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HomeMy WebLinkAboutMINUTES - 08122003 - C.108 TO: BOARD OF SUPERVISORS FR`M: John Sweeten, County Administrator DA August 12, 2003 r R� s, Contra SUBJLCT: Negotiate a contract with the Contra Costa € oz,-: t a County Schools Insurance Croup to � # Perform Medical Billing Reviews on Behalf : < of the County's Risk Management •}r.., n'�y Division. ti COW SPEECIFICREQU SE 'T(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION RECOMMENDATION: AUTHORIZE the Risk Manager to negotiate a contract with the Contra Costa County Schools Insurance Group to perform medical billing reviews on behalf of the County's Risk Management Division. AUTHORIZE the Risk Manager to pay $172,000 from the Worker's Compensation Trust Fund to upgrade software, hardware including an imaging system and move the computer server capabilities to their software vendor Valley Oak Systems. RESULTS OF NEGATIVE ACTION: The County would lose approximately $78,000 in savings the first year and approximately $134,000 annually excluding the requirement to replace computer software within two years. BACKGROUNDIREASONS FOR RECOMMENDATION: AR 2000 is a private company, which currently performs medical billing reviews on the County's workers' compensation claims. This company seeks reductions in the medical cost for treating the County's injured employees. AR 2000 then bills the County of Contra Costa a percentage of the reduction. Their current billing rate is 18% of the medical bill savings. In fiscal 02103 the CONTINUED ON ATTACHMENT: YES SIGNATURE: ✓' RECOMMENDATION OF COUNTY ADMINISTRATOR RECOMMENDATION OF BCfAt@FdIITTEE n-. APPROVE r OTHER SIGNATURES ACTION OF BOA Oty3 kWwt 12, 2003 APPROVED AS RECOMMENDED x OTHER VOTE OF SUPERVISORS 1 HEREBY CERTIFY THAT THIS IS A TRUE AND CORRECT COPY OF AN ACTION TAKEN AND ENTERED ON THE MINUTES OF THE BOARD X UNANIMOUS {ABSENT NONE ) OF SUPERVISORS ON THE DATE SHOWN. AYES: NOES: ABSENT: ABSTAIN: ATTESTED August 12, 2003 JOHN SWEETEN„CLERK OF THE BOARD OF SUPERVISORS AND COUNTY ADMINISTRATOR Contact: Ron Harvey-305-9443 cc: CAD Risk Management Auditor-Controller C:1My Documents\Board Orders\BO2003\BO-Med Revlew.doc BY JAJ1J- { DEPUTY "n SUBJECT: Negotiate a contract with the Contra Costa County Schools Insurance Group to Perform Medical Billing Reviews on Behalf of the County's Disk Management Division. DATE: August 12, 2003 PAGE: 2 County paid approximately $400,000 for their services. The Contra Costa County Schools Insurance Group (CCCSIG) and our software provider, Valley Oak System has developed software for medical billing review. CCCSIG has offered to perform the medical review service for $150,000 annually. This will result in savings of$250,000 for the County. CCCSIG is a government entity so the service is at costs. The savings would be used on a one-time basis to upgrade hardware, move to an imaging system for workers' compensation claims (paper less files) and create a web based browser system maintained by our software vendor Valley Oak Systems. Their cost for this one time upgrade is $172,000. The projected savings would allow Risk Management to purchase the software upgrade. The upgrade will create data compatibility with CCCSIG. Risk Management will be required to perform the software upgrade in two years whether the recommendation is accepted or not. The estimated savings for the first year are $78,000. Thereafter, Valley Oak Systems annual fee to maintain their server and software is $116,000 annually. The current fee for software and hardware maintenance is $50,000 annually. Risk Management would no longer be required to replace servers. Lost time for software and hardware maintenance is essentially eliminated. After the first year the anticipated annual savings is $134,000. The County's partnership with CCCSIG would create the largest employer group in the County. This partnership will provide greater strength in negotiating reductions in medical costs with Preferred Provider Organizations, hospitals, diagnostic imaging, physical therapy and prescriptions. . cad CONTRA COSTA COUNTY EQUIPMENT, SOFTWARE & SERVICES PROCUREMENT AGREEMENT REVISED April 9,2004 Modified By CCC July 12,2004 Page I CCC DoIT\Admin\Phur} CONTRA COSTA COUNTY EQUIPMENT, SOFTWARE & SERVICES PROCUREMENT AGREEMENT Name of Project:Upgrade to Workers'Compensation/Liabilities System.Contract No: Contractor:Valley Oak Systems,Inc. Effective Date: Termination Date:_ This Agreement is entered into by and between the Contra Costa County and the above named Contractor,and is effective as of the date given above. A. Contractor will provide the County with the Services and Products described in Exhibit A and B in accordance with the Project milestones contained in Exhibit C; as such exhibits may be modified as provided herein. The Project will be evaluated and accepted by the County pursuant to the tests,procedures,and criteria set forth in Exhibit D. B.The attached Terms and Conditions are incorporated into and made a part of this Agreement. C.The following provisions shall apply to the attached Terms and Conditions: (1)Authorized Representatives(Section 4.2,6.2,6.3): For Contractor:Robert Faulhaber Telephone:(925)242-4600 For County: Ron Saari Telephone:(925)313-1248 (2)Addresses and Fax Numbers for Notices(Section 20.0): County: Contractor: Contra Costa County Valley Oaks Systems 30 Douglas Drive 5400 Executive Parkway,Suite 340 Martinez,CA 94553 San Ramon,CA 94583 Fax: (925)313-1459 Fax: (925)941-1020 (3)Fixed Price or Other Pricing Basis(Section 3.1):$172,000 (4)Reserve amount for minor changes(Section 6.3):$0 (5)Maximum amount for minor changes(Section 6.3):$4 (6)Contractor Federal ID#68-0331363 Page 2 CCC DolnAdn?in\Phur1 "COUNTY" CONTRA COSTA COUNTY "CONTRACTOR" By: By: Chairperson,Board of Supervisors/Designee Robert Faulhaber,president Date: t3 By: L_..- Attest: Clerk,Board of Supervisors Rand `Wheeler,CEO/Assistant Secretary Note to Contractor:For corporations(profit or non-profit),the Agreement must be signed by two officers. Signature A must be that of the President or Vice-President and Signature B must be that of the Secretary or Assistant Secretary {Civil Code Sec. 1190.1 and Corporation Code Sec. 313}.All signatures must be acknowledged as set forth on following page. Page 3 CCC DoITlAdminThuri ACKNOWLEDGMENT STATE OF CALIFORNIA COUNTY OF CONTRA COSTA ) On 4yis ,before me, d (insert name and title of the officer),personally appeared r Personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s)—ie/are subscribed to the within instrument and acknowledged to me that 44elilw, they executed the same in-hisAmr•, their authorized capacity(ies),and that4494m-(their signature(s)on the instrument the person(s),or the entity upon behalf of which the person(s) acted,executed the instrument. WITNESS MY HAND AND OFFICIAL SEAL CARCOLY N K.WHO* CMYM* M#12MOIS Notcry fttft-c4NOMIG Cart o Caaict Cater � .� •� 1 My'C.arxrn• NovS 2130+1 Signature(Seal) Acknowledgment(by Corporation,Partnership or Individual) Civil Code Sec. 1189 Page 4 CCC DorRAdmin\Phurl APPROVALS RECOMMENDED BY DEPARTMENT FORMAPPROVED COUNTY COUNSEL BY: B APPROVED: COUNTY ADMINISTRATOR f BY: signee Page 5 CCC DoIT\ABmin\Phuri CONTRA COSTA COUNTY EQUIPMENT,SOFTWARE,AND SERVICES PROCUREMENT AGREEMENT TERMS AND CONDITIONS 1.0 DEFINITIONS 1.1 The following general definitions shall apply for the purposes of this Agreement: "Agreement"shall mean this agreement. "Business Day" shall mean Monday through Friday,excluding holidays observed by the County. "Confidential Information" shall have the meaning set forth in Section 7.1. "Contractor"shall mean the person or entity identified as Contractor on the first page of this Agreement. "County" shall mean the Contra Costa County. "First Productive Use" shall mean that point in time,which County processes"live"customer data with any functional portion,or total function,of"named" software. "Four Digit Year Format"shall mean a format that allows entry or processing of a four-digit-year date,where the first two digits will designate the century and the second two digits will designate the year within the century. 'Disclosing Party'shall have the meaning set forth in Section 7.5. "Documentation"shall have the meaning set forth in Section 8.4. "Leap Year" shall mean the year during which an extra day is added to February(February 29).Leap Year occurs in all years evenly divisible by the number four(4),except that a year that is divisible by 100 is not a Leap Year,unless it is also divisible by 400. "Maintenance" shall mean the providing of technical information,assistance,error correction,repair services,and repair parts in the manner specified in Exhibit F. "Minor Changes"shall have the meaning set forth in Section 6.3. "Products"shall mean the equipment and software listed in Exhibit B and all other equipment and software to be provided by Contractor pursuant to this Agreement. "Project" shall mean the task(s)described in Exhibit A. "Receiving Party" shall have the meaning set forth in Section 7.5. "Section" shall mean a section of this Agreement. "Services" shall mean all labor to be provided by Contractor or its subcontractors pursuant to this Agreement. Page 6 CCC DoMAdminThurl "Year 2000 Compliant" shall mean dates outside the range of 1900-1998, including the years 1999, 2000 and thereafter, encountered and/or processed by the software/fnmware/hardware/equipmentlsystern will be correctly recognized, calculated, sorted, stored, displayed and/or otherwise processed in any level of computer hardware or software, including,but not limited to, microcode, firmware, application programs, system software, utilities, files, databases and network infrastructure devices. 1.2 Exhibit A hereto contains additional definitions of technical terms to be used with this Agreement and its exhibits. 2.0 EXHIBITS The following Exhibits hereto are incorporated into and made a part of this Agreement: Exhibit A Statement of Work Exhibit B Equipment and Software Deliverable Items;Pricing for Additional Items Exhibit C Project Milestones and Special Payment Provisions Exhibit D Performance, and Acceptance Criteria Exhibit E Indemnity and Insurance Exhibit E Maintenance Obligations Exhibit G Software License Exhibit Ii Escrow Agreement Exhibit I Controlled Access Protection Exhibit J VOS Service Level Agreement 3.0 PRICING AND PAYMENT 3.1 The County will pay Contractor for the Services and the Products in accordance with the pricing set forth in item C(3)of this Agreement,except as otherwise provided in this Agreement. 3.2 Except as otherwise provided in this Agreement, Contractor will invoice the County and will be paid in accordance with the provisions of Exhibit C. 3.3 All invoices from Contractor will be in a format approved in advance by the County. 3.4 Invoices are payable within 30 days after receipt,unless otherwise agreed. 3.5 If this Agreement is designated as a firm fixed-price contract in item C(3) of page 1 hereof, such price shall include all sales,use,and value-added taxes,freight charges,insurance,licenses,and any other charges related to the sale or licensing of the Products and the providing of the Services to the County; the total amount invoiced to the County for the Project shall not exceed the amount set forth in item C(3) of page 1 hereof, unless changes are approved pursuant to Section 6.0. It is the understanding of all parties that sales tax will not apply to any item transmitted to or downloaded by the County. In the event there is a change of status or interpretation of California sales tax law such that California sales tax is due and payable, County shall be responsible for the payment of said tax. Page 7 CCC DoMAdminThurl 3.6 Should the County require additional Products for the Project, they will be provided under the pricing structure set forth in Exhibit B and shall be considered changes pursuant to Section 6.0. that will require amendment of this Agreement to increase the payment limit and expand the scope of work to be provided by Contractor. 4.0 PERSONNEL AND SUBCONTRACTORS 4.1 Contractor shall provide qualified personnel to supply the Services for the Project. 4.2 The authorized Representative of Contractor designated on page 1 of this Agreement shall be the County's normal point of contact at Contractor on matters related to Contractor's performance of the Services hereunder. Likewise, the County has designated its Authorized Representative who will be the normal point of contact at the County for Contractor concerning the County's duties and responsibilities hereunder. The Authorized Representatives for a party may be changed upon written notice from the party changing the Authorized Representative to the other party. Upon written request by the County, Contractor will replace Contractor's Authorized Representative. 4.3 Prior written consent of the County is required before Contractor may enter into subcontracts for any work contemplated under this Agreement, or before Contractor may assign this Agreement or monies due or to become due,by operation of law or otherwise. 4.4 Contractor acknowledges that it will be responsible for the performance or non-performance by its subcontractors of the tasks set forth in this Agreement. Contractor shall contractually require all subcontractors performing work on the Project to abide by the following provisions of this Agreement: Sections 4.5, 4.6, 4.7, 4.8, 4.9, 5.3,5.4,7.0, 11.0, 17.1, 18.2, 19.0,and 22.1 through 229. 4.5 Immediately upon receipt of written notice from the County that any Contractor employee, or employee of a subcontractor to Contractor, is not performing work on the Project in a satisfactory manner,Contractor will remove such employee and,within a reasonable period of time,replace such employee with a qualified employee. 4.6 Contractor and its employees, subcontractors,and subcontractors' employees,are not and shall not be deemed to be, employees of the County. Contractor and its subcontractors will be solely responsible for the payment of their respective employees' compensation, including employee taxes, workers' compensation, and any similar taxes associated with their employment. 4.7 This Agreement shall not create any partnership or joint venture between the parties. Nothing contained in this Agreement shall constitute either party as the agent or legal representative of the other for any purpose.No provision of this Agreement grants either party any express or implied right of authority to assume or create any obligation or responsibility on behalf of or in the name of the other party, or to bind the other party in any manner or thing whatsoever. 4.8 Neither party will, directly or indirectly, solicit or offer employment to any employee of the other party during the work on the Project by said employee and for one year thereafter. 5.0 ASSISTANCE FROM COUNTY;RULES OF ACCESS AND CHANGE MANAGEMENT 5.1 The County will be providing the level of assistance on the Project as indicated in Exhibit A. 5.2 While on County's premises in connection with the performance of this Agreement, Contractor personnel will comply with the County's applicable rules with respect to security, conduct and other matters concerning access to County's premises. Such rules may require in some cases background checks and escorts for Contractor and subcontractor personnel. On notice from the County, Contractor will immediately remove any of its personnel assigned to perform work under this Agreement who do not comply with such rules. Page 8 CCC DoMAdminThurl 5.3 Unless otherwise requested in writing by the County, that portion of the Project work to be done on County premises by Contractor and its subcontractors will be performed between the hours of 8:OOAM and 6:OOPM on Business Days. 5.4 In performing its duties for the Project, Contractor will comply with the County's standard requirements with respect to technical and Operational change management. It is understood by Contractor that changing the County's computers, in particular its mainframes, requires advance notice and compliance with established County procedures. 6.0 CHANGES 6.1 The parties acknowledge that additions, deletions, and modifications to the Products and Services specified under this Agreement may be required in the manner set forth in this Section. 6.2 No such change, whether major or minor, shall be binding, and Contractor shall not proceed with ay change, unless the change is confirmed in writing and formally executed by the Authorized Representatives of both Contractor and the County as set forth on page 1 of this Agreement. A major or material change, as defined in Section 6.4 below, also requires a written amendment of this Agreement that is approved by the County's Board of Supervisors. 6.3 Minor Changes may be made by the mutual written agreement of the Authorized Representatives of Contractor and the County without the necessity of a formal proposal and estimates. Minor Changes are those having a price less than the maximum amount for Minor changes as specified in item C(5) of page i of this Agreement, and are changes which do not affect a material term of this Agreement such as the term or payment limit of the Agreement or the nature and scope of services to be provided. Minor Changes will be funded form a pool reserve in the amount specified in item C(4)of page 1 of this Agreement. Once that fund is depleted,this Minor Change procedure will no longer be available. If the reserve is not entirely depleted during the Project,the balance will,at the County's option following completion or termination of the Project,either be credited to other work Contractor is performing for the County or be returned to the County. 6.4 For a major material change, a change that affects the contract payment limit, contract term, or nature and general scope of services, the party seeking the change shall inform the other in writing of the details of the contemplated change and any requested terms concerning the change. For a material change of this type requested by Contractor and involving additional or deleted Services, Contractor shall include a written proposal containing the cost of the additional or deleted Services,Contractor shall include a written proposal containing the cost of the additional or deleted Services involved in the change,and any impacts upon price,delivery schedule, or other terms. For a change of this type requested by the County, Contractor shall respond with such a proposal within five Business Days after receipt of a written request for the change. 7.0 CONFIDENTIAL INFORMATION 7.1 Contractor acknowledges that in the course of performing work on the Project,it and its subcontractors may be exposed to certain Confidential Information, including without limitation medical records, employment records, secret passwords to County computer systems,methods of accessing County computers and data, County personnel data,payroll data, County proprietary software, records and data which are not available to the general public, and documents marked "Confidential" or "Proprietary." Other categories of documents considered Confidential Information by the County shall be specified to Contractor in writing. 7.2 The County acknowledges that Contractor may be disclosing Confidential Information to the County in the course of performance of the Project,including documents marked"Confidential"or"Proprietary"provided that the County agrees prior to disclosure that such information is Confidential Information. Such agreement will not be unreasonably withheld. Page 9 CCC DoMAdmin\Phurl 7.3 Information of a proprietary nature which is disclosed orally to a party hereto shall not be treated as Confidential Information unless it is stated at the time of such oral disclosure that such information is Confidential Information and such information is reduced to writing and confirmed as Confidential Information to the Receiving Party(as defined below)within 30 days after the oral disclosure. 7.4 Confidential Information does not include (a) information which the party receiving the information (the "Receiving Parry") can prove was known to it at the time of receipt from the party disclosing (the "Disclosing Party") that information to the Receiving Party, (b) information lawfully received by the Receiving Party from a third party that is not under an obligation of confidentiality with respect to such information, (c) information which becomes known to the public other than by a disclosure prohibited by this Agreement, or(d) information which the Receiving Party can prove was independently developed by it without assistance from access to Confidential Information. 7.5 The Receiving Party shall use Confidential Information solely for the purposes of the Project and may disclose Confidential Information to others only upon the advance written consent of the Disclosing Parry. The Receiving Parry shall protect Confidential Information with the same degree of care that it regularly employs to safeguard its own confidential information of like nature from unauthorized disclosure but no less than a reasonable degree of care. If the Receiving Party is required by a governmental agency, court or other,quasi-judicial or other regulatory body or by State or Federal law, including but not limited to, the California Public Records Act to disclose Confidential Information received under this Agreement, the Receiving Parry shall not be liable for such disclosure provided that the Receiving Party shall, as promptly as reasonably possible, give notice to the Disclosing Party of the requirement to disclose such Confidential Information in order that the Disclosing Party may contest the requirement that Recipient disclose such Confidential Information. Except as provided in Section 8.0 and except as required by law,no other disclosure of Confidential Information is authorized under this Agreement. 7.6 Except for Confidential Information contained in documentation prepared for the County by Contractor or its subcontractors hereunder, and except as otherwise required by law, upon request by the Disclosing Party, the Receiving Party shall return Confidential Information to the Disclosing Party, along with all copies and notes made therefrom. 8.0 RIGHTS IN SOFTWARE AND DOCUMENTATION 8.1 All software from third parties to be provided by Contractor hereunder will be licensed to the County pursuant to the terms and conditions of the license agreements provided by the publishers of such software. 8.2 Custom software,if any,developed for the County hereunder will be subject to the requirements in Exhibit A. 8.3 With respect to software routines, programs, scripts, or diagrams or schematics written or formulated by Contractor or its subcontractors hereunder, Contractor will designate any third-party software tools (e.g., compilers or CAD programs)that were used in the development of such software,diagrams,or schematics. It is the preference of the County that non-proprietary tools be used for the development of such software, diagrams, or schematics,but if proprietary software tools must be used, then Contractor must provide the County with an object-code version,as well as available documentation on the use of such tools. The County may use such proprietary tools solely for the purpose of maintaining and modifying the software, diagrams,or schematics written or formulated by Contractor or its subcontractors for the Project. 8.4 All documentation required to be developed for the County pursuant to Exhibit A("Documentation")will not be based on Contractor Confidential Information, unless there is a compelling need and the County agrees in writing. The County shall own all such Documentation delivered hereunder except for (a) Documentation Contractor can demonstrate was previously developed by or for Contractor and is not in the public domain; or(b) Documentation identified in writing by Contractor and proved to the County's reasonable satisfaction as being developed solely with Contractor resources. Page 10 CCC Dol T Admin\Dhart 8.5 With respect to Documentation that is deemed to belong to Contractor in accordance with Section 8.4, Contractor grants the County a non-exclusive, royalty-free license to use and copy any such Documentation for its own internal use.The County shall have the right to disclose such Documentation to successor vendors,contractors, or computer hardware or software maintenance organizations,provided such entities (a) have a need to know such information for the purposes of modifying, maintaining, or enhancing the County's equipment or software, and(b) agree not to use such information except with respect to work for the County. Such Documentation will not otherwise be disclosed outside County government, except as required by law, without the advance written consent of Contractor,which shall not be unreasonably withheld or delayed. 9.0 RISK OF LOSS Risk of loss or damage for the Products, except for equipment,shall pass to the County when the Project is accepted by the County pursuant to the provisions of Exhibit D. Risk of loss with respect to equipment shall pass to the County upon delivery of the equipment to County. 10.0 INFRINGEMENT PROTECTION 10.1 All royalties or other charges for any patent,copyright, trademark,trade secret, or other proprietary right to be used in the Project shall be considered as included in the price for the Project. Contractor shall defend, indemnify, and hold the County harmless against any and all liabilities,judgments, costs, damages, and expenses including reasonable attorney's fees resulting from a claim or suit against the County for alleged infringement of any patent, copyright, trademark, trade secret, royalty or license agreement, or other proprietary right arising out of the use by the County of the Products or Documentation for the purposes intended hereunder. As a condition of such indemnification, the County shall promptly inform Contractor of any such claim or suit, allow Contractor or its suppliers to control the defense against such suit,and cooperate,at Contractor's expense, in the defense against such suit, provided however, that in no event shall Contractor make any admission of guilt or liability on behalf of County without County's prior written consent. 10.2 If the County's use of any portion of the Products or Documentation is enjoined by a court of competent jurisdiction,Contractor shall at its option and expense and within 60 days of the enjoinment: (a)Procure for the County the right to use such infringing portion; (b)Replace such infringing portion with a non-infringing portion providing equivalent functionality;or (c) Modify the infringing portion so as to eliminate the infringement while providing equivalent functionality. 10.3 Contractor may delegate its responsibilities under Sections 10.1 and 10.2 to the manufacturer of the allegedly infringing Product, provided Contractor has received the advance written consent of the County. Such consent will not be unreasonably withheld or delayed. 11.0 INDEMNIFICATI©N AND INSURANCE Contractor shall comply with, and require its subcontractors to comply with, the terms and conditions of Exhibit E related to indemnity and insurance. 12.0 WARRANTIES AND MAINTENANCE 12.1 Products to be provided by Contractor hereunder will be subject to the warranties, if any of the manufacturers or suppliers of such Products. Contractor will ensure that such warranties are transferred to the County. Page I I CCC DoITA&MnYburl 12.2 Contractor will provide maintenance or will arrange for maintenance for Products in the manner specified by Exhibit J. 12.3 Contractor represents and warrants to the County that, upon payment of the purchase price specified in this Agreement, the County will have good title to each of the Products, free and clear of all liens, encumbrances, and claims. Unless otherwise agreed to in writing by the County, only new materials shall be used in each of the hardware Products provided by Contractor under this Agreement. 12.4 Contractor represents and warrants to the County,that at the time of installation,the software Products will be free of programming that is intentionally and specifically constructed for the purpose of destroying, interrupting, or otherwise adversely affecting the software Product's code or other code or data in a computer,such as by replicating itself or another program many times without any useful purpose. 12.5 Contractor warrants to the County that the Services to be performed by it and its subcontractors hereunder(a) will be performed in a competent manner by qualified personnel, and (b) will conform to the performance and acceptance criteria set forth in Exhibit D. This warranty shall remain in effect during the implementation by Contractor and shall continue in force until 90 days after final acceptance of the Project. In order to qualify for remedial action under this warranty, the County must report a warranty failure to Contractor in writing within the warranty period. Contractor shall not be responsible for remedial action under this warranty to the extent the failure to meet the warranty is caused by modification to the Products by the County or anyone other than Contractor or its subcontractors,unless under Contractor's or its subcontractors'direction. 12.6 As Contractor's sole obligation, and the County's exclusive remedy, for failure to meet the warranty in Section 12.5,Contractor will use reasonable efforts to correct the failure,provided the County makes available to Contractor information concerning the failure.If Contractor is unable,by using reasonable efforts,to correct the failure within a reasonable period of time, Contractor will refund to the County an equitable portion of the amounts paid by the County based on the proportion of the Project affected by the failure and the severity of the failure with respect to the objectives of the Project. 12.7 Contractor warrants and represents to County that all software developed, distributed, installed or programmed by Contractor pursuant to this Agreement: a) Is Year 2000 Compliant; will operate consistently, predictably and accurately, without interruption or manual intervention, and in accordance with all requirements of this Agreement, including without limitation all specification and/or firnctionality and performance requirements, in relation to dates it encounters or processes; b) That all date recognition and processing by the software/fn-mware/hardware/equipment/system will include the four-digit-year format and will correctly recognize and process the date of February 29,and any related data,during Leap Years;and c) That all date sorting by the software/firmware/hardware/equipment/system that includes a "year category" shall be done based on the four-digit-year format. Upon being notified in writing by County of the failure of any software/firmware/hardware/equipment/systems to comply with this Agreement, Contractor will, within 60 days and at no cost to County, replace or correct the non-complying software/firmware/hardware/equipment/systems with software/firmware/hardware/equipment/systems that does comply with this Agreement. 12.8 Reserved 12.9 No Disclaimers: The warranties set forth in sections 12.7 above shall not be subject to any disclaimer or exclusion of warranties or to any limitation of Contractor's liability under this agreement,and shall remain in effect until termination of this agreement. Page 12 CCC DoITlAdminThuri 12.10 Contractor warrants that it has the corporate power and authority and the legal right to grant the licenses granted by Contractors under this Agreement and neither has nor will enter into agreements or take or fail to take action which shall restrict Contractor's legal right or ability to grant said licenses. 12.11 Contractor represents and warrants that it is aware of no circumstances that would impair its ability to fully perform its obligations under this Agreement. 13.0 DELAYS 13.1 Neither parry will be liable to the other party by reason of any failure in performance of this Agreement if the failure arises out of acts of Gard, acts of the other party, acts of non-County governmental authority, fires, strikes, delays in transportation, riots or war, or any cause beyond the reasonable control of that party. If any such event delays performance,the time allowed for such performance will be extended an amount of time equal to the period of such delay. 13.2 If performance under this Agreement is postponed or extended pursuant to Section 13.1 for longer than 60 days for a reason other than the acts of the County,then the County may, upon written notice to Contractor given during the postponement or extension,terminate this Agreement. In such case, Contractor shall be paid in accordance with Section 16.2. 14.4 TERMINATION FOR CONVENIENCE 14.1 The County may terminate this Agreement for convenience by providing Contractor 30 days advance written notice of such termination. Such notice may direct Contractor to stop work immediately on some portion or all of the Project and may direct Contractor to continue work until the termination date on other portions of the Project. 14.2 In the event of termination under this Section 14,0, the County's total payment to Contractor shall be determined in accordance with Section 16.2. 15.4 TERMINATION FOR CAUSE 15.1 It is expressly agreed that this Agreement shall be fully discharged only by the completion of all work and obligations contracted for,or with the written consent of the County. 15.2 If Contractor fails to begin work on the Project in a timely manner,fails to meet a milestone in Exhibit C by 15 or more days,or fails to carry out or breaches its obligations hereunder(and such failure or breach is not excused by Section 13.2), the County may terminate this Agreement by giving written notice of intent to terminate to Contractor. If Contractor has not completely cured its breach within 30 days of the receipt of such notice, then the County may terminate this Agreement upon the delivery of a written notice of termination to Contractor. 15.3 In the event of termination under this Section, the County may, at its option, return any or all copies of Documentation to Contractor, which was the subject of the breach. The County's total payment to Contractor subsequent to termination shall be determined in accordance with Sections 16.2 and 16.3. 16.0 EFFECT OF TERMINATION 16.1 After receipt of notice of termination, Contractor shall (a) comply with the instructions of the County with respect to stopping or continuing work until the termination date; (b) place no further orders or subcontracts for Products or third-party Services, except as otherwise directed by the County, (c) terminate all orders for Products and subcontracts to the extent they relate to the performance of work terminated by the notice of termination; (d) return Products to their suppliers, if requested by the County and permitted by such suppliers, (e) deliver the Documentation and any custom software to the County in the form it is then in and not subject to the delivery acceptance criteria in Exhibit D, and(f) return to the County all County Confidential Information, along with all copies and notes made therefrom and a certificate signed by Contractor's Authorized Representative evidencing Page 13 CCC DoMAdininThurl compliance with this provision. 16.2 After termination pursuant to Section 14,0 or 15.0,the County shall pay Contractor an amount equal to the sum of the following, less any amounts previously paid to Contractor and any additional amounts, which the County is entitled to withhold pursuant to Section 16.3: (a) The amount due Contractor for completion by Contractor of the latest Project milestone set forth on Exhibit C, as such amount may be adjusted as provided herein due to the addition or deletion of Products or Services. (b) An amount for Contractor's and its subcontractors' labor utilized on the Project since completion of that last completed milestone,billed at Contractor's and its subcontractors'rates as set forth in Exhibit B. Contractor shall submit a claim for such amount and shall permit the County access to all backup documents which relate to such claim. The County shall have the right to disallow from such claim any unauthorized,excessive, or defective labor. (c) The unpaid balance due for unreturned Products delivered to the County and fees for noncancellable (or noncancelled by the County) third-party Services authorized by the County prior to the effective date of termination,to the extent such Products and Services are not covered by Section 16.2(a). (d) The price to the County permitted under Exhibit B for Products in Contractor's possession which were delivered to Contractor for the Project in the ordinary course of performance of this Agreement and which are not returnable to the supplier(or which the County indicates in writing that it wants); any costs that Contractor must pay due to Project cancellation as a result of loss of quantity discounts for Products used solely in the Project. 16.3 if this Agreement is terminated for cause pursuant to Section 15.0, then the County shall be entitled to deduct the following amounts from any monies to be paid Contractor pursuant to Section 16.2: (a)A credit for Documentation returned to Contractor pursuant to Section 15.3,with such credit equal to the amount paid to Contractor for such Documentation prior to termination. (b)An amount equal to the direct damages the County can prove it suffered as a result of breach of this Agreement by Contractor,such as the reasonable costs of having problems created by Contractor corrected by a third party. 16.4 Sections 7.0,8.0,9.0, 10.0, 11 A, 12.1, 12.3, 12.4,and 18.0,shall survive termination of this Agreement. 17.LIMITATION OF LIABILITY;EXCLUSIVE REMEDIES 17.1 EXCEPT FOR THE COUNTY'S PAYMENT OBLIGATIONS HEREUNDER, THE COUNTY SHALL HAVE NO LIABILITY TO CONTRACTOR OR ITS SUBCONTRACTORS FOR ANY BREACH OR TERMINATION OF THIS AGREEMENT. 17.2 EXCEPT FOR WILLFUL AND INTENTIONAL ACTS, AND EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT, NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY FOR SPECIAL,INCIDENTAL OR CONSEQUENTIAL DAMAGES (EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES), INCLUDING, BUT NOT LIMITED TO, LOST PROFITS OR SAVINGS, LOSS OF USE OF SERVICES, COST OF CAPITAL, COST OF SUBSTITUTE SERVICES, DOWNTIME COSTS, OR DAMAGES AND EXPENSES ARISING OUT OF THIRD PARTY CLAIMS. 17.3 THE REMEDIES SPECIFIED INTHIS AGREEMENT ARE EXCLUSIVE. Page 14 CCC DoMAdminThur! 18.0 DISPUTES 18.1 Any dispute arising out of or relating to this Agreement,or breach thereof,shall be first submitted to the senior management of each party for resolution. If the dispute cannot be resolved within 30 days after such matter is referred to senior management, then the dispute shall be submitted to binding arbitration in Contra Costa County, California in accordance with the Commercial Arbitration Rules of the American Arbitration Association("AAA")then in effect and section 1283.05 of the California Code of Civil Procedure. All discoveries must be concluded within 60 days after the submission to arbitration. The decision of the arbitrator shall be final and may be entered as judgment in any court of competent jurisdiction. The losing party, as determined by the arbitrator, shall pay the administrative costs of arbitration. Each party shall bear the cost of its own attorneys' fee, except that the arbitrator shall have the discretion in appropriate circumstances to require the losing party to pay all or a portion of the prevailing party's reasonable attorneys' fees. 18.2 Except as provided in the Termination provisions herein, Contractor or its Subcontractors shall not stop work on the Project,due to a dispute. 19.0 PUBLICITY Prior to issuing any press release concerning the Project or otherwise making a public statement about the Project, Contractor shall obtain the County's written approval of the content of such press release or statement. Such approval will not be unreasonably withheld or delayed. Contractor shall impose this same requirement on its subcontractors. 20.0 NOTICES Any notice under this Agreement will be in writing delivered by hand,by certified mail(return receipt requested),or by other competent and reliable courier service (delivery receipt retained),to the other party at the address indicated in item C(2) of page 1 of this Agreement or to such other address as may be substituted by notice. Notice will be effective on the date of receipt;or if delivery is refused,on the date the attempted delivery was refused. 21.0 NON-APPROPRIATIONS OF FUNDS In the event no finds or insufficient funds are appropriated and budgeted in any Fiscal Year for payments due under this agreement for the then current or the succeeding Fiscal Year during the term aforesaid, this agreement shall create no obligation on the County as to such current or succeeding Fiscal Year except as to the portions of payments herein agreed upon for which funds shall have been appropriated and budgeted, and no right of action or damages shall accrue to the benefit of Contractor, its successors or assigns, as to that portion of this Agreement which may so become unenforceable,except County agrees to peaceably surrender possession of the Products which have not been paid for by County to Contractor or its assignee.Contractor or its assignees shall have all legal rights and remedies to take possession of the Products which have not been paid for by County. 22.0 GENERAL PROVISIONS 22.1 In the performance of duties hereunder,Contractor shall comply,and shall require its subcontractors to comply, with all applicable federal,state,and local laws,rules,and regulations. 22.2 Neither party may assign this Agreement without the prior written consent of the other party, which consent will not be unreasonably withheld. 22.3 If any part or parts of this Agreement are held to be invalid,the remaining parts of this Agreement will continue to be valid and enforceable. Page 15 CCC DoMAA.dmin\Phuri 22.4 The headings in this Agreement are for reference purposes only; they will not affect the meaning or construction of the terms of this Agreement. 22.5 The provisions of this Agreement are for the sole benefit of the parties, and not for the benefit of any other persons or legal entities. 22.6 This Agreement may be executed by the parties in one or more counterparts,each of which when so executed shall be an original.All such counterparts shall constitute one and the same instrument. 22.7 Each of the parties to this Agreement represents and warrants that it has the power and authority to enter into this Agreement and perform the action contemplated hereunder,and this Agreement has been duly authorized and is the valid binding and enforceable obligation of such parties. 22.8 This Agreement, including its referenced exhibits, contains the complete and exclusive understanding of the parties with respect to the subject matter hereof. Except for any terms or conditions of a Request for Quotes or Request for Proposal that are included by reference in this Agreement, this Agreement supersedes and cancels the terms and conditions contained in any previous Request for Quotes or Request for Proposals of the County, any prior Contractor negotiations, proposals, or other submissions to the County by Contractor, and any prior oral or written agreements or representations between County and Contractor concerning the Project.No waiver,alteration, or modification of any of the provisions hereof will be binding unless in writing and signed by a duly authorized representative of the party to be bound.Neither the course of conduct between the parties nor trade usage will act to modify or alter the provisions of this Agreement. 22.9 This Agreement is entered into and to be performed in the State of California and shall be governed and construed under the laws of the State of California. Any action relating to this Agreement shall be instituted and prosecuted in the courts of Contra Costa County, State of California. Page 16 CCC DoMAdmin\Phuri EXHIBIT A STATEMENT OF WORK 1. General Description of Project The project involves the purchase, installation, testing and maintenance of an automated Workers' Compensation/Liabilities System("Project"),which consists of, licensed software which is capable of the functionality as described in the vendor's documentation and hardware. The project will be implemented at the Insurance/Risk Management Department located at 2530 Arnold Drive,Suite 140,Martinez,CA 94553. 2. Project Phases Project will comprise of phases as listed in Exhibit C. 3. Project Control and Schedule Contractor will provide experienced management, administration, and support staff to ensure successful completion of the Project. Contractor support shall include the following functions and services: a. Administrative Control Contractor will maintain schedule,budget, and cost information appropriate to the successful management of the contract on program status and planned activities. This information includes an ongoing analysis of cost and schedule variances. b. Implementation Schedule Contractor shall perform its duties and responsibilities hereunder in accordance with the schedule in Exhibit C. Contractor acknowledges that prompt performance of all services hereunder is required. c. Reviews, Reports, and Meetings Luring the term of this agreement, Contractor will conduct a project status review with the County approximately every two weeks or as otherwise agreed. These reviews will include a discussion on the status of the project, including details on technical issues, schedules, problems and potential problems, and recommended solutions to such problems. In connection with such meetings,Contractor will draft a report covering the foregoing topics and give it to the County in advance of the meeting. In addition, Contractor will attend such other technical and programming meetings and produce such reports concerning the project as requested by the County. Page 17 ccc DoMAdminThurl 4. Software a. Licensing Terms The software provided under the Agreement shall be referred to as the "Valley Oak Systems Software or "iVOS". The Valley Oak Systems Software is licensed to the County pursuant to the terms and conditions of the software license attached hereto as Exhibit G. b. Source Code Escrow Concurrent with the execution of this Agreement, Contractor will enter into a source code escrow agreement in the form of Exhibit H and deliver a copy of the source code for the Valley Oak Workers' Compensation Claim Processing Software to a mutually acceptable escrow agent approved by the County and Contractor. Thereafter, Contractor will deliver a copy of each revision or update to the software, implemented by the County, to the escrow agent promptly after County implementation of such revision or update. 5. Software Support Software telephone support will be provided pursuant to the provisions of Exhibit F. 6. Technical Documentation Contractor shall provide to the County electronic documentation. Such versions may be reproduced by the County for use only by County personnel and contract workers without further compensation to Contractor. All manuals provided with the hardware provided under the Agreement shall also be provided to the County in both electronic and hard copy media. Updates to the foregoing manuals shall be provided to the County without charge. 7. Trainine Contractor will provide training as described in Exhibit B. 8. Additional Consulting Any consulting requested by the County, which is not covered by the Project, shall be provided at the rates set forth in Exhibit B. 9. Acceptance Testing The Project as delivered and installed by Contractor will be tested in accordance with the provisions of Exhibit D. 10. General Warranties The Contractor warrants (a) the hardware sold hereunder and all of its parts and components are new and unused, (b) Contractor has good title to that hardware, free from liens and ?age 18 CCC DoMAdminThurl encumbrances, and that good title to the hardware shall pass to County upon payment in full of the purchase price for the Project, and (c)County shall have all the rights of a direct purchaser of the hardware from the manufacturer(e.g., update rights,patent Indemnification, etc.). 11. Maintenance The Project will be maintained pursuant to the terms of Exhibit F. Contractor represents and warrants that the hardware sold hereunder qualifies for service under its manufacturer's standard warranty and post-warranty maintenance. Contractor will provide County with all necessary documentation to activate such warranty and post-warranty maintenance. 12. Relocation of Proiect The County shall have the right to relocate the Project to another County site in Contra Costa County upon written notice to Contractor. The County shall also have the right to transfer the Valley Oak Systems software to another County computer system upon written notice to Contractor. County may, at its option, and at no additional fee, elect to transfer the software to a different computer architecture of its choice which is supported by Contractor by providing written notice to Contractor of such transfer. Page 19 CCC DoI'flAdminThurl EXHIBIT B EQUIPMENT AND SOFTWARE DELIVERABLE ITEMS PRICING FOR ADDITIONAL ITEMS L DELIVERABLE ITEMS INCLUDED IN THE CONTRACT FIXED PRICE Monthly Application Service Provider Software Subscription Fees Application Service: $8,525 for 12 months Annual Total Fee: $102,300 31 Concurrent User Licenses Equipment-Hardware and Software 2 -Dell OptiPlex GX270S, 2.4GHz, P4 W/CDRW @ 777.$2 each=$1,555.64 36—Dell OptiPlex GX270S, 2.4GHZ,p4 @777.02 each= $27,972.72 Estimated Sales Tax=$2,436.12 Document Imaging Module=$12,500 Total Fee: $44,465 Proiect Management/Network Setup/Data Upgrade Project Manager- Installation of hardware and software - 67 hours @ 150 per hour= $10,050 Data Base Administrator Support- 71.23 hours @ 150 per hour=$10,6$5. Total Fee: $20,735 Training Three days of training to he provided at$1,500 per day Total Fee: $4,500 Page 20 CCC DoMAdminThur? II. PRICING FOR ADDITIONAL ITEMS Hardware and Software Maintenance Maintenance on hardware will be per manufactures agreed to period of time, after that the County will be responsible for ongoing maintenance charges. If the County chooses to terminate the Application Services and once again host the system on its own site, the following shall occur: a) If the County chooses not to continue using the iVOS system, and migrate hack to VOS Portal, then the County agrees to utilize the then current version of Portal. The maintenance fee will remain at the then current rate at the time this option is exercised. b) If the County chooses to continue utilizing the iVOS system, there shall be an increase to the maintenance fee of fifty percent(501/o) of the then current rate at the time this option is exercised. Additional Consulting Consulting not included in the contract price will be provided by Contractor at a rate of $150 per hour. Expenses Contractor's costs and expenses of telephone travel to the County's office, and other office and travel expenses are included in the costs listed above and are not reimbursable. Summary of Service Initialization Fees: A. 12 months of ASP Subscription Fees $102,300 31 Concurrent User Licenses B. Hardware and Software Costs $ 44,465 C. Project Management/Network Setup $ 20,735 C. Valley Oak System (VOS)Training S4,500 TOTAL COSTS $172,000 Page 21 CCC DoMAdminThurl EXHIBIT C PROJECT MILESTONES AND SPECIAL PAYMENT PROVISIONS Except as otherwise provided in this agreement, County will pay Contractor the fixed price of $172,000 upon successful completion of each milestone according to the following schedule: Milestone 1: Hardware and software purchase and installation Payment: $65,200 County will pay Contractor$44,465 for the purchase of the hardware and software when it has been delivered to the County and$20,735 for the installation of the hardware and software when the Contractor has demonstrated the hardware and software meets the equipment manufacturer's operating specifications and Valley Oaks software specifications. Milestone 2: Software Subscription Fee Payment: Monthly subscription of$8,525 for 12 months totaling$102,300 County will start paying the Contractor a monthly subscription fee of$8,525 when the Contractor has completed the conversion of the County's data and demonstrates the First Productive Use where Risk Management successfully conducts their Worker's Compensation and Liabilities Claims processing on the system. Milestone 3: Training Payment: $4,500 County will pay the Contractor$4,500 when the contractor has finished the three days of staff training at Risk Management. Page 22 CCC DoMAdminThurt EXHIBIT D PERFORMANCE AND ACCEPTANCE CRITERIA 1. Performance Criteria The Contractor is expected to submit a proposed acceptance-testing plan for review and approval by the County. The plan should adopt the performance criteria and functionality as set forth in the Technical Specification as accepted by the County and the user manual for the Valley Oak System software. 2. Testing and Acceptance The Contractor's proposed acceptance-testing plan must include the following subjects at a minimum: a. Functional Testing In conjunction with the County, Contractor shall develop tests, which check the compliance of the Project with the functionality and performance described in the performance criteria. Such tests shall be submitted to the County for review and approval. After approval of the tests, Contractor shall run the tests in the presence of County personnel designated by the County. b. Stress Testing In conjunction with the County, Contractor shall develop tests, for review and approval by the County,which simulate the County's future projected conditions of continuous heavy use of the Project and/or sudden bursts of traffic under different patterns of usage. c. Real-Time Testing In conjunction with the County, Contractor shall develop tests to evaluate the Project in a real- time environment at the County with all data loaded into the system after successful completion of functional testing and stress testing. Such tests shall last at least 30 days and shall measure Project performance in accordance with the acceptance criteria. d. Recovery Testing In conjunction with the County, Contractor shall develop tests, for review and approval by the County, which demonstrate recovery of databases and program files. e. Evaluation At the conclusion of each of the tests described above, the County must promptly inform Contractor in writing if the Project has passed or failed to pass the test. If the Project does not pass all aspects of the test, the County shall provide Contractor detailed information with Page 23 CCC DoMAAdminThurl documented examples concerning the failure to pass the test. If within 30 days after receipt of such written notice, Contractor is not able to remedy the cause of the failure to pass the test,then the County shall have the right to return the Project to Contractor, within 90 days after the date of such written notice to Contractor, for a full refund of the price paid by the County for the Project. Page 24 ccc DoMAamfnThur2 EXHIBIT E INDEMNITY ANIS INSURANCE CONTRA COSTA COUNTY CONTRACTUAL TERMS AND CONDITIONS Indemnity The Contractor shall indemnify, defend, save and hold harmless the Contra Costa County (hereinafter "County") its officers, agents and employees from any and all claims, costs and liability for any damages, sickness, death, or injury to person(s) or property, including without limitation all consequential damages, from any cause whatsoever arising directly or indirectly from or connected with the operations or services of the Contractor or its agents, servants, employees or subcontractors, hereunder. Contractor's obligations under this section shall exist regardless of concurrent negligence or willful misconduct on the part of the County or any other person, but Contractor's obligations shall be limited to the proportion of negligence or willful misconduct attributable to Contractor, Contractor's officers, employees, agents, sub-contractors, or any person under the Contractor's direction or control. Contractor will reimburse the County for any expenses, including reasonable attorneys' fees, the County may make by reason of the matters that are the subject of this indemnification, and if requested by the County will defend any claims or litigation to which this indemnification provision applies at the sole cost and expense of the Contractor. Insurance During the entire term of this Contract and any extension or modification thereof, the Contractor shall keep in effect insurance policies meeting the following insurance requirements unless otherwise expressed in the Special Conditions. a. Liability Insurance. The Contractor shall provide comprehensive liability insurance, including coverage for owned and non-owned automobiles, with a minimum combined single limit coverage if $500,000 for all damages, including consequential damages, due to bodily injury, sickness, or disease, or death to any person or damage to or destruction of property, including the loss use thereof, arising from each occurrence. Such insurance should be endorsed to include the County and its offices and employees as additional insureds as to all services performed by Contractor under this Agreement. Said policies shall constitute primary insurance as to the County, the State and Federal Governments, and their officers, agents, and employees, so that other insurance policies held by them or their self-insurance program(s) shall not be required to contribute to any loss covered under the Contractor's insurance policy or policies. b. Workers Compensation. The Contractor shall provide workers' compensation insurance coverage for its employees. Page 25 CCC DoI -AAdminThurl c. Certificate of Insurance. The Contractor shall provide the County with (a) certificate(s) of insurance evidencing liability and worker's compensation insurance as required herein no later than the effective date of this Contract. If the Contractor should renew the insurance policy(ies) or acquire either a new insurance policy(ies) or amend the coverage afforded through an endorsement to the policy at any time during the term of this Contract, the Contractor shall provide(a)current certificate(s)of insurance. d. Additional Insurance Provisions. The insurance policies provided by the Contractor shall include a provision for thirty (30) days written notice to County before cancellation or material changes of the above-specified coverage. Page 26 CCC DorrAdminThurt EXHIBIT F MAINTENANCE OBLIGATIONS 1. DEFINITIONS a. "System"means the Workers Compensation/Liabilities system as described in Exhibit A. b. "Hardware"means the equipment portion of the Project,which is listed on Exhibit B. C. "Vendor Software" means Proprietary Software and Third-Party Software which are part of the Vendor offering(s) and which are listed on Exhibit B. d. "Custom Software" shall have the meaning set forth in Exhibit A to the Agreement of which this Maintenance Agreement is a part. e. "Major Malfunction" means the failure of the hast computer for the Project to function in accordance with the Project user manual or the failure of all terminals or workstations at a County Project site to function in accordance with the Project user manual in such a manner as to render the Project host or Project site effectively unusable. f. "Proprietary Software" means Software,which is developed by or licensed to Contractor and is maintained by Contractor. g "Third-Party Software"means software, such as operating system software which has been developed and which is maintained by a party other than Contractor. h. "Workaround"means a recommended change in the standard procedures for use of the vendor software to avoid an error without significantly impairing performance of the vendor software. i. "First Productive Use" shall have the meaning described in Exhibit C, paragraph 5. Page 27 CCC DoMA.dmin\Phuri 2. COVERAGE AND GENERAL MAINTENANCE RESPONSIBILITIES a. Contractor will provide the County with the maintenance services described herein for the Valley Oak Hardware and Software listed on the attached Exhibit B. Valley Oak Hardware and Software may be deleted from coverage under this Maintenance Agreement upon written notice from the County to Contractor. b. The County acknowledges that Contractor may be an agent or contractor for the manufacturer of Hardware for the repair of that hardware or may arrange for that hardware to be repaired by the manufacturer's authorized repair facilities. Such arrangement shall not relieve Contractor of its obligations for maintenance and support of the entire Project. Contractor represents and warrants that the Hardware and Third - Party Software qualifies for service under its manufacturer's or publisher's standard warranty and post-warranty maintenance. Contractor will ensure that all necessary documentation is executed to activate such warranty and post-warranty maintenance. C. During the term of this Agreement, the Contractor will be responsible for ensuring that the Software, when used in accordance with the applicable Documentation, will perform all the functions listed in, and operate substantially in accordance with (a) the Technical Specification and(b)the applicable user manuals provided with the software. Contractor's sole obligation under this warranty will be to repair promptly the software or provide the other remedies set forth in Section 4 of this Maintenance Agreement. As part of its obligations hereunder, Contractor shall check for and remove, at least once each 30 days, any "harmful code," defined as programming that is intentionally and specifically constructed for the purpose of destroying, interrupting, or otherwise adversely affecting other code or data in the Project, such as by replicating itself or a another program many times without any useful purpose. 3. MAINTENANCE AND SUPPORT SERVICE a. Contractor shall provide telephone support to the County concerning the use of the Project. b. Contractor shall provide remote diagnostic analysis of software problems via modem and correction of such problems remotely or on-site, if necessary. C. Contractor shall exercise commercially reasonable efforts to correct any replaceable error in the Proprietary software reported by the County, which causes the Software to fail to operate substantially in accordance with its user manual. Contractor will attempt to correct as soon as possible errors, which cause a Major Malfunction or materially restrict the full use of the Software when used in accordance with its user manual. For such errors, Contractor will use its best efforts to develop a temporary Workaround until a permanent correction can be effected. Temporary workarounds will be Page 28 CCC Do1T\Admin\PhuT1 made permanent corrections in the next release of the Proprietary software. For other errors in the Proprietary Software, Contractor will use reasonable efforts to include a correction in the next release of the Proprietary Software, which should be issued within six months after discovery of such error. Contractor shall provide all regularly distributed updates, enhancements, and improvements to the Proprietary Software, and installation support without charge. Contractor shall provide release notes and revised documentation therefor. d. Contractor will promptly report errors in Third-Party Software of which it is aware to the publisher of the Third-Party Software for correction. Contractor will, without charge, arrange for the County to obtain promptly and will install all updates, enhancements, and improvements to Third-Party Software and engineering changes to Valley Oak Systems Hardware which are provided by the third-party publisher or manufacturer. Contractor shall provide the County with release notes and revised documentation therefor, which are provided to it by the publisher or manufacturer. e. Any modification to the Custom Software which is required to ensure compatibility with updates, enhancements, and improvements to the Proprietary Software shall be accomplished by Contractor as part of maintenance charge to the County. Any resulting necessary revisions to the documentation for the Custom Software will be furnished to the County without charge. 4. ESCALATION PROCEDURES; REMEDIES For major malfunctions during Critical Claims Processing periods the Contractor will respond by phone within 60 minutes and resolve the problem remotely for the first twenty-four hours. In the event the problem has not been resolved, Contractor will provide on-site technical services to the County until the problem has been resolved, at no charge to the County. For Major Malfunctions that occur outside the Critical Claims Processing;period, Contractor will provide the services as set forth in Section 5. S. SERVICE HOURS AND RESPONSE TIMES a. Except as otherwise provided herein, Contractor shall provide the services set forth in Section 3 hereof between the hours of 8:40 a.m. to 6:00 p.m., Pacific Time, Monday through Friday, excluding County holidays. b. Contractor's Service bevel Agreement (SLA), included herein as Exhibit J, which as amended from time to time, shall be incorporated herein by reference. No reduction in service shall be imposed upon County by amendment to the SLA without the consent of County,which shall not be unreasonably withheld. Page 29 CCC DoMAdrnin\Phurl 6. RESPONSIBILITIES OF THE COUNTY The County shall promptly report any problem, which is covered hereunder to Contractor, and provide details concerning such problem. The County shall allow authorized representatives of Contractor access to the software during the County's regular business hours and thereafter, if necessary. The County shall refrain from making repairs or modifications to the software without advance written approval of Contractor. The County shall provide a telephone line for remote diagnosis of the software available by Contractor 24 hours a day, 7 days a week. It is the responsibility of the County to ensure that all of its electronic files on the software are periodically and adequately duplicated and documented. CONTRACTOR WILL NOT BE RESPONSIBLE FOR THE COUNTY'S FAILURE TO DO SO, NOR FOR THE COST OF RECONSTRUCTING DATA STORED ON THE SOFTWARE WHICH IS LOST FOR ANY CAUSE WHATSOEVER. 7. CHARGES AND PAYMENT A. The County shall continue to pay the current annual maintenance fee in addition to the supplemental maintenance fees set forth in this Agreement, payable in advance, and such fees may not increase more than 4% annually from the commencement date of this Agreement. (Please note that the County may not be in a position to make payments in advance, as mandated by State law). b. Additional hardware and-software may be added upon written notice from the County to Contractor and payment of the applicable fee set forth in Exhibit B to the Agreement of which this Maintenance Agreement is a part. If no fee is set forth for the item to be added, then Contractor and the County will negotiate a mutually acceptable fee which is calculated pursuant to the same formula used to calculate the maintenance fees in Exhibit B. 8. TERM AND TERMINATION a. Contractor's maintenance services shall commence upon First Productive Use of the software by the County and shall continue for five years thereafter unless terminated pursuant to the terms of this agreement. b. Either party may terminate this Agreement upon written notice to the other party that such party has failed to observe, keep, or perform any material provision of these Maintenance obligations. Such termination shall be effective 30 days from the receipt of such notice unless the defaulting party has completely cured the default within that thirty-day period. Page 30 CCC DoMAdmin\Phuri C. The County shall be entitled to a pro-rata refund of fees paid in advance in the case of a termination. 9. REPRESENTATIONS AND LIMITATION OF LIABILITY a. Contractor represents that the maintenance services will be performed in a workman like manner. CONTRACTOR DISCLAIMS ALL OTHER REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, FOR MAINTENANCE UNDER THIS MAINTENANCE AGREEMENT INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR. PURPOSE. The foregoing disclaimer shall not affect Contractor's obligations under the Software and Services Procurement Agreement under which the software was procured from Contractor. Third-Party Software is subject to any warranties or limitations of liability stated in documentation provided by such products' manufacturers with such products. b. Except for claims for bodily injury or property damage to the extent caused by the proven fault or negligence of Contractor and not arising from use of the software, Contractor's liability for damages under this Maintenance Agreement (regardless of the farm of action, whether in contract or tort) shall in no event exceed the amount paid by the County to Contractor for a ane-year period. CONTRACTOR WILL NOT BE LIABLE FOR INDIRECT, INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES, INCLUDING BUT NOT LIMITED TO LOST DATA OR LOST PROFITS, HOWEVER ARISING, EVEN IF IT HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES OR FOP, ANY CLAIM AGAINST THE COUNTY BY ANY OTHER PARTY. Contractor shall not be liable for any failure or delay in performance under this Maintenance Agreement due to causes beyond its reasonable control. Page 31 CCC DoMAdminThuri EXHIBIT G SOFTWARE LICENSE 1. Definitions "Documentation"means only technical publications relating to the use of the Software, such as reference, user, installation, system administrator and technical guides delivered by Contractor to County. "Tools" means the underlying architecture from which the Software is designed, and includes software application programming tools and code. "Software" means all or any portion of the United States version of the binary computer software programs (including corresponding source code) provided by Contractor or made by the County with Contractor's prior written consent, in machine readable form including all listed in Exhibit B and all corrections or updates thereto. Software includes third-party software as identified in Exhibit B except that County recognizes that Contractor cannot supply third party software source code to Escrow Agent. "Server" means a single database or file server, which may be accessed by a network of personal computers. "Territory"means the United States and Canada. "Site" means a specific,physical location of County's Server. 2. License County shall be utilizing VOS software in Valley Oak Systems' Inc. ASP solution. In the event County elects to install iVOS pursuant to Exhibit B, the following license provisions shall govern said license. Definitions a. Application Services. The term. "Application Services" means the electronic data processing, storage and transmission services identified in the Subscription Schedule. b. Application Software. The term "Application Software" means the software used by Contractor to provide the Application Services. Page 32 CCC DoMAdminThur! The County is responsible for all use of its account and maintaining the confidentiality of all passwords and information. Sharing of passwords and account numbers and information is at the County's own risk. When selecting passwords, the County shall select unique, non- obvious passwords with at least six (6) alpha and numeric characters and change each password at least once each ninety(90)days. 2.1 Contractor grants County a perpetual, non-exclusive, nontransferable license to use the licensed number of copies of the software in the Territory, solely for internal data processing operations, on each Server at the Site up to the licensed number of workstations. Any third party software products or modules provided by Contractor to County shall be used solely with Contractor's Software. County may use the Software temporarily on a machine other than the Server in the event that the Server is inoperable. County may make a reasonable number of copies of the Software solely for archive or emergency back-up purposes and/or disaster recovery testing purposes. County may modify or merge the Software with other software with the understanding that any modifications, however extensive, shall not diminish Contractor's title or interest in the Software. 2.2 Contractor shall provide County with the licensed number of copies of the Software and. Documentation as specified in Exhibit B. County may make a reasonable number of copies of the Documentation solely for County's internal use with the Software provided all copyright notices are reproduced. 3. License Exclusions 3.1 Except as expressly authorized herein, County shall not: a) Copy the Software; b) Cause or permit reverse compilation or reverse assembly of all or any portion of the Software; c) Distribute, disclose, market, rent, lease or transfer to any third party any portion of the Software or the Documentation, or use the Software or Documentation in any service bureau arrangement, facility, management,or third party training; d) Disclose the results of Software performance benchmarks to any third party without the prior written consent of Contractor; e) Transfer the Software to a different Server platform without the prior written consent of Contractor(such consent not unreasonably withheld); f) Transfer the Software to a different Site without prior written notice to Contractor. g) Export the Software in violation U.S. Department of Commerce export administration regulation. h) Invoke support libraries other than through documented AN calls; and i) Use Tools except in conjunction with the licensed Contractor applications. Page 33 CCC DoMAdmin\Phurt 3.2 No license, right, or interest in any Contractor trademark, trade name or service mark is granted hereunder. 4. Fees and Payment Terms 4.1 County shall pay Contractor the fees specified in accordance with the schedule of payments listed in Exhibit C,unless County elects to install iVOS on its internal system pursuant to Exhibit B, in which case the fee provisions set forth in Exhibit B shall prevail. 5. Title and Protection 5.1 Contractor (or its third-party providers) retains title to all portions of the Software, and any copies thereof. Title to the physical media for the Software vests in the County upon delivery. Contractor represents that the Software contains valuable proprietary information and County shall not disclose the Software to anyone other than those of its employees or consultants under nondisclosure obligations who have a need to know for purposes consistent with this Agreement. County shall affix, to each full or partial copy of the Software made by the County, all copyright and proprietary information notices as affixed to the original. The obligations set forth in this paragraph shall survive termination of this Agreement. 5.2 The Software may be transferred to the U.S. Government only with the separate prior written consent of Contractor and solely with "Restricted Rights" as the term is defined in F.A.R.52.227-19(c)(2)(or DFAR 252.227-7013(c)(1) if the transfer is to a defense- related agency) or subsequent citation. 6. Limited Warranty Contractor warrants that it has title to the Software and the authority to grant license to use the Software. Contractor warrants that the Software will perform substantially in accordance with the Documentation for as long as Contractor continues to support the version of the Contractor Software in use at the County and County subscribes to Contractor's Software Support Services. Page 34 CCC DoMAdminThur6 Exhibit H ESCROW AGREEMENT This Escrow Agreement is made this day of —' 2004 by and among Valley Oak Systems, Inc., a California corporation("Contractor"),Contra Costa County, a political subdivision of the State of California(the"County") and ("Escrow Agent"), a corporation ("Escrow Agent") RECITALS A. Contractor and County have entered into an Equipment Software & Services Procurement Agreement dated , 2004, pursuant to which Contractor will provide, install, use and maintain the hardware and software necessary to operate a Worker's Compensation/Liabilities System("Project"). B. Under the Agreement, Contractor granted County a license ("License") to use the software (the"Valley Oak Systems or VOS Software")required to operate the Project. C. Under the Agreement, Contractor is required to enter into this source code escrow agreement ("Escrow Agreement") and deliver a copy of the source code for the VOS Software to Escrow Agent so that County will have access to the source code for the VOS Software upon the occurrence of any event of default, as set forth below. AGREEMENT NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,the parties agree as follows: 1. DEPOSIT Contractor has concurrently herewith deposited with Escrow Agent a copy of the source code ("Source Code") form of the VOS Software, including all relevant commentary, explanations and other documentation of the Source Code (collectively "Commentary"). Contractor also agrees to deposit with Escrow Agent, at such times as they are made, a copy of all revisions of the Source Code or Commentary encompassing all corrections and enhancements made to the VOS Software by Contractor pursuant to the .License provisions set forth in Exhibit G or the maintenance obligations set forth in Exhibit F to the Equipment, Software & Services Procurement Agreement. Promptly after any such revision is deposited with the Escrow Agent, both Contractor and Escrow Agent shall give written notice thereof to the County. 2. TERMS This Escrow Agreement shall remain in effect during the term of the Equipment, Software & Services Procurement Agreement. Page 35 CCC DoMAdminThurl 3. DEFAULT A default by Contractor shall be deemed to have occurred under the Escrow Agreement upon the occurrence of any of the following: 1. If Contractor has availed itself of, or been subjected to by any third party, a proceeding in bankruptcy in which Contractor is the debtor, an assignment by Contractor for the benefit of its creditors, the appointment of a receiver for Contractor, or any other proceeding involving insolvency or the protection of, or from, creditors and same has not been discharged or terminated without any prejudice to Contractor's or County's rights or interests under the Equipment, Software & Services Procurement Agreement within 90 days; or 2. If Contractor has ceased its on-going business operations, or its licensing, maintenance or other support of the VOS Software; or 3. If Contractor fails to pay the annual fee due to Escrow Agent hereunder; or 4. If any other event or circumstance occurs which convincingly to a court or arbitrator of proper jurisdiction, demonstrates the inability or unwillingness of Contractor to fulfill its obligations to the County under the Equipment, Software & Services Agreement or this Escrow Agreement, including, without limitation, the detection of defects in the VOS Software. 4. NOTICE OF DEFAULT County shall give written notice to Escrow Agent and Contractor of the occurrence of a default hereunder, except that Escrow Agent shall give notice of the default to County and Contractor if default is based on failure of Contractor to pay Escrow Agent's annual fee. Upon receipt of County's notice of default or Contractor's failure to pay the Escrow Agent's annual fee when due, Escrow Agent shall deliver to the County the entire Source Code and Commentary with respect to the VOS Software then being held by Escrow Agent. The County's use of the source code and commentary shall be limited to County's own use, and shall not be sold or licensed to third parties. 5. COMPENSATION As compensation for the service to be performed by Escrow Agent hereunder, Contractor shall pay Escrow Agent, Cornell Law Group at the time of execution of this Escrow Agreement. 6. LIABILITY Escrow Agent shall not, by reason of its execution of this Escrow Agreement, assume any responsibility or liability for any transaction between the Contractor and the County, other than the performance of its obligations, as Escrow Agent, with respect to the Source Code and Commentary held by it in accordance with this Escrow Agreement. 7. TESTS Upon written notice to Contractor and Escrow Agent, County shall have the right to conduct tests of the Source Code held in escrow, under the supervisions of Contractor, to confirm that it is the Page?6 CCC DoMAdmir.Tharl current Source Code for the VOS Software. 8. CONFIDENTIALITY Except as provided in this Escrow Agreement, Escrow Agent agrees that it shall not divulge or disclose or otherwise make available to any third person whatsoever, or make any use whatsoever, of the Source Code or Commentary,without the express prior written consent of Contractor. 9. ADDRESS All notices or other communications required or contemplated herein shall be in writing, sent by certified mail, return address requested, addressed to another party at the address indicated herein or as same may be changed from time to time by notice hereby give: For Contractor: Attn: President For County: For Escrow Agent: 10. ASSIGNMENT Neither this Escrow Agreement, nor any rights, liabilities or obligations hereunder may be assigned by Escrow Agent without the prior written consent of the County and Contractor. 11. CONSTRUCTION The section headings and captions of this Escrow Agreement are, and the arrangement of this instrument is, for the sole convenience of the parties to this Escrow Agreement. The section headings, captions and arrangement of this instrument do not in any way affect, limit, amplify or modify the terms and provisions of this Escrow Agreement. This Escrow Agreement shall not be construed as if it had been. prepared by one of the parties, but rather as if all of the parties have prepared it. The parties to this Escrow Agreement and their counsel have read and reviewed this Escrow Agreement and agree that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not apply to the interpretation of this Escrow Agreement. The Recitals are, and shall be enforceable as, a part of this Escrow Agreement. 12. GOVERNING LAW This Escrow Agreement shall be governed and construed in accordance with California,law. The venue for any legal action pertaining to this Escrow Agreement shall be Contra Costa County, California. 13. SEVERABILITY In the event that any provision herein is held to be invalid by any court of competent jurisdiction, the remaining parts of this Escrow Agreement will continue to be valid and enforceable. 14. MODIFICATION This Escrow Agreement may not be altered, amended, modified or otherwise changed unless in Page 37 CCC DorrlAdmin\Pnurl writing signed by a duly authorized representative of each party. 15. COUNTERPARTS This Escrow Agreement may be executed in one or more counterparts, each of which when so executed shall be an original. All such counterparts shall constitute one and the same instrument. IN WITNESS WHEREOF, the parties have executed this Escrow Agreement as of the date first set forth above. CONTRA COSTA COUNTY CONTRACTOR Authorized Signature Authorized Signature Print name and title Print name and.title ESCROW AGENT Authorized Signature Print name and title Page 38 CCC Do1T\Adrnin\Phur1 ........... EXHIBIT I CON'T'ROLLED ACCESS PROTECTION The Contractor will provide systems or software which enforces strong security measures to protect the County's information assets by using finely grained discretionary access controls, making users individually accountable for their actions through login procedures, auditing of security-related events and resource isolation. The following are minimal requirements for Contractor supplied systems or software: Security Policy a. Discretionary Access Control The system or software supplied shall define and control access between named users and named objects (e.g., files and programs) in the system. The enforcement mechanism (e.g., self/group/public controls, access control lists) shall allow users to specify and control sharing of those objects by named individuals, or defined groups of individuals, or by bath, and shall provide controls to limit propagation of access rights. The discretionary access control mechanism shall, either by explicit user action or by default, provide that objects are protected from unauthorized access. These access controls shall be capable of including or excluding access to the granularity of a single user. Authorized users shall only assign access permission to an object to users not already possessing access permission. b. Object Reuse No new or old user shall have access to a deleted users storage space or `released space'. That deleted information shall not be assessable by non-evasive methods. 2. Accountability a. Identification and Authentication The system or software shall require users to identify themselves to it before beginning to perform any other actions that the system or software is expected to mediate. Furthermore, the system of software shall use a protected mechanism (e.g., passwords) to authenticate the user's identity. The system or software shall protect authentication data so that it cannot be accessed by any unauthorized user. The system or software shall be able to enforce individual accountability by providing the capability to uniquely identify each individual system user. The system or software shall also provide the capability of associating this identity with all auditable actions taken by that individual. Page 34 CCC DoIT\Admin\Phurl 3. Audit The system or software shall be able to create, maintain, and protect from modification or unauthorized access or destruction an audit trail of accesses to the objects it protects. The audit data shall be protected by the system or software so that read access to it is limited to those who are authorized for audit data. The system or software shall be able to record the following types of events: use of identification and authentication of mechanisms, introduction or objects into a user's address space (e.g., file open, program initiation), deletion of objects, and actions taken by computer operators and system administrators and/or system security administrators, and other security relevant events. For each recorded event, the audit record shall identify: date and time of the event, user, type of event, and success or failure of the event. For identification/authentication events the origin of request (e.g., terminal ID, IP address) shall be included in the audit record. For events that introduce an object into a user's address space and for object deletion events the audit record shall include the name of the object. The system administrator shall be able to selectively audit the actions of any one or more users based on individual identity. 4. Assurance a. Operational Assurance 1) System Architecture The system or software shall maintain a domain for its own execution that protects it from external interference or tampering (e.g., by modification of its code or data structures). Resources controlled by the system or software may be a defined subset of the subjects and objects in the system. The system or software shall isolate the resources to be protected so that they are subject to the access control and auditing requirements. 2) System Integrity The Contractors' solution whether commercial-off-the-shelf (CLOTS) or Contractor proprietary must supply a means to validate the integrity of the solution (hardware, middleware, and software) from the original install through any fixes or enhancements. 5. Life-Cycle Assurance a. Security Testing The security mechanisms of the system or software shall be tested and found to work as claimed in the systemm or software documentation. Testing shall be done (initiated by the Contractor; but may have collaboration with the County) to assure that there are no obvious ways for an unauthorized user to bypass or otherwise defeat the security protection mechanisms of the system or software. Testing shall also include a search for obvious flaws that would allow violation of resource isolation, or that would permit unauthorized access to the audit or authentication data. Patch management must also be addressed in this section. Page 40 CCC DOIT\Admin\Phur': 6. Documentation a. Security Features User's Guide A single summary, chapter, or manual in user documentation shall describe the protection mechanisms provided by the system or software, guidelines on their use, and how they interact with one another. b. Trusted Manual A manual addressed to the system administrator shall present cautions about Functions and privileges that should be controlled when running the supplied solution. The procedures For examining and maintaining the audit files as well as the detailed audit record structure for each type of audit event shall be given. c. Test Documentation As part of the system or software supplied, a document shall be provided that describes the test plan, test procedures that show how the security mechanisms were tested, and results of the security mechanisms' functional testing. d. Design Documentation Documentation shall be available that provides a description of the manufacturer's philosophy of protection and an explanation of how this philosophy is translated into the system or software. If the system of software is composed of distinct modules, the interfaces between these modules shall be described. Page 41 CCC Dol'T1AdminThurl EXHIBIT J VOS Service Level Agreement The VOS Service Level Agreement("SLA")describes the type of services included under the standard support and maintenance agreement,and the service level expectations for the customer(the"Customer")who has purchased Software(the"Software")from VOS.In addition,it covers billable services that fall outside the standard Software Support and Maintenance Agreement. The VOS Software Support and Maintenance Agreement pertain to issues with the VOS Software,and not with any infrastructure or database issues. If the Customer provides access,VOS will provide remote diagnostic analysis of the Software problem and problem correction. VOS exercises commercially reasonable efforts to address any error in the Software.VOS will use its best efforts to provide one(or a combination)of the following three solutions: Provide a software fix in the current release of the Software Provide a workaround until a software fix is available Provide a software fix in the next release of the Software Important Note:The Customer shall appoint up to three individuals to act as liaisons between the Customer and VOS.Those individuals must be knowledgeable in the operation of the Software in order to serve as primary contacts between the Customer and VOS regarding the report of support issues.All of the Customer's support inquiries shall be initiated through these contacts.The Customer may change either the main contacts or their alternates at any time upon notification in an e-mail to vossu port&valleyoakcom,or in writing to: Customer Support Manager, Valley Oak Systems,Inc. Bishop Ranch 8 5000 Executive Parkway, Suite 340 San Ramon,CA 94583, 1. User Problems A. HOURS OF OPERATION -.*- Support during business hours is Monday-Friday 5:00 a.m.-6:00 p.m.PST, ❖ Support during non business hours and holidays can be pre-arranged on a time and expenses basis. Page 42 CCC DoMAdminThurl -------------- _. E. PROBLEM REPORTING METHODS During business hours,the Customer has the option of reporting problems via phone or e-mail.A voice- mail will be recorded if all VOS support staff are busy. ❖ During non-business hours,users have the option of reporting problems via phone(voice-mail)or e- mail. C. TYPES OF PROBLEMS HANDLED Customer Support is a triage center for all problems and/or requests regarding VOS Software after implementation.These include: ❖ Bugs with the Software ❖ VOS Software Upgrades—Customers can request to upgrade to any standard VOS release during business hours. See section 3 below for more details. ❖ Enhancement Requests—Request enhancements to VOS. ❖ Optional Module Purchases—Request to purchase an optional module. ❖ Data Conversions—Request for an add on data conversion. ❖ Support Extra—request VOS resources to perform tasks outside the Software Support and Maintenance Agreement. ❖ Training—cost depends on training request. D. PRIORITIZATION OF PROBLEM REPORTS 1. Priority 1 —Customer is unable to perform critical business functions as a result of Software bug,such as: Unable to add claims; ❖ Unable to process checks or create Accounts Payable export; •S Data corruption caused by a VOS Software bug. 2. Priority 2—the VOS Software is impaired,but the Customer can perform critical business functions and no data is being corrupted. E. PROCESS FOR PROBLEM ESCALATION 1. Escalation Process for Priority 1 ❖ Escalation State 1 -If the VOS Customer Support Analyst cannot resolve the issue within 2 hours, the issue is escalated to the VOS Customer Support Manager. ❖ Escalation State 2—If the VOS Customer Support Manager cannot resolve the issue within 8 hours, the issue is escalated to the VOS Vice President,Client Services. 2. Escalation Process for Priority 2 ❖ Escalation State 1 -If the VOS Customer Support Analyst cannot resolve the issue or provide Customer with a workaround within 2 business days,the issue is escalated to the VOS Customer Support Manager. Page 43 CCC DoITlAdminThurl ❖ Escalation State 2—If the VOS Customer Support Manager cannot resolve the issue or provide Customer with a workaround within 4 business days,the issue is escalated to the VOS Vice President,Client Services. 2. Service Expectations A. RESPONSE TIMES—PROBLEMS RECEIVED DURING BUSINESS HOURS 1. Telephone •* On average,the customer support center responds to calls in person 85%of the time. Calls not answered by the customer support center are directed to voice-mail. 2. Voice-mail or E-Mail Reporting ❖ Problems reported by voice-mail or e-mail will receive an acknowledgement within 1 hour by phone or e-mail. The VOS Customer Support Analyst will provide a Heat ticket number and priority. B. RESPONSE TIMES—PROBLEMS RECEIVED DURING NON BUSINESS HOURS ❖ Problems reported by voice-mail or e-mail during non-business hours,are evaluated and prioritized at the start of the next business day. The Customer will receive an acknowledgement within 1 hour by phone or e-mail. The VOS Customer Support Analyst will provide a Heat ticket number and priority. C. FOLLOW-UP TIMES Customers whose problems are not resolved in the course of the first contact will receive a first update via phone or e-mail within 24 hours. 3. VOS Software Upgrades The Software Support and Maintenance Agreement entitles Customers to request VOS support to perform upgrade of any standard VOS release during business hours.This includes: ❖ Scheduling upgrade with point person at the Customer site. ❖ Applying upgrade scripts to the Customer test and production environrnents. 43 Installation of new Software and ensuring the VOS user id can start the application. Additional services can be requested on a time and expenses basis from VOS.These include: ❖ Performing upgrade prerequisite tasks such as backups. ❖ Performing acceptance testing of the upgrade. *:• Changing custom Software,if required,as a result of the upgrade. ❖ Providing Security adjustments as a result of new functionality in the upgrade. ❖ Hooking in new reports via Reporter. Page 44 CCC DoIT\Admin\Phuri 4. Billable Services Billable requests are handled either under a Support Extra Agreement or on an individual request basis. A signed statement of work is required for work to proceed. Billable work includes,but is not limited to,the following: Support for custom modules that are not covered under the Software Support and Maintenance Agreement. ❖ Implementation for any optional software modules. Add on data conversions. ❖ Supplemental training. •.• Support during non business hours. •:= VOS upgrades during non business hours. •.• Custom reports. 4- VOS database changes,such as org changes,combining insureds,reference table changes. Security configuration consulting or setup. Performance troubleshooting. •:= Database administration services. +.= Backup and recovery consulting. ❖ Server set up,upgrades or update services. Database setup,upgrades or update services. +:= Citrix consulting. ❖ Business Analysis. ❖ Custom Enhancements,for example: ➢ New functionality in vpcheck. > Changes to vpcheck for new Customer set up. ➢ Changes to vpcheck for sort sequence. Custom stored procedures(e.g.p`examiner). ➢ Enhancements. •:= For interfaces: o Installation and configuration of any interface Software on hardware external to the VOS data center. o Training on interfaces. o Customer initiated changes to the interface specification. VOS reserves the right to modify the interface specification for future enhancements. • Customer changes to systems external to VOS that result in any failures or performance problems with the interface. Page 45 CCC DoMAdminThurt o Corrections to Customer's data,including,but not limited to,data modification for purposes of exporting/importing to/from.the VOS database. o Any hardware or software problems beyond the control of VOS, including,but not limited to, the following: o Bugs in a Customer's computer software and hardware that result in interface operational failure. a Network changes and network performance problems. ❖ Other S. Causes Not Attributable to VOS The Maintenance Fee does not include services requested as a result of,or with respect to,causes or errors,which are not attributable to VOS or cannot be reproduced by VOS on unmodified Software. In the event that the Customer requests VOS to provide,and VOS does so provide,any services in connection with causes or errors which are not attributable to VOS,the Customer shall pay VOS for such additional services on a time and materials basis at VOS' then current service rates. Causes or errors,which are not attributable to VOS include,but are not limited to,the following: I. Accident;unusual physical,electrical or electromagnetic stress;neglect;misuse;failure or fluctuation of electric power,air conditioning or humidity control;excessive heating;fire and smoke damage;or causes other than ordinary use. 2. Use of the Software on equipment or rotation media other than the equipment for which such software was designed and licensed for use on. 3. Interconnection,interfacing or operation of the Software with other software products not supplied by VOS. 4. Operation of the Software with other media,hardware,software or telecommunication interfaces not meeting or not maintained in accordance with the manufacturer's or environmental or VOS' specifications. 5. Improper installation by the Customer or use of the Software that deviates from any operating procedures established by VOS in the applicable Documentation or in environmental or manufacturer specifications. 6. Modification,customization, alteration or addition or attempted modification,customization, alteration or addition of the Software undertaken by the Customer or its agents,assigns,contractors,employees or other's under the Customer's control. 7. Software programs made by the Customer or other parties unless specifically covered in a Statement of Work between the Customer and VOS. 8. Customer's failure to implement current versions of the Software that are issued under this Service Level Page 46 CCC DoMAdminThur( :> Agreement. 9. introduction of data into any database used by the Software by any means other than the use of the Software. 10. Failure by the Customer to respond to any action plans provided by VOS pursuant to a support call by the Customer. 6. Contacting VOS Customer Support Support is initiated through a Customer contact via telephone or e-mail. The following information can be used to initiate the support process. Support Number (925)2424672 E-Mail Address vossupport@valleyoak.eom A support ticket will be issued via e-mail and/or phone along with a priority per the response times provided in this SLA.During this initial contact, the VOS Customer Support Representative may verify and/or request the following information from the Customer.Failure to provide this information may hinder the ability to resolve the issue in a timely fashion. • Customer support contact information(name,title,company name,e-mail address,phone number,pager number,fax number,and/or cell number). • Confirmation of Software release and patch level,operating system,and/or database version. For performance issues,include desktop operating system,disk space,amount of memory,and MHz. • Detailed problem description. Include any symptoms,patterns(time of day,certain users,etc.),and/or any specific error messages received. • Historical description of problem(did it ever work,when last worked,what changed,what steps have been taken to avoid and/or resolve issue,etc.). 7. On-Site Assistance When,at VOS' discretion,on-site assistance is required to perform any support,the Customer will reimburse VOS for all related traveling expenses and costs for board and lodging with all Professional Services. 8. Supported Software Versions Maintenance and support will only be provided for the current version of the Software and the version of the Software released immediately prior to the current version. Support for the Software prior to the current version will be for a period up to one(1)year from the release date of the current version. Page 47 CCC DoMAdminThurl