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8 <br /> I. Title shall remain in the County. <br /> II. Title to such nonexpendable personal property, which is purchased, developed, or acquired by <br /> the Contractor and which is claimed as an acquisition cost, shall pass to and vest in the County <br /> upon delivery of such property by the Contractor and shall not be rented, loaned, or transferred <br /> without the prior express written approval of the County. <br /> III. Unless provided otherwise by agreement of the parties, if the Contractor elects to capitalize and <br /> depreciate such nonexpendable personal property in lieu of claiming the acquisition cost, title to <br /> such property shall remain with the Contractor. An election to capitalize and depreciate or claim <br /> acquisition cost as a direct cost shall be irrevocable. <br /> IV. Such nonexpendable personal property shall only be used by the Contractor or its subcontractors <br /> in the performance of this Agreement, unless otherwise provided herein or approved by the <br /> County. <br /> A. As a condition precedent to reimbursement for the purchase or acquisition of <br /> nonexpendable personal property, the Contractor agrees to execute security instruments <br /> and other documents that are necessary for the County, State, Federal, or other funding <br /> agency to protect its interest in such property in accordance with Article 9 of the Uniform <br /> Commercial Code, as codified in Title 62A RCW, including but not limited to, <br /> completion of UCC-1, UCC-2, and UCC-3 forms. The Contractor also agrees to name <br /> the County (or funding agency) as lien holder(s) on certificates of title for all motor <br /> vehicles in accordance with Title 46 RCW. <br /> B. The Contractor shall submit completed Certificates of Title and applicable UCC forms <br /> for equipment and fixtures to the County with the claim for reimbursement on which they <br /> are claimed. The security interest shall be retained beyond this Agreement for the <br /> serviceable life of the property, beginning on the date of purchase, to ensure its continued <br /> use for the purpose intended. <br /> V. The Contractor shall maintain records, perform inventories, and maintain control systems to <br /> prevent loss, damage, or theft of County property. The Contractor shall be responsible for: (a) <br /> performing an annual physical inventory of all nonexpendable personal property of the County in <br /> its possession or control and requiring such inventories of any subcontractor that is in possession <br /> of such property provided under a subcontract of this Agreement at the end of the Contractor's <br /> fiscal year during this Agreement; (b) loss, damage and expenses, which results from (i) <br /> negligence, willful misconduct, or lack of good faith on the part of the Contractor or (ii) failure <br /> on the part of the Contractor to maintain and administer the property in accordance with sound <br /> management practices; and, (c) ensuring that the property will be returned to the County in like <br /> condition to that furnished to or acquired by the Contractor, reasonable wear and tear excepted; <br /> and, (d) notifying the County of loss, destruction or damage to any County property and taking <br /> all reasonable steps to protect that property from further damage. <br /> 52 <br /> April 14,2004 Basic Terms&Conditions HSD-2004-05-198 <br /> City of Everett <br /> Page 10 <br />