Catholic Medical Center
of
Brooklyn & Queens, Inc.
[insert graphics & logos]
Enterprise Network Contract
* CONFIDENTIAL TREATMENT REQUESTED
DEFINITIONS
56Kb -- A transmission speed of fifty-six thousand bits per second.
BMIS -- Burst Mode Implementation Services. These engineering man-days provided
by DAOU at a discounted price when purchased as part of an overall service
contract.
CMC -- Catholic Medical Center of Brooklyn and Queens.
CNE -- Certified Novell Engineer. An individual who has been through an
industry certification process administered by Novell, Inc. The title indicates
a level of understanding of the Netware operating system.
Dial up remote access -- A method of accessing a remote computer network that
makes use of telecommunication lines and modems allowing a remote user to
connect to a network.
Disk duplexing -- A hardware and software configuration that allows for data
redundancy and therefore reduces the risk of data loss in the event of storage
system failure.
ECNE -- Enterprise Certified Novell Engineer. An individual who has been
through an industry certification process administered by Novell, Inc. The
title indicates a level of understanding of the Netware operating system and how
it operates in a multi-server environment.
E-mail -- Electronic Mail. An application that allows the addressing and
sending of messages electronically from one end user to another.
ESI -- Enterprise Systems, Inc. is a company located in Illinois who has
developed materials management software which CMC has installed.
Ethernet -- A network access scheme adhering to the IEEE 802.3 standard.
FDDI -- Fiber Data Distributed Interface. A network access scheme adhering to
the ANSI X3T9.5 standard.
First productive use (FPU) Shall be the date on which Customer's operational
data is first transmitted across the network and is utilized by Customer in it's
day to day operation.
Interconnectivity -- A quality of a network that allows for communication to
occur between devices on the network.
Internetworked -- Devices connected by means of a computer network such that
they can communicate between each other.
IP -- Internet protocol. A layer three transport protocol developed by the
Department of Defense and used by many vendors as a de facto standard.
IP Ping Utility -- A network diagnostic application for testing connections.
Ping sends an ICMP echo request to another host. A successful reply from the
remote host confirms that network access to that host is available. Ping
includes a time stamp for the elapsed time between the sending and receiving of
the Ping.
* CONFIDENTIAL TREATMENT REQUESTED
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IPX -- Internet Packet Exchange. The native layer three transport protocol for
Novell Netware.
LAT -- Local Area Transport. The native layer three transport protocol for
Digital Equipment Corporation (DEC).
MACs -- Moves, Adds and Changes. Any regular reconfiguration of patch cores and
coding documentation to facilitate users added to the network moved from one
location to another in a network or requiring a change in network connectivity.
Netware -- Any of several network operating system versions manufactured by
Novell, Inc.
NMS -- DAOU Systems, Inc. Network Management Services.
Novell -- One of several network operating system vendors.
NSE -- Network Systems Engineer.
PC -- Personal Computer. One of any possible configurations of end user
workstations that house an intelligent processor (e.g. Compaq Prolinea or
Deskpro models).
Products/Services -- Are those products and services as outlined in Schedule A
and Schedule B.
RAID -- Redundant Array of Independent Drives. A hardware and software
configuration that allows for data redundance and therefore reduces the risk of
data loss in the event of storage system failure.
Remote Control -- A network access method that allows a user to take control of
a processor that resides on the Local Area Network to which they are attaching
and use that processor to run desired applications.
Remote Node -- A network access method that allows a user to establish a
connection to the network but still use their own remote processor for running
accessed applications.
SMS -- "Shared Medical Systems" hereinafter referred to as SMS. SMS provides to
customer applications and services from their corporate headquarters in Malvern,
Pa.
SNA -- Systems Network Architecture. The native layer three transport protocol
for many systems manufactured by International Business Machines (IBM).
SNE -- Senior Network Engineer.
SNMP -- Simple Network Management Protocol. A network communication protocol
that facilitates management of and communication with network devices that
support that protocol.
T1 -- A telephone transmission medium with a transfer speed of 1.544 megabits
per second (mbps). Normally configured as a dedicated telephone circuit
between two facilities
TCP -- Transmission Control Protocol. A layer four protocol developed by the
Department of Defense and
Telecom -- Telecommunications. Any of many mechanisms used to communication
using digital or analog communication lines.
* CONFIDENTIAL TREATMENT REQUESTED
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Telemedicine -- The use of telecommunications facilities to provide healthcare
services at a site other than the provider's physical location.
UNIX -- A multi-tasking network operating system originally developed at
University of California at Berkeley but modified by many hardware manufacturers
for use with their systems.
Videoconferencing -- The use of telecommunications services to send and receive
audio and video signals in support of a meeting.
Virtual LAN -- A concept that refers to the ability to group Local Area Network
users logically according to things like department, location, or protocol, even
though they are not physically connected to the same network segment.
* CONFIDENTIAL TREATMENT REQUESTED
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TABLE OF CONTENTS
PAGE
----
EXECUTIVE SUMMARY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
SCOPE OF PRINCIPLE AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . 7
1. CONSIDERATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -
2. QUOTATION OF PRICES . . . . . . . . . . . . . . . . . . . . . . . . . . . -
3. CHARGES AND PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . -
4. OUT OF POCKET EXPENSES. . . . . . . . . . . . . . . . . . . . . . . . . . 8
5. TAXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
6. TITLE AND SECURITY INTEREST . . . . . . . . . . . . . . . . . . . . . . . 8
7. RISK OF LOSS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
8. MODIFICATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
9. CANCELLATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
10. TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
11. RESTOCKING FEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
12. CONTACT PERSON. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
13. DELIVERY SHIPPING DISCREPANCIES . . . . . . . . . . . . . . . . . . . . . 8
14. IMPLEMENTATION/TRAINING SUPPORT . . . . . . . . . . . . . . . . . . . . . 9
15. NETWORK ACCEPTANCE/CABLING CERTIFICATION. . . . . . . . . . . . . . . . . 9
16. PERSONNEL PERFORMANCE GUARANTEE . . . . . . . . . . . . . . . . . . . . . 9
17. NETWORK PERFORMANCE GUARANTEE . . . . . . . . . . . . . . . . . . . . . . 9
18. PRODUCT WARRANTIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
19. SOFTWARE LICENSES . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
20. CONFIDENTIALITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
21. DEFAULT/BREACH. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
22. DISPUTE RESOLUTION. . . . . . . . . . . . . . . . . . . . . . . . . . . .10
23. ARBITRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
24. INSURANCE AND LIABILITY . . . . . . . . . . . . . . . . . . . . . . . . .11
25. PERFORMANCE WARRANTY. . . . . . . . . . . . . . . . . . . . . . . . . . .11
26. FORCE MAJEURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
27. THIRD PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
28. RELATIONSHIP OF PARTIES . . . . . . . . . . . . . . . . . . . . . . . . .11
29. SURVIVAL CLAUSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
30. ENTIRE PRINCIPLE AGREEMENT. . . . . . . . . . . . . . . . . . . . . . . .12
31. SUCCESSORS IN INTEREST. . . . . . . . . . . . . . . . . . . . . . . . . .12
32. WILLINGNESS TO WORK WITH ALL PARTIES. . . . . . . . . . . . . . . . . . .12
33. INTERPRETATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
34. SUBCONTRACTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
35. OCCUPATIONAL SAFETY AND HEALTH ACT: . . . . . . . . . . . . . . . . . . .12
36. BANKRUPTCY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
37. LIENS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
38. PATENTS AND COPYRIGHTS. . . . . . . . . . . . . . . . . . . . . . . . . .13
39. COMPLIANCE WITH OMNIBUS RECONCILIATION ACT OF 1980. . . . . . . . . . . .13
40. NOTICES FROM DAOU TO CUSTOMER . . . . . . . . . . . . . . . . . . . . . .13
41. NOTICES FROM CUSTOMER TO DAOU . . . . . . . . . . . . . . . . . . . . . .14
* CONFIDENTIAL TREATMENT REQUESTED
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TABLE OF CONTENTS
(CONTINUED)
PAGE
----
ATTACHMENT A [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
ATTACHMENT B [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33
ATTACHMENT C [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36
ATTACHMENT D [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .65
ATTACHMENT E [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .70
ATTACHMENT F [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .73
ATTACHMENT G [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .75
ATTACHMENT G-1 [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .84
ATTACHMENT H [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .86
ATTACHMENT I [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .87
ATTACHMENT J [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88
ATTACHMENT K [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .90
ATTACHMENT L [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .93
SCHEDULE A [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .94
SCHEDULE B [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 128
SCHEDULE C [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 129
SCHEDULE C-1 [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 130
SCHEDULE D [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 131
SCHEDULE E [*] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 132
* CONFIDENTIAL TREATMENT REQUESTED
ii
- --------------------------------------------------------------------------------
DAOU SYSTEMS, INC.
5120 Shoreham Place
San Diego, California 92122
(619) 452-2221
Principle Agreement
Contract #
- --------------------------------------------------------------------------------
CUSTOMER NAME : CATHOLIC MEDICAL CENTER OF BROOKLYN & QUEENS, INC.
ADDRESS : 88-25 153 STREET
CITY/STATE/ZIP : JAMAICA, NY 11432
CONTRACT # :
- --------------------------------------------------------------------------------
This Principle Agreement, the term effective _________________, 1996, through
_____________________, [*] by and between DAOU Systems, Inc., (hereinafter
referred to as "DAOU"), and Catholic Medical Center of Brooklyn & Queens, Inc.
and affiliates, with its principle place of business defined above, hereinafter
referred to as ("CUSTOMER") sets forth the promises of the parties with respect
to the products and services of DAOU which are described in this Principle
Agreement. The parties hereto agree as follows:
EXECUTIVE SUMMARY
In accordance with this Agreement DAOU has designed and will manage an
enterprise-wide communications infrastructure for CUSTOMER. The network
consists of fiber optic and unshielded twisted paid cabling for each of the
CUSTOMER Sites. As described in Attachment K, active network electronic
components, network operating system software and related software for office
automation related tasks. This network will provide CUSTOMER with the
foundation to build and implement existing and new applications such as
electronic mail, remote physician access and integrated voice, video and data
for such applications as telemedicine, and video conferencing across the
institution. This network structure will allow any assigned used at a personal
computer station secure access to any information located on any host or server
connected to the network. Any assigned user at a personal computer station will
also be able to share files and schedules with, and send email to any other
assigned user who is granted the same capabilities on the network. DAOU will
supervise the installation of the cabling infrastructure; acquire, test,
integrate and install the active network electronic components; network
operating software and office automation software into an integrated enterprise
wide communications infrastructure. DAOU will further coordinate all activities
of third party vendors related to the acquisition of said products and services,
including but not limited to, application software companies, suppliers of
telecommunications services, hardware and software vendors, necessary to the
success of the overall project. DAOU will further manage, support and otherwise
assume complete responsiblity for the day to day ongoing operation of the
enterprise wide communications infrastructure. This will result in an
information delivery system capable of supporting CUSTOMER well into the next
century.
SCOPE OF PRINCIPLE AGREEMENT
* CONFIDENTIAL TREATMENT REQUESTED
5
CUSTOMER and DAOU agree that CUSTOMER shall be entitled to procure the products
and services made available under the Principle Agreement.
Attachments & Schedules hereto of this Principle Agreement are made a part
hereto of as if fully included in the text.
Attachment A [*]
Attachment B [*]
Attachment C [*]
Attachment D [*]
Attachment E [*]
Attachment F [*]
Attachment G [*]
Attachment G-1 [*]
Attachment H [*]
Attachment I [*]
Attachment J [*]
Attachment K [*]
Attachment L [*]
Schedule A [*]
Schedule B [*]
Schedule C [*]
Schedule C-1 [*]
Schedule D [*]
Schedule E [*]
- --------------------------------------------------------------------------------
1. CONSIDERATION:
For consideration of the Products and Services, as defined in Schedules A and C,
CUSTOMER agrees to pay DAOU's fees as set forth in relevant Attachments A-L and
Schedules A-E. Any modifications or additions must be approved in writing by
both parties.
2. QUOTATION OF PRICES:
All prices quoted shall remain valid only if CUSTOMER purchase order (including
any change orders) is issued within ninety (90) days of the date on which the
final quotation was submitted. In addition, DAOU agrees to generate a change
order and pass savings on to CUSTOMER if prices quoted are reduced prior to
DAOU's ordering of equipment at a rate which is ten percent (10%) or greater.
Prior to products being ordered, an inventory of existing products will be
completed and the product and prices in Schedule A will be adjusted accordingly.
Network Implementation Services, are based on a fixed price, referenced in
Schedule B and for the Scope of Work/Solution Document outlined in Attachment A.
Should additional equipment/services be required, for the Scope of Work outlined
in Attachment A, it shall be at no additional cost to CUSTOMER.
* CONFIDENTIAL TREATMENT REQUESTED
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Network Management Services pricing, as identified in Schedule C, and Network
Support Staff Agreement, as identified in Schedule C-1, are [*] and [*]
3. CHARGES AND PAYMENT:
CUSTOMER shall be invoiced for Products and Services as described in
Schedules A-E. All fees to be paid by CUSTOMER, as identified in Payment
Milestones in Attachment B, will be invoiced by DAOU to CUSTOMER with payment
due net forty-five (45) days.
4. OUT OF POCKET EXPENSES:
DAOU's Out of Pocket travel expenses as outlined in DAOU's Travel Policy as
referenced in Attachment 1 are additional to the purchase price, as listed in
Schedules A, B and D, and are to be paid by the CUSTOMER. This is based upon a
10-month implementation schedule, as outlined in Attachment D Work Plan.
5. TAXES:
CUSTOMER represents that it is exempt from New York State and City Sales and USE
taxes. At contract signing the CUSTOMER will provide DAOU with a certificate of
exemption.
6. TITLE AND SECURITY INTEREST:
DAOU reserves, and CUSTOMER grants, a security interest in the products which
shall remain in effect for as long as the purchase price of the products remains
unpaid.
7. RISK OF LOSS:
Risk of loss of the Products shall pass to the CUSTOMER upon receipt of delivery
of the Products by CUSTOMER at CUSTOMER site.
8. MODIFICATIONS:
All modifications to this Agreement as well as any Attachments and/or Schedules
must be approved in writing by both parties. CUSTOMER will issue a CUSTOMER's
purchase order and payment in accordance with Payment Milestones as identified
in Attachment B, for any additional Products or Services not identified in
Schedules A-E. Should additional equipment/services be required, beyond the
Scope of Work outlined in Attachment A, pricing of the equipment/services will
be identified in a change order, which will require authorized signatures from
both parties, prior to purchase by DAOU. The cost of any additional products
required to complete installation pursuant to this Agreement shall be paid for
by responsible party.
9. CANCELLATION:
Either party may cancel this Principle Agreement, with cause, immediately upon
written notice, after the Dispute Resolution process has been followed, as
defined in Paragraph (22), of the Principle Agreement. If the Agreement is
canceled the parties shall meet to determine the amount due for work performed
prior to the cancellation and the CUSTOMER shall pay such amount, minus any
payments already made or DAOU shall issue a refund to CUSTOMER for payments made
in excess of the amounts due subject to Attachment B and Paragraph 23 of this
Principal Agreement.
* CONFIDENTIAL TREATMENT REQUESTED
7
10. TERMINATION:
Each party may terminate this Principle Agreement without cause, within 10
business days after contract signing, by providing written notice to other
party.
11. RESTOCKING FEES:
Any Restocking Fees for Products charged by the manufacturer or distributor,
which is returned at the request of CUSTOMER, without DAOU's fault or
negligence, for any desired design changes will be the sole responsibility of
the CUSTOMER. CUSTOMER may be denied credit or exchange on Products that are
unacceptable for return by manufacturer or distributor.
12. CONTACT PERSON:
CUSTOMER will appoint a Project Manager who will assist DAOU Project Manager in
coordinating delivery and installation of Products and Services described in
Schedules A through E. CUSTOMER Project Manager will be available to sign-off
all necessary DAOU paperwork required to complete installation process.
13. DELIVERY SHIPPING DISCREPANCIES:
DAOU will notify CUSTOMER in advance of all Product deliveries and installation
dates. DAOU shall not be liable for losses or consequential damages resulting
from delays in delivery due to causes beyond its control and without its fault
or negligence. CUSTOMER agrees to verify bill of lading for the Products as
soon as practical after delivery and to notify DAOU in writing within 7 days of
delivery of any shipping discrepancies.
14. IMPLEMENTATION/TRAINING SUPPORT:
Modifications to the mutually agreed upon Network Implementation and Cabling
Project Dates, as defined in Attachment D, shall not be changed without written
consent of both parties.
Network training is provided as required through Network Management Services as
described in Attachment G. Network training is provided through Network
Management Services at no additional cost.
Support is provided through Network Management Services as defined in
Attachment G. Existing ESI and ADL Network Support and Maintenance Agreements
will be superseded by this Principle Agreement effective, date of commencement
of Network Management Services support services.
15. NETWORK ACCEPTANCE/CABLING CERTIFICATION:
Network Acceptance is defined as when DAOU has demonstrated and documented that
the network is functional according to the following criteria:
A. Connectivity:
1) Any DAOU designed network connected workstation at a site will be able to
log on to the local server at that site.
2) Any DAOU designed network connected workstation at that site will be able
to connect to the SMS host at Malvern, Pa.
* CONFIDENTIAL TREATMENT REQUESTED
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3) Any DAOU designed network connected workstation will be able to connect to
any new-network connected host or server and,
B. First Productive Use (FPU): The date on which CUSTOMER's operational data
is first transmitted across the network and is utilized by CUSTOMER in it's
day to day operation.
Cabling Certification is defined as when each cabling drop is tested,
documented, labeled and is provided to CUSTOMER, which states that the cabling
requirements meets the criteria as defined in Attachment C.
16. PERSONNEL PERFORMANCE GUARANTEE:
DAOU guarantees the personnel assigned as Network Management Services personnel
will meet the CUSTOMER's expectations of project management. The DAOU Project
Manager will supervise all personnel and it's sub-contractors responsible for
implementation and training at CUSTOMER site. CUSTOMER may request personnel
changes in writing to which DAOU will respond in accordance with Paragraph E,
Attachment G within 30 days. DAOU guarantees the same for any work and services
provided to CUSTOMER by any sub-contractor contracted by DAOU to provide
services to CUSTOMER.
17. NETWORK PERFORMANCE GUARANTEE:
DAOU guarantees the network will support the maximum number of devices and
hardware growth as outlined in Capacity Planning, Attachment E. Any DAOU
designed network connected workstation will be able to "ping" the Malvern, PA
host within 1 second. This Ping shall be performed at a time when there is no
other network traffic. A ping is defined as using a standard 1P Ping utility
which will record the time it takes to send and receive a packet from a
workstation to the host and back.
18. PRODUCT WARRANTIES:
A. WARRANTIES:
DAOU warrants and represents that all goods under this agreement (i) are
merchantable, (ii) are fit for their intended purpose, and (iii) do not infringe
upon or violate any patent, copyright, trade secret, or other proprietary right
of any third party.
DAOU further warrants that it has all rights needed to enter into and ocmplete
this Principle Agreement. DAOU will defend, at its own expense, any action or
proceeding brought against CUSTOMER based upon a claim that the work performed
or any Product supplied pursuant to this Principle Agreement, infringes or
violates a patent, copyright, trade secret, trademark, trade name, right of
privacy or any other proprietary, personal, of civil right of a third party.
DAOU will pay all costs and damages awarded against CUSTOMER in any such action
and any expense incurred by CUSTOMER, including reasonable attorneys fees, as a
resolute of such action. CUSTOMER reserves the right to terminate this
Principle Agreement, in the event of any such claim.
B. MANUFACTURERS WARRANTIES:
DAOU has included manufacturers warranties as identified as Cabling and Product
Warranties in Attachment C.
C. DISCLAIMER:
* CONFIDENTIAL TREATMENT REQUESTED
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CUSTOMER understands and agrees that, with the exception of the Warranties in
Section 18a,. and 18b, his/her sole remedy, and only in the case of failure of
Products to perform, shall be limited to repair, replacement or refund of
purchase price of products sold.
19. SOFTWARE LICENSES:
Any and all software purchased by CUSTOMER shall be licensed in accordance with
the manufacturer's software licensing policies. CUSTOMER shall indemnify and
hold DAOU harmless from any and all violation of software copyright laws and
license infringements caused by CUSTOMER's use of such software.
20. CONFIDENTIALITY:
DAOU and its subcontractors agree to protect the confidentiality of CUSTOMER's
proprietary information including, but not limited to, financial information,
patient information, clinical practice or management at CUSTOMER's facility.
DAOU shall not divulge or disclose to any third parties any information
concerning the affairs of the CUSTOMER which may be received by DAOU at any
time, unless such information becomes publicly available through no cause of
DAOU, unless requested in writing by CUSTOMER.
CUSTOMER agrees to protect the confidentiality of DAOU's proprietary information
including but not limited to all drawings, design techniques, contract prices,
and improvements provided by DAOU. CUSTOMER will not divulge any portion of the
Principle Agreement, or design, not already in the public domain that are deemed
confidential shall not be revealed at any time unless such information becomes
publicly available through no fault of the CUSTOMER.
[*] DAOU shall not use the CUSTOMER's name in any publication, promotional or
written material without the prior written approval of an officer of the
CUSTOMER.
21. DEFAULT/BREACH:
In the event of default by CUSTOMER on any payment which is not in dispute as
described in Payment Milestones, Attachment B, CUSTOMER shall pay interest at
the rate of eighteen percent (18%) per annum on each such obligation from the
day it is due until it is received by DAOU, which is not in dispute. CUSTOMER
payment will not be subject to interest if DAOU authorizes in writing a change
in payment due date in the event of incomplete installation or delivery by DAOU.
In the event of default by DAOU delivered or as otherwise defined herein, DAOU
shall not invoice the CUSTOMER for any Product or Service not delivered or as
defined in attached proposal.
The occurrence of any of the following shall constitute a breach and material
default of this Principle Agreement:
a. The failure of CUSTOMER to pay or cause to be paid by the due date any
monies or charges required by this Principle Agreement to be paid by
CUSTOMER, when such failure continues for a period of forty-five (45)
days after written notice thereof from DAOU to CUSTOMER
b. DAOU's failure to adhere to this Principle Agreement, as defined in
Attachments and Schedules, also constitutes a material default under
this Principle Agreement.
c. Any act of bankruptcy caused, suffered or permitted by CUSTOMER or
DAOU.
22. DISPUTE RESOLUTION:
* CONFIDENTIAL TREATMENT REQUESTED
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In the event that a dispute arises between both parties which cannot be resolved
in the normal course of doing business, the following dispute resolution shall
be followed:
a. If the dispute arises during the installation, then -
(i) Within five (5) days of a written request by either party,
CUSTOMER's Corporate Director of Information Systems and DAOU's
Director of Technical Services shall meet and resolve the issue;
if these parties cannot resolve the issue within five (5) days of
the meeting, then -
(ii) Within five (5) days of the Directors Meeting or upon DAOU's
receipt of notification by CUSTOMER, the issue shall be submitted
to DAOU's Sr. Vice President and CUSTOMER's Vice President of
Information Systems and a meeting scheduled to resolve the issue.
If these parties cannot resolve the issue within fifteen (15)
days, then paragraph 23 will be invoked.
If the dispute arises after the installation, the procedure set forth in
22(a)(2) shall be instituted upon fifteen (15) days written request of either
party.
23. ARBITRATION:
Both parties agree that in the event an amicable resolution of dispute is not
attained pursuant to Paragraph 22, then both parties agree to submit to
arbitration, and both parties are willing to abide by the rulings of the
American Arbitration Association. Each party shall bear it's own costs. This
paragraph shall survive termination of this Principal Agreement.
24. INSURANCE AND LIABILITY:
INSURANCE. At all times while this Principle Agreement is in effect, DAOU shall
maintain (or cause to be in effect), liability insurance covering negligence of
itself and its' subcontractors, with limits of not less than [*] per incident
and [*] aggregate. Such insurance shall be obtained from an insurance carrier
admitted to do business in the State of New York or from a duly established and
funded self-or pooled- insurance program. Any insurance carrier providing such
coverage shall give CUSTOMER at least thirty (30) days advance notice of
cancellation or material change in any such coverage. DAOU shall not commence
performance under this Principle Agreement until it has obtained, at its own
expense, all insurance required under this Principle Agreement. DAOU warrants
that all required insurance shall be maintained until its work under this
Principle Agreement is complete, provided that, if DAOU fulfills any of the
insurance requirements set forth herein by the use of claims-made policies.
DAOU warrants that these policies shall be kept in effect for at least three (3)
years following completion of its work under this Principle Agreement and if its
claims-made policies are canceled during the Term of the Principle Agreement,
DAOU will purchase tail coverage for the remainder thereof. DAOU will furnish
CUSTOMER with a certificate of insurance within ten (10) business days of the
execution of the Principle Agreement.
LIABILITY. DAOU will maintain public liability and property damage insurance in
amounts not less than [*] for injury or death to any one person in any one
accident or occurrence and not less than [*] per occurrence for damages to
property. CUSTOMER shall maintain in force a policy or policies of extended
coverage insurance with respect to any products delivered by DAOU but not paid
for by CUSTOMER.
25. PERFORMANCE WARRANTY:
* CONFIDENTIAL TREATMENT REQUESTED
11
DAOU warrants that all project milestones will be met as defined in Attachment D
of this Principle Agreement. In the event a project milestone is not met,
CUSTOMER shall be entitled to withhold payment for that project milestone as it
relates to entire project. [*]
26. FORCE MAJEURE:
Neither DAOU nor CUSTOMER shall be responsible for any delay or failure of
performance resulting from causes beyond its control without its fault or
negligence. If a force majeure event occurs the party being delayed or failing
to perform shall promptly notify the other party of the nature of such cause and
its reasonably anticipated duration and if either party declares a force majeure
event, the parties shall meet as soon thereafter as possible to determine the
nature and extent of the event, the expected impact of the event on CUSTOMER's
processing capabilities, and a recommended course of action intended to enable
CUSTOMER to process its data in the operation of the Facility.
27. THIRD PARTIES:
This Principle Agreement is between DAOU and CUSTOMER and is not for the benefit
of, nor does it vest any rights in, any third party.
28. RELATIONSHIP OF PARTIES:
DAOU is performing its services and obligations hereunder as an independent
contractor. Neither party shall have any rights or authority to create any
obligation or responsibility, expressed or implied, on behalf of, or in the name
of, the other party, or to bind the other party contractually in any manner
whatsoever. Under no circumstances, as a result of this Principle Agreement,
shall any employee, agent, or representative of one party be considered an
employee, agent, or representative of the other party.
29. SURVIVAL CLAUSE:
The provisions of this Principle Agreement pertaining to warranties,
confidentiality, hold harmless, and proprietary rights shall continue in full
force and effect notwithstanding the fact that the CUSTOMER has accepted and
paid for any work, services provided or products purchased hereunder.
Each party shall indemnify, defend and hold harmless the other party, its agents
and employees from any and all losses, damage, injury, causes of action or
liability of any kind whatsoever, including defense cost and reasonable legal
fees that are caused by or arise out of any omission, fault, negligence or other
misconduct by said party, its officers, employees or agents in connection with
this Principle Agreement.
30. ENTIRE PRINCIPLE AGREEMENT:
This Principle Agreement executed by CUSTOMER and DAOU contains the entire
Principle Agreement of the parties relating to its subject matter. There are no
promises, representations or undertakings other than as expressly provided
herein, and no modification of this Principle Agreement will be binding unless
in writing and signed by both parties. CUSTOMER's rights herein may not be
assigned to a third party without the prior written consent of DAOU.
Nothing contained in this Principle Agreement shall require CUSTOMER to provide
any service or engage in any activity which is not consistent with the Ethical
and Religious Directives for Catholic Health Care Services issued by the United
States Catholic Conference as interpreted by the Bishop of the Diocese of
Brooklyn.
* CONFIDENTIAL TREATMENT REQUESTED
12
31. SUCCESSORS IN INTEREST:
Assignment and Sublicenses. Neither Party has the power nor the right to
(1) assign or transfer this Agreement or any rights granted thereunder, or
(2) delegate any duty under this Agreement without the permission of the other,
which permission shall not be unreasonably withheld.
32. WILLINGNESS TO WORK WITH ALL PARTIES:
DAOU will be required to work with other vendors contracted with the CUSTOMER
and may on occasion seek advice and/or support to work with those parties.
CUSTOMER shall provide every means possible to promote a spirit of willingness
and have the organizations work together and agrees to intervene if necessary.
33. INTERPRETATION:
This agreement shall in all respects be governed by and construed in accordance
with the State of New York. The parties hereto shall submit to the jurisdiction
of the federal and state courts located in New York County, New York State for
the resolution of disputes arising hereunder.
34. SUBCONTRACTS:
DAOU reserves the right to subcontract any portion of the work to be performed
under this Principal Agreement. DAOU acknowledges responsibility for the
conduct and work performed by it's SUBCONTRACTORS.
35. OCCUPATIONAL SAFETY AND HEALTH ACT:
DAOU agrees that for the purpose of compliance with the requirements of the
Occupational Safety and Health Act of 1970, services performed for the CUSTOMER
shall be deemed entirely within DAOU's responsibility.
36. BANKRUPTCY:
Both parties have the right to terminate the Principle Agreement immediately if
the other party formally files for Chapter 7 or Chapter 11 bankruptcy
protection.
37. LIENS:
DAOU shall pass Equipment title to the CUSTOMER free and clear of all liens and
encumbrances. DAOU agrees to promptly pay and discharge any liens, or claims
filed by or, on behalf of any employees, laborers, subcontractors, or Material
Suppliers or, in the alternative, to indemnify and hold CUSTOMER harmless from
said claims.
38. PATENTS AND COPYRIGHTS:
If CUSTOMER uses a DAOU or DAOU provided product for purposes beyond those
defined in the Scope of Work (Attachment A-E and Schedule A-1), DAOU shall not
be liable for any claim based upon the combination, operation, or use of DAOU or
DAOU provided products resulting from such usage.
39. COMPLIANCE WITH OMNIBUS RECONCILIATION ACT OF 1980:
* CONFIDENTIAL TREATMENT REQUESTED
13
To the extent that Section 952 if the Omnibus Reconciliation Act of 1980, or
regulations adopted pursuant thereto are applicable to this agreement, DAOU
shall, until the expiration of four (4) years after furnishing of services under
this agreement, make available upon the request of the Secretary of Health and
Human Services or the Comptroller General or its representative, this agreement,
invoices for services rendered hereunder, and the supporting documents and
records as may be necessary to verify the nature and costs of this agreement.
40. NOTICES FROM DAOU TO CUSTOMER:
All written notifications will be sent by DAOU to the CUSTOMER to the attention
of the following at the address identified below:
Catholic Medical Center of Brooklyn and Queens, Inc.
Attention: Legal Department
88-25 153 Street
Jamaica, NY 11432
Catholic Medical Center of Brooklyn and Queens, Inc.
Attention: Director of Corporate Information Systems
88-15 Woodhaven Blvd.
Woodhaven, NY 11421
NOTICES FROM CUSTOMER TO DAOU:
DAOU Systems, Inc.
Attention: Contract Administrator
5120 Shoreham Place
San Diego, CA 92122
DAOU Systems, Inc.
Attention: Vice President Sales, North East Region
5120 Shoreham Place
San Diego, CA 92122
* CONFIDENTIAL TREATMENT REQUESTED
14
SIGNATURES
- --------------------------------------------------------------------------------
I have read, understand, and agree to all the Terms and conditions of sale in
this PRINCIPAL AGREEMENT. I also certify that I have the legal authorization to
sign on behalf of the owners/principals of the business entity I am
representing.
DAOU SYSTEMS, INC. CATHOLIC MEDICAL CENTER OF
5120 Shoreham Place BROOKLYN & QUEENS, INC.
San Diego, CA 92122 88-25 153 Street
Jamaica, NY 11432
/s/
- ---------------------------------- ----------------------------------
Signature Signature
Daniel J. Rinaldi
- ---------------------------------- ----------------------------------
Name Name
Treasurer
- ---------------------------------- ----------------------------------
Title Title
6/18/96
- ---------------------------------- ----------------------------------
Date Date
ST. MARY'S HOSPITAL BISHOP MUGAVERO CENTER FOR
OF BROOKLYN GERIATRIC CARE
170 Buffalo Avenue 155 Dean Street
Brooklyn, NY Brooklyn, NY
/s/ /s/
- ---------------------------------- ----------------------------------
Signature Signature
Daniel J. Rinaldi Daniel J. Rinaldi
- ---------------------------------- ----------------------------------
Name Name
Treasurer Treasurer
- ---------------------------------- ----------------------------------
Title Title
6/18/96 6/18/96
- ---------------------------------- ----------------------------------
Date Date
* CONFIDENTIAL TREATMENT REQUESTED
15
CMC OCCUPATIONAL HEALTH SERVICES, P.C. CMC PROFESSIONAL NURSE REGISTRY, INC.
Building 198 95-25 Queens Boulevard
JFK International Airport Suite 136, 10th Floor
Jamaica, NY Rego Park, NY
/s/ /s/
- ---------------------------------- ----------------------------------
Signature Signature
Daniel J. Rinaldi Daniel J. Rinaldi
- ---------------------------------- ----------------------------------
Name Name
Treasurer Treasurer
- ---------------------------------- ----------------------------------
Title Title
6/18/96 6/18/96
- ---------------------------------- ----------------------------------
Date Date
CATHOLIC HEALTH SERVICES ST. JEROMES HEALTH SERVICES CORPORATION
PLAN OF BROOKLYN & QUEENS 740 84th Street
26 Court Street, Suite 1701 Brooklyn, NY
Brooklyn, NY
/s/ /s/
- ---------------------------------- ----------------------------------
Signature Signature
Daniel J. Rinaldi Daniel J. Rinaldi
- ---------------------------------- ----------------------------------
Name Name
Treasurer Treasurer
- ---------------------------------- ----------------------------------
Title Title
6/18/96 6/18/96
- ---------------------------------- ----------------------------------
Date Date
* CONFIDENTIAL TREATMENT REQUESTED
16
[Attachments A through L]
[Schedules A through E]
[CONFIDENTIAL TREATMENT REQUESTED]
17