LEVIED FOR THE FISCAL YEAR BEGINNING OCTOBER 1, 2020, AND ENDING SEPTEMBER 30, 2021, FOR OPERATING PURPOSES INCLUDING THE FUNDING OF PENSIONS, DEBT SERVICE, AND ROAD MAINTENANCE FOR CAPITAL IMPROVEMENT EXPENDITURES AT 5.9550 MILLS; PROVIDING AN EFFECTIVE DATE. THE LEVY OF 5.9550 MILLS CONSTITUTES A 5.12% INCREASE FROM THE ROLLED BACK RATE OF 5.6649 MILLS. WHEREAS, the estimated revenue to be received by the City for the fiscal year beginning October 1, 2020, and ending September 30, 2021, from ad valorem taxes is $71,918,560; and WHEREAS, based upon the taxable value provided by the Pinellas County Property Appraiser, 5.9550 mills are necessary to generate $71,918,560; now, therefore, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CLEARWATER, FLORIDA: Section 1. It is hereby determined that a tax of 5.9550 mills against the non-exempt real and personal property within the City is necessary to raise the sums to be appropriated for operation purposes, including pensions, debt service, and road capital improvement projects, for the fiscal year beginning October 1, 2020. Section 2. The levy of 5.9550 mills constitutes a 5.12% increase from the rolled back rate. Section 3. This ordinance shall take effect October 1, 2020. PASSED ON FIRST READING _____________________ PASSED ON SECOND AND FINAL _____________________ READING AND ADOPTED ________________________________ Frank Hibbard Mayor Approved as to form: Attest: _____________________________ _________________________________ Pamela K. Akin Rosemarie Call City Attorney City Clerk |1CITY OF CLEARWATER ANNUAL OPERATING & CAPITAL IMPROVEMENT BUDGET myclearwater.com Fiscal Year 2020/21 |2CITY OF CLEARWATER Total Budget (All City Operations) Amended FY 2019/20 Proposed FY 2020/21 % Inc/(Dec) $558,204,821 $539,205,084 (3%) |3CITY OF CLEARWATER All Funds Fund Amended FY 2019/20 Proposed FY 2020/21 Increase/ (Decrease) General Fund $ 155,622,768 $ 152,179,840 (2%) Utility Funds 199,246,385 189,956,110 (5%) Enterprise Funds 12,406,426 12,750,460 3% Internal Service Funds 65,301,247 64,391,260 (1%) Special Revenue Funds 29,238,941 19,383,564 (34%) Capital Fund 96,389,054 100,543,850 4% |4CITY OF CLEARWATER $0 $3 $6 $9 $12 $15 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 $7.9 $7.6 $7.7 $8.7 $10.2 $11.9 $12.7 Property Values Billion |5CITY OF CLEARWATER Millage Rate •A “mill” is the property tax levy of $1 per $1,000 of taxable property value •Current Millage Rate 5.9550 mills •Proposed Millage Rate 5.9550 mills •(5.12% greater than rolled-back rate) •The rolled-back rate is the millage rate that will provide the same revenues as prior year if applied to the current tax roll (after adjusting for new construction) •Rolled-back Rate 5.6649 mills |6CITY OF CLEARWATER $0 $10 $20 $30 $40 $50 $60 $70 $80 $39.1 $37.1 $40.6 $46.5 $63.8 $68.1 $71.9 Ad Valorem Tax Revenues Million |7CITY OF CLEARWATER General Fund Revenues Source Amended FY 19/20 Proposed FY 20/21 Inc/(Dec) Ad Valorem Tax $ 64,911,420 $ 68,492,140 6% Utility Taxes 15,575,000 15,230,000 (2%) Other Taxes 6,614,400 6,350,000 (4%) Franchise Fees 10,010,000 10,104,770 1% Intergovernmental 23,499,780 18,862,910 (20%) Charges for Service 15,569,430 15,780,380 1% Transfers In 11,428,599 11,052,684 (3%) All Other Revenue 8,711,482 6,306,956 (28%) Transfer (to)/from Surplus (697,343) TOTAL $ 155,622,768 $ 152,179,840 (2%) |8CITY OF CLEARWATER General Fund -By Department Police 31% Fire / EMS 20% Parks and Recreation 21%Library 5% Planning and Development 4% Engineering 5% Non- Departmental5% Adm/Other 9% Public Safety 51% $152.2 Million |9CITY OF CLEARWATER General Fund -By Category Personnel 65% Operating 15% Internal Service 12% Interfund Transfers 7% Debt and Capital 1% $152.2 Million |10CITY OF CLEARWATER 1,708.4 1,685.5 1,709.7 1,790.3 1,834.6 1,837.6 0.0 200.0 400.0 600.0 800.0 1,000.0 1,200.0 1,400.0 1,600.0 1,800.0 2,000.0 Full Time Equivalent Positions (All Funds) |11CITY OF CLEARWATER Capital Improvement Fund Utility Operations 54% General Government 36.5% Internal Service 7.5% Small Enterprise 2% $100.5 Million |12CITY OF CLEARWATER Homesteaded Property Save Our Homes Cap –2.3% 2019 2020 Increase Taxable Value $100,00 $102,300 $2,300 City Taxes $595.50 $609.20 $13.70 |13CITY OF CLEARWATER Where your property taxes go - 31% 31% 29% 9%School Board Pinellas County Clearwater Other Agencies |14CITY OF CLEARWATER Public Hearings Thursday, Sept. 3 –6 p.m. Thursday, Sept. 17 –6 p.m. |15CITY OF CLEARWATER ANNUAL OPERATING & CAPITAL IMPROVEMENT BUDGET myclearwater.com Fiscal Year 2020/21 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: 9408-20 Agenda Date: 9/3/2020 Status: Public HearingVersion: 1 File Type: OrdinanceIn Control: Office of Management & Budget Agenda Number: 8.2 SUBJECT/RECOMMENDATION: Approve the City of Clearwater Annual Operating Budget for the 2020/21 fiscal year and pass Ordinance 9408-20 on first reading. (APH) SUMMARY: In accordance with Chapter 200 of the Florida Statutes and the rules governing Truth in Millage (TRIM) compliance, the City Council must hold two public hearings to adopt the budget. The adoption of this ordinance and the related ordinances adopting the 2020/21 millage rate and the Capital Improvement Budget are an integral part of fulfilling these requirements. On June 26, 2020, the City Manager provided the City Council with a Preliminary Annual Operating and Capital Improvement Budget that outlined estimates of revenues and expenditures for the 2020/21 fiscal year. The City Manager presented the preliminary budget at the City Council meeting on July 16, 2020, for Council discussion and citizen input. In addition, a Special Budget Work Session was held on July 28, 2020 for Council discussion of the proposed budget. The following changes have been made to the preliminary operating budget and are included in the ordinances for adoption of the operating budget: ·General Fund revenues reflect an increase of $105,630 to ad valorem tax revenues based upon 2020 preliminary property tax values received on June 29th which were greater than early estimates. ·Updates made in Miscellaneous and Transfer In revenues (net zero) to account for revenues in the correct categories. ·Various General Fund department budgets are being reduced representing operating savings found to help offset the increase to the Police Department for the cost of the Police Body Worn Camera Program which was approved by Council on August 6, 2020. This results in a net expenditure increase of $105,630. ·In the Stormwater Fund, utility fee revenue is reduced by $258,380 and transfers to capital projects are reduced by $1,451,950. These changes are being made to better align with rate study revenue estimates and planned project funding. ·In the Central Insurance Fund, transfers to capital projects is increased by $27,460 to fund the AED Replacement Program formerly in the General Fund Fire Department. Page 1 City of Clearwater Printed on 9/3/2020 File Number: 9408-20 The use of fund reserves is increased to cover this expenditure. ·In the Special Development Fund, ad valorem tax (road millage) revenues are increased by $5,290 based upon 2020 preliminary property tax values received from the County on June 29th which were greater than early estimates. ·Special Program Fund revenues and expenditures are increased by $270,794 to account for the transfer of General Fund revenue to fund the new Police Body Worn Camera Program approved by Council on August 6, 2020. ·In Other Housing Assistance Funds, revenues and expenditures for State Housing Initiatives Partnership (SHIP) are eliminated reflecting a decrease of $1,247,740. The State’s distribution of SHIP funds for fiscal year 2020/21 was vetoed statewide. Page 2 City of Clearwater Printed on 9/3/2020 Ordinance No. 9408-20 OPERATING BUDGET ORDINANCE ORDINANCE NO. 9408-20 AN ORDINANCE OF THE CITY OF CLEARWATER, FLORIDA, ADOPTING AN OPERATING BUDGET FOR THE FISCAL YEAR BEGINNING OCTOBER 1, 2020, AND ENDING SEPTEMBER 30, 2021; AUTHORIZING THE CITY MANAGER TO ISSUE SUCH INSTRUCTIONS THAT ARE NECESSARY TO ACHIEVE AND ACCOMPLISH THE SERVICE PROGRAMS SO AUTHORIZED; AUTHORIZING THE CITY MANAGER TO TRANSFER MONIES AND PROGRAMS AMONG THE DEPARTMENTS AND ACTIVITIES WITHIN ANY FUND AS PROVIDED BY CHAPTER 2 OF THE CLEARWATER CODE OF ORDINANCES; PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Manager has submitted an estimate of the expenditures necessary to carry on the City government for the fiscal year beginning October 1, 2020, and ending September 30, 2021; and WHEREAS, an estimate of the revenues to be received by the City during said period from ad valorem taxes and other sources has been submitted to the City Council; and WHEREAS, a general summary of the operating budget, and notice of the times and places where copies of the budget message and operating budget are available for inspection by the public, was published in a newspaper of general circulation; and WHEREAS, the City Council has examined and carefully considered the proposed budget; and WHEREAS, in accordance with Chapter 2 of the Clearwater Code of Ordinances, the City Council conducted a public hearing in City Hall on September 3, 2020, upon said budget and tax levy; now, therefore, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CLEARWATER, FLORIDA; Section 1. Pursuant to the City Manager's Annual Budget Report for the fiscal year beginning October 1, 2020, and ending September 30, 2021, a copy of which is on file with the City Clerk, the City Council hereby adopts a budget for the operation of the City, a copy of which is attached as Exhibit A, and a summary of which is attached as Exhibit B. Section 2. The budget as adopted shall stand and be the budget of the City for said fiscal year, subject to the authority of the City Council to amend or change the budget as provided by Section 2.519 of the Clearwater Code of Ordinances. Section 3. The City Manager is authorized and directed to issue such instructions and directives that are necessary to achieve and accomplish the service programs authorized by the adoption of this budget. Ordinance No. 9408-20 Section 4. The City Manager is authorized for reasons of economy or efficiency to transfer part or all of any unencumbered appropriation balance among programs within an operating fund, provided such action does not result in the discontinuance of a program. Section 5. It is the intent of the City Council that this budget, including amendments thereto, is adopted to permit the legal appropriation and encumbering of funds for the purposes set forth in the budget. All appropriated and encumbered but unexpended funds at the end of the fiscal year may be expended during the subsequent fiscal year for the purposes for which they were appropriated and encumbered, and such expenditures shall be deemed to have been spent out of the current budget allocation. It shall not be necessary to reappropriate additional funds in the budget for the subsequent fiscal year to cover valid open encumbrances outstanding as of the end of the current fiscal year. Section 6. Should any provision of this ordinance be declared by any court to be invalid, the same shall not affect the validity of the ordinance as a whole, or any provision thereof, other than the provision declared to be invalid. Section 7. This ordinance shall take effect October 1, 2020. PASSED ON FIRST READING _____________________ PASSED ON SECOND AND FINAL _____________________ READING AND ADOPTED ________________________________ Frank Hibbard Mayor Approved as to form: Attest: ______________________________ ________________________________ Pamela K. Akin Rosemarie Call City Attorney City Clerk Page 1 Special Special Other Housing Total General Development Program Assistance Trust Governmental GOVERNMENTAL FUNDS Fund Fund Fund Funds Funds Balances Brought Forward 25,123,713 11,665,573 8,693,718 3,256,144 48,739,148 Budgeted Revenues Ad Valorem Taxes 68,492,140 3,426,420 71,918,560 Utility Taxes 15,230,000 15,230,000 Local Option, Fuel & Other Taxes 6,350,000 13,271,980 19,621,980 Franchise Fees 10,104,770 10,104,770 Other Permits and Fees 2,309,000 2,309,000 Intergovernmental Revenue 18,862,910 837,360 431,440 20,131,710 Charges for Services 15,780,380 150,000 15,930,380 Judgments, Fines and Forfeits 1,354,000 1,354,000 Miscellaneous Revenues 2,643,956 550,000 100,000 3,293,956 Transfers In 11,052,684 722,904 11,775,588 Other Financing Sources TOTAL BUDGETED REVENUES 152,179,840 17,398,400 1,660,264 431,440 171,669,944 TOTAL REVENUES, TRANSFERS, AND BALANCES 177,303,553 29,063,973 10,353,982 3,687,584 220,409,092 Budgeted Expenditures City Council 395,821 395,821 City Manager's Office 1,275,890 1,275,890 City Attorney's Office 1,809,585 1,809,585 City Audit 226,432 226,432 CRA Administration 468,480 468,480 Economic Development and Housing 1,828,948 1,828,948 Engineering 8,230,947 8,230,947 Finance 2,637,681 2,637,681 Fire 30,293,051 30,293,051 Human Resources 1,562,078 1,562,078 Library 8,000,965 8,000,965 Non-Departmental 7,784,508 7,784,508 Official Records and Legislative Services 1,215,681 1,215,681 Parks and Recreation 31,136,988 31,136,988 Planning and Development 6,458,802 6,458,802 Police 47,259,323 300,794 47,560,117 Public Communications 1,196,190 1,196,190 Public Utilities 398,470 398,470 General Government Services 337,380 337,380 Economic Environment 686,120 323,580 1,009,700 Human Services 1,500 1,500 Culture and Recreation 70,000 70,000 Transfers Out 17,361,860 194,470 107,860 17,664,190 TOTAL BUDGETED EXPENDITURES 152,179,840 17,361,860 1,590,264 431,440 171,563,404 Fund Balances/Reserves/Net Assets 25,123,713 11,702,113 8,763,718 3,256,144 48,845,688 TOTAL EXPENDITURES AND BALANCES 177,303,553 29,063,973 10,353,982 3,687,584 220,409,092 EXHIBIT A CITY OF CLEARWATER 2020-21 BUDGET Ordinance No. 9408-20 Page 2 Water Stormwater Solid Waste Total & Sewer Utility & Recycling Gas Utility UTILITY FUNDS Fund Fund Fund Fund Funds Balances Brought Forward 57,968,487 29,954,457 18,494,583 10,264,058 116,681,585 Budgeted Revenues Ad Valorem Taxes Utility Taxes Local Option, Fuel & Other Taxes Franchise Fees Other Permits and Fees 1,350 1,350 Intergovernmental Revenue Charges for Services 93,969,645 16,910,500 26,090,000 47,003,340 183,973,485 Judgments, Fines and Forfeits 271,000 73,000 103,000 153,100 600,100 Miscellaneous Revenues 1,835,000 916,390 936,000 631,700 4,319,090 Transfers In Other Financing Sources TOTAL BUDGETED REVENUES 96,075,645 17,899,890 27,130,350 47,788,140 188,894,025 TOTAL REVENUES, TRANSFERS, AND BALANCES 154,044,132 47,854,347 45,624,933 58,052,198 305,575,610 Budgeted Expenditures Water & Sewer Fund Public Utilities Administration 1,703,374 1,703,374 Wastewater Collection 13,506,904 13,506,904 Public Utilities Maintenance 9,060,046 9,060,046 WPC Plant Operations 33,737,721 33,737,721 WPC Laboratory Operations 1,594,863 1,594,863 WPC Industrial Pretreatment 1,042,918 1,042,918 Water Distribution 18,805,229 18,805,229 Water Supply 18,336,027 18,336,027 Reclaimed Water 4,502,398 4,502,398 Stormwater Fund Stormwater Management 10,647,663 10,647,663 Stormwater Maintenance 6,058,657 6,058,657 Solid Waste & Recycling Fund Administration 1,036,817 1,036,817 Solid Waste Collection 17,853,129 17,853,129 Solid Waste Transfer 2,354,091 2,354,091 Solid Waste Container Maintenance 944,923 944,923 Recycling Residential 1,401,597 1,401,597 Recycling Multi Family 460,267 460,267 Recycling Commercial 1,652,106 1,652,106 Gas Fund Administration and Supply 21,830,658 21,830,658 Pinellas Gas Operations 9,775,059 9,775,059 Pasco Gas Operations 6,709,495 6,709,495 Gas Marketing and Sales 6,942,168 6,942,168 TOTAL BUDGETED EXPENDITURES 102,289,480 16,706,320 25,702,930 45,257,380 189,956,110 Fund Balances/Reserves/Net Assets 51,754,652 31,148,027 19,922,003 12,794,818 115,619,500 TOTAL EXPENDITURES AND BALANCES 154,044,132 47,854,347 45,624,933 58,052,198 305,575,610 EXHIBIT A CITY OF CLEARWATER 2020-21 BUDGET Ordinance No. 9408-20 Page 3 Clearwater Total Harbor Other Airpark Marine Marine Parking Enterprise OTHER ENTERPRISE FUNDS Fund Fund Fund Fund Funds Balances Brought Forward 897,409 1,841,232 1,864,589 16,352,838 20,956,068 Budgeted Revenues Ad Valorem Taxes Utility Taxes Local Option, Fuel & Other Taxes Franchise Fees Other Permits and Fees Intergovernmental Revenue Charges for Services 18,500 5,133,210 872,870 6,230,560 12,255,140 Judgments, Fines and Forfeits 6,000 1,600 800,000 807,600 Miscellaneous Revenues 329,360 138,000 47,500 300,000 814,860 Transfers In Other Financing Sources TOTAL BUDGETED REVENUES 347,860 5,277,210 921,970 7,330,560 13,877,600 TOTAL REVENUES, TRANSFERS, AND BALANCES 1,245,269 7,118,442 2,786,559 23,683,398 34,833,668 Budgeted Expenditures Airpark Fund Airpark Operations 340,770 340,770 Marine Fund Marina Operations 5,119,120 5,119,120 Clearwater Harbor Marine Fund Clearwater Harbor Marina Operations 854,430 854,430 Parking Fund Parking System 4,552,380 4,552,380 Parking Enforcement 800,000 800,000 Beach Guard Operations 950,920 950,920 Seminole Street Boat Ramp 132,840 132,840 TOTAL BUDGETED EXPENDITURES 340,770 5,119,120 854,430 6,436,140 12,750,460 Fund Balances/Reserves/Net Assets 904,499 1,999,322 1,932,129 17,247,258 22,083,208 TOTAL EXPENDITURES AND BALANCES 1,245,269 7,118,442 2,786,559 23,683,398 34,833,668 EXHIBIT A CITY OF CLEARWATER 2020-21 BUDGET Ordinance No. 9408-20 Page 4 Administrative General Central Service Service Garage Insurance INTERNAL SERVICE FUNDS Fund Fund Fund Fund Total Balances Brought Forward 5,767,651 6,557,103 5,716,881 27,249,418 45,291,053 Budgeted Revenues Ad Valorem Taxes Utility Taxes Local Option, Fuel & Other Taxes Franchise Fees Other Permits and Fees Intergovernmental Revenue Charges for Services 13,125,520 6,009,230 17,494,420 23,271,960 59,901,130 Judgments, Fines and Forfeits Miscellaneous Revenues 180,000 185,000 1,030,000 900,000 2,295,000 Transfers In Other Financing Sources TOTAL BUDGETED REVENUES 13,305,520 6,194,230 18,524,420 24,171,960 62,196,130 TOTAL REVENUES, TRANSFERS, AND BALANCES 19,073,171 12,751,333 24,241,301 51,421,378 107,487,183 Budgeted Expenditures Administrative Services Fund Information Technology/Administration 408,735 408,735 Network Services 4,703,533 4,703,533 Software Applications 3,272,530 3,272,530 Telecommunications 862,372 862,372 Courier 191,630 191,630 Utility Customer Service 3,815,660 3,815,660 General Services Fund Administration 443,624 443,624 Building and Maintenance 5,718,756 5,718,756 Garage Fund Fleet Maintenance 17,760,211 17,760,211 Radio Communications 1,155,979 1,155,979 Central Insurance Fund Risk Management 426,880 426,880 Employee Benefits 426,370 426,370 Employee Health Center 1,702,340 1,702,340 Non-Departmental 23,502,640 23,502,640 TOTAL BUDGETED EXPENDITURES 13,254,460 6,162,380 18,916,190 26,058,230 64,391,260 Fund Balances/Reserves/Net Assets 5,818,711 6,588,953 5,325,111 25,363,148 43,095,923 TOTAL EXPENDITURES AND BALANCES 19,073,171 12,751,333 24,241,301 51,421,378 107,487,183 EXHIBIT A CITY OF CLEARWATER 2020-21 BUDGET Ordinance No. 9408-20 Page 1 Total Total Total Total Other Internal Total Governmental Utility Enterprise Service All ALL FUNDS Funds Funds Funds Funds Funds Balances Brought Forward 48,739,148 116,681,585 20,956,068 45,291,053 231,667,854 Budgeted Revenues Ad Valorem Taxes 71,918,560 71,918,560 Utility Taxes 15,230,000 15,230,000 Local Option, Fuel & Other Taxes 19,621,980 19,621,980 Franchise Fees 10,104,770 10,104,770 Other Permits and Fees 2,309,000 1,350 2,310,350 Intergovernmental Revenue 20,131,710 20,131,710 Charges for Services 15,930,380 183,973,485 12,255,140 59,901,130 272,060,135 Judgments, Fines and Forfeits 1,354,000 600,100 807,600 2,761,700 Miscellaneous Revenues 3,293,956 4,319,090 814,860 2,295,000 10,722,906 Transfers In 11,775,588 11,775,588 Other Financing Sources TOTAL BUDGETED REVENUES 171,669,944 188,894,025 13,877,600 62,196,130 436,637,699 TOTAL REVENUES, TRANSFERS, AND BALANCES 220,409,092 305,575,610 34,833,668 107,487,183 668,305,553 Budgeted Expenditures City Council 395,821 395,821 City Manager's Office 1,275,890 1,275,890 City Attorney's Office 1,809,585 1,809,585 City Audit 226,432 226,432 CRA Administration 468,480 468,480 Economic Development and Housing 1,828,948 1,828,948 Engineering 8,230,947 8,230,947 Finance 2,637,681 2,637,681 Fire 30,293,051 30,293,051 Human Resources 1,562,078 1,562,078 Library 8,000,965 8,000,965 Non-Departmental 7,784,508 7,784,508 Official Records and Legislative Services 1,215,681 1,215,681 Parks and Recreation 31,136,988 31,136,988 Planning and Development 6,458,802 6,458,802 Police 47,560,117 47,560,117 Public Communications 1,196,190 1,196,190 Public Services 398,470 398,470 General Government Services 337,380 337,380 Economic Environment 1,009,700 1,009,700 Human Services 1,500 1,500 Culture and Recreation 70,000 70,000 Transfers Out 17,664,190 17,664,190 Water & Sewer Fund Expenditures Public Utilities Administration 1,703,374 1,703,374 Wastewater Collection 13,506,904 13,506,904 Public Utilities Maintenance 9,060,046 9,060,046 WPC Plant Operations 33,737,721 33,737,721 WPC Laboratory Operations 1,594,863 1,594,863 WPC Industrial Pretreatment 1,042,918 1,042,918 Water Distribution 18,805,229 18,805,229 Water Supply 18,336,027 18,336,027 Reclaimed Water 4,502,398 4,502,398 Stormwater Fund Stormwater Management 10,647,663 10,647,663 Stormwater Maintenance 6,058,657 6,058,657 EXHIBIT B CITY OF CLEARWATER 2020-21 BUDGET Ordinance No. 9408-20 Page 2 Total Total Total Total Other Internal Total Governmental Utility Enterprise Service All ALL FUNDS Funds Funds Funds Funds Funds Budgeted Expenditures Solid Waste & Recycling Fund Administration 1,036,817 1,036,817 Solid Waste Collection 17,853,129 17,853,129 Solid Waste Transfer 2,354,091 2,354,091 Solid Waste Container Maintenance 944,923 944,923 Recycling Residential 1,401,597 1,401,597 Recycling Multi Family 460,267 460,267 Recycling Commercial 1,652,106 1,652,106 Gas Fund Administration and Supply 21,830,658 21,830,658 Pinellas Gas Operations 9,775,059 9,775,059 Pasco Gas Operations 6,709,495 6,709,495 Gas Marketing and Sales 6,942,168 6,942,168 Airpark Fund Airpark Operations 340,770 340,770 Marine Fund Marina Operations 5,119,120 5,119,120 Clearwater Harbor Marine Fund Clearwater Harbor Marina Operations 854,430 854,430 Parking Fund Parking System 4,552,380 4,552,380 Parking Enforcement 800,000 800,000 Beach Guard Operations 950,920 950,920 Seminole Street Boat Ramp 132,840 132,840 Administrative Services Fund Information Technology/Administration 408,735 408,735 Network Services 4,703,533 4,703,533 Software Applications 3,272,530 3,272,530 Telecommunications 862,372 862,372 Courier 191,630 191,630 Clearwater Customer Service 3,815,660 3,815,660 General Services Fund Administration 443,624 443,624 Building and Maintenance 5,718,756 5,718,756 Garage Fund Fleet Maintenance 17,760,211 17,760,211 Radio Communications 1,155,979 1,155,979 Central Insurance Fund Risk Management 426,880 426,880 Employee Benefits 426,370 426,370 Employee Health Center 1,702,340 1,702,340 Non-Departmental 23,502,640 23,502,640 TOTAL BUDGETED EXPENDITURES 171,563,404 189,956,110 12,750,460 64,391,260 438,661,234 Fund Balances/Reserves/Net Assets 48,845,688 115,619,500 22,083,208 43,095,923 229,644,319 TOTAL EXPENDITURES AND BALANCES 220,409,092 305,575,610 34,833,668 107,487,183 668,305,553 2020-21 BUDGET EXHIBIT B CITY OF CLEARWATER Ordinance No. 9408-20 Proposed Final FY 20/21 Adjustments FY 20/21 Unassigned Fund Balance 25,123,713 25,123,713 Budgeted Revenues: Ad Valorem Taxes 68,386,510 105,630 68,492,140 (1) Utility Taxes 15,230,000 15,230,000 Local Option, Fuel & Other Taxes 6,350,000 6,350,000 Franchise Fees 10,104,770 10,104,770 Other Permits and Fees 2,309,000 2,309,000 Intergovernmental Revenues 18,862,910 18,862,910 Charges for Services 15,780,380 15,780,380 Judgments, Fines & Forfeits 1,354,000 1,354,000 Miscellaneous Revenues 2,531,000 112,956 2,643,956 (2) Transfers In 11,165,640 (112,956) 11,052,684 (2) Total Budgeted Revenues 152,074,210 105,630 152,179,840 Transfer (to) from Surplus - Total Revenues 152,074,210 105,630 152,179,840 Budgeted Expenditures: City Council 395,821 395,821 City Manager's Office 1,275,890 1,275,890 City Attorney's Office 1,809,585 1,809,585 City Audit 226,432 226,432 CRA Administration 468,480 468,480 Economic Development & Housing 1,858,948 (30,000) 1,828,948 (3) Engineering 8,230,947 8,230,947 Finance 2,637,681 2,637,681 Fire 30,366,721 (73,670) 30,293,051 (3) Human Resources 1,562,078 1,562,078 Library 8,000,965 8,000,965 Non-Departmental 7,824,508 (40,000) 7,784,508 (3) Official Records & Legislative Services 1,215,681 1,215,681 Parks & Recreation 31,159,988 (23,000) 31,136,988 (3) Planning & Development 6,480,802 (22,000) 6,458,802 (3) Police 46,965,023 294,300 47,259,323 (4) Public Communications 1,196,190 1,196,190 Public Utilities - Maintenance Facility 398,470 398,470 Total Budgeted Expenditures 152,074,210 105,630 152,179,840 Source/(Use) of Fund Equity - - - Ending Fund Balance 25,123,713 - 25,123,713 (1) Additional ad valorem revenues. Preliminary values were increased in comparison to early estimates. (2) Updates made to account for revenues in the correct category. (2) Operating savings found in various departments to offset cost of Police Body Worn Camera Program. (3) Increases related to new Body Worn Camera Program approved by Council August 6, 2020. As amended for final budget ordinance for September 3, 2020 public hearing. General Fund Operating Budget 2020/21 Page 1 Proposed Final FY 20/21 Adjustments FY 20/21 Fund Equity (Unrestricted Net Assets)29,954,457 29,954,457 Budgeted Revenues: Charges for Service 17,168,880 (258,380) 16,910,500 (1) Judgments, Fines & Forfeits 73,000 73,000 Miscellaneous Revenues 916,390 916,390 Transfers In - - Total Budgeted Revenues 18,158,270 (258,380) 17,899,890 Fund Reserves - - - Total Revenues 18,158,270 (258,380) 17,899,890 Budgeted Expenditures: Eng/Stormwater Management 12,099,613 (1,451,950) 10,647,663 (2) PS/Stormwater Maintenance 6,058,657 6,058,657 Total Budgeted Expenditures 18,158,270 (1,451,950) 16,706,320 Source/(Use) of Fund Equity - - 1,193,570 Ending Fund Balance 29,954,457 - 31,148,027 Stormwater Fund Operating Budget 2020/21 As amended for final budget ordinance for September 3, 2020 public hearing. (1) Reduction to stormwater utility fee revenue to better align with rate study revenue estimates. (2) Reduction to transfers to capital projects to better align with rate study project funding. Page 2 Proposed Final FY 20/21 Adjustments FY 20/21 Fund Equity (Unrestricted Net Assets)27,249,418 27,249,418 Budgeted Revenues: Charges for Service 23,271,960 23,271,960 Miscellaneous Revenues 900,000 900,000 Transfers In - - Total Budgeted Revenues 24,171,960 - 24,171,960 Fund Reserves 1,858,810 27,460 1,886,270 (1) Total Revenues 26,030,770 27,460 26,058,230 Budgeted Expenditures: Risk Management 426,880 426,880 Employee Benefits 426,370 426,370 Employee Health Center 1,702,340 1,702,340 Non-Departmental 23,475,180 27,460 23,502,640 (2) Total Budgeted Expenditures 26,030,770 27,460 26,058,230 Source/(Use) of Fund Equity (1,858,810) - (1,886,270) Ending Fund Balance 25,390,608 - 25,363,148 (1) Increased use of reserves to cover increased expenses (2). (2) Increase in transfers to capital to fund the AED Replacement Program formerly in General Fund Fire Department. Central Insurance Fund Operating Budget 2020/21 As amended for final budget ordinance for September 3, 2020 public hearing. Page 3 Proposed Final Budgeted Revenues:FY 20/21 Adjustments FY 20/21 Ad Valorem Taxes 3,421,130 5,290 3,426,420 (1) Infrastructure Tax 11771980 11,771,980 Interest Earnings 550000 550,000 Multi-Modal Impact Fees 150000 150,000 Local Option Gas Tax 1500000 1,500,000 Allocation of Assigned Fund Balance 678020 678,020 Total Revenues 18,071,130 5,290 18,076,420 Budgeted Expenditures: Transfer to Capital Improvement Fund Road Millage 3,344,710 3,344,710 Infrastructure Tax 12,450,000 12,450,000 Multi-Modal Impact Fees 140,000 140,000 Local Option Gas Tax 1,427,150 1,427,150 Total Expenditures 17,361,860 - 17,361,860 Proposed Final Budgeted Revenues:FY 20/21 Adjustments FY 20/21 Intergovernmental: Community Development Block Grant (CDBG)837,360 837,360 Interest Earnings 100,000 100,000 Transfers from General Fund: Sister City Program 37,380 37,380 Planning Study Fund 300,000 300,000 United Way Campaign Fund 1,500 1,500 Special Events 70,000 70,000 Economic Development QTI 13,230 13,230 Police Recruitments 30,000 30,000 Police Body Worn Camera Program - 270,794 270,794 (2) Total Revenues 1,389,470 270,794 1,660,264 Budgeted Expenditures: General Government 337,380 337,380 Public Safety 30,000 270,794 300,794 (2) Economic Environment 686,120 686,120 Human Services 1,500 1,500 Culture and Recreation 70,000 70,000 Interfund Transfers 164,470 164,470 Transfer to Capital Fund 30,000 30,000 Total Expenditures 1,319,470 270,794 1,590,264 Special Revenue Funds Operating Budget 2020/21 As amended for final budget ordinance for September 3, 2020 public hearing. SPECIAL DEVELOPMENT FUND SPECIAL PROGRAM FUND Page 4 Special Revenue Funds Operating Budget 2020/21 As amended for final budget ordinance for September 3, 2020 public hearing. Proposed Final Budgeted Revenues:FY 20/21 Adjustments FY 20/21 HOME Investment Partnerships (HOME)431,440 431,440 State Housing Initiatives Partnership (SHIP)1,247,740 (1,247,740) 0 (3) Total Revenues 1,679,180 (1,247,740) 431,440 Budgeted Expenditures: Economic Environment 1,440,300 (1,116,720) 323,580 (3) Interfund Transfers 238,880 (131,020) 107,860 (3) Total Expenditures 1,679,180 (1,247,740) 431,440 (1) Additional ad valorem revenues. Preliminary values were increased in comparison to early estimates. (2) To account for the transfer of General Fund revenue to fund the new Police Body Worn Camera Program approved by the Council on August 6, 2020. (3) To eliminate SHIP revenues and associated expenses. The distribution of SHIP funds for fiscal year 2020/21 was vetoed statewide. OTHER HOUSING ASSISTANCE FUNDS Page 5 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: 9409-20 Agenda Date: 9/3/2020 Status: Public HearingVersion: 1 File Type: OrdinanceIn Control: Office of Management & Budget Agenda Number: 8.3 SUBJECT/RECOMMENDATION: Approve the fiscal year 2020/21 Annual Capital Improvement Budget, establish a six-year plan for the Capital Improvement Program (CIP) and pass Ordinance 9409-20 on first reading. (APH) SUMMARY: In accordance with Chapter 200 of the Florida Statutes and the rules governing Truth in Millage (TRIM) compliance, the City Council must hold two public hearing to adopt the final budget. The adoption of this ordinance and the related ordinances adopting the 2020/21 millage rate and operating budget are an integral part of fulfilling these requirements. On June 26, 2020, the City Manager provided the City Council with a Preliminary Annual Operating and Capital Improvement Budget that outlined estimates of revenues and expenditures for the 2020/21 fiscal year. The City Manager presented the preliminary budget at the City Council meeting on July 16, 2020, for Council discussion and citizen input. In addition, a Special Budget Work Session was held on July 28, 2020 for Council discussion of the proposed budget. The following changes have been made to the Preliminary Capital Improvement Budget and are included in the ordinance for adoption of the capital improvement budget. ·The funding for Police District 3 Sub Station was incorrectly posted in fiscal year 2021/22, this interfund loan for $11,000,000 has been moved to fiscal year 2020/21. ·The Police Boat Replacement project has been eliminated. The boat purchase was approved by Council on August 20, 2020, amending the fiscal year 2019/20 budget to purchase with existing special program funds. ·The source of funding for the Auto External Defibrillator Program has been changed from General Fund revenue to Central Insurance Fund revenue. ·In the Spectrum Field Infrastructure Repairs/Improvements project, fiscal years 2023/24 and 2024/25 have been reduced by a total of $1,100,000 to better align future funding with the timing of contract negotiation. ·Stormwater projects have been amended to better align with project funding as planned in the rate study. This results in a decrease in project funding of $1,451,950 for fiscal year 2020/21. For the six-year capital improvement plan (fiscal years 2020/21 through 2025/26), project funding was decreased by a net total of $854,230. Page 1 City of Clearwater Printed on 9/3/2020 File Number: 9409-20 ·Water and Sewer projects have been amended to better align with project funding as planned in the rate study. This results in an increase of $9,000,000 to capital project funding in fiscal year 2025/26. Staff has provided a worksheet detailing these project changes for fiscal years 2020/21 through 2025/26. Page 2 City of Clearwater Printed on 9/3/2020 Ordinance No. 9409-20 CAPITAL IMPROVEMENT ORDINANCE ORDINANCE NO. 9409-20 AN ORDINANCE OF THE CITY OF CLEARWATER, FLORIDA, ADOPTING THE CAPITAL IMPROVEMENT PROGRAM BUDGET FOR THE FISCAL YEAR BEGINNING OCTOBER 1, 2020, AND ENDING SEPTEMBER 30, 2021; APPROVING THE SIX-YEAR CAPITAL IMPROVEMENT PROGRAM WHICH SHALL BE REEVALUATED AT THE BEGINNING OF EACH FISCAL YEAR; AUTHORIZING THE CITY MANAGER TO ISSUE SUCH INSTRUCTIONS THAT ARE NECESSARY TO ACHIEVE AND ACCOMPLISH THE CAPITAL IMPROVEMENTS SO AUTHORIZED; AUTHORIZING THE CITY MANAGER TO TRANSFER MONEY BETWEEN PROJECTS IN THE CAPITAL IMPROVEMENT PROGRAM; APPROPRIATING AVAILABLE AND ANTICIPATED RESOURCES FOR THE PROJECTS IDENTIFIED; PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Manager has submitted a proposed Six-Year Capital Improvement Program, and has submitted an estimate of the amount of money necessary to carry on said Capital Improvement Program for the fiscal year beginning October 1, 2020, and ending September 30, 2021; and WHEREAS, an estimate of the resources available and income to be received by the City during said period from ad valorem taxes and other sources has been submitted to the City Council; and WHEREAS, a general summary of the Capital Improvement Budget, and notice of the times and places when copies of the budget message and capital budget are available for inspection by the public, was published in a newspaper of general circulation; and WHEREAS, the City Council has examined and carefully considered the proposed budget; and WHEREAS, in accordance with Chapter 2 of the Clearwater Code of Ordinances, the City Council conducted a public hearing in the City Hall upon said proposed budget on September 3, 2020; now, therefore, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CLEARWATER, FLORIDA: Section 1. Pursuant to the Capital Improvement Program Report and Estimated Budget for the fiscal year beginning October 1, 2020, and ending September 30, 2021, a copy of which is on file with the City Clerk, the City Council hereby adopts a budget for the Ordinance No. 9409-20 capital improvement fund for the City of Clearwater, a copy of which is attached hereto as Exhibit A. Section 2. The Six-Year Capital Improvement Program and Budget, a summary of which is attached hereto, marked Exhibit B, is approved in its present form, but prior to the beginning of each fiscal year the City Council shall reevaluate priorities, hold public hearings and formally adopt additions or corrections thereto. Section 3. The budget as adopted shall stand and be the Capital Improvement Program Budget of the City for said fiscal year, subject to the authority of the City Council to amend or change the budget as provided by Section 2.519 of the Clearwater Code of Ordinances. Section 4. The City Manager is authorized and directed to issue such instructions and directives that are necessary to achieve and accomplish the capital improvements authorized by the adoption of this budget. Section 5. The City Manager is authorized to transfer appropriations within the capital budget, provided such transfer does not result in changing the scope of any project or the fund source included in the adopted capital budget. Section 6. Should any provision of this ordinance be declared by any court to be invalid, the same shall not affect the validity of the ordinance as a whole, or any provision thereof, other than the provision declared to be invalid. Section 7. This ordinance shall take effect October 1, 2020. PASSED ON FIRST READING AS AMENDED _____________________ PASSED ON SECOND READING _____________________ AND ADOPTED ________________________________ Frank V. Hibbard Mayor Approved as to form: Attest: _____________________________ ________________________________ Pamela K. Akin Rosemarie Call City Attorney City Clerk Budgeted Revenues GENERAL SOURCES:2020/21 General Operating Revenue 7,767,920 Penny for Pinellas 12,450,000 Road Millage 3,344,710 Local Option Fuel Tax 1,427,150 Grants 120,000 Other Governmental Revenue 456,020 Multi-Modal Impact Fees 140,000 Special Program Fund 30,000 Donations 50,000 SELF SUPPORTING FUNDS: Parking Revenue 894,000 Marine Revenue 690,000 Clearwater Harbor Marina Fund 150,000 Airpark Revenue 55,000 Utility System: Water Revenue 4,980,000 Sewer Revenue 22,733,500 Utility R & R 10,575,600 Water Impact Fees 160,000 Sewer Impact Fees 50,000 Stormwater Utility Revenue 6,063,090 Gas Revenue 8,800,000 Solid Waste Revenue 625,000 Recycling Revenue 100,000 INTERNAL SERVICE FUNDS: Garage Revenue 598,300 Administrative Services Revenue 985,000 General Services Fund 75,000 Central Insurance Fund 152,460 BORROWING - GENERAL SOURCES: Lease Purchase - General Fund 195,100 Interfund Loan - General Fund 11,000,000 BORROWING - INTERNAL SERVICE FUNDS: Lease Purchase - Garage 5,201,000 Lease Purchase - Administrative Services 675,000 TOTAL ALL FUNDING SOURCES:$100,543,850 CAPITAL IMPROVEMENT PROGRAM FOR FISCAL YEAR 2020/21 Exhibit A Ordinance No. 9409-20 Budgeted Expenditures FUNCTION:2020/21 Police Protection 11,075,000 Fire Protection 1,996,380 Major Street and Sidewalk Maintenance 4,596,470 Intersections 315,390 Parking 834,000 Miscellaneous Engineering 5,191,500 Parks Development 7,665,100 Marine Facilities 1,460,000 Airpark Facilities 175,000 Libraries 135,000 Garage 5,899,300 Maintenance of Buildings 2,665,000 Miscellaneous 2,105,000 Stormwater Utility 6,063,090 Gas System 8,800,000 Solid Waste & Recycling 725,000 Utilities Miscellaneous 100,000 Sewer System 30,988,020 Water System 9,754,600 TOTAL PROJECT EXPENDITURES $100,543,850 Exhibit A CAPITAL IMPROVEMENT PROGRAM FOR FISCAL YEAR 2020/21 Ordinance No. 9409-20 Function 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 Total Police Protection 11,075,000 2,175,000 675,000 675,000 675,000 675,000 15,950,000 Fire Protection 1,996,380 482,880 1,465,370 1,404,460 3,607,060 1,250,060 10,206,210 Major Street and Sidewalk Maintenance 4,596,470 5,292,440 5,395,790 5,136,720 6,798,010 6,475,170 33,694,600 Intersections 315,390 315,390 315,390 315,390 315,390 315,390 1,892,340 Parking 834,000 999,000 429,000 10,994,000 384,000 464,000 14,104,000 Miscellaneous Engineering 5,191,500 1,541,500 221,500 221,500 221,500 273,000 7,670,500 Parks Development 7,665,100 6,705,000 8,010,000 14,720,000 4,480,000 4,360,000 45,940,100 Marine Facilities 1,460,000 1,460,000 8,470,000 8,225,000 730,000 740,000 21,085,000 Airpark Facilities 175,000 25,000 6,035,000 3,061,600 25,000 25,000 9,346,600 Libraries 135,000 135,000 135,000 135,000 135,000 135,000 810,000 Garage 5,899,300 5,944,270 6,242,730 6,625,370 6,937,890 7,266,030 38,915,590 Maintenance of Buildings 2,665,000 2,315,000 2,365,000 2,415,000 2,415,000 2,415,000 14,590,000 General Public City Buildings - - - 1,853,570 14,903,500 1,585,410 18,342,480 Miscellaneous 2,105,000 1,855,000 1,855,000 1,755,000 1,695,000 1,705,000 10,970,000 Stormwater Utility 6,063,090 6,500,630 6,958,010 5,590,710 10,106,780 10,663,400 45,882,620 Gas System 8,800,000 8,800,000 8,550,000 8,550,000 8,550,000 8,550,000 51,800,000 Solid Waste & Recycling 725,000 750,000 2,100,000 750,000 760,000 760,000 5,845,000 Utilities Miscellaneous 100,000 100,000 100,000 100,000 100,000 100,000 600,000 Sewer System 30,988,020 39,299,610 39,027,000 34,244,540 25,547,540 11,797,540 180,904,250 Water System 9,754,600 19,391,000 23,601,000 41,744,000 18,861,000 10,136,000 123,487,600 100,543,850 104,086,720 121,950,790 148,516,860 107,247,670 69,691,000 652,036,890 Exhibit B Schedule of Planned Expenditures CAPITAL IMPROVEMENT PROGRAM EXPENDITURE SUMMARY BY FUNCTION FY 2020-2021 THROUGH FY 2025-2026 CAPITAL IMPROVEMENT FUND CITY OF CLEARWATER Ordinance No. 9409-20 Preliminary CIP Budget Net Change Project Funding Source 6-year Total 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 6-year Total Prelim vs. Final PD00180001 Police District 3 Sub Station Interfund Loan 11,000,000 11,000,000 - - - - - 11,000,000 - C21PD1 Police Boat Replacement Special Program Fund 180,000 - - - - - - - (180,000) FD 91257 Auto External Defibrillator Program Central Insurance Fund 177,600 27,460 28,280 29,130 30,000 30,900 31,830 177,600 - PR 93205 Spectrum Field Infra R&R General Fund 2,850,000 200,000 200,000 200,000 200,000 200,000 750,000 1,750,000 (1,100,000) C1908 Stormwater Vehicles & Equipment Stormwater Fund 8,300,000 800,000 1,258,340 1,307,550 1,358,200 1,500,000 1,500,010 7,724,100 (575,900) ENST180001 Storm System Improvements Stormwater Fund 10,857,150 1,515,030 1,572,940 1,802,240 1,094,640 2,693,750 2,593,350 11,271,950 414,800 ENST180002 - Allens Creek Stormwater Fund 2,600,000 - - 697,360 905,460 479,210 490,370 2,572,400 (27,600) ENST180003 Stormwater System Expansion Stormwater Fund 1,917,200 53,750 225,660 244,160 179,270 363,230 509,010 1,575,080 (342,120) ENST180004 Stevenson Creek Stormwater Fund 7,555,000 1,123,460 1,205,920 944,710 481,030 1,773,060 1,998,280 7,526,460 (28,540) ENST180005 Coastal Basin Stormwater Fund 7,874,000 1,447,390 1,031,850 1,017,280 1,091,080 1,430,430 1,574,100 7,592,130 (281,870) ENST180006 Alligator Creek Stormwater Fund 7,633,500 1,123,460 1,205,920 944,710 481,030 1,867,100 1,998,280 7,620,500 (13,000) PU 96664 Water Pollution Control R & R Sewer Revenue 8,000,000 - 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 10,000,000 2,000,000 PU 96665 Sanitary Sewer R & R Utility R&R 6,390,000 940,000 1,150,000 1,100,000 1,200,000 2,000,000 3,000,000 9,390,000 3,000,000 PU 96665 Sanitary Sewer R & R Sewer Revenue 21,500,000 4,600,000 5,100,000 4,900,000 4,900,000 2,000,000 3,000,000 24,500,000 3,000,000 PU 96722 Line Relocation Maint Water Revenue 3,700,000 850,000 850,000 750,000 750,000 500,000 500,000 4,200,000 500,000 PU 96739 Reclaimed Water Distribution System Water Revenue 5,000,000 650,000 950,000 450,000 2,450,000 500,000 500,000 5,500,000 500,000 105,534,450$ 112,400,220$ 6,865,770$ change from preliminary budget CIP Budget Final Project changes as amended for final budget ordinance for September 3, 2020 public hearing Page 1 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8128 Agenda Date: 9/3/2020 Status: Public HearingVersion: 1 File Type: Action ItemIn Control: Office of Management & Budget Agenda Number: 8.4 SUBJECT/RECOMMENDATION: Approve the recommended Penny for Pinellas project list, as revised for Fiscal Years 2020/21 through 2029/30. (APH) SUMMARY: On March 6, 1997, the City Council adopted Ordinance 6137-97. The ordinance established the requirement for a special hearing prior to adoption of the capital improvement budget to discuss the use of Penny for Pinellas tax, and at any time in which there is any proposed change to the Penny for Pinellas project funding of $500,000 or more. Changes to Penny for Pinellas projects that meet this criterion in the proposed 2020/21 capital improvement budget and six-year plan include the following: ·Fire Engines/Ladder Truck Replacement - The replacement schedule for fire engines is being changed to advance the planned engine replacement from fiscal year 2021/22 to 2020/21. This results in the replacement of two engines in fiscal year 2020/21. ·Public Safety Vehicle/Equipment Facility - The funding for this project, which provides for construction of a facility to store oversized vehicles and equipment for both the Police and Fire department, is being postponed to fiscal year 2021/22. Page 1 City of Clearwater Printed on 9/3/2020 Penny for Pinellas - Project Funding for September 3, 2020 Public Hearing Approved Total Projects 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 2026/27 2027/28 2028/29 2029/30 Projected Beginning Balance:2,484,482 1,806,462 2,887,495 990,554 363,190 (2,226,858) 2,128,342 (3,603,077) (702,782) (2,532,230) 2,484,482 - 11,771,980 12,081,033 12,383,059 12,692,636 13,009,952 13,335,200 13,668,580 14,010,295 14,360,552 3,679,892 120,993,180 14,256,462 13,887,495 15,270,554 13,683,190 13,373,142 11,108,342 15,796,923 10,407,218 13,657,770 1,147,662 123,477,662 Penny IV Approved Projects: Utilities Infrastructure 18,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 18,000,000 Sports Fields & Facilities Upgrades/Improvements 12,000,000 5,000,000 1,000,000 1,500,000 500,000 600,000 600,000 700,000 700,000 700,000 700,000 12,000,000 Waterfront/Bluff Masterplan (Imagine Clearwater)4,000,000 4,000,000 4,000,000 1,350,000 Fire Engines/Ladder Trucks 5,970,000 660,000 690,000 720,000 720,000 750,000 780,000 810,000 840,000 5,970,000 Police Vehicles 1,750,000 100,000 100,000 150,000 200,000 200,000 200,000 200,000 200,000 200,000 200,000 1,750,000 Public Safety Vehicle/Equipment Facility 1,500,000 1,500,000 1,500,000 1,500,000 Neighborhood and Community Parks Renovations 3,500,000 400,000 400,000 400,000 400,000 400,000 400,000 400,000 350,000 350,000 3,500,000 Bicycle Paths & Recreation Trails 2,500,000 1,250,000 1,250,000 2,500,000 Aviation Operations Center 760,000 760,000 760,000 Environmental Park Upgrades 1,500,000 750,000 750,000 1,500,000 Beach Marina Upgrades 15,000,000 7,500,000 7,500,000 15,000,000 Public Works Complex 12,300,000 4,600,000 2,600,000 5,100,000 12,300,000 City Hall 6,300,000 6,300,000 6,300,000 Sand Key Bridge Replacement Fund 22,000,000 1,000,000 7,000,000 7,000,000 7,000,000 22,000,000 Total Proposed Penny Projects 107,080,000 Penny IV Interfund Loan Repayment Schedule Police District III 11,000,000 6,000,000 5,000,000 11,000,000 Waterfront/Bluff Masterplan (Imagine Clearwater)6,500,000 6,500,000 6,500,000 Sports Fields & Facilities (Spectrum/Carpenter)6,000,000 6,000,000 6,000,000 130,580,000 12,450,000 11,000,000 14,280,000 13,320,000 15,600,000 8,980,000 19,400,000 11,110,000 16,190,000 8,250,000 130,580,000 1,806,462 2,887,495 990,554 363,190 (2,226,858)2,128,342 (3,603,077)(702,782)(2,532,230)(7,102,338)(7,102,338) Replacement/Upgrade of Current Infrastructure 7,000,000 3,400,000 12,160,000 11,150,000 14,650,000 3,000,000 12,700,000 10,100,000 15,150,000 8,050,000 97,360,000 Public Safety Infrastructure/Equipment 1,450,000 7,600,000 870,000 920,000 950,000 5,980,000 200,000 1,010,000 1,040,000 200,000 20,220,000 New Infrastructure 4,000,000 - 1,250,000 1,250,000 - - 6,500,000 - - - 13,000,000 Estimated Available Balance Fiscal Years 2020/21 - 2029/30 Estimated Penny III Proceeds Estimated Penny IV Proceeds Estimated Revenue Planned Project Expenditures CITY OF CLEARWATER NOTICE OF PUBLIC HEARING PENNY FOR PINELLAS PROJECTS CITY COUNCIL MEETING Thursday, September 3, 2020 6:00 p.m. A public hearing will be held by the City of Clearwater, regarding the Penny for Pinellas project list for fiscal years 2020/21 through 2029/30 totaling $130,580,000 to fund capital projects under the Penny for Pinellas plan. This hearing will be held using a communications media technology platform. Information on the different options for participation can be found at the following link: https://www.myclearwater.com/government/city- departments/finance-budget/budget Significant changes to the plan include: Fire Engines/Ladder Truck Replacement – The replacement schedule for fire engines is being changed to advance the planned engine replacement from fiscal year 2021/22 to 2020/21. This results in the replacement of two engines in fiscal year 2020/21. Public Safety Vehicle/Equipment Facility – The funding for this project, which provides for construction of a facility to store oversized vehicles and equipment for both the Police and Fire department, is being postponed to fiscal year 2021/22. Interested parties may appear and be heard at the hearing or file written notice of approval or objection with the City Clerk prior to the hearing. Any person who decides to appeal any decision made by the Council, with respect to any matter considered at such hearing, will need a record of the proceedings and, for such purpose, may need to ensure that a verbatim record of the proceedings is made, which record includes the testimony and evidence upon which the appeal is to be based per Florida Statute 286.0105. Rosemarie Call, CMC City of Clearwater City Clerk P.O. Box 4748, Clearwater, FL 33758-4748 Individuals with disabilities who need reasonable accommodations to effectively participate in this meeting are asked to contact the City Clerk at (727)562-4092 or rosemarie.call@myclearwater.com in advance. Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8114 Agenda Date: 9/3/2020 Status: Public HearingVersion: 1 File Type: Action ItemIn Control: Economic Development & Housing Agenda Number: 8.5 SUBJECT/RECOMMENDATION: Approve State Housing Initiatives Partnership (SHIP) Program Annual Report and Local Housing Incentive Certification for the closeout year 2017-2018 and interim years 2018-2019 and 2019-2020 and allow appropriate officials to execute same. (APH) SUMMARY: The Florida Legislature enacted the William E. Sadowski Affordable Housing Act (Act) in 1992. The Act created a dedicated revenue source for state and local housing trust funds including the State Housing Initiatives Partnership (SHIP) Program. Through the SHIP Program, the Economic Development and Housing Department has provided funding for the following housing activities: Downpayment and closing costs assistance of existing structures; the construction of new dwellings; the rehabilitation of owner-occupied single-family dwellings; and the construction, acquisition, and rehabilitation of rental properties. All local governments receiving SHIP funds must submit their annual report to the Florida Housing Finance Corporation by September 15 of each year. The annual report provides details of expended and encumbered funds. The report also provides information on the strategies funded, the number of households served, and income category, age, family size, race and other data regarding special needs populations such as homeless persons, persons with disabilities and the elderly. The report is submitted electronically to the State of Florida. For closeout year 2017-2018, the City received $482,265 from the state annual distribution, $338,118.15 in program income and related interest, carryover of a negative balance of $20,329.18 from previous year funds. The department assisted eighteen families utilizing its approved strategies. The department also used these SHIP funds and SHIP program income to match federal program funds to support other existing housing programs. SHIP funding has a positive impact on the City’s economy, as evidenced by activities in closeout year 2017-2018, where the City expended $829,034.33 in SHIP funds (including $65,132.40 on program administration) to leverage over $16.5 million in other funds. APPROPRIATION CODE AND AMOUNT: N/A USE OF RESERVE FUNDS: N/A Page 1 City of Clearwater Printed on 9/3/2020 State Housing Initiatives Partnership (SHIP) Program Annual Report and Local Housing Incentives Certification On Behalf of _________________________________________ (Local Government), I hereby certify that: 1. The Annual Report information submitted electronically to Florida Housing Finance Corporation is true and accurate for the closeout year ________________ and interim years_______________________. 2. The local housing incentives or local housing incentive plan have been implemented or are in the process of being implemented. Including, at a minimum: a. Permits as defined in s.163.3164 (15) and (16) for affordable housing projects are expedited to a greater degree than other projects; and b. There is an ongoing process for review of local policies, ordinances, regulations, and plan provisions that increase the cost of housing prior to their adoption. 3. The cumulative cost per newly constructed housing per housing unit, from these actions is estimated to be $__________________. 4. The cumulative cost per rehabilitated housing per housing unit, from these actions is estimated to be $ ____________________. Staff Member responsible for submitting annual report to FHFC: _____________________________________ ____________________________________________ ____________________________________________ Witness Signature Date Chief Elected Official or Designee Signature Date ____________________________________________ _____________________________________________ Witness Printed Name Chief Elected Official or Designee Printed Name ____________________________________________ Witness Signature Date ____________________________________________ Witness Printed Name or ATTEST (Seal) ____________________________________________ Signature Date 420.9075 (10) Each county or eligible municipality shall submit to the corporation by September 15 of each year a report of its affordable housing programs and accomplishments through June 30 immediately preceding submittal of the report. The report shall be certified as accurate and complete by the local government's chief elected official or his or her designee. Transmittal of the annual report by a county’s or eligible municipality’s chief elected official, or his or her designee, certifies that the local housing incentive strategies, or, if applicable, the local housing incentive plan, have been implemented or are in the process of being implemented pursuant to the adopted schedule for implementation. City of Clearwater 2017-2018 2018-2019 and 2019-2020 Ms. Terry Malcolm-Smith 0.00 0.00 SHIP Annual Report Clearwater FY 2017/2018 Closeout Report Status:UnsubmittedTitle: Form 1 Code Strategy Expended Amount Units Encumbered Amount Units Unencumbered Amount Units 1 Purchase Assistance w / Rehab $20,425.00 1 2 Purchase Assistance w / o Rehab $81,225.00 4 3 Owner-Occupied Rehabilitation $155,041.42 4 10 New Construction $300,278.26 3 Homeownership Totals:$556,969.68 12 Homeownership SHIP Distribution Summary Code Strategy Expended Amount Units Encumbered Amount Units Unencumbered Amount Units 20 Multifamily Rehab $56,932.25 2 21 Multifamily New Construction $150,000.00 4 Rental Totals:$206,932.25 6 Rentals Subtotals:$763,901.93 18 Additional Use of Funds Use Expended Administrative $48,226.50 Homeownership Counseling Admin From Program Income $16,905.90 Admin From Disaster Funds Totals:$829,034.33 $.00 $.0018 Total Revenue (Actual and/or Anticipated) for Local SHIP Trust Fund 1Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 Description Eff.1 Bed 2 Bed 3 Bed 4 Bed ELI 336 373 519 681 843 VLI 560 600 720 831 927 LOW 895 958 1,150 1,328 1,482 MOD 1,344 1,440 1,728 1,995 2,226 Up to 140%1,568 1,680 2,016 2,327 2,597 Rental Unit Information Recap of Funding Sources for Units Produced ("Leveraging") Source of Funds Produced through June 30th for Units Amount of Funds Expended to Date % of Total Value SHIP Funds Expended $763,901.93 4.41% Public Moneys Expended $16,096,935.01 92.97% Private Funds Expended $443,235.25 2.56% Owner Contribution $9,789.41 .06% Total Value of All Units $17,313,861.60 100.00% SHIP Program Compliance Summary - Home Ownership/Construction/Rehab Compliance Category SHIP Funds Trust Funds Homeownership $556,969.68 $461,935.82 Construction / Rehabilitation $645,176.93 $461,935.82 % of Trust Fund FL Statute Minimum % 120.57%65% 139.67%75% Program Compliance - Income Set-Asides Form 2 * Carry Forward to Next Year:-$28,980.36 NOTE: This carry forward amount will only be accurate when all revenue amounts and all expended, encumbered and unencumbered amounts have been added to Form 1 Source of Funds Amount State Annual Distribution $482,265.00 Program Income (Interest)$2,986.41 Program Income (Payments)$335,131.74 Recaptured Funds $.00 Disaster Funds Other Funds Carryover funds from previous year -$20,329.18 Total:$800,053.97 2Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 Strategy List Unincorporated and Each Municipality ELI VLI Low Mod Over 140%Total Purchase Assistance w / o Rehab Clearwater 1 3 4 New Construction Clearwater 2 1 3 Multifamily New Construction Clearwater 2 2 4 Purchase Assistance w / Rehab Clearwater 1 1 Owner-Occupied Rehabilitation Clearwater 1 3 4 Multifamily Rehab Clearwater 1 1 2 Totals:4 4 9 1 18 Number of Households/Units Produced Description List Unincorporated and Each Municipality 0 - 25 26 - 40 41 - 61 62+Total Purchase Assistance w / o Rehab Clearwater 1 2 1 4 New Construction Clearwater 2 1 3 Characteristics/Age (Head of Household) Form 3 Project Funding for Expended Funds Only Income Category SHIP Funds Expended Total Available Funds % * Extremely Low $145,900.72 18.24% Very Low $123,741.13 15.47% Low $378,620.46 47.32% Moderate $115,639.62 14.45% Over 120%-140%.00% Totals:$763,901.93 95.48% Income Category Total Funds Mortgages, Loans & DPL's Mortgages, Loans & DPL Unit #s Total Funds SHIP Grants SHIP Grant Unit #s Total SHIP Funds Expended Total # Units Extremely Low $145,900.72 4 0 $145,900.72 4 Very Low $123,741.13 4 0 $123,741.13 4 Low $378,620.46 9 0 $378,620.46 9 Moderate $115,639.62 1 0 $115,639.62 1 Over 120%-140%0 0 $.00 0 Totals:$763,901.93 18 $.00 0 $763,901.93 18 3Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 Multifamily New Construction Clearwater 1 1 2 4 Purchase Assistance w / Rehab Clearwater 1 1 Owner-Occupied Rehabilitation Clearwater 4 4 Multifamily Rehab Clearwater 2 2 Totals:2 5 3 8 18 Description List Unincorporated and Each Municipality 1 Person 2- 4 People 5 + People Total Purchase Assistance w / o Rehab Clearwater 3 1 4 New Construction Clearwater 1 2 3 Multifamily New Construction Clearwater 3 1 4 Purchase Assistance w / Rehab Clearwater 1 1 Owner-Occupied Rehabilitation Clearwater 2 2 4 Multifamily Rehab Clearwater 2 2 Totals:9 8 1 18 Family Size Description List Unincorporated and Each Municipality White Black Hisp- anic Asian Amer- Indian Other Total Purchase Assistance w / o Rehab Clearwater 2 1 1 4 New Construction Clearwater 1 2 3 Multifamily New Construction Clearwater 2 2 4 Purchase Assistance w / Rehab Clearwater 1 1 Owner-Occupied Rehabilitation Clearwater 2 2 4 Multifamily Rehab Clearwater 2 2 Totals:10 6 1 1 18 Race (Head of Household) Description List Unincorporated and Each Municipality Farm Worker Home- less Elderly Total Purchase Assistance w / o Rehab Clearwater 0 New Construction Clearwater 0 Demographics (Any Member of Household) 4Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 Status of Incentive Strategies Support Services Incentive Description (If Other)Category Status Year Adopted (or N/A) Expedited permitting AHAC Review Implemented, in LHAP 2018 Ongoing review process AHAC Review Implemented, in LHAP 2018 Flexible densities AHAC Review Implemented, in LHAP 2018 Reduction of parking and setbacks AHAC Review Implemented, in LHAP 2018 Allowance of flexible lot sizes AHAC Review Implemented, in LHAP 2018 Support of development near transportation/employment hubs AHAC Review Implemented, in LHAP 2018 Other Identification of Properties having repeat code violations that may be suitable for Rehabiliation or Acquisition for Affordable Housing. AHAC Review Implemented, in LHAP 2018 Form 4 Multifamily New Construction Clearwater 1 1 Purchase Assistance w / Rehab Clearwater 0 Owner-Occupied Rehabilitation Clearwater 4 4 Multifamily Rehab Clearwater 2 2 Totals:7 7 Special Target Groups for Funds Expended (i.e. teachers, nurses, law enforcement, fire fighters, etc.) Set Aside Description Special Target Group Expended Funds Total # of Expended Units 5Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 The City of Clearwater partners with organizations that provide support services in many areas. The available services include, but are not limited to, the following: Homeless Emergency Project provides emergency shelter to individuals and families who are homeless through an integrated system of care that will improve the quality of life of persons experiencing homelessness. Tampa Bay Community Development Corporation, Bright Community Trust and Clearwater Neighborhood Housing Services provide homebuyer counseling to individuals and families desiring to purchase a home in Clearwater. Pinellas Opportunity Council through the Chore Services Program provides supportive service designed to help frail elderly persons maintain a decent, independent living environment. They provide heavy household cleaning, yard work and minor repairs. These services help to alleviate blighting conditions, reduce crime, and create a sense of pride in the community. Gulf Coast Legal Services is a civil legal aid organization serving low-income clients who otherwise may not be able to afford an attorney. Directions for Living is a multifaceted social service agency offering trauma-informed care through four distinct but integrated service areas: Child Safety and Family Preservation, Children’s Behavioral Health Services, Adult Behavioral Health Services, and Prevention, Wellness, and Recovery Services. Intercultural Advocacy Institute provides services, information, and education to improve the lives of, primarily, Hispanic individuals. The agency provides support services to parents, develops curriculum elements to support high school parents and makes referrals; provides transportation to and from meetings; and provides child care services for the Youth Leaders Program that benefit low-to moderate-income residents of the City of Clearwater. The Kimberly Home is a pregnancy center that offers an array of services, including pregnancy testing, ultrasounds, mentoring, infant/toddler daycare, pregnancy and parenting education, and other community resources. Transitional housing is provided to pregnant women and new mothers in a safe and loving campus environment. This program is specifically designed to serve women 18 years and older who are homeless or at the risk for homelessness. RCS Grace House allows families to reside at Grace House, rent-free, while they obtain steady employment and/or save income to pay for permanent housing. The average stay is 12 weeks. During this time, Grace House provides the essentials such as food, utilities, and transportation, enabling families to save money to move into permanent housing. Hispanic Business Initiative Fund of Florida, Inc., d/b/a Prospera offers bilingual assistance to Hispanic entrepreneurs trying to establish or expand their business. Miracles Outreach Community Development Center, Inc. provides support to children aged 12-17 who are pregnant or have been homeless, abused and victims of human trafficking. Mattie Williams Neighborhood Family Center provides programs and services for families in need of temporary support in these areas: Critical Basic Needs, Family Support Services; Youth Programs and Services; Career Development and Adult Education. Tampa Bay Black Business Investment Corporation offers capital accompanied by hands-on technical assistance to micro-business and entrepreneurs. WestCare GulfCoast-Florida, Inc. provides shelter to the homeless and inebriate homeless. Other Accomplishments 6Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 In 2019, the City of Clearwater was contacted after a neighbor made a visit to our client’s home. She expressed concern about the elderly woman’s living conditions. The issues in the dwelling included clutter, an inoperable HVAC system, ceiling damage from a failing roofing system, termites, rodents, mold, and numerous other code-related issues. The neighbor contacted us because she was aware of the City’s State Housing Initiatives Partnership (SHIP) Program. She wondered if we could help her elderly neighbor who was unable to maintain the dwelling on her fixed income. An application was completed by the homeowner and a feasibility inspection was ordered for the dwelling. When complete, the report indicated multiple code deficiencies with a proposed repair cost that would exceed the maximum amount available for assistance. The application had to be denied. Because the SHIP Program encourages its recipients to establish partnerships with area organizations to help leverage funding, we were able to reach out to Chores Services, a program of Pinellas Opportunity Council, to address the clutter and get the property cleaned up. A local faith-based organization in the stepped in with a group of volunteers and addressed some of the immediate code issues. This group of knowledgeable citizens then reached out to a local roofing company that on annual basis donates their time and roofing materials to a deserving individual or family. An application was submitted on behalf of the client and she was selected as the 2019 recipient for a complete roof replacement. The homeowner was also selected by Paint Your Heart Out Clearwater to have the exterior of the dwelling painted by their dedicated group of volunteers. With these deficiencies addressed, the cost to finish the repairs to the clients home no longer exceeded the maximum amount of funding allowed per project. The City went on to repair the electrical and plumbing issues, replace the HVAC, remediate the mold issue, and treat the dwelling for termites/rodents. This project exemplifies the true need for community partnerships. Without them, we would not have been able to bring about such dramatic changes to our client’s living conditions. Because the City has these well- established partnerships, she is now able to remain in the comfort and safety of the only place she calls home. Availability for Public Inspection and Comments The City's Annual Report was made available for public inspection and comments on the City's weboite at www.myclearwater.com/affordablehousing. Notice to the public of the availability of the report was given by new paper advertisement in the Tampa Bay Times. Life-to-Date Homeownership Default and Foreclosure Mortgage Foreclosures A. Very low income households in foreclosure: B. Low income households in foreclosure: C. Moderate households in foreclosure: Mortgage Defaults A. Very low income households in default: B. Low income households in default: C. Moderate households in default: 3 8 4 3 2 0 Foreclosed Loans Life-to-date: Defaulted Loans Life-to-date: 15 5 SHIP Program Foreclosure Percentage Rate Life to Date: SHIP Program Default Percentage Rate Life to Date: 2.94 0.98 Total SHIP Purchase Assistance Loans:511 7Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 Strategies and Production Costs Expended Funds Strategy Average Cost Multifamily New Construction $37,500.00 Multifamily Rehab $28,466.13 New Construction $100,092.75 Owner-Occupied Rehabilitation $38,760.36 Purchase Assistance w/o Rehab $20,306.25 Purchase Assistance w/Rehab $20,425.00 Strategy Full Name Address City Zip Code Expended Funds FY if Unit Already Counted Purchase Assistance w/o Rehab Dinnaga Noatunne 112 N Highland Ave Clearwater 33755 $20,400.00 Purchase Assistance w/o Rehab Parker Ware 2052 Kings Hwy Apt 6 Clearwater 33755 $20,275.00 Purchase Assistance w/o Rehab Majida Nabi 2052 Kings Highway Apt 10 Clearwater 33755 $20,275.00 Purchase Assistance w/o Rehab Christine Achinelli 24862 US Highway 19 N Apt 2302 Clearwater 33763 $20,275.00 New Construction Renee Robinette 1121 South Street Clearwater 33756 $69,426.62 Multifamily New Construction Lakeria Burney 803 Woodlawn Loop Unit 833 Clearwater 33756 $37,500.00 Multifamily New Construction Jaime Perez 803 Woodlawn Loop Unit 819 Clearwater 33756 $37,500.00 Multifamily New Construction Geraldine Brown 400 S. Martin Luther King Jr. Ave Clearwater 33756 $37,500.00 Multifamily New Construction Timmy Parker 400 S. Martin Luther King Jr. Ave Clearwater 33756 $37,500.00 Purchase Assistance w/Rehab Georg Kamal 2072 San Marino Way N Clearwater 33763 $20,425.00 Owner-Occupied Rehabilitation Renee Furay 1540 Elmwood St Clearwater 33755 $45,000.00 Owner-Occupied Rehabilitation Naomi Jenkins 1129 Carlton St Clearwater 33755 $39,083.63 Owner-Occupied Rehabilitation Evelyn Everett 1143 Kingsley St Clearwater 33756 $28,523.19 Owner-Occupied Rehabilitation Frana Parker 1508 Kings Hwy Clearwater 33755 $42,434.60 Total Unit Count:18 $763,902.00Total Expended Amount: 8Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 Administration by Entity Program Income Loan Repayment:$119,321.29 Refinance: Foreclosure: Sale of Property:$215,810.45 Interest Earned:$2,986.41 Total:$338,118.15 Program Income Funds Name Business Type Strategy Covered Responsibility Amount Nova Engineering Engineering Company Down Payment Assistance, Owner Occupied Rehabilitation, New Construction, Rental Rehabilitation/New Construction Construction Inspections $7,480.00 City of Clearwater Local Government All Strategies in the current LHAP Administration of all housing programs $57,652.40 New Construction Rictavia Hightower 903 Beckett St Clearwater 33755 $115,639.62 New Construction Ciara Walker 404 Blanche B Littlejohn Trl Clearwater 33755 $115,212.02 Multifamily Rehab William Bowser 1115 Woodlawn Street Clearwater 33756 $28,466.13 Multifamily Rehab Cynthia Hart 1117 Woodlawn Street Clearwater 33756 $28,466.12 Explanation of Recaptured funds Description Amount Number of Affordable Housing Applications Submitted 18 Approved 14 Denied 4 Number of Affordable Housing Applications 9Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 Total:$.00 Rental Developments Development Name Owner Address City Zip Code SHIP Amount SHIP Units Compliance Monitored By Community Service Foundation Owner 1123 Tangerine Street Clearwater 33755 $90,000.00 2 Community Service Foundation Owner 1101, 1115 & 1119 Woodlawn St Clearwater 33755 $56,932.25 2 SP Trail LLC Woodlawn Apts Owner 803 Woodlawn Trail Clearwater 33756 $75,000.00 2 Madison Point LLC Owner 400 S. MLK Jr. Ave Clearwater 33755 $75,000.00 2 Single Family Area Purchase Price The average area purchase price of single family units:109,260.00 Or Not Applicable Form 5 10Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 Code(s)Strategies Expended Amount Units Encumbered Amount Units 1 Purchase Assistance w/Rehab $20,425.00 1 2 Purchase Assistance w/o Rehab $40,550.00 2 3 Owner-Occupied Rehabilitation $67,606.82 2 SHIP Expended and Encumbered for Special Needs Applicants Special Needs Breakdown Strategies Special Needs Category Expended Amount Units Encumbered Amount Units (2) Purchase Assistance w/o Rehab Person with Disabling Condition (not DD) $20,275.00 1 (2) Purchase Assistance w/o Rehab Receiving Social Security Disability Insurance $20,275.00 1 (1) Purchase Assistance w/Rehab Receiving Supplemental Security Income $20,425.00 1 (3) Owner-Occupied Rehabilitation Receiving Social Security Disability Insurance $67,606.82 2 Special Needs Category Breakdown by Strategy Provide a description of efforts to reduce homelessness: The City of Clearwater supports social service providers who address the root cause of homelessness. The City contributes to five Continuum of Care providers in Pinellas County who serve Homeless individuals and families and also supports the Pinellas Continuum of Care under direction of the Homeless Leadership Alliance of Pinellas which coordinates with local service providers. The City has initiated and maintained a comprehensive, holistic approach and has formed a Homeless Committee that consists of directors and staff who frequently address the needs and impact of the homeless population. Interim Year Data 11Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 Interim Year Data Interim Year 1 State Annual Distribution $156,785.00 Program Funds Expended $345,170.04 Program Funds Encumbered $768,153.14 Total Administration Funds Expended $112,045.52 Total Administration Funds Encumbered Homeownership Counseling 65% Homeownership Requirement $1,007,323.18 75% Construction / Rehabilitation $1,036,723.18 30% Very & Extremely Low Income Requirement $336,136.89 30% Low Income Requirement $565,213.69 20% Special Needs Requirement $352,411.93 Carry Forward to Next Year Interim Year 2 State Annual Distribution $202,776.00 Program Funds Expended Program Funds Encumbered 642.49% 30.00% 50.45% 31.45% 661.24% Disaster Funds Program Income $963,670.23 12Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 LG Submitted Comments: 13Page Form SHIP AR/2009 67-37.008(3)(f), F.A.C. Effective Date: 11/2009 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: 9383-20 2nd rdg Agenda Date: 9/3/2020 Status: Second ReadingVersion: 1 File Type: OrdinanceIn Control: Legal Department Agenda Number: 9.1 SUBJECT/RECOMMENDATION: Adopt Ordinance 9383-20 on second reading, amending Chapter 33, Clearwater Code of Ordinances, to prohibit derelict vessels from being left in the city waterways and providing for enforcement. SUMMARY: During the August 31 work session, the City Attorney reported a scrivener’s error in Ordinance 9383-20 (a superfluous comma found in existing code). Staff is requesting Council make a motion to amend Sec. 33.055(4) as follows: No vessel shall be permitted to occupy the City-owned Island Way Grill, non-leased public dock slips during the period each night between 10:00 p.m. and 8:00 a.m., except in an emergency as authorized by the city harbormaster. The harbormaster will determine whether the circumstance constitutes an emergency. Page 1 City of Clearwater Printed on 9/3/2020 Ordinance No. 9383-20 ORDINANCE NO. 9383-20 AN ORDINANCE OF THE CITY OF CLEARWATER, FLORIDA, RELATING TO THE REGULATION OF DERELICT VESSELS; AMENDING CODE OF ORDINANCES CHAPTER 33 – WATERWAYS AND VESSELS, ARTICLE III. – VESSELS, SECTION 33.055 – PROHIBITED MOORING, BEACHING OR PLACING OF VESSELS; PROHIBITING DERELICT VESSELS FROM BEING LEFT IN THE CITY WATERWAYS, AND PROVIDING FOR ENFORCEMENT; PROVIDING AN EFFECTIVE DATE. WHEREAS, there are currently and from time to time will be a number of derelict vessels in, on, and under the City’s navigable waterways; and WHEREAS, such derelict vessels pose potential hazards to the environment, to safe navigation, and commercial and recreational use of City waters; and WHEREAS, derelict vessels are hazards to public safety and waterfront property during severe weather; and WHEREAS, § 823.11, Florida Statutes empowers the City with the authority to provide for the removal and disposition, including destruction, of derelict vessels; and WHEREAS, City Council desires to promote the public safety, health, and welfare of the residents of the City and the tourists and guests visiting or vacationing in the City by reducing or eliminating the threats posed by derelict vessels through the exercise of the authority granted to the City pursuant to § 823.11, Florida Statutes; NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF CLEARWATER, FLORIDA: Section 1: Sec. 33.055, Clearwater Code of Ordinances is hereby amended to read as follows: Sec. 33.055. - Prohibited mooring, beaching or placing of vessels. (1) No vessel of any kind whatsoever shall moor to or tie up to a private seawall or dock or be beached upon private property within the city limits without the permission of the owner thereof. (2) It is unlawful for a person, firm, or corporation to store, leave, or abandon any derelict vessel in any navigable waters within the City. No vessel that is in an unregistered, derelict, wrecked, junked, or substantially dismantled condition shall be permitted to dock, moor, or tie up at any private seawall, dock, or moorage space within the city, except that such vessel may moor at licensed marine facilities for the purpose of repair. (3) No vessel shall be moored or otherwise placed in such a manner as to impede, restrict, or otherwise interfere with the use of public docks, launching ramps or other public waterfront facilities. (4) No vessel shall be permitted to occupy the City-owned Island Way Grill, non-leased public dock slips during the period each night between 10:00 p.m. and 8:00 a.m., except in an emergency as authorized by the city harbormaster. The harbormaster will determine whether the circumstance constitutes an emergency. Ordinance No. 9383-20 (5) No vessel shall be permitted to occupy the City-owned Recreation Center (Sand Pearl), non-leased public dock slips during the period each night between 10:00 p.m. and 8:00 a.m., except in an emergency as authorized by the city harbormaster. The harbormaster will determine whether the circumstance constitutes an emergency. (6) No vessel shall be permitted to occupy the City-owned side tie, non-leased public mooring section of the Downtown Boat Slips, during the period each night between 9:00 p.m. and 8:00 a.m., except in an emergency or hours may be adjusted to coincide with special events as authorized by the city harbor-master. The harbor-master will determine whether the circumstance constitutes an emergency or a special event. (7) Vessels in violation of this section shall be subject to punishment as provided by law, including, but not limited to those enforcement procedures contained in Article 7 of the Clearwater Community Development Code, and all costs of towing and storage of vessels in violation of this section shall be assessed to the vessel owner. Section 2: This ordinance shall take effect immediately upon adoption. PASSED ON FIRST READING _____________________ PASSED ON SECOND AND FINAL _____________________ READING AND ADOPTED ___________________________ Frank Hibbard Mayor Approved as to form: Attest: __________________________ ____________________________ Matthew Smith Rosemarie Call Assistant City Attorney City Clerk Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8120 Agenda Date: 9/3/2020 Status: City Manager ReportVersion: 1 File Type: Action ItemIn Control: Gas System Agenda Number: 10.1 SUBJECT/RECOMMENDATION: Approve a Gas Utility Easement from Fl-Tarpon Square-QRX, LLC, for the construction, installation, and maintenance of gas utility facilities on real property located at 41256 US Highway 19 North, Tarpon Springs and adopt Resolution 20-43. SUMMARY: Fl-Tarpon Square-QRX, LLC (Grantor) has granted a non-exclusive five-foot wide natural gas easement, on property located on the northwest corner of US Hwy 19 N and Tarpon Ave, in Tarpon Springs for the installation of a natural gas distribution line. This main line will initially serve one commercial customer (Hibachi Express) and any future accounts located in the Tarpon Square Plaza at 41256 US Highway 19 N, contained within Parcel ID No. 12-27-15-89982-023-0100. The easement grant is sufficient for the City to maintain and replace its facilities as necessary in perpetuity, or until such time as the City determines to abandon its use. APPROPRIATION CODE AND AMOUNT: N/A USE OF RESERVE FUNDS: N/A Page 1 City of Clearwater Printed on 9/3/2020 Resolution No. 20-43 RESOLUTION NO. 20-43 A RESOLUTION OF THE CITY OF CLEARWATER, FLORIDA ACCEPTING A UTILITY EASEMENT FROM FL-TARPON SQUARE-QRX, LLC FOR THE CONSTRUCTION, INSTALLATION, AND MAINTENANCE OF CITY UTILITY FACILITIES; PROVIDING AN EFFECTIVE DATE. WHEREAS, the City of Clearwater needs a utility easement from FL-TARPON SQUARE- QRX, LLC for the construction, installation and maintenance of certain utility facilities; and WHEREAS, by this Resolution, the City Council of the City of Clearwater wishes to accept said grant of easement; now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CLEARWATER FLORIDA: Section 1. The City Council of the City of Clearwater hereby accepts the Utility Easement, a copy of which is attached hereto and incorporated herein as Exhibit “A” to Resolution 20-43. Section 2. This resolution shall take effect immediately upon adoption. PASSED AND ADOPTED this ______ day of _________________, 2020. ________________________________ Frank V. Hibbard Mayor Approved as to form: Attest: ___________________________ ________________________________ Laura Mahony Rosemarie Call Assistant City Attorney City Clerk Exhibit "A" to Resolution 20-43 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8188 Agenda Date: 9/3/2020 Status: City Manager ReportVersion: 1 File Type: Action ItemIn Control: Legal Department Agenda Number: 10.2 SUBJECT/RECOMMENDATION: Confirm COVID-19 Emergency Proclamation and adopt Resolution 20-47. SUMMARY: APPROPRIATION CODE AND AMOUNT: USE OF RESERVE FUNDS: Page 1 City of Clearwater Printed on 9/3/2020 Resolution No. 20-47 RESOLUTION NO. 20-47 CONFIRMATION OF COVID-19 EMERGENCY PROCLAMATION – September 3, 2020 A RESOLUTION OF THE CITY OF CLEARWATER, FLORIDA, CONFIRMING DECLARATIONS OF A STATE OF EMERGENCY; PROVIDING AN EFFECTIVE DATE. WHEREAS, a state of emergency in the City of Clearwater was proclaimed by Mayor George N. Cretekos, upon recommendation by the Emergency Management Director (City Manager William B. Horne), after certification of emergency conditions by the Emergency Management Coordinator (Fire Division Chief of Emergency Management Jevon Graham), on March 18, 2020 due to the unmitigated spread of coronavirus disease (COVID-19); and WHEREAS, the March 18, 2020 state of emergency was confirmed by City Council in Resolution 20-11 later that day, extended 7 days by Mayor George N. Cretekos on March 25, extended 7 days by Mayor Frank Hibbard on April 1, confirmed by City Council in Resolution 20-14 on April 2, extended 7 days by Mayor Frank Hibbard on April 8 and 15, confirmed by City Council in Resolution 20-16 on April 16, extended 7 days by Mayor Frank Hibbard on April 22, 29, and May 6, confirmed by City Council in Resolution 20-19 on May 7, extended 7 days by Mayor Frank Hibbard on May 13 and 20, confirmed by City Council in Resolution 20-22 on May 21, extended 7 days by Mayor Frank Hibbard on May 27 and June 3, confirmed by City Council in Resolution 20-28 on June 4, extended 7 days by Mayor Frank Hibbard on June 10 and 17, confirmed by City Council in Resolution 20-30 on June 18, extended 7 days by Mayor Frank Hibbard on June 24, July 1, 8, and 15, confirmed by City Council in Resolution 20-32 on July 16, extended 7 days by Mayor Frank Hibbard on July 22, 29, and August 5, confirmed by City Council in Resolution 20-36 on August 6, and extended 7 days by Mayor Frank Hibbard on August 12 and 19, confirmed by City Council in Resolution 20-44 on August 20, and extended 7 days by Mayor Frank Hibbard on August 26 and September 2; and WHEREAS, COVID-19 is a severe acute respiratory illness that can spread among humans through respiratory transmission and presents with symptoms similar to those of influenza, with no available vaccine or cure; and WHEREAS, on January 31, 2020 the United States Department of Health and Human Services declared that a public health emergency exists nationwide as a result of confirmed cases of COVID-19 in the United States; and WHEREAS, on March 1, 2020 Governor Ron DeSantis issued Executive Order 20- 51, declaring that appropriate measures to control the spread of COVID-19 in the State of Florida are necessary, and therefore directed that a Public Health Emergency be declared in the State of Florida; and WHEREAS, on March 9, 2020 Governor Ron DeSantis issued Executive Order 20- 52 declaring a State of Emergency for COVID-19; and Resolution No. 20-47 WHEREAS, the World Health Organization declared COVID-19 a pandemic on March 11, 2020, which is defined as “worldwide spread of a new disease,” and is the first declared pandemic since the H1N1 "swine flu" in 2009; and WHEREAS, on March 13, 2020 President Donald J. Trump declared a national state of emergency; and WHEREAS, on March 16, 2020 President Trump and CDC issued the “15 Days to Slow the Spread” guidance advising individuals to adopt far-reaching social distancing measures. such as working from home and avoiding gatherings of more than 10 people; and WHEREAS, on March 17, 2020 Governor Ron DeSantis issued Executive Order 20- 68 closing bars, pubs and nightclubs for 30 days, recommending that public beachgoers follow CDC guidelines limiting group sizes and social distancing, and ordering that restaurants limit occupancy to 50% of current building capacities and begin employee screening; and WHEREAS, on March 18, 2020 the City of Clearwater passed Resolution 20-11, cancelling most City meetings and groups, prohibiting all in-person gatherings of 10 people or more, closed all beaches, closed all libraries, closed all recreation centers, required businesses open to the public to provide hand sanitizer, gave the Emergency Management Director authority to close parking as necessary, prohibited price gouging, and enabled emergency procurement procedures; and WHEREAS, on March 19, 2020 Pinellas County passed Resolution 20-17, closing all public beaches within the county; and WHEREAS, on March 20, 2020 Governor Ron DeSantis issued Executive Order 20- 71, suspending all sales of food and alcohol in the State by establishments for on-site consumption and allowing for take-out or delivery service, and closing all gyms and fitness centers; and WHEREAS, on March 20, 2020 Governor Ron DeSantis issued Executive Order 20- 72, prohibiting elective and unnecessary medical procedures; and WHEREAS, on March 24, 2020 Governor Ron DeSantis issued Executive Order 20- 83, recommending an advisory to all persons over 65 and those with underlying serious medical conditions to stay home and limit risk of exposure; and WHEREAS, on March 25, 2020 Pinellas County passed Resolution 20-20, “COVID- 19 Safer at Home Order,” directing individuals to limit non-essential activity and/or transportation, closing places of public assembly, and ordering the closure of non-essential businesses if they can not comply with current CDC social distancing guidelines; and Resolution No. 20-47 WHEREAS, on March 27, 2020 Governor Ron DeSantis issued Executive Order 20- 86, retroactively ordering any person entering the State of Florida from “an area with substantial community spread” to self-quarantine for 14 days and inform anyone they have had direct physical contact with of their status; and WHEREAS, on April 1, 2020 Governor Ron DeSantis issued Executive Orders 20- 91 and 20-92, ordering all persons in Florida to limit their movements and personal interactions outside of their homes to only those necessary to obtain or provide essential services or conduct essential activities; and WHEREAS, on April 16, 2020 the City Council extended for 30 days and modified those emergency measures enacted by Resolution 20-11; and WHEREAS, on April 28, 2020 Pinellas County passed Resolution 20-34, “Order Relaxing Beach Restrictions With Conditions,” allowing public beaches to reopen consistent with CDC social distancing guidelines effective May 4, 2020; and WHEREAS, on April 29, 2020 Governor Ron DeSantis issued Executive Order 20- 112, ordering all persons in Florida to continue to limit their movements and personal interactions outside of their homes, and allowing restaurants to resume on-premises service with restrictions; and WHEREAS, on May 1, 2020 Pinellas County passed Resolution 20-39 “Order Clarifying Local Restrictions,” which gives support to Governor DeSantis’ EO 20-112, terminates Pinellas County Res. 20-20 and 20-23, but continues to restrict public playgrounds and pools, and requires social distancing; and WHEREAS, on May 1, 2020 City of Clearwater Emergency Management Director William B. Horne announced that Clearwater beaches would reopen May 4 in conjunction with Pinellas County’s Res. 20-34; and WHEREAS, on May 14, 2020 Governor Ron DeSantis issued Executive Order 20- 123, initiating the full Phase 1 of his “Safe. Smart. Step-by-Step. Plan for Florida’s Recovery” relaxing social distancing requirements and allowed limited reopening of businesses, including gyms and fitness centers; and WHEREAS, on May 21, 2020 the City Council adopted Resolution 20-22 terminating the emergency measures portions of Resolutions 20-11, 20-16, and 20-19, and granting the Emergency Management Director authority and flexibility to manage City facilities in response to Covid-19; and WHEREAS, on June 3, 2020 Governor Ron DeSantis issued Executive Order 20- 139, initiating Phase 2 of his “Safe. Smart. Step-by-Step. Plan for Florida’s Recovery” which further relaxes social distancing guidelines, including avoiding congregating in groups larger than 50 persons, allows for restaurants, bars, and entertainment businesses to operate at 50% indoor capacity; and Resolution No. 20-47 WHEREAS, on June 23, 2020 Pinellas County passed Ordinance 20-14 mandating, with some exceptions, that individuals wear a face covering in public indoor places, and encouraged exempt government entities to enact their own similar procedures to protect employees and members of the public; and WHEREAS, on June 25, 2020 City of Clearwater Emergency Management Director William B. Horne ordered that all persons, with some exceptions, wear a face covering in public indoor places within City of Clearwater buildings, facilities, and properties in conjunction with Pinellas County’s Ord. 20-14; and WHEREAS, on June 26, 2020 the Florida Department of Business and Professional Regulation issued Executive Order 2020-09 suspending on-premises consumption of alcoholic beverages by vendors who derive more than 50% of gross revenue from sales of alcoholic beverages; and WHEREAS, on July 16, 2020 the City Council adopted Resolution 20-32 confirming extensions of the state of emergency and confirming the Emergency Management Director’s face covering order; and WHEREAS, on July 29, 2020 Governor Ron DeSantis issued Executive Order 20- 179 extending prior executive orders allowing local governments to hold virtual meetings without a physical quorum, and Executive Order 20-180 extending prior executive orders suspending mortgage foreclosure and eviction final actions; and WHEREAS, on August 7, 2020 Governor Ron DeSantis issued Executive Order 20- 193 extending prior executive orders allowing local governments to hold virtual meetings without a physical quorum until October 1, 2020; and WHEREAS, on August 31, 2020 Governor Ron DeSantis issued Executive Order 20-211 extending a prior executive order suspending final executions of mortgage foreclosure and eviction actions until October 1, 2020; and WHEREAS, as of September 3, 2020 626,426 Florida residents (633,442 total cases in Florida including non-residents), including 37,668 in Hillsborough County (including 554 deaths), 10,532 in Manatee County (including 263 deaths), 8,165 in Pasco County (including 183 deaths), and 20,080 in Pinellas County (including 665 deaths) have tested positive for COVID-19; and WHEREAS, the City of Clearwater continues to be threatened by COVID-19 because of the apparent ability of the virus to spread rapidly among humans, and COVID- 19 thereby constitutes a clear and present threat to the health, safety, and welfare of the citizens and visitors of the City of Clearwater, and WHEREAS, Section 252.38, Florida Statutes authorizes the establishment and amendment of emergency measures during a state of emergency; and Resolution No. 20-47 WHEREAS, Chapter 15, Code of Ordinances requires City Council to confirm any declaration of a state of emergency and all emergency regulations activated under the provisions of this chapter at their next regularly scheduled meeting; now, therefore, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CLEARWATER, FLORIDA; Section 1. The August 26, 2020 state of emergency proclamation is hereby confirmed. Section 2. The September 2, 2020 state of emergency proclamation is hereby confirmed. Section 3. This resolution shall take effect immediately. The state of emergency must be renewed in seven-day increments pursuant to § 15.07(5), Code of Ordinances. PASSED AND ADOPTED this 3rd day of September, 2020. Attest: ___________________________ _______________________________ Rosemarie Call Frank Hibbard City Clerk Mayor Approved as to form: ___________________________ Pamela K. Akin City Attorney Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8233 Agenda Date: 9/3/2020 Status: Agenda ReadyVersion: 1 File Type: Action ItemIn Control: City Council Agenda Number: 10.3 SUBJECT/RECOMMENDATION: NFL Alumni Children’s Obstacle Course SUMMARY: Page 1 City of Clearwater Printed on 9/3/2020 Obstacle Course Details My name is Earl Bedford and I am the Vice President of Business Development for the National Football League Alumni association in Tampa, Florida. We are spearheading a project with the City of Tampa Parks and Recreation Youth Activity Initiative. The youth activity that we are proposing will be several 12 and under obstacle courses throughout the city of Tampa. This plan will combine balance and coordination skills to allow school aged children to navigate a simple obstacle course. We would like to make sure that every obstacle course is an adventure because of the number of obstacles in the way and the “perilous dangers” children need to avoid (which we can make up and tell with great fanfare) as they go through the course. The more interesting and exciting the course, the more the children will love it! Most young kids have a good notion of what obstacle courses are so, getting them to race through stationary gauntlets is fairly easy and, when it comes to tiring them out, incredibly effective. The perfect obstacle course should be challenging, silly, and easily deconstructed or reconstructed. But, most importantly, it should be safe. Objectives/Learning Outcomes 1. Overall physical fitness. Obstacle courses promote cardiovascular endurance, flexibility, muscular strength and endurance. 2. Gross motor development. Obstacle courses promote using the large muscles of the arms, legs and trunk. 3. Bilateral coordination. Obstacle courses promote using both sides of the body at the same time in unison as in jumping. 4. Perceptual motor development. Obstacle courses promote the ability to receive, interpret, and respond successfully to sensory information. 5. Social development. Obstacle courses promote acquisition of skills that enable children to react and interact with others as they mature and begin to understand the point of view of others. 6. Agility. Obstacle courses promote quick, easy, lively movements. 7. Coordination. Obstacle courses promote parts of the body moving smoothly together. 8. Sequencing. Obstacle courses promote the ability to arrange and follow a series of steps to be followed. 9. Eye-hand coordination. Obstacle courses promote eyes and hands working together smoothly to meet a challenge. 10. Eye-foot coordination. Obstacle courses promote eyes and feet working together smoothly to meet a challenge. 11. Spatial awareness. Obstacle courses promote coordinated movement in relationship to other objects in the environment. 12. Directionality. Obstacle courses promote the inner sense and knowledge of where things are in relation to the body. 13. Laterality. Obstacle courses promote the ability to understand the differences between right and left and being able to control the two sides of the body independently and together. 14. Balance. Obstacle courses promote being able to hold the position of the body through the interaction of muscles working together (maintaining body equilibrium) whether the body is stationary (static balance) or moving (dynamic balance). 15. Cooperation and teamwork. Obstacle courses can promote 2 or more people working and playing together rather than against one another, just for the fun of it. 16. Fun. Obstacle courses promote playful actions providing amusement and enjoyment. 17. Listening skills. Obstacle courses promote the ability to follow verbal directions. 18. Self-Esteem. Obstacle courses promote confidence and satisfaction or pride in oneself. The individual stations can be anything and are only limited by space and imagination. We can add special challenges as kids figure out how to manage certain obstacles. It is also important to note that stations can reoccur in each running of an obstacle course. It is, for instance, a great idea to get kids to jump multiple times between activities that require more precise muscle control. This forces kids to engage different muscles and tires them out. What We May Need: ▪ Things to jump over, onto, or from. Animated objects, hopscotch. ▪ Things to crawl under or through. Tires, rope, tunnel. ▪ Things to throw. Make a station where aim is important. Throwing is a skill young kids can develop. Have them bring their own football or baseball and throw through some tires. ▪ Things to balance on. Balance beams. Hopscotch on one leg. Jump from block to block. ▪ Monkey bars to strengthen upper body. ▪ Feet speed drills. Like running through tires Wrap up: Obstacle courses are a great way for kids to burn off excess energy. And if they ever get tired of the same old course, we can change the theme or turn it into a narrated adventure: Superhero tryouts, ninja training, find the hidden treasure. Younger kids will especially enjoy embarking on the course as a character on an expedition. In the end, not only is it satisfying to watch kids challenge themselves but also to watch them enjoy something we all built. My take on obstacle courses are they invite, they challenge, and they satisfy while always leaving children begging, “Can we do it again? Can we do it again?” Disclaimer: Date and time subject to change due to COVID-19 Earl Bedford Vice President Business Development Tampa Chapter | NFL Alumni Earl.Bedford@NFLAlumni.org CARING FOR OUR OWN & CARING FOR KIDS NFL Alumni Tampa Bay Chapter Attn: Nils Sedwick 624 Mirabay Blvd Apollo Beach, FL 33572 Phone: 4086879728 Fax:4086879728 nils.sedwick@nflalumni.org Ship to Zip 32771 Quantity Part #Description Unit Price Amount 6450 Digout GT-Impax - Digout/Sitework of area (per sq. ft.)- Does not include removal of spoils $1.32 $8,514.00 6450 Spoils GT-Impax - Removal/Disposal from Site the Spoils from Digout (per sq. ft.)$1.00 $6,450.00 556 Curb GT-Impax - Concrete Curb (ln. ft.)- 4" Wide - Not Reinforced $31.50 $17,514.00 6450 Crush GT-Impax - Crushed & Compacted Stone Sub-Base (sq. ft.)- Warranty to match Surfacing Warranty (5-years). Installed per specification of Unitary Surfacing requirements. $3.75 $24,187.50 1 Turf-6 GT-Impax - Synthetic Turf Surfacing - Standard Turf Surfacing with infill - pricing includes NFL Alumni Logo approx 12' x 8' $114,265.00 $114,265.00 1 13647 GameTime - Youth 5000 $90,824.00 $90,824.00 1 13640 GameTime - Challenge Course Timing Scorebd Pkg $4,350.00 $4,350.00 1 13651 GameTime - Challenge Course Timing Upr Pkg $1,689.00 $1,689.00 1 13626 GameTime - 40 Yard Dash Sign (Std)$2,072.00 $2,072.00 1 13639 GameTime - 40 Yard Dash Scoreboard Upright $798.00 $798.00 1 13634 GameTime - 40 Yard Dash Scoreboard Pkg (Dbl)$20,210.00 $20,210.00 1 GRANT DRP Promo - GameTime Grant Promotion Funding Discount- Order must be placed prior to October 31, 2020 ($21,880.00)($21,880.00) 1 INSTALL 5-Star Plus - Five Star Plus Playground Installation Services- Performed by a Certified Installer, includes meeting and unloading delivery truck, signed completion forms, site walkthrough, 90 day site revisit by installation foreman, and 3-Year Labor Warranty! $34,585.00 $34,585.00 1 Sealed 5-Star Plus - Signed/Sealed FBC 2017 6th Ed Building Code Drawings $995.00 $995.00 1 Permits 5-Star Plus - Building Permits- Estimated Costs of Permits plus Time. If actual permit fees are significantly higher or lower, final invoice will be adjusted accordingly. Includes two visits to the permit office, if additional time spent acquiring permits, final invoice to be adjusted. Site Plans are to be provided by the owner for the permit application. $1,250.00 $1,250.00 Sub Total $305,823.50 Freight $6,076.38 Total $311,899.88 Comments Site visit prior to order space and access. Site access for construction equipment and staging area must be provided by owner. Timing system electric installation by others. GameTime c/o Dominica Recreation Products, Inc. P.O. Box 520700 Longwood, FL 32752-0700 800-432-0162 * 407-331-0101 Fax: 407-331-4720 www.playdrp.com 08/18/2020 Quote #101638-01-01 NFL Alumni ~ Youth Challenge Course Page 1 of 3 This quote was prepared by Gina Wilson, Vice President / Senior Project Manager. For questions or to order please call - 800-432-0162 ext. 101 ginaw@gametime.com Permits are not included in cost, unless specifically listed in pricing. If permits are required Signed/Sealed drawings are usually needed and are also not included unless specifically listed in pricing. Any costs for muncipal permits, paid by installer, will be charged back to the owner. Adding permits to any job will increase the length of completion, expect total time to be about 120 days, after receipt of Site Plan from owner/customer (this is not due to manufacturing but rather the permit process at the muncipality level). It is expected that the owner will provide approved site plans of the area for the permit office, and will help and assist in the securing of all required approvals before assembly of equipment can begin. Installer cannot provide site plans. The permit process can not begin until the site plans are available. If additional permitting requirements are needed during the process, those will be added and billed accordingly, i.e. soil density test, formed footers, etc. Payment Terms: Deposit at time of Order. Balance to be paid upon completion of work Net 30. Credit Application must be completed for open amount on credit terms. This Quotation is subject to policies in the current GameTime Park and Playground Catalog and the following terms and conditions. Our quotation is based on shipment of all items at one time to a single destination, and changes are subject to price adjustment. A 1.5% per month finance charge will be imposed on all past due acounts. Pricing: Firm for 60 days from date of quotation. Shipment: F.O.B. factory, order shall ship within 30-45 days after GameTime's receipt and acceptance of your purchase order, color selections, approved submittals, and receipt of payment. Taxes: State and local taxes will be added at time of invoicing, if not already included, unless a tax exempt certificate is provided at the time of order entry. Exclusions: Unless specifically discussed, this quotation excludes all sitework and landscaping; removal of existing equipment; acceptance of equipment and off-loading; storage of goods prior to installation; security of equipment (on site and at night); equipment assembly and installation; safety surfacing; borders; drainage; signed/sealed drawings; or permits. Payment Terms: Complete Credit Application submitted and approved with order. Net 30 days subject to approval by GameTime Credit Manager. A completed Credit Application and Bank Reference Authorization, must be received with the order. The decision on credit is the sole discretion of GameTime/PlayCore. A 1.5% per month finance charge will be imposed on all past due accounts. Invoices: Will be generated upon services rendered. When equipment ships it will be invoiced seperately from installation and/or other services. Terms are Net 30 for each individual invoice. This Quotation is subject to policies in the current GameTime Park and Playground Catalog and the following terms and conditions. Our quotation is based on shipment of all items at one time to a single destination, and changes are subject to price adjustment. Pricing: Firm for 60 days from date of quotation. Shipment: F.O.B. factory, order shall ship within 45 days after GameTime's receipt and acceptance of your purchase order, color selections, approved submittals, and receipt of payment. Taxes: State and local taxes will be added at time of invoicing, if not already included, unless a tax exempt certificate is provided at the time of order entry. Exclusions: Unless specifically discussed, this quotation excludes all sitework and landscaping; removal of existing equipment; acceptance of equipment and off-loading; storage of goods prior to installation; security of equipment (on site and at night); equipment assembly and installation; safety surfacing; borders; drainage; signed/sealed drawings; or permits. Installation Terms: Shall be by a Certified Installer. The installer is an indepedent installer and not part of PlayCore, GameTime, nor Dominica Recreation Products. If playground equipment, installer will be NPSI and Factory Trained and Certified. Unless otherwise noted, installation is based on a standard installation consistent with GameTime installation sheets and in suitable soil with a sub-base that will allow proper playground installation. Drainage is not part of our scope of work unless otherwise noted. Customer shall be responsible for scheduling and coordination with the installer. Site should be level and allow for unrestricted access of trucks and machinery. Customer shall also provide a staging and construction area. Installer not responsible for sod replacement or damage to access path and staging area. Customer shall be responsible for unknown conditions such as buried utilities, tree stumps, rock, or any concealed materials or conditions that may result in additional labor or material costs. Customer will be billed hourly or per job directly by the installer for any additional costs that were not previously included. Unitary Surfacing Notes : The installer of the Unitary Surfacing (Poured, Bonded, Turf, Tiles) is not the same installer of the playground equipment. However, your certified equipment installer will coordinate the timing of the unitary surfacing installation, but more than likely they will not be on-site at the time. They will continue to be your contact should you have any questions. Security is needed to protect surfacing at night or after installation as the product set. Normally it is not needed or a concern, however in some areas additional security is needed to prevent vandalism. Security is not included. Vandalism will be the responsible of the owner. GameTime c/o Dominica Recreation Products, Inc. P.O. Box 520700 Longwood, FL 32752-0700 800-432-0162 * 407-331-0101 Fax: 407-331-4720 www.playdrp.com 08/18/2020 Quote #101638-01-01 NFL Alumni ~ Youth Challenge Course Page 2 of 3 ORDER INFORMATION Bill To: ________________________________________ Ship To: _________________________________________ Contact: ______________________________________ Contact: _________________________________________ Address: ______________________________________ Address: _________________________________________ Address: ______________________________________ Address: _________________________________________ City, State, Zip: _______________________________ City, State, Zip: ____________________________________ Tel: __________________ Fax: ____________________ Tel: ____________________ Fax: ____________________ SALES TAX EXEMPTION CERTIFICATE #: ____________________________________ (PLEASE PROVIDE A COPY OF CERTIFICATE) Acceptance of quotation: Accepted By (printed): ________________________________ P.O. No: ___________________________________ Signature: __________________________________________ Date: ____________________________________ Title: ______________________________________________ Phone: __________________________________ E-Mail: ____________________________________________ Purchase Amount: $311,899.88 GameTime c/o Dominica Recreation Products, Inc. P.O. Box 520700 Longwood, FL 32752-0700 800-432-0162 * 407-331-0101 Fax: 407-331-4720 www.playdrp.com 08/18/2020 Quote #101638-01-01 NFL Alumni ~ Youth Challenge Course Page 3 of 3 NFL Alumni Children’s Obstacle Course Types of Designs Military Style Design Types of Obstacles Upper Body Strength Over and Under Balance is the Key Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8106 Agenda Date: 9/3/2020 Status: Other CouncilVersion: 1 File Type: Council Discussion Item In Control: Council Work Session Agenda Number: 12.1 SUBJECT/RECOMMENDATION: Solar Panels on Amphitheater - Councilmember Beckman SUMMARY: APPROPRIATION CODE AND AMOUNT: USE OF RESERVE FUNDS: Page 1 City of Clearwater Printed on 9/3/2020 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8199 Agenda Date: 9/3/2020 Status: Other CouncilVersion: 1 File Type: Council Discussion Item In Control: Council Work Session Agenda Number: 12.2 SUBJECT/RECOMMENDATION: Go Vote banner on old City Hall - Councilmember Beckman SUMMARY: APPROPRIATION CODE AND AMOUNT: USE OF RESERVE FUNDS: Page 1 City of Clearwater Printed on 9/3/2020 Cover Memo City of Clearwater Main Library - Council Chambers 100 N. Osceola Avenue Clearwater, FL 33755 File Number: ID#20-8200 Agenda Date: 9/3/2020 Status: Other CouncilVersion: 1 File Type: Council Discussion Item In Control: Council Work Session Agenda Number: 12.3 SUBJECT/RECOMMENDATION: PSTA Update - Vice Mayor Allbritton SUMMARY: Page 1 City of Clearwater Printed on 9/3/2020