SYSTEMS MAINTENANCE SERVICES (SMS) 1 - 2007

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Service • We are professional. We know our niche and our strengths • We do not try to be everything to everyone. Service only. Not a reseller or VAR. • We respect our clients' business needs and critical time requirements • We always remember who the client is. 2.3.2 Multi-Year Discount. The City is interested in knowing if a commitment to term of an agreement for more than one year would be reciprocated by the Vendor with pricing discounts. If so, the City would consider either a 2-year or 3-year term for the agreement. SMS Response: SMS is pleased to provide the City of Santa Ana with several increasing discount options from which to choose. These options allow for discounts from 4% - 7% depending on the term selected. If the City would like to take advantage of the 5 year term discount SMS is flexible and will work out terms to help satisfy the City's legal limitations. Additionally, SMS is providing an Annual pre-payment discount option of 3%. 2.3.3 The Proposer is asked to explain the method followed, and included in any agreement, to set the price for additional models of equipment not identified in any original agreement. SMS Response: As indicated on MSA agreement (N103) Quotation Summary, Page 4, number 2 of the "Notes" section: "Future additions to this agreement may be added at the same price or discount." 2.3.4 Proposals from the Vendor must fully disclose any and all charges that the City would be subject to from the Vendor under an agreement resulting from this proposal. SMS Response: As indicated on MSA agreement (N103) Quotation Summary, Page 4, number 1 of the "Notes" section, unless otherwise priced: "The final MSA configuration and pricing is subject to an on-site audit and serial number verification." Also noted at the bottom of MSA agreement (N103) Page 3: "The above PC Server Pricing includes: (1) <= 17" CRT Color Monitor per server, all CPU's, Memory, CD-ROM, Floppy Disk, Internal Disk Drives and Keyboard and Mouse. The Above PC Server Pricing does not include: Monitors exceeding 17'; LCD/TFT Displays, Touch Screen Monitors, Printers, Storage Arrays, Tape Drives, Scanners." If the City requests and authorizes support services to be provided by SMS that are outside the normal scope of hardware maintenance coverage or on a system that is not already covered on the agreement, SMS will provide its best-effort service support on a time and material basis. Rates for time and material support include parts, labor, portal-to-portal travel, parking and tolls. Standard business hours labor rates are $175/hr and $225/hr for after hours support. 3. GENERAL TERMS AND CONDITIONS 3.1 AGREEMENT Prior to the performance by the Vendor of any work hereunder, the City and the Vendor shall enter into a written agreement, a draft of which is attached as Appendix B. • ' ' Proposers responding to the RFP are strongly advised to review all the