EXHIBIT NO. 10.5
COMPANION TECHNOLOGIES
Division of Blue Cross Blue Shield of South Carolina
LEASE AND LICENSE AGREEMENT
Customer Name: Doctor's Care - Central Acct #:
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Term #:
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Address: 6168 St. Andrews Road Business:
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Columbia, SC 29212 Rep.:
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Attn: Mr. Mehta
(803) 772-8840
This Agreement between the Customer named herein below and Companion
Technologies Division of Blue Cross Blue Shield of South Carolina (the
Corporation) shall commence on October 1, 1994.
The Corporation agrees to provide and the Customer agrees to lease and license
the following for business use in South Carolina:
1. LEASE OF HARDWARE AND PERIPHERALS
Quantity Type/Model Serial #
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Refer to Attachment A.
II. LICENSE OF STANDARD SYSTEM SOFTWARE PROGRAMS
Refer to Attachment A.
III. PASS THROUGH LICENSE OF OPTIONAL SOFTWARE PROGRAMS
Refer to Attachment A.
IV. TERM
The term of this Agreement shall be from the date of installation,
unless it is terminated by either party in accordance with the
Termination section set forth below.
V. PAYMENTS
Payment of $ ( Refer to Attachment B ) is due from the Customer on the
date this Agreement is signed. Then $ (See Selected Payment Option
Below), for as long as this contract remains in force.
Payment Option Payment Term Payment
Amount
( ) A Month-to-Month Lease $
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( ) B Annual Lease (Paid Annually) $
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( ) C Annual Lease (Paid Monthly) $
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( ) D Term of 60 Months $14,924.85*
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*Ownership of equipment will ___________ to Doctor's Care at
the end of 60 months' payments for $1.00.
Charges for Month-to-Month Leases (Option A) can be increased upon
thirty (30) days prior written notice by the Corporation to the
Customer.
Charges for Term Leases (Options B, C and D) cannot be increased during
the initial contract period. Term Leases will revert to Month-to-Month
Leases after the initial contract period.
The above charges do not include the fee for access to the PAID TM
Network for transmission and receipt of data between the provider and
the Corporation's Data Center.
VI. PARTIES' RESPONSIBILITIES
The Customer agrees it will:
o Pay the Corporation the full rent and service fee in advance by the first
of each month if a Monthly Payment Option is selected at V. above.
o Pay the full rent and service fee on or before the termination of
this lease and agreement.
o Not hold the Corporation liable for injuries caused by the misuse
of, or malfunction in, their service, software, hardware or
equipment.
o ONLY use the PAID TM system software as designated and instructed
by the Corporation's user manuals and personnel. Other uses of
such material must be approved, in writing, by the Corporation.
The provider may use the equipment to run other software.
o Make no alterations in or additions to the equipment.
o Obtain the written authorization of the Corporation prior to any
movement of the equipment.
o Pay for repairs or replacements not covered by the maintenance agreement.
o Pay interest on any delinquent payments at the rate of 18% per annum.
o Maintain insurance to indemnify the Corporation in the event the
system is lost, damaged, stolen or destroyed.
o Keep the system free and clear of all liens and encumbrances.
o Return the system (hardware and software) to the Corporation under
termination of this Agreement in good repair, ordinary wear and
tear from proper use alone excepted, and return all manuals and
other materials related to the system.
o Hold the information contained in the software program material,
changes, additions, and enhancements in confidence and not
disclose, or permit its employees to disclose, such information to
any other party.
o Use the system solely at its own location in South Carolina and
that it will not copy, reproduce, assign, or otherwise transfer
the system or any part thereof.
o Allow the Corporation to inspect and observe the system during normal business
hours.
o Sign a statement attesting that the system belongs to the
Corporation for filing with the Secretary of State.
The Corporation and the Customer understand and agree as follows:
o Charges and fees are exclusive of all federal, state, municipal,
or other government, excise, sales, use, occupational, or like
taxes now in force or enacted in the future and, therefore,
charges are subject to an increase equal in amount to any tax the
Corporation may be required to collect or pay upon the delivery of
items leased or licensed.
o The system is personal property of the Corporation and shall not
be affixed or attached to any building or other real property.
o The equipment is and remains the sole and exclusive property of
the Corporation and the Corporation's identification must remain
affixed to the equipment.
o In the event of default by the provider, the Corporation can take
possession of the system (hardware and software), declare the
entire amount of the rent due and payable without notice or
demand, terminate the lease, sue to recover all rents and other
payments and pursue any other remedy. These remedies are
cumulative and may be exercised concurrently or separately.
THE CORPORATION MAKES NO WARRANTIES EITHER EXPRESS OR IMPLIED, AS TO
ANY MATTER WHATSOEVER, INCLUDING, WITHOUT LIMITATION, THE CONDITION OF
THE EQUIPMENT OR SOFTWARE, ITS MERCHANTABILITY OR ITS FITNESS FOR ANY
PARTICULAR PURPOSE. THE CORPORATION SHALL HAVE NO LIABILITY TO CUSTOMER
FOR ANY CLAIM, LOSS OR DAMAGE CAUSED OR ALLEGED TO BE CAUSED DIRECTLY,
INDIRECTLY, INCIDENTALLY OR CONSEQUENTIALLY BY THE EQUIPMENT OR
SOFTWARE, BY ANY INADEQUACY THEREOF OR DEFICIENCY OR DEFECT THEREIN, BY
ANY INCIDENT WHATSOEVER IN CONNECTION THEREWITH, ARISING IN CONTRACT,
STRICT LIABILITY, NEGLIGENCE OR OTHERWISE, OR IN ANY WAY RELATED TO OR
ARISING OUT OF THIS AGREEMENT, OR USE PERFORMANCE OF THE SYSTEM.
VII. PAID TM SERVICES
The Corporation agrees to deliver the following to the Customer:
(1) PAID TM Manual; (2) Access to the help desk for questions
and problems connected with software, hardware, and
maintenance; and, (3) Initial training of the Customer's
personnel in the use of the equipment by representatives of
the Corporation. (Continued requests by the Customer for
retraining will be subject to a fee by the Corporation.)
Charges for these items can be assessed or increased upon
thirty (30) days prior written notice by the Corporation to
the Customer.
This software enables you to utilize the Corporation's PAID System for
patient injury, electronic mail with the Corporation, and filing of
claims electronically.
VIII. SOFTWARE AND HARDWARE MAINTENANCE
Improvements: During the term of this Agreement, the Corporation will
supply the customer with any improvements or modifications to the software which
are not charged for as options.
Coverage: Except as stated otherwise herein, during the term of this
Agreement, the Corporation will correct or replace software and
hardware and/or provide services necessary to remedy any programming
error or problem which is attributed to the Corporation and which
significantly affects use of the software. The Corporation may provide
preventative and remedial maintenance to the hardware, including labor
and parts required for good operating condition when such labor and
parts are required because of normal wear and tear. Exchanged parts
removed from the system become the property of the Corporation. Such
correction, replacement or services will be promptly accomplished after
the Customer has identified and notified the Corporation of any such
error in accordance with the Corporation's reporting procedures. The
maintenance services shall be performed during normal working hours
which are defined as 8:00 am to 5:00 pm Monday through Friday,
exclusive of the Corporation's observed holidays.
The Corporation shall not be responsible for maintaining Customer
modified portions of the software or hardware or for maintaining
portions of the software or hardware affected by Customer modified
portions of the software or hardware.
Corrections for difficulties or defect traceable to Customer errors or
system changes will be billed at the Corporation's standard time and
material rates.
EXCLUSIONS AND CONDITIONS OF SERVICE: The Corporation shall be under no
obligation to furnish maintenance service should repair be required
because of (1) improper use or misuse; (2) natural disasters such as
flood or earthquake; (3) strikes, riots or acts of war or nuclear
disaster; (4) repairs, maintenance, modifications or relocation and
reinstallation made by other than the Corporation's personnel or
without the Corporation's supervision and approval; (5) unusual shock
or electrical damage, accident, fire or water damage, neglect, air
conditioning failure, damage during transportation by Customer or other
causes other than ordinary use; or (6) overhaul or refurbishment of the
equipment due to age or prolong use. If maintenance service is required
as a result of the causes stated above, such service shall be offered
at the Corporation's published rates for labor, travel and material in
effect at the time of service.
The Corporation's maintenance service does not include operating
supplies and consumables; refinishing the products or furnishing
materials for that purpose; electrical work external to the products;
maintenance of accessories, attachments or products not specified in
this Agreement; and equipment calibrations.
RESPONSIBILITIES OF THE CUSTOMER: The Customer agrees (1) to provide
the Corporation access to the software and hardware to perform
maintenance; (2) to provide adequate working space and facilities close
to the software and hardware for use by the Corporation; (3) to provide
access to and use of all information and facilities determined
necessary by the Corporation to maintain the software and hardware;
(Insofar as these items may contain propriety or classified
information, the Customer shall assume full responsibility for
safeguards and protection for wrongful use): (4) to provide routine
operator maintenance as specified in the Corporation's Operating
Instructions for the software and hardware; and, (5) to provide
operating supplies and consumables.
LIMITATIONS OF REMEDIES: THE CORPORATION'S LIABILITY TO THE CUSTOMER,
WHETHER IN CONTRACT, TORT, NEGLIGENCE, OR STRICT LIABILITY OR OTHERWISE
SHALL NOT EXCEED THE TOTAL CHARGES PAID OR PAYABLE DURING ONE YEAR
UNDER THIS AGREEMENT. IN NO EVENT SHALL THE CORPORATION BE LIABLE FOR
LOST PROFITS, DATA OR ANY INDIRECT OR CONSEQUENTIAL DAMAGES.
DISCLAIMER: THE CORPORATION DISCLAIMS ALL WARRANTIES, INCLUDING IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
TERMINATION: Either party may terminate a month-to-month agreement at
any time by giving 30 days prior written notice to the other party.
Either party may terminate a yearly agreement at any time after the
term of the Agreement by giving 30 days prior written notice to the
other party.
The Corporation may terminate this Agreement in the event of default by
the Customer, which includes, but is not limited to, Customer's failure
to make timely payments under this Agreement. If termination occurs for
any reason, the Corporation has the right to take possession of all
hardware indicated in Section I and Software indicated in Section II
and retain all payments previously made by the Customer under this
Agreement. Upon termination of this Agreement, the Customer shall
return the hardware and software to the Corporation in good repair,
ordinary wear and tear from proper use alone excepted.
IX. GENERAL PROVISIONS
The Provider agrees it will not hold the Corporation liable for any
damages caused by the misuse of, or malfunction of, any software,
hardware or services.
This Agreement shall constitute the entire agreement between the
Provider and the Corporation for the leased equipment, software and
services described in the Agreement and may only be amended by a
separate writing signed by both parties.
This Agreement is not assignable without the prior written consent of
the Corporation. Any attempt by the Customer to assign any of the
rights, duties or obligations of the Agreement without such consent is
void.
No action, regardless of form, arising out of this Agreement may be
brought by either party more than two years after the cause of action
has arisen, or, in the case of non-payment, more than two years from
the date of the last payment. In any action for enforcement of any
provision of this Agreement, the Corporation shall be entitled to
reasonable attorney fees, the cost of the action, and prejudgment
interest.
Doctor's Care - Central
(Customer Name)
/s/ M.F. McFarland President
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03/30/94
By: Title
Date Signed
This Agreement is not enforceable until accepted by an officer of the
Corporation in Columbia, South Carolina and will be governed by the laws of the
State of South Carolina.
Accepted By:
/s/ Curtis Oliver Senior Director
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03/30/94
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Companion Technologies Title
Date Signed
Division of Blue Cross Blue Shield of SC
in Columbia, South Carolina
ATTACHMENT A
BUSINESS PROPOSAL TO
CONSOLIDATE DOCTOR'S CARE FACILITIES
Submitted By: Curtis Oliver
March 28, 1994
Hardware
1 RISC/6000 990, 4 Gigabyte Hard Disk, 5.0 Gigabyte Tape
Backup Unit, 1.44 Megabyte Diskette Drive, 10 Backup
Tapes $124,500.00
1 3270 Connection Adapter 618.00
1 256 Megabyte Memory Select 26,200.00
1 256 Port Async Controller 2,590.00
1 256 Port Async 4.5M Controller Cabling 120.00
14 256 Port Async 23CM Controller Cabling 560.00
16 16 Port Concentrators 23,920.00
64 RJ-45 to DB-25 Converters 7,680.00
1 Power GT31 1,855.00
1 Power Display, Keyboard, Mouse (3 button) 2,760.00
2 Data Products LM815 Line Printer (600 LPM) 19,700.00
1 Clary Online UPS 800 Watt w/Oneac Line Conditioner 1,710.00
38 Wyse 60 Terminals 22,762.00
34 Eight port multiplexer with CSU/DSU 67,660.00
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Hardware Total $302,635.00
NOTE: Current desktop or TI880 printers will be supplied by the site for
remote locations.
Software
- AIX - 64 User License $14,610.00
- AIX Windows
- AIX 3270 Host Connect
- AIX Load
- PAID IV Plus (a private label of the Medical Manager TM)
accounts receivable and billing system 55,900.00
- Standard Management Reports
- Data Merge Language
- 77 Terminal Serialization
- Refund Check Writer
- Lab Interface (one company)
- Prescription Writer
- Facet Term (8 users)
- Contract Module
- Electronic Data Interface (one company)
- Chart Tracking
- Delinquent Report Module
- Company Insurance Reporting
- Location Reporting
- Electronic Claim Module, Blue Cross, Medicaid,
Medicare, CHAMPUS, Commercial
- Collections Module 2,500.00
- Report Writer - Allows center the capability to produce
custom reports 2,495.00
- Automated conversion ($2,000.00 each) 20,400.00
Software Total $95,905.00
Installation $22,000.00
- Complete installation and wiring to connect equipment
to RISC/6000
- Bring all sites to production
- Testing all remote locations
- Testing Communications
Training $16,100.00
- (2) 40 hour group sessions (regional)
- (1) 40 hour group session (central)
- 6 hours at each location follow-up
Custom Programming/Consulting (200 Hours) $ 24,000.00
- Used to identify and code corporate financial reports
- Time will be reported to Doctor's Care on all activity
related to the corporate reports
NOTE!!! If 200 hours of programming/consulting time is
attained prior to the completion of all corporate
reports, additional hours will be billed at $80.00
per hour.
TOTAL SYSTEM PRICE $460,640.00
Monthly Maintenance Fees
Hardware (above only) $3,531.00
Telephone and Software Support 1,170.00
Electronic Claims 65.00
Accepted By: /s/ M.F. McFarland Accepted By: /s/ Curtis Oliver
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Doctor's Care Companion
Technologies
Date: 03/30/94 Date: 03/30/94
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* * *Proposal Valid Until April 25, 1994* * *
C O N F I D E N T I A L
ATTACHMENT B
DOCTOR'S CARE
FINANCIAL SUMMARY
MARCH 14, 1994
Down payment = PPI, Inc. Software Cost - Plus $ 2,225.00
12,600.00
480.00
700.00
950.00
= Automated Conversions 10,200.00
= Installation 11,000.00
= Training 8,050.00
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$ 46,205.00
Total Trade-In (17,723.00)
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Total Down payment Due $ 28,482.00
May Be Paid as Follows:
Pay $9,461.00 upon time of initial installment
Pay $9,461.00 August
Pay $9,461.00 October
System Price $460,640.00
Plus Payoff 89,700.00
Less Down payment (46,205.00)
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Balance to be Financed $504,135.00 @ 8% for 60 months = $10,223.85
per month installment beginning
October 1, 1994
NOTE!!! Doctor's Care will continue payment current fees until system is
completely installed and will begin above payment schedule on October 1, 1994.
DOCTOR'S CARE
ITEMS TO BE TRADED-IN
8 APC 450 Watt @ $125 ea. $
1,000.00
1 TSI UPS @ $100 ea. 100.00
6 Clary UPS @ $350 ea.
2,100.00
15 ALTOS 1000 CPU's @ $800 ea. 12,000.00
Tape backup, 440 hard disk
33 Terminals - ALTOS @ $ 50 ea. 1,650.00
15 2400 Baud Modem @ $ 75 ea. 1,125.00
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Subtotal
17,975.00
Less: Shipping
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(252.00)
Total
$17,723.00