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HomeMy WebLinkAbout24288CSAC Excess Insurance Authority Valley Oak Systems Participating Entity Service Agreement Fresno County ----.---- AfcEIVEu APR 0 I Z005 RISK MANAGEMENT This agreement is made and entered into as of April 1,2005,between the CSAC-Excess Insurance Authority,hereinafter referred to as "EIA"and Fresno County,hereinafter referred to as "Member". Whereas,the EIA has entered into an agreement with Valley Oak Systems (VaS)to provide software licenses for the iVOS claim system,support,maintenance,and ASP services;and Whereas,Member desires to obtain software licenses from the EIA in order to utilize the iVOS system. Therefore,be it resolved that: EIA agrees to issue two iVOS software licenses to Member,and Member agrees to utilize the iVOS system under the same terms and conditions provided for in the agreement between the EIA and Valley Oak Systems.A copy of that agreement is attached hereto as Exhibit I. Member agrees to pay EIA an annual software license fee of $9,500 for two GL Only access licenses.This fee will be pro-rated if the Member enters this agreement mid-year (based on a July 1 fiscal year).However,Member understands that the license fee does not include other costs such as data conversion,implementation and training.These types of services are the sole responsibility of Member and have been negotiated with Valley Oak Systems.As outlined in the System Guidelines and Cost Summary provided by the EIA and vas,Member agrees to pay a flat rate of $10,000 for conversion and implementation fees (Option 2)and $3,000 for training. Member also agrees to purchase the Laser Check Printing Optional Module.The fee for the Laser Check Printing Optional Module is $1,500 per year for five years (based on a July 1 fiscal year).If additional members require the use of the module,the rate for subsequent years will be shared among the users of that module. This agreement shall become effective April 1,2005,and shall automatically renew on July 1, 2005,and thereafter continue to renew for successive one (1)year periods.However,either party may terminate the agreement sixty days after issuing a written notice of termination to other party.If either party terminates this agreement,the Member shall be provided the opportunity to contract directly with Valley Oak Systems for iVOS software licenses. Title: MEM~PjtName:Mar.tinG.Bloom Faclhty Servtces &Purchooing Manager J1j;5 Entity:Fresno County Ref #'250/-o7H ina Dean Chief Operating Officer CSAC Excess Insurance Authority Date Signed:Date Signed:~j;;JS.Ie;s- CSAC Excess Insurance Authority Valley Oak Systems'Claim System Price Structure for Member Usage Annual Per Concurrent User License Rate Full Access Licenses (WC and Liability Lines of Business) $5,150 per concurrent license GL Only Access Licenses (Liability Line of Business Only) $4,750 per concurrent license Note:The above licenses are only required if your County/Entity will use the VOS system to input data and administer claims.If you want limited access (read and print reports only)to our data or the data from the PWC and PGL TPA's,you do not need to buy a license.The EIA has purchased a couple of licenses to allow our members limited access to our data. Estimated Conversion Costs* Minimum «20,000 claims) >20,000 claims $10,000 $15,000 *These are estimates based on quotes provided for the EIA conversion.Actual conversion costs will be determined by the number of claims,existing claim system and lines of coverage.Quotes for actual costs must be obtained from Valley Oak Systems. Optional Modules The below Optional Modules are available to members at a maximum rate of $1,500 per year per module for five years.Each year,the rate of the module will be determined by the number of users of that module.Members may receive a discounted rate if additional members use the same module.Rates will be charged to members for five years following the purchase of a module. Laser Check Printing Medical Bill Review Medical Treatment Module Employee Interface Accounts Payable Interface Positive Pay Bank Reconciliation ISO Claim Search Auto.Interface Please note that VOS's costs for conversion and training are the responsibility of the member. Valley Oak Systems Optional Modules The following Optional Modules are available for members to purchase.Each module will be billed at a maximum of $1,500 per year per member for the first 5 years after its purchase.The per module rate will be adjusted annually as additional members utilize the modules. Laser Check Printing Provides high quality custom laser printed checks with custom design to be printed using an existing laser printer and stock paper.Includes custom programming to combine multiple payments per check according to client's specification.Also includes software,custom graphics and 2 signatures for 2 different check stocks.Additional check stocks or signatures are an additional charge.Changes after production use to modify signatures,graphics,payment/check grouping,etc.will be billed at the then current hourly rate for custom services. Medical Bill Review Company Interface Custom interface to import medical payment information into VOS Portal from diskette or e-mail file.This interface electronically transfers payment information from most Bill Review companies systems directly into VOS Portal for check/voucher issuance.Optionally,bill review and/or PPO fees charged by the Bill Review Company/PPO can be automatically attached to the individual claim files and a single check(s) produced to the Bill Review Company/PPO.Medical treatment and EOR/EOB information is not imported as part of this interface. Medical Treatment Interface We offer an optional Medical Treatment Interface to import additional information into VOS Portal.This interface allows the following: ~Electronically transfers payment information from most Bill Review company systems directly into VOS Portal. ~The ability to view treatment information from the payment window. ~The receipt of EOB information with the payment data for an Accounting Interface to potentially print an EOB on the stub of the checks. Positive Pay Bank Reconciliation Module Provides a two-way electronic transfer of check information between VOS Portal and the bank.Issued checks,and voids are sent to the bank.Cleared checks and corrections are received from the bank and applied to the individual claim file.Users can view cleared,stop,and void status from the payment window. ISO Claim Search -Automated Central Index Bureau Interface The Automated Index Bureau Module provides the following capabilities. ~Automatic requests configurable to user requirements ~Initial/supplemental/re-index ~All lines of insurance ~Index reports filed into claim notepad Employee Interface VOS Portal has a standard employee interface:When a claim (or injury report)is opened and a SSN or Employee number is entered,the employee information is automatically populated into the general claim window and database eliminating the need to manually enter the data.VOS clients will be responsible for extracting the data from the HR database into a fixed length ASCII file format. Accounts Payable Interface Development,delivery,and testing of custom interface necessary to satisfy requirements of an electronic automated interface to/from AP system. ----uu ,/ .<Software License Agree~nl Exhibit I ,..." :.~alley Oak IVED Valley Oak Systems Software License Agreemen APR 0 1 Z005 This Valley Oak Systems Software License Agreement is a legal agreement between 'Clienf'and Valley Oak Systems,Inc.for the Valley Oak Systems products listed in Schedule A.RISK MANAGEMENT DEFINITIONS'.~4"~ The followingdefinitionsapplyto the termsas theyappearin this agreement:d.l!>~~A "VaS"meansValleyOak Systems,Inc.~I/I /~l) "Clienf'means"CSACEXcessInsuranceAuthority"-Oaf...Q. "Software Producf'which Includes computer software,electronic documentation,and...,.,.<'ti1J1i printed materials as listed in Schedule A and as described in Schedule B."'.A ~. "Server Software"means software to be used on a single computer referred to as the "9',A ."Server").., "Client Software"means software to be used on Individual user workstations. "Install"means placing the Software Product on a computer's hard disk,CD-ROM;or other secondary storage device. "Use"means executing or loading the Software Product Into computer RAM or other primary memory... "Production Use"means capability to use the system in a liveenvironment (I.e.open new claims,make payments,set reserves,generate checks). LICENSE GRANT VOS grants Client the non-exclusive license to: Install and use one copy of the Server Software on a single Server. Install and use Client Software for the number of concurrent users listed in Schedule A. LICENSE AND SERVICE FEES Client agrees to pay VOS the License Fees of $131,200 according to the following schedule.The. License Fee noted includes a License for a single site and 6 concurrent Workers'Compensation Full Access users and 2 General Liability Only users.Additional users listed in Schedule A can be acquired at the cost listed In Schedule A per the Payment Schedule noted below for a period of 12 months following the execution of this agreement. Payment Schedule for Software License Fees 50%Due upon execution of License Agreement 25%Due upon Installation of Software 25%Due upon production use of Software $65,600 $32,800 $32,800 Client agrees to pay vas for services delivered with the Software Product according to the following schedule at the rates listed in Schedule A.All payments are due 30 days after receipt ofinvoice. Payment Schedule for Services Training Invoiced monthly for services provided Project management,customization Invoiced monthly for services provided Data Conversion 50%invoiced @ delivery of trial conversion 50%Invoiced @ production use Page 1 Software License Agree~~) f '. .'~alley Oak Systems,Inc. COPYRIGHT and OTHER RESTRICTIONS The Software Product is licensed,not sold,and is not transferable.Title and copyrights in and to the Software Product (including any images,.photographs,video,audio,and text incorporated into the Software Product),accompanying printed material,and any copies you are permitted to make herein are owned by VOS and are protected by United States copyright laws and international treaty provisions. LIMITED WARRANTY VOS hereby warrants to Client that the Software Product shall perform in accordance with current program specifications and documentation (including user manuals,program descriptions,guides, etc.,as amended and revised for new releases).VOS DISCLAIMS ALL OTHER WARRANTIES, EITHER EXPRESSED OR IMPLIED,INCLUDING BUT NOT LIMITED TO IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE,WITH RESPECT TO THE PROGRAM.THIS LIMITED WARRANTY GIVES YOU SPECIFIC LEGAL RIGHTS,YOU MAY HAVE OTHERS,WHICH VARY FROM STATE TO STATE. NO LIABILITY FOR CONSEQUENTIAL DAMAGES In no event will VOS be liable for direct,incidental or consequential damages,including but not limited to damages resulting from loss of data or business opportunities,resulting from the Software Product,either alone or in conjunction with other programs. GENERAL This Agreement constitutes the entire agreement between Client and VOS relating to the subject matter of this Agreement.It is governed by the laws of the State of California. RESTRICTED RIGHTS LEGEND Use,duplication,or disclosure by the Government is subject to restrictions as set forth in subparagraph (c}(1)(ii)of the Rights in Technical Data and Computer software clause in DFAR 52.227-7013 or the equivalent clause in FAR 52.227-14,whichever is applicable. Valley Oak Systems,Inc.CSAC Excess Insurance Authority £~kJPL Robert Faulhaber President Date:~!t'~~~ Page2 " SoftWare License Agreem",..J .~alley Oak Systems,Inc. -i' Schedule A All pricing is exclusive of travel related expenses,which are billed to Client on a monthly basis as incurred. .License Fees Single Site License (One Time Fee) VOS Portal Claims AdministrationSystem -Enterprise (Single Site/Server License)Modules included: $102,000 >Workers'Compensation >Auto/Property >Reporter >DocumentImaging >CaliforniaCommutation Calculator >ClaimIntakeModule >General Liability >Scheduled/Internet Reporting >PolicyMaintenance >vas Express >PRDPGeneralLiabilityInterface User Licenses (One-Time Fee)$29,200 >6 Workers'Compensation FullAccess Concurrent Users @ $3,900/user >2 General LiabilityOnly Concurrent Users @ $2,900/user vas per user pricingis on a concurrentuser basis.Forexample,Clientmay have any numberof users withaccess to the system but onlyup to the totalnumberof user licenses may be on the system at anyone time,regardless of beingremoteor local. Project management/Implementation support Resources for projectmanagementand implementationsupportinclude: $60,000 >1/2 FullTime Equivalent (FTE)Personnel IncludingProject Manager and Systems/BusinessAnalyst ' Pricing is based on a rate of $1 ,500/day.The pricing quoted assumes an implementation time frame of 4 months from the first kickoffmeeting to initiationof production use of the system based on scope of project defined withinthis document.Implementation cost willbe invoiced on a monthly basis as incurred. Page 3 Software License Agreem"..J } ,"Valley Oak Systems,Inc. Training For 8 days @ $1,500/day Estimated cost for training is based on the assumptions for training 24 Users.Actual training cost will be invoiced on a monthly basis as incurred. a.General User Training 8 attendees/class 4 days of training b.Reports &Graph Module 8 attendees/class 2 days of training c.System Administrator 2 -6 attendees/class 2 days of training Data Conversion Total Conversion Cost Cost is based on converting historical claims information from the following systems with associated claim volumes: ~EIA Staff 0 RiskMasterdatabase 0 WC &GL data,not to exceed 6,000 claims ~Bragg &Associates 0 VOS database 0 WC only,not to exceed7,000claims ~George Hill 0 VOS database 0 GeneralLiabilityonly,not to exceed2,000claims $8,500 $5,000 $5,000 ~CMI $15,000 0 ATS database 0 WC only,not to exceed 25,000 claims ~ICS $15,000 0 DAVID database 0 WC only,not to exceed 30,000 claims $12,000 $48,500 Page 4 ""'~-I Software'Maintenance and SUI-'tibrt Agreement )Valley aak Systems,Inc. ;. SOFTWARE MAINTENANCE AND SUPPORT AGREEMENT CSAC EXCESS INSURANCE AUTHORITY 3017 GOLD CANAL DRIVE,SUITE 300 RANCHO CORDOVA,CA 95670 TELEPHONE (916)631-7363 hereafter referred to as "Client,"and Valley Oak Systems,Inc.,a California Corporation,located at: 3189 Danville Blvd.Suite 100 Alamo,CA 94507 hereafter referred to as "VaS,"in consideration of the promises made herein and intending to be legally bound, agree as follows: Recitals Client is the licensee of software developed by vas and listed in 1(a).This agreement provides that Valley Oak Systems,Inc.will provide technical support to the undersigned Client under the terms and conditions of this agreement. Maintenance and Support Service 1.(a)vas agrees to provide the technical support services necessary to remedy any operational difficulties attributable to the following Software product(s). vas Portal Claims Management System for Windows.Modules included: ~Workers'Compensation ~Auto/Property ~Reporter -).Document Imaging ~California Commutation Calculator ~Claim Intake Module ~General Liability ~Scheduled/Internet Reporting ~Policy Maintenance >vas Express >PROP General Liability Interface Additional modules and/or concurrent users can be added to this maintenance and support agreement per the Software License Agreement for a fee of 15%of the module/user license fee paid for additional modules and/or concurrent users. (b)vas agrees to provide unlimited phone support from 8:00 a.m.EST to 6:00 p.m.PST Monday -Friday,except holidays.Such holidays shall be designated by vas in writing and provided to Client at the time of execution of this agreement and annually thereafter upon renewal,if applicable.Support during non- business hours and holidays can be pre-arranged on a time and expense basis. (c)vas agrees to provide periodic product updates and upgrades to the products listed in above in paragraph 1a.All enhancements included as part of the standard product shall be included. Proprietary Rights 2.Client acknowledges and.agrees that corrected Software and associated documentation remain the Property of the licensor and constitute a trade secret of said software licensor. Page 1 '.~ Sbftware'Maintenance and Su...)ort Agreement )Valley eak Systems,Inc. .' Access to Data and Computer 3.Client shall,at its own expense,install and maintain a modem (minimum 28kbps),remote control access software,and dedicated telephone line for contractors use in providing support services.ves shall at all times have 24 hour/day,7 days per week access to provide technical support services. Terms of Agreement 4.This Agreement shall be operative upon production use of the software,for a period of one year (365 days)subject to renewal or after which time it may be terminated by either party on sixty (60)days prior written notice to the other party.It .Is hereby agreed that Client may renew said contract,if for Identical services,at a price increase guaranteed not to exceed 7.5%. Fees and charges 5.The fee for the maintenance and support services provided for herein shall be $19,680,payable in advance of each one-year period.A refund equal to the prorated maintenance fee (Le.,maintenance fee/12 times the remaining months)shall be given if this contract is terminated pursuant to paragraph 9 of this contract. Costs Not Included In This Contract 6.If it is necessary for ves to provide services to Client outside the scope of services contracted herein,Client shall provide written consent in advance for ves to perform such services.Client agrees to pay ves at the Contractor's then current standard rates for time and material,and travel expenses.An example of this type of cost is that any travel expenses incurred pursuant to paragraph B of this agreement are reimbursable to the VOS within thirty (3D)days of submittal. Taxes 7.Client shall be responsible for all sales or use taxes or any other taxes,fees,or duties imposed by federal,state,local,or other governments or governmental entities on or with respect to the services rendered or property provided by ves pursuant to this Agreement. Travel Expenses 8.Client agrees to pay ves for all travel and other incidental expenses,including meals,and shipping costs,incurred in connection with Contractor's performance of its duties under this Agreement.Client shall first approve any travel by ves outside the services contracted herein. Termination 9.(a)This Agreement may be terminated by either party at the end of its initial term or upon sixty (60)days prior written notice to the other party. (b)This Agreement shall be terminated without refund upon the termination by reason of default on the part of Client of the Agreement pursuant to which Client obtained the Software. (c)This Agreement may be terminated at any time by ves in the event of any failure on the part of Client to pay the maintenance fee provided for hereunder after thirty (3D)days notice that the maintenance fee is delinquent. (d)In the event of termination,all fees or charges payable under this Agreement shall become due and payable within thirty (30)days of written notice or demand by ves and all obligations of vas under this Agreement shall end immediately upon termination.As set forth above in paragraph 5 and in this paragraph at Page 2 .'.,' Software Maintenance and slI ;brt Agreement ) Valley Oak Systems.Inc. (a).a refund will be issued to Client for the prorated maintenance fee (Le.,maintenance fee/12 times the remaining months)under the contract.Because of the sixty (60)day termination notice requirement,no refunds will be made if there is only 60 days or less remaining on the contract period at the time of termination. (e)Clients'sole and exclusive remedy for vas's breach of this agreement shall be limited to a refund,on a pro rata basis,of any portion of the advance maintenance fee which has not been used.Said refund will be calculated on a monthly basis.[fotal maintenance fee /12 =monthly rate x months remaining.Partial months will be calculated at the mathematical equivalent of a daily rate (monthly rate /30 days)]. Delays 10.vas shall not be liable for any delay in performance directly or indirectly resulting from acts of Client,its agents,employees,or subcontractors or causes beyond the control of vas "Causes beyond the control .of vas"include,but are not limited to:acts of God;acts of a public enemy;acts of the United States or the District of Columbia,any State or Territory of the United States,or any of their political subdivisions;fire;flood; epidemics;quarantine restrictions;strikes,civil commotions,or revolution;freight embargoes;unusually severe weather condition;or default of Contractor's subcontractors or suppliers. Entire Agreement 11.This Agreement constitutes the entire agreement of the parties and the terms and conditions stated herein supersede all prior agreements between the parties relating to the subject matter of this Agreement. Modifications to Agreement 12.This Agreement may be amended by the parties only by a written agreement. Attorneys'Fees 13.If any legal action is necessary to enforce the terms of this Agreement,the prevailing party shall be entitled to reasonable attorneys'fees in addition to any other relief to which that party may be entitled.This provision shall be construed as applicable to the entire Agreement. Parties Bound 14.This Agreement shall be binding on and inure to the benefit ofVOS and Client and their respective successors and (to the extent specified in any assignment)assigns. Notices 15.Any notices or reports required by this Agreement to be given by one party to the other party shall be made in writing to that party at the address shown at the beginning of this Agreement or at any other address that may be designated in writing from time to time by that party. Page 3 ," ,'\ .Software'Maintenance and SlIl-r'6rt Agreement .,.Valley Oak Systems,Inc. Governing Law 16. California. Executedon ~,2002,at ~clAQ CDr~DVCl..California' This Agreement shall be governed by and construed in accordance with the laws of the State of CSAC Excess Insurance Authority Valley Oak Systems,Inc. By.~/B.dName:tArCL Title:-3$~-t.6r!:::.'J.~~:,U" By:~£/-~L Robert Faulhaber President Page 4 }. ,))./) APPLICATION SERVICES PROVIDER AGREEMENT This Application Services Provider Agreement is made between Valley Oak Systems,Inc.;a California cOrPoration with its principal offices locatea at 3189 Danville Blva.Suite #100 AlaI11o,CA 94507 ("Venaor"),and CSAC Excess Insurance Authori~with its princiPal office located at 3017 Gold Canal Drive, SUite 30o"Rancho ~ordova,CA 95670 ("Customer"),and is effective as of8/29/200.l. 1.Definitions a.Agreement.The term "Agreement"means this agreement and the Subscription Schedule,Fee Schedule and SLA attached hereto and incorporated by reference in this Agreement. b.Application Services.The term "Application Services"means the electronic data processing,storage and transmission services identified in the Subscription Schedule. c.Application Software:The term "Application Software"means the software used by Vendor to provide the Application Services. d.Customer Information.The term "Customer Information"means information created or otherwise owned by Customer,Customers'members and JPA organizations or licensed by Customer from third parties,including Data and infonnation created by Customer by using the Application Services,that is used in conjunction with the Application Services and the Application Software. e.Data.The tenn "Data"means any and all information provided by Customer to Vendor for use in conjunction with the Application Services and the Application Software,including processing,storage and transmission as part of the Application Services. f.Documentation.The term "Documentation"means the user manual for the Application Software.The Documentation shall be made available online by Vendor to Customer. g.Effective Date.The term "Effective Date"means the date stated above. Page 1 .; Valley Oak Systems,Inc.)) Application ~~fvice Provider Agreement ".~ h.Fee Schedule.The tenn "Fee Schedule"means the document attached to and incorporated by reference in this Agreement that identifies the charges for the Application Services provided by Vendor to Custon1er. i.SLA.The term"SLA"means the Service Level Agreement attached hereto and incorporated by reference in this Agreement. j.Subscription Schedule.The tenn "Subscription Schedule"means the docUlnent attached to and incorporated by reference in this Agreement that identifies the Application Services. k.Third Party.The term "Third party"means any entity other than Vendor and Customer. 1.Vendor Information.The tern1 "Vendor InfoTI11ation"means infoTITIation, including the Application Software,created or otherwise owned by Vendor or licensed by Vendor from Third Parties,related to the Application Services. 2.Services a.Obligation of Vendor.Subject to the terms and conditions of this Agreement,Vendor agrees to provide Customer the Application Services,as identified in the Subscription Schedule,in accordance with the SLA. b.Grant of License.Subject to the terms and conditions of this Agreement, Vendor grants to Customer a limited,nontransferable,nonexclusive license for the tern1 of this Agreen1ent to access over the Internet and use the Application Services and the Application Software solely to support Customer's nonnal course of business. c.Restrictions on Use.Customer shall not,without express written permission,directly or indirectly,(i)license,sell,lease or otherwise transfer the Application Services or the Application Software,(ii)alter or permit a third party to alter any part of the Application Software;(iii)use or permit the use of the Application Services or the Application Software in the operation of a service bureau for non-customer employees;or (iv)disassemble,decompile,reverse engineer or otherwise attempt to derive source code or other trade secrets from the Application Software. Page 2 Valley Oak Systems,Inc. )Application ~e~ce Provider Agreement d.Use of Data.Customer agrees that (i)it is solely responsible for collecting,inputting and updating all Data related to Customer's use of the Application Services,and (ii)Data shall not include anything that actually or potentially inmnges or misappropriates the copyright,trade secret,trademark or other intellectual property right of any Third Party. e.Passwords.Customer 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 Customer's own risk.When selecting passwords,CustOlnershall 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. 3.Fee and Payment Terms a.Fees.Customer agrees to pay Vendor (i)all nonrecurring charges ("Service Initialization Fees"),and (ii)all monthly recurring charges ("Monthly Subscription Fees")during the term of this Agreelnent,each as set forth in the Fee Schedule attached hereto and incorporated by reference in this Agreement. b.Payment Schedule.Customer shall pay Vendor an amount equal to the Fees listed in the Fee Schedule of this Agreement.Customer shall be invoiced on a monthly basis in advance for the Monthly Subscription Fees for the Application Services to be provided for such monthly period.Payment shall be due thirty (30) days after the date of the invoice.Vendor reserves the right to invoice on a pro rata basis for any part of a monthly period to allow for subsequent invoices to be calculated and paid on a n10nthlyperiod basis. c.Late Charges;Other Remedies.Any payment not received within thirty (30)days of the invoice date will accrue interest at a rate of one and one-half percent (11/2%)per month,or the highest rate allowed by applicable law, whichever is lower.If Customer is delinquent in its payments,Vendor may,upon prior written notice to Customer,and at Vendor's sale discretion (i)terminate this Agreement,(ii)in whole or in part suspend providing Application Services to Customer until payment in full has been made to Vendor,(iii)in whole or in part suspend providing Application Services to CustOlneruntil Vendor and Customer have agreed,in writing,to modified payment terms that include a payment schedule for all delinquent amounts,and/or (iv)require other assurances to secure Customer's payment obligations hereunder. Page 3 Valley Oak:Systems,Inc. ) Application ::se~ce Provider Agreement d.Taxes.All fees charged by Vendor for Application Services are exclusive of taxes and similar fees now in force or enacted in the future imposed on the transaction,all of which the Customer will be responsible for,except for taxes based on Vendor's net income. 4.Warranty a.In General.Vendor warrants that it will use commercially reasonable efforts to provide the Application Services to Customer in accordance with the Subscription Schedule and the SLA;provided that: i.Customer has not used any equipment or software creating an adverse impact on the Application Services; ii.Custon1er has paid all amounts due under this Agreen1ent and is not in default of any provision of this Agreement,and iii.Customer has made no changes (nor permitted any changes to be made other than by or with the express approval of Vendor)to the Software Applications.ANY UNAUTHORIZED CHANGES TO THE APPLICATION SOFTWARE WILL VOID THE WARRANTY. b.No Other Warranties.THE WARRANTY SET FORTH IN TillS SECTION IS THE SOLE AND EXCLUSIVE WARRANTY FOR ANY FAILURE BY VENDOR TO PROVIDE THE APPLICATION SERVICES. EXCEPT AS EXPRESSLY PROVIDED IN TillS SECTION,VENDOR DOES NOT MAKE,AND HEREBY DISCLAIMS,ANY AND ALL OTHER EXPRESS,Jl\.1PLIED,OR STATUTORY WARRANTIES,INCLUDING BUT NOT LIMITED TO,WARRANTIES OF MERCHANTABILITY,FITNESS FOR A PARTICULAR PURPOSE,AND TITLE AND NON-INFRINGEMENT,AND ANY WARRANTIES ARISING FROM COURSE OF DEALING,COURSE OF PERFORMANCE,OR TRADE USAGE.VENDOR DOES NOT WARRANT THAT THE APPLICATION SERVICES SHALL BE PROVIDED .UNINTERRUPTED OR MISTAKE FREE. c.Precedence.IN NO EVENT SHALL THE SUBSCRIPTION SCHEDULE OR SLA WAIVE THE WARRANTY DISCLAIMER SET OUT HEREIN.IN THE EVENT OF ANY CONFLICT BETWEEN THE PROVISIONS OF THE SUBSCRIPTION SCHEDULE OR SLA AND THE Page 4 y'alley Oak Systems,Inc. ) \ Application ~ehice Provider Agreement WARRANTY DISCLAIMER IN THIS SECTION,THE WARRANTY DISCLAIMER IN THIS SECTION SHALL TAKE PRECEDENCE. 5.Confidential Information a.Acknowledgment.Customer aclmowledges that the Vendor Information contains trade secrets,confidential information and other valuable proprietary information owned by Vendor. b.Obligations of Customer.Customer agrees to use a commercially reasonable level of care to preserve the confidentiality of all Vendor Infonnation that in any way is provided to,discovered by or otherwise disclosed to Customer as the result of tIns Agreement.Customer shall use a commercially reasonable level of care not to disclose or make available to any Third Party,or use for its own or for any Third Party's benefit,other than its own use as necessary to access and use the Application Services,any Vendor hlfonnation,without the prior written consent of Vendor.Notwithstanding the foregoing,Customer shall have the right to disclose that Customer is a customer of Vendor.Customer agrees that no Third Parties,including any consultants or other independent contractors engaged by Customer,shall have access to Vendor Information without the prior written consent of Vendor. c.Obligations of Vendor.Vendor agrees to use a commercially reasonable level of care to preserVe the confidentiality of all Customer Information that in any way is provided to,discovered by or otherwise disclosed to Vendor as the result of this Agreement.Vendor shall use a commercially reasonable level of care not to disclose or make available to any Third Party,or use for its own or for any Third Party's benefit,other than as necessary in performance of its obligations under this Agreenlent,any CustOlnerInfonnation,without the prior written consent of Customer.Notwithstanding the foregoing,Vendor shall have the right to disclose that CustOlner is a customer of Vendor and may use CustOlnerInformation for statistical and comparative analysis purposes provided that no such information is disclosed in any nlanner,which could reasonably identify Customer. d.Agreement.The parties expressly agree that the terms of this Agreement shall be maintained in confidence and that neither party shall disclose the terms of tins Agreement to any Third Party without the prior written approval of the other party. Page5 \\ Valley Oak Systems,Inc.")j Application 8etvice Provider Agreement 6.Proprietary Rights a.Vendors Proprietary Rights.Exclusive of Customer Information, Vendor shall retain all right,title,and interest (including copyright and other intellectual property rights,or informational rights)relating to the Application Services and the Vendor Information and all legally protectable elements or derivative works thereof Vendor may place copyright and/or proprietary notices, including hypertext links,within"the Application Services.Customer shall not alter or remove such notices without Vendor's written permission. Notwithstanding anything to the contrary in this Agreement,Vendor shall not be prohibited or enjoined at any time by Customer ITomutilizing any skills or lmowledge of a general nature acquired during the course of providing the Application Services,including information publicly known or available or that could reasonably be acquired in similar work performed for another Customer of Vendor. b.Customer's Proprietary Rights.Customer shall retain all right,title and interest (including copyright and other intellectual property rights,or informational rights)in the Custon1er InfoTI11ationand all legally protectable elements or derivative works thereof. 7.Term The term for each of the Application Services will commence on the date set forth in the Subscription Schedule and continue for the period specified therefor in the Subscription Schedule.Thereafter,the term of each of the Application" Services shall automatically renew and continue for additional terms equal to the period specified in the Subscription Service unless either party notifies the other in writing at least ninety (90)days prior to the end of a tenn of its intention not to renew.Each renewal will be at Vendor's then current rates,as set forth in a Fee Schedule provided by Vendor to Customer at least one hundred and twenty (120) days prior to the end of a term. 8.Termination a.By Vendor.Vendor may terminate this Agreement upon giving Customer a Notice of Tern1inationif Customer (i)breaches tillSAgreen1entand fails to cure such breach "within thirty (30)days of written notice describing such breach,except in the case of failure to pay fees,which must be cured within fifteen (15)days after Vendor gives CustOlnernotice of such delinquency,or (ii)becomes the subject of a Page6 Valley Oak Systems,Inc.J Application ~ljhice Provider Agreement voluntary or involuntary petition in bankruptcy or any proceeding relating to insolvency,receivership,liquidation,or composition for the benefit of creditors,if such petition is not dismissed within sixty (60)days offiling. b.By Customer.Customer may terminate this Agreement upon giving Vendor a Notice of Termination if Vendor (i)breaches this Agreement and fails to cure such breach within thirty (30)days of written notice describing such breach, or (ii)becomes the subject of a voluntary or involuntary petition in bankruptcy or any proceeding relating to insolvency,receivership,liquidation,or composition for the benefit of creditors,if such petition is not dismissed within sixty (60)4ays of filing. c.Procedure upon Termination.Upon the effective date of termination of this Agreement,Vendor shall cease providing the.Application Services,CustOlner shall cease using the Application Services,and all payment obligations of Customer through the effective date of termination shall immediately become due. Within sixty (60)days after the effective date of termination and full payment by Custonler,Vendor shall provide Customer with a copy of all Customer Infon11ation,which resulted :tronlproviding the Application Services,in the format specified on the Subscription Schedule. 9.Limitations of Liability a.In General.THIS SECTION 9,SECTION 4 (WARRANTY),AND SECTION 10 (INDEMNIFICATION)SET FORTH VENDOR'S ENTIRE LIABILITY AND CUSTOMER'S EXCLUSIVE REMEDIES.IN NO EVENT SHALL VENDOR BE LIABLE FOR ANY AMOUNT IN EXCESS OF AMOUNTS PAID UNDER THIS AGREEMENT DURING THE TWEL VE- MONTH PERIOD PRIOR TO THE EVENT GIVING RISE TO SUCH LIABILITY.UNDER NO CIRCUMSTANCES SHALL VENDOR BE LIABLE FOR.ANY TYPE OF INCIDENTAL,SPECIAL,PUNITIVE,INDIRECT OR CONSEQUENTIAL DAMAGES,INCLUDING,BUT NOT LIMITED TO,LOST REVENUE,LOST PROFITS,REPLACEMENT GOODS,COST OF REPLACEMENT GOODS,LOSS OF TECHNOLOGY,RIGHTS OR SERVICES,LOSS.OF INFORMATION,OR INTERRUPTION OR LOSS OF USE OF SERVICE OR EQUIPMENT,EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES,ARISING UNDER ANY THEORY OF CONTRACT,TORT (INCLUDING NEGLIGENCE),STRICT LIABILITY OR OTHERWISE.THE PARTIES ACKNOWLEDGE THAT VENDOR HAS SET ITS PRICES AND ENTERED INTO THIS AGREEMENT IN RELIANCE UPON Page7 --------- Valley Oak Systems,Inc. ) Application 8~ce Provider Agreement THE LIMITATIONS OF LIABILITY AND THE DISCLAIMERS OF WARRANTIES AND DAMAGES SET FORTH HEREIN,AND THAT THE SAME FORM AN ESSENTIAL BASIS OF THE BARGAIN BETWEEN THE PARTIES.THEPARTmS AGREE THAT THE LIMITATION AND EXCLUSIONS OF LIABILITY AND DISCLAIMERS SPECIFmD IN TIllS AGREEMENT WILL SURVIVE AND APPLY EVEN IF FOUND TO HAVE FAILED OF THEIR ESSENTIAL PURPOSE. b.Force Majeure.VENDOR SHALL NOT BE LIABLE FOR AND WILL NOT BE RESPONSffiLE TO CUSTOMER FOR ANY DELAY OR FAILURE TO PERFORM UNDER THIS AGREEMENT IF SUCH DELAY OR FAILURE RESULTS FROM FIRE,EXPLOSION,LABOR DISPUTE,EARTHQUAKE, CASUAL TY OR ACCIDENT,LACK OR FAILURE OF TRANS PORTA TION F ACILITmS AND/OR SERVICES,LACK OR FAILURE OF ELECTRICAL UTILITIES AND/OR TELECOMMUNICATIONS FACILITIES AND/OR SERVICES INCLUDING INTERNET SERVICES,EPIDEMIC,FLOOD, DROUGHT,OR BY REASON OF WAR,REVOLUTION,CIVIL COMM:OTION,BLOCKADE OR EMBARGO,ACT OF GOD,ANY INABILITY TO OBTAIN ANY REQUISITE LICENSE,PERMIT OR AUTHORIZATION,OR BY REASON OF ANY LAW,PROCLAMATION, REGULATION,ORDINANCE,DEMAND OR REQUIREMENT OF ANY GOVERNMENT OR BY REASON OF ANY OTHER CAUSE WHATSOEVER, WHETHER SIMILAR OR DISSIMILAR TO THOSE ENUMERATED, BEYOND THE REASONABLE CONTROL OF VENDOR. 10.Indemnification a.By Customer.Cust0111eragrees to protect,indemnify and save harmless Vendor and its directors,officers,employees and agents from and against all claims,demands and causes of action by Customer's enlployees or third parties on account of personal injuries or death or on account of property damages arising out of the work to be performed by Customer hereunder and resulting from the negligent act or omissions of Customer,Custonler's agents,employees or subcontractors. b.By Vendor.Vendor agrees to protect,indemnify and save harmless Customer and its directors,officers,elnployees and agents from and against all clainls,demands and causes of action by Vendor's employees or third parties on account of personal injuries or death or on account of property damages ariSing out Page8 .Valley Oak Systems,Inc. )) Application 8etVice Provider Agreement of the work to be perfonned by Vendor hereunder and resulting from the negligent act or omissions of Vendor,Vendor's agents,employees or subcontractors. 11.Assignment Customer shall not assign,without written approval of V endor,which said approval shall not be unreasonably withheld,any of its rights,duties,or obligations under this Agreement to any person or entity,in whole or in part,and any attempt to do so shall be deemed void and/or a material breach of this Agreement. 12.Notices Any notice or communication required or permitted in this Agreement shall be in writing and shall be deemed to have been duly given on the day of delivery if hand-delivered or four (4)days after mailing if mailed by first class mail, registered or certified,postage prepaid,and addressed as follows: To Vendor:3189 Danville Blvd.Suite 100 Alamo,CA 94507 To Customer:3017 Gold Canal Drive,Suite 300 Rancho Cordova,CA 95670 13.General Provisions a.Independent Contractors.The parties and their respective employees are and shall be independent contractors and neither party by virtue of this Agreement shall have any right,power or authority to act or create any obligation,express or implied,on behalf of the other party.. b.Mediation and Arbitration i.If a dispute arises out of or relates to this Agreement,or the breach thereof,and the dispute cannot be settled,the parties agree first to try in good faith to settle the dispute by mediation administered by the American Arbitration Association under its Commercial Mediation Rules before resorting to arbitration. ii.Subject to subsection i.above,the parties shall settle any dispute arising out of or related to tbis Agreement,or the breach thereof,by Page 9 Valley Oak Systems,Inc.Application SerViceProvider Agreement arbitration in Contra Costa County,State of California in accordance with the rules of the American Arbitration Association.The parties shall agree upon a single arbitrator or,if the parties cannot agree upon an arbitrator within thirty (30)days,then the parties agree that a single arbitratorshall be \ appointed by the A1nerican Arbitration Association.The arbitrator may' award attOTI1eys'fees and costs as part of the award.The award of the arbitrator shall be binding and may be entered as a judgment in any court of competent jurisdiction. c.Waiver.No waiver of any provision hereof or of any right or ren1edy hereunder shall be effective unless in writing and signed by the party against whom such waiver is sought to be enforced.No delay in exercising,no course of dealing with respect to,or no partial exercise of any right or ren1edyhereunder shall constitute a waiver of any other right or remedy,or future exercise thereof. d.Severability.If any provision of this Agreen1ent is detennined to be invalid under any applicable statue or rule of law,it is to that extent to be deemed Olnitted,and the balance of the Agreement shall remain enforceable. e.Entire Agreement.This Agreement,together with the Subscription Schedule,Fee Schedule and SLA,which are incorporated by reference herein, constitutes the con1plete and exclusive staten1entof all mutual understandings between the parties with respect to the subject matter hereof,superseding all prior and contelllpOraneousproposals,communications and understandings,oral or written. f.Amendment.This Agreen1entInay not be modified,altered or amended except by a written instrument duly executed by both parties. g.Governing Law.This Agreen1ent and perforn1ance hereunder shall be .governed by the laws of the State of California. h.Read and Understood.Each party ac1mowledges that it has read and understands this Agreement and agrees to be bound by its terms. Page 10 Valley ORk Systems,Inc.)Application ~t;;~ice Provider Agreement AGREED: Valley Oak Systems,Inc.: .fP~cvL Bob Faulhaber President Address: 3189 DanvilleBlvd.Suite 100 Alamo,CA 94507 J'¥'zDae CSAC Excess Insurance Authority: By:~\)tL-- Name:It ~u;C tk.b I.., Title:Ass+.u..L.tc..r.Jl.M4",CL~ Address:. 3017 Gold Canal Drive,Suite 300 Rancho Cordova,CA 95670 9 /'0 10 1-. Date Page 11 Valley Oak:Systems,Inc.)Application :Sti~ice Provider Agreement ---------_.--.-------------- Subscription Schedule 1.Application Service a.a.Description:Access and Use of VOS Portal Claims Administration Software as described in the Proposal dated May 13,2002.Modules and number of Concurrent Users included in the service are listed below: ~Workers'Compensation ~Auto/Property ~Reporter ~DocumentImaging ~CaliforniaCommutation Calculator ~Claim Intal<:eModule ~General Liability ~ScheduledlInternet Reporting ~Policy Maintenance ~VOS Express ~PRDP General Liability Interface ~6 Workers'Compensation and Full Access Concurrent User Licenses ~2 General Liability Only Concurrent User Licenses Additional users and/or modules can be added at Vendor's current rates. Upon Customer request an extract of data will be provided to Customer with a reasonable timeframe for delivery and cost.Upon Customer's written request for the data extract,VOS will provide a timeframe and cost to perform the services required. b.Commencement Date: c.Initial Term:Monthly d.Renewal Term:Monthly 2.Format for Delivery of Customer Information upon Termination:Oracle database dump file created by the Oracle database export utility. Page 12 Valley Oak Systems,Inc. "" Application 8ekc~Provider Agreement .1.Monthly Subscription Fees Application Service:$2.200 Fee Schedule Page 13 ------------------------ Valley Oak Systems,Inc. -)f Application ~t:if{,iceProvider Agreement Service Level Agreement Below is an outline of the services that will be included in the ASP service provided by Vendor. Remote Access »Access via the Internet »Remote Communication Software (Citrix MetaFrame)- »System is available 8am Eastern -6pm Pacific Monday through Saturday (System will be available outside of the hours noted above,but will be subject to potential unavailability for Vendor maintenance procedures. >Customer support is available 8am Eastenl -6pm Pacific Monday through Friday.Support during non-business hours and holidays can be prearranged on a time and expense basis. Should the System not be available due to failure of Vendor infrastructure for more than one (1)day:- >Customer may subtract"a penalty amount from the Monthly fee. >Penalty Amount is limited to the total number of days the System is unavailable following the first day. >Penalty Amount is based on a daily rate calculated as follows: Monthly Fee /30 days =Daily Penalty Rate) >System unavailability must be verified by Vendor support. >Customer must notify Vendor of system unavailability in a prompt nlanner. System,Infrastructure »Hardware (Server and Router) >Database (Oracle) >Operating System (Windows NT) >Ancillary Software (all to be used within VOS Portal only):MS-Word,MS- Excel,and Adobe Acrobat Writer.E-mail,fax,and any other software are not included. Services In addition to the standard system support,VOS will provide the System Administration support nonnally provided by in-house technical staff. Services are available during normal support hours.Other procedures such as check generation,correspondence maintenance and modification,and reference table maintenance will be the responsibility of Customer Personnel. Page 14 Valley Oak Systems,Inc. . J .\ Application boAriceProvider Agreement Examples of services provided by vas are listed below as well as examples of tasks to be performed by Customer. Services provided by VOS >Database administration tasks -such as killing runaway jobs,monitoring logs,backups,testing backups,monitoring performance/capacities etc.) >Citrix administration Service provided to Customer at an additional cost: >Running or scheduling standard monthly reporting history periods. >Security maintenance -adding new users,changing existing user profiles,resetting passwords etc. >Resolution of client issues relating to connectivity to the Intenlet >Data corrections to Customer databases at Customer request >Reference table changes -changes that cannot be done via vas Portal >Enhancenlents Additional services will be provided upon request at Valley Oak Systems standard published rates. Services provided by Customer >E-nlail services >Internet services >Desktop/Printer/Scanner support >Desktop software (e.g.MS Office) >Virus protection >Network infrastructure and cOlmectivityto ISP (Internet) >User access/password approvals >Enhancement change request approvals >Production maintenance approvals >Reference table changes -changes made via vas Portal >Running and configuring custom interfaces -such as Bill Review,state EDI data transfers,Positive Pay,Insurance Carrier Data Extracts,ISO Claim Search,PRDP Interface,etc. >Check generation >Correspondence maintenance >Policy maintenance Page 15 '..1 t-' System Usage Guidelines and Cost Summary for the Implementationof iVOS . CSAC Excess Insurance Authority Members Fresno County Proposal Overview The purpose of this document is to outline the System Usage Guidelines and the associated costs required to implement the iVOS claims system in partnership with CSAC-EIA.Alternative pricing has been provided if the choice is made to contract directlywith Valley Oak Systems.. System Usaqe Guidelines General Guidelines .EIA or CPEIA members will utilize the iVOS Claims Administration System under the same terms and conditions provided in the agreement between the EIA and Valley Oak Systems (VaS).Pricing specific to the members is outlined below. .Each EIA or CPEIA member will be implemented on a separate database using the vas Application Service Provider (ASP)model. .Each member will be provided with a "standard"environment to administer and/or track both Workers'Compensation and/or General Liability (includes Auto/Property).The standard environment is based upon the EIA's environment and utilization of the system. .The "standard"environment will include pre-defined codes for primary reference tables such as body part,nature of injury,cause,reserve categories,etc.to ensure ease of data transfer to the EIA database.Most code tables can be modified by the member,but proper code translations must be provided for the EIA. .The EIA will develop .an application that will electronically transfer new EIA reportable claims and updates from the member's database into the EIA's. .Each member will be allowed up to 5 user licenses following this model.In the event that more than 5 licenses are required,the member may opt to contract directly with Valley Oak at their current pricing.Other solutions specific to a member's needs may be available and can be negotiated with the EIA and vas. ,, ,'< IVOS System Usage Guidelines and Cost Summary Fresno County.Proposal January 27,2005 Page 2 of 4 Data Conversion/Database Implementation .Member's database will be implemented using the standard claims environment. .Some members may not require conversion of their current data. .Members who require conversion may convert manually or may require data conversion and implementation services from vas.Costs are outlined below. Support .All EIA and CPEIA member support will be handled through the EIA.The EIA will contact vas directly for any/all support issues. Training .Training will be the sole responsibility of the member and will be provided by vas. .EIA may assist coordinating training whereas multiple members wish to share the training costs. .vas recommends the following training: 0 GeneralUserTraining .Maximum of 8 attendees per class .1 training day 0 Reportsand GraphsTraining .Maximum of 8 attendees per class .1 training day 0 SystemAdministrator(maynot be requiredif EIA will do administration) .Maximum of 6 attendees per class .1 training day .Prices outlined below. Pricinq Detail User License Fees Annual fee is $19,000 based on 4 user licenses for GL Only Access.This fee is based on the Price Structure approved by the EIA's IT Committee.The Structure is outlined below. Full Access Licenses (WC and Liability Lines of Business) $5,150 per concurrent license per year GL Only Access Licenses (Liability Line of Business Only) $4,750 per concurrent license per year Ivas System Usage Guidelines and Cost Summary Fresno County.Proposal January 27,2005 Page 3 of4 These annual fees were determined based on the one-time license fees and annual fees that the EIA is required to pay vas per the contract.The EIA has determined a flat annual rate for members to assist with budgeting.This rate includes the following: .User license fees.User licenses are based on a concurrent user basis,meaning that licenses are required for the number of users using the system at one time. .Maintenance and Support fees. .ASP Monthly Hosting Fees.These are the fees associated with using vas as the Application Service Provider (ASP)to host and maintain the claims system and associated files on their servers. Data Conversion and Implementation There are three options for data conversion and implementation.All conversion and implementation costs must be quoted directly from vas.vas will require the file layout,historical claim volume and a sample of the member's data (if possible)prior to providing a quote.Payment options and financing terms may be available.All payment arrangements must be made directly with vas.The member is solely responsible for all conversion and implementation costs. Option 1 -No conversion of claims data Flat fee of $1 ,500 This fee covers the cost of implementing the member's database using the standard claims environment. Option 2 -Conversion and implementation based on a fIat rate Flat fee of $10,000 Cost is based on implementing the member's database and converting historical claims information for approximately 8,000 GL claims from RiskMaster. Option 3 -Conversion and implementation based on a time and expense basis Estimated Range:$6,000 -$1-2,000 Conversion tasks will be billed on a time and expense basis at a rate of $150/hour and implementation tasks will be billed at a rate of $175/hour.The estimated range is based on vas's assessment for implementing the member's database and converting historical claims information for approximately 8,000 GL claims from RiskMaster.vas will not exceed the high end of the range without prior approval from the member. r Ivas System Usage Guidelines and Cost Summary Fresno County.Proposal January 27,2005 Page 4 of 4 Additional implementation support fees can be provided at a rate of $1,500 per day,for those services that fall outside the scope of work. Training Estimated cost of $3,000. The cost for training has been calculated based on the assumption of vas providing training for a maximum of 8 users per class.Actual Fees are based on $1,SOO/day/trainer. General User Training 1 training class Reports &Graph Module 1 training class Optional Modules The below Optional Modules are available to members at a maximum rate of $1,500 per year per module for five years.Each year,the rate of the module will be determined by the number of users of that module.Members may receive a discounted rate if additional members use the same module.Rates will be charged to members for five years following the purchase of a module. Laser Check Printing Medical Bill Review Medical Treatment Module Employee Interface Accounts Payable Interface Positive Pay Bank Reconciliation ISO Claim Search Auto Interface Contract with VOS Directlv The following pages contain a quote provided by Valley Oak for Fresno County.This quote is provided for comparison and shows the costs that Fresno County would incur if they decided to purchase the iVOS system independently of the EIA.Also included are several payment options that Fresno County could consider,if they choose to purchase the system directly from vas.