HomeMy WebLinkAbout127-91 RESOLUTIONRESOLUTION NO.
127-91
A RESOLUTION AUTHORIZING THE PURCHASE OF AN
IBM AS/400 MODEL D50 COMPUTER SYSTEM FROM IBM
CORPORATION, APPLICATION SOFTWARE AND SOFTWARE
MAINTENANCE FROM NEW WORLD SYSTEMS AND
APPROVAL OF A BUDGET ADJUSTMENT TO FACILITATE
THE PURCHASE.
BE IT RESOLVED BY THE -BOARD OF DIRECTORS OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Section 1. That the Mayor and City Clerk are hereby
authorized and directed to execute a purchase agreement with the
IBM Corporation in the amount of $360,132.00 for an IBM AS/400
Model D50 computer system.. A copy of the agreement authorized for
execution hereby is attached hereto marked Exhibit "A" and made a
part hereof.
Section 2. That the Mayor and City Clerk are hereby
authorized and directed to execute an agreement in the amount of
$179,391.00 with New World Systems for application software and
software maintenance. A copy of the agreement authorized for
execution hereby isattached hereto marked Exhibit "B" and made a
part hereof.
Section 3. That the Board of Directors hereby approves a
budget adjustment in the amount of $216,933.00 from Sales Tax
Construction Fund Unreserved Fund Balance, Acct. No. 452-000-1-
800.99 to Sales Tax Construction Fund, Acct. No. 452-952--5-801.00
to faciliate this purchase in the current year. A copy of the
budget adjustment for approval is attached hereto and made a part
hereof.
PASSED AND APPROVED this 2nd day of July , 1991.
APPROVED:
79/
Mayor
ATTEST:
City -Cl
+*r.
..�A n Irl r.
ADJUSTMENT #
BUDGET YEAR
1991
DEPT
DIV
PROG
CITY OF FAYETTEVILLE, ARKANSAS
IN -YEAR SUPPLEMENTAL BUDGET ADJUSTMENT
ADMIN SERV
FINANCE
DATA PROCESS
PROJECT OR ITEM REQUESTED:
COMPUTER SYSTEM UPGRADE
DATE REQUESTED
07/02/91
JUSTIFICATION OF THIS INCREASE: BUDGETED
AMOUNT WAS ORIGINALLY TO BE SPENT OVER A 4 YR
PERIOD. SAVINGS OF $59,067 WILL ACCRUE TO THE
CITY BY PAYING FOR THE COMPUTER AND SOFTWARE
UPGRADE IN 1991 RATHER THAN LEASING THE EQUIP-
MENT OVER A 4 YEAR PERIOD.
PROJECT OR ITEM DELETED:
INCREASE
ACCOUNT TITLE
SALES TAX CONSTRUCTION FUND
ACCOUNT NUMBER
452-952-5-801.00
AMOUNT
$ 216,933
DECREASE
ACCOUNT TITLE
REDUCTION OF THE 1992 & 1993 FUNDING FOR THE SALES TAX CONSTRUCTION FUND
COMPUTER SYSTEM UPGRADE. UNRESERVED FUND BALANCE
ACCOUNT NUMBER
JUSTIFICATION OF THIS DECREASE: 452-000-1-800.99
AVOIDANCE OF $59,067 WILL ACCRUE TO THE CITY BY
PAYING FOR COMPLETE SYSTEM UPGRADE IN 1991 AMOUNT
RATHER THAN LEASE THE EQUIPMENT FOR A 3-5 YR
PERIOD AS ORIGINALLY PLANNED. $ 216,933
REQUESTED BY:
BURDRGE�T COORDINATOR:
.►ice \
DEPAR'
DIRECTOR:
ADM .flERVICES DIR:
CI MANAGER:
DATE
6-14-41
06-1`191
(0-20-01
BUDGET OFFICE USE .ONLY
DATE OF APPROVAL
BY
ENTERED
DATE
POSTED
TYPE ABCDE
Total program adjustments to date:
DESIGNATED RESOURCES
1991 CAPITAL
1992 CAPITAL
1993 CAPITAL
1994 CAPITAL
ANALYSIS OF REQUESTED FUNDS
IMPROVEMENT PROGRAM
IMPROVEMENT PROGRAM
IMPROVEMENT PROGRAM
IMPROVEMENT PROGRAM
$ 92,000
$ 92,000
S 92.000
TOTAL DESIGNATED RESOURCES AVAILABLE
1991 COSTS
Software and Related Items
• License Fees for application
software
• Contingency for Replacement of approximately 7
outdated emulation boards originally purchased
in 1986-87
• Contingency for Data Processing Utility software,
other application software, and related costs that
may be beneficial to the City
• Contingency for Travel for Contract Negotiations
and/or New World Customer Site visits
• Sales Tax
TOTAL SOFTWARE
Hardware
IBM AS/400 - D50 AND REQUIRED FEATURES, & OPERATING
SYSTEM SOFTWARE
IBM Application Software Modules for:
Programmer Productivity Tools,
System Management Tools, and
OfficeVisison. Educational Software
for training Data Processing personnel
on the AS/400 operations
Sales Tax
TOTAL HARDWARE
Y -T -D Expenditures
VARIOUS HARDWARE AND SOFTWARE REVIEW VISITS
TOTAL 1991 COSTS
DUDGET ADJUSTMENT REOUIRED
TOTAL 1991 COSTS
1991 CAPITAL IMPROVEMENT PROGRAM
TOTAL BUDGET ADJUSTMENT REQUIRED
$ 324,972
276.000
$ ¢00.97
$ 149,130
4,500
15,000
4,000
6.761,
$ 179,391
$ 316,036
28,540
15.556
360,132
2.382
541,905
324.972
216,933
1
•
NEW:WORLD SYSTEMS CORPORATION
SOFTWARE LICENSE AGREEMENT
FOR
IBM AS/400
THE ATTACHED ,'EXHIBITS ARE TO BE USED TO
:LICENSE SOFTWARE PACKAGES AND PURCHASE SUPPORT
:SERVICES FROM NEW WORLD SYSTEMS.
EXHIBIT A - STANDARD SOFTWARE PACKAGES
2. EXHIBIT B - SUPPORT SERVICES AND FEES
AUTHORIZATION
3. EXHIBIT C -. STANDARD SOFTWARE MAINTENANCE
AGREEMENT
4. EXHIBIT D - GENERAL TERMS AND. CONDITIONS
COVERING SOFTWARE AND SERVICES
5. EXHIBIT E - DEMONSTRATION SITE DISCOUNT
6. EXHIBIT F - SOFTWARE ENHANCEMENTS
7, EXHIBIT G - SOFTWARE SPECIFICATIONS FROM RFP
APPROVED: CITY OF FAYETTEVILLE, ARKANSAS
Name: Fred Vorsanger
Title: Mayor
Signature: 6,E t -ci. i
Date: 7'02-11
APPROVED* NEW WORLD SYSTEMS CORPORATION
Name:
Title:
.-Signature:
Date:
Larry D. Leinweber
06-24-91
CONFIDENTIAL
JUN -26-1991 17:30 FROM NEW WORLD SYSTEMS
TO 91501575825? P.03
EXHIBIT A
STANDARD Sa£TWARE PACKAGES
TO: NEW WORLD BYBTEMS CORPORATION (NWS)
FROM: CITY OF E°TEVILLE. ARKANSAS
(CUSTOMER)
CONCERNING:. LIC* �ING AND INSTALLATION OF APPLICATION SOFTWARE
FOR DR¢+ANIZATIONS USING IBM AS/400 MODEL 50
A. Standard S 1tware cages
Please consider!s your authorization to plan the
installation of the application software packages
described below.
APPLICATION
1. Financial Manageme
- General Ledger M
- Budgetary Accoun
- Annual Budget Pr
- Accounts Payable
- Purchasing and
COST
Base Package $ 25,000
ule
Module
sing Module
00 ule
••rance Control Module
2. Other Financial Ma gement Software
- Requisition Procsing Module
- Revenue Accountii$/Cash Receipts
Base Module
- Project/Grant Accbu
- Billing and Rece kra
- Fixed Assets.Modure
- Integrated Invent
Module
5,000
5,000
ting Module 5,000
les Module 5,000
5,000
/Purchasing 12,000
3. Human Resources So re
- Payroll with Base sonnet Module 14,000
- Advanced Personn17t Module 6,000
4. Utility Informatio9
- Water/Sewer/Other
- Automatic (PC) Matt
ftware
ule
Read Module
5. Geo -Based Land Man ep�++ent Software
- Geo Property Mas r Module
- Permits and Inspection Module
6. Clerk's Office Software
- Ordinances and Re0 utions
16,000
6,000
6,000
11,000
4,800
rnarrnrumrxt
MONTH/YEAR_REOUESTED
when equipment avail.
When eauipznent avail.
When equipment avail.
Khen equipment avail.
When equipment a_v-ai1.
Wheitequipieemt a_v-aii.
JUN -26-1991 17:30 FROM NEW WORLD SYSTEMS
EIHHIBIT A
Page 2
APPLICATION
7. Public Works 5oftwa
- Base Equipment M
- Work Order Proces
•
TO 915015758257 P.04
enance Module $ 9,000
g Module* 8,000
8. Municipal Court Sof re**
3urisdictio )
9. Parking Ticket Soft$a%e
10. Investment Managemeht!Software***
STANDARD SOFTWARE COST
(includes Application 5 e Code)
DEMONSTRATION SITE DISCO*
TOTAL SOFTWARE COST:***(*
MONTH/YEAR PEOUESTED
When equipment avail.
By 10-1-91
8,000 When equipment avail.
8,000
4.000 By 4-15-92
$162,800
When equipment avail.
(61,800)
5101.000
THE_ABOVE PAC A E CASTS ARE VALID THROUGH JULY 2.5. 1991
* If this software not installed on Customer's AS/400 by 10-01-91,
Customer shall hat the option of requesting a refund for any amounts
paid and NWS sha ,l refund within thirty (3o) days of receipt of
Customer's writte notice.
** Customer shall hay, 60 days after installation (but no later than 10-01-
91) to review the features of this software. If customer decides not to
use this software,, based upon well documented deficiencies, Customer
shall have the optj!ion of requesting a refund for any amounts paid and
NWS shall refund ;Within 'thirty (30) days of receipt of Customer's
written notice. f
If this software 45 not installed on Customer's AS/400 by 04-15-92,
Customer shall ha'M the option of requesting a refund for any amounts
paid and NWS shaal refund within thirty (30) days of receipt of
Customer's written notice. If the software is installed prior to 04-15-
92, Customer sha*lihave 30 days to review the features of their
software. If $u4tomer documents that the software does not
substantially meette specififcations in Exhibit G, Customer shall have
the option of regie ting a refund for any amounts paid and NWS shall
refund within thiry!(30) days of receipt of Customer's written notice.
A11 costs assume Qpstomer signs IBM's Letter of Understanding (LOU) on
NWS' behalf and IBI isccepts the LOU.
***
snnnw a r.
EXH:rIT A
Page 3`
B. Payments on Standard Software
- DOWNPAYMENT
(40% of Exhibit A Cost - Invoiced upon
receipt of signed Licensing Agreement)
- INSTALLATION PAYMENT(S)
(40% of Exhibit A Cost - Invoiced upon
installation of each software package
on your computer, normally within 15 days
from equipment availability)
- ACCEPTANCE PAYMENT(S)
(20% of Exhibit A Cost - Invoiced by
individual module cost upon Software
Acceptance based on either of the
criteria in Paragraph 16 of Exhibit D.
Customer agrees that all modules will
be tested and accepted no later than
03-15-92, except for Investment
Management which will be tested and
accepted by 05-15-92.
$ 40,400
$ 40,400
$ 20,200
- STANDARD SOFTWARE PAYMENTS DUE $101,000
NOTE: ALL PAYMENTS ARE DUE WITHIN THIRTY DAYS FROM RECEIPT OF INVOICE.
CONFIDENTIAL
•
EXHIBIT B
SUPPORT SERVICES AND FEES AUTHORIZATION
1. Hours of Assistance Required
We recommend allocating adequate support hours per application on
standard software packages to provide:
- Installation of Standard Software
- User Education and Training
Other technical assistance may be required including:
- Modifications to Standard Software
- Custom Design and Programming
- File Conversion Assistance
- Consultation of Customer Technical Staff
Based on the standard software licensed on Exhibit A, we suggest
that 600 hours of support services be scheduled. Actual usage
may be higher or lower based on Customer's use of support.
Avoiding or minimizing custom or modified features is beneficial.
2. Support Service Cost
Without written permission from Customer, Exhibit B costs for
Exhibit A software in year one of this agreement may not exceed
$48,130. This cost is based on a combination of support services
and travel costs that are estimated at:
a) 600 hours of support services at $60/hour $36.000
(after the $48,130 is used, the then current NWS rates shall
apply)
b) Travel Cost $122130
NWS and Customer agree to schedule trips of sufficient length
and far enough in advance to obtain the least cost air fares.
When possible, NWS employees will stay at reasonable cost
hotel facilities within walking distance of Customer's
offices.
NWS employees will not use auto rentals. Customer agrees to
provide ground transportation for NWS employees to and from
the airport and while on customer business.
A daily per diem of $25.00 will be used in year one of this
Agreement. After year one, the rate shall be the then current
NWS rate.
- Any other reasonable travel cost approved by Customer.
CONFIDENTIAL
EXHIBIT B
Page 2
3. Use of Time
Within thirty (30) days of this Agreement being executed by both
Customer and NWS, NWS shall submit a plan and schedule to use the
support hours and travel cost budgeted. Customer and NWS shall
confirm and finalize this plan and schedule within sixty (60) days
of this Agreement being signed. The plan shall not include, nor
shall Customer be charged for, more than four (4) hours of travel
time per NWS employee visit. Customer agrees to have customer
employees available for training as the schedule is implemented.
Both NWS and Customer agree and understand that support hours use
and cost, and travel cost, may need to be adjusted and/or
substituted for each other,based on travel rates as long as the
$48,130 is not exceeded without permission of Customer. If
substantial modifications, custom software or file conversion work
is requested, NWS may schedule employees to perform this type of
work at NWS facilities. This is to enhance employee productivity
and to save travel time and cost. Customer shall be notified in
advance should this occur.
4. Payments for Services and Travel Costs
All hours for services and travel costs will be billed weekly for
the previous calendar week. Payments are due within thirty (30)
days from receipt of invoice.
CONFIDENTIAL
EXHIBIT C
STANDARD SOFTWARE MAINTENANCE AGREEMENT
1. Service Period
This maintenance agreement between New World Systems (NWS) and
CITY OF FAYETTEVILLE, ARKANSAS (Customer) addresses the
standard software maintenance and other support services provided by
NWS. This agreement will remain in effect for a period of five (5)
years beginning 90 days after software installation (start date) to five
(5) years after the start date.
2. Services Included
The following services or features are included or available in the
standard software maintenance agreement:
(a) new releases of standard software including enhancements.
Previous releases are supported no longer than nine (9) months
after a new release is announced by NWS.
(b) program updates for problems or malfunctions to standard
software only (temporary fixes).
(c) updates to standard software user documentation will be
provided along with (a) and (b) above.
(d) telephone support for standard software on Monday through
Friday from 8:00 a.m. to 7:00 p.m. (Eastern Time Zone).
(e) participation in user group meetings.
(f) additional support services are available as requested by
Customer using (then) current hourly rates. Exhibit B has a
description of support services. Custom software and modified
standard software is supported using Exhibit B services and
fees.
OTHER THEN EXHIBIT F ITEMS THAT BECOME STANDARD SOFTWARE, CUSTOMER
SHOULD BE AWARE THAT IF THEY HAVE REQUESTED CHANGES TO STANDARD
SOFTWARE, THAT THESE CHANGES (NO MATTER WHO MAKES THE CHANGES) MAY MAKE
THEIR STANDARD SOFTWARE MORE DIFFICULT TO MAINTAIN. ADDITIONAL HOURLY
SUPPORT CHARGES MAY BE INCURRED IF NWS HAS TO PERFORM ADDITIONAL WORK TO
MAINTAIN STANDARD SOFTWARE THAT HAS ANY CHANGES OR MODIFICATIONS
REQUESTED BY CUSTOMER.
Items (a), (b) and (c) above will be distributed to Customer on magnetic
media as appropriate. Customer is to return the magnetic media sent by
NWS.
If used, additional support services (see Exhibit B) will be billed at
(then) current hourly rates. Travel expenses are billed at actual cost.
CONFIDENTIAL
EXHIBIT C
i' -;Page 2
3. Software Packages
Covered for IBM AS/400 Model 50
NWS agrees to provide software
standard software packages in use
Application/Module
maintenance for the following NWS
at Customer's location:
List Cost
1. Financial Management Software
(11 Modules)
2. Human Resource Software
(2 Modules)
3. Utility Information Software
(2 Modules)
4. Geo -Based Land Management Software
(2 Modules)
5. Clerks Office
6. Public Works Software (2 Modules)
6. Municipal Court Software
7. Parking Ticket Software
8. Investment Management Software
9. Application Source Code
TOTAL: $162.800
Annual
Maintenance Cost
(5 -Year Plan)
Year 1&2 Year 3-5
$6,500 $9,300
2,100
2,300
1,800
500
1,800
835
835
400
Included
3,000
3,300
2,550
720
2,550
1,200
1,200
600
Included
$17,070 $24,420
4. Billing
The total annual maintenance cost will be billed annually as follows.
This cost includes items 2a, 2b, 2c, 2d, and 2e from the previous page.
For Period
Selected
Year 1
Year 2
Year 3
Year 4
Year 5
Annual
Amount Billed
$17,070
17,070
24,420*
24,420*
24,420*
Billing Date
First day of the month
on the third month
following software
installation and
annually thereafter.
If used, support service hours (and travel costs) will be billed weekly
for the previous calendar week. All invoices are due thirty (30) days
from receipt of invoice.
* If Customer assists NWS in obtaining another NWS Customer in the
State of Arkansas and the new Customer Licenses at least $50,000 in
Exhibit A software prior to 02-01-93, the amount in years 3, 4, or
5, will be reduced to the year 1 and year 2 amount.
CONFIDENTIAL
EXHIBIT C
Ps1ge 3
5. Additions of Software to Maintenance Agreement
Additional: standard software modules licensed from NWS will be added to
the maintenance agreement as they are installed. 90 days after
installation, costs for the additional maintenance will be billed to
Customer prorata for the remainder of the maintenance year and on a full
year basis. thereafter.
CONFIDENTIAL
.4
EXHIBIT D
GENERAL TERMS AND CONDITIONS
1. Personnel
During the entire duration of this Agreement and for twelve (12)
months thereafter, each party agrees not to solicit or hire
current or former employees of the other without the other's
prior written consent.
NWS shall exercise its best efforts to furnish competent
employees for fulfillment of these Agreement obligations. NWS
shall require employees (when on customer's premises) to comply
with all Customer's regulations and policies and shall promptly
remove those who do not comply. Given adequate cause, NWS shall
dismiss immediately from the project upon receipt of
notification, employees who are unsatisfactory for the services
to be performed hereunder. Such personnel shall be replaced
with individuals satisfactory to Customer as soon as possible.
2. Training and Installation Support Services
At Customer's request, NWS shall (as described on Exhibit B)
make available to Customer qualified representative(s) who will
provide training and other support services for each application
licensed. The training and support services shall include
software overviews and detail reviews by software module
licensed. The parties shall mutually agree to the time for
training and support services.
3. Correction and Software Maintenance on Standard Software Packages
For 90 days after the software installation, NWS provides
program corrections and maintenance to standard software at no
charge. As part of this Agreement, Customer is also obtaining
a NWS Standard Software Maintenance Agreement (SSMA). The SSMA
provides a continuation of standard software maintenance and
other support services after the ninety (90) day period has
passed. The SSMA (see Exhibit C) shall begin on the following
date:
90 days after the software is installed.
The procedure for requesting standard software correction
service will be as follows:
a) Customer personnel will be required to document in writing
(with examples) each feature and/or report they believe to
be in error. All documentation will be forwarded to the
Customer liaison for review and control.
Page 2
b) The CuStomer liaison and a NWS Customer Support Manager
will review as may be required the software correction
requests. Invalid requests will not be serviced, valid
requests will be serviced at no charge. Requests for
features and/or reports that were not in the original
software will be billed (if approved) to the Customer. A
valid request will be:
- when a feature and/or report is not working as designed
An invalid request will be:
- the featureand/or report is working as designed
- a new feature and/or report is requested
This correction procedure does not apply to the following:
- situationswhere the software (programs) has/have been
changed by anyone other than NWS personnel.
- situations where user operations error causes incorrect
information or reports to be generated.
4. Confidential Information
Subject to the requirements of the Freedom of Information Act
(FOIA) and/or any comparable state laws, each party shall treat
as confidential such information as the other may expressly
designate as confidential. In furtherance of this duty, each
party shall treat the other's confidential information as it
treats its own confidential information. Each party shall
instruct its employees not to divulge such information to third
parties without the consent of the other and shall take such
measures as may be reasonably requested by the other to preserve
the confidential nature of such designated information. In the
event any information is provided under the FOIA, notice and
copies of the information divulged must be sent to the other
party.
5. Utilization of Software and Software Documentation
a) General Provisions
Both parties recognize that NWS owns all software licensed
under this Agreement. Upon availability of equipment, NWS
shall deliver to Customer two copies of the user manual and
one copy of the binary code of the software (in machine
readable form compatible with the system configuration
selected - on storage media supplied by Customer). With
the payment of licensing fees for source code, Customer
shall have the right to use, enhance, or modify all
software for Customer's own use as desired.
For internal use only, Customer shall be allowed to make
additional copies of NWS user manuals.
Page 3
Except for emergency processing needs, Customer (both
through his own employees and/or throughother
contractors/service organizations) agrees not to distribute
copies of programs or documentation in any form, including
magnetic media - to any parties, individuals, or
organizations outside of Customer's physical premises where
Customer's computer is located.
The effect of this provision is to provide Customer a
single use license that is limited to the original (or
upgraded model) IBM AS/400 processor (serial number) that
is installed at the Customer location.
In the event of emergency processing needs (i.e. by fire,
flood, or power failure), Customer's employees shall be
allowed to remove programs and/or documentation from
Customer's physical premises. Customer shall also be
allowed to keep a copy of programs and documentation off
site, so long as they are locked in a secure location with
access limited to Customer liaison person. After Emergency
Processing is completed, all copies not on Customer AS/400
must be destroyed, and or returned to Customer's location.
The Customer agrees to provide for the enforcement of the
above provisions by the appropriate use of Non -Disclosure
Agreements that are to be reviewed with employees and/or
contractors/service organization that have access to the
programs and/or documentation.
b) Software Upgrade Charges on AS/400 Model Changes
Customer will pay at the time of upgrade the difference
between the standard software charges for the present
AS/400 model (see Exhibit A) and the standard software
charges for the upgraded AS/400 model. The upgrade charge
shall not exceed the difference between the then current
rates for a Model D50 AS/400 and the AS/400 model Customer
upgrades to. Based on the difference in software costs
from the D50 to the new model, the then current software
maintenance charges (see Exhibit C) will be increased on
the next annual billing date after the upgrade occurs.
Customer agrees to immediately notify NWS when AS/400
models will be upgraded and to pay promptly when invoiced.
c) Usage of Non -Standard Software and Intellectual Property
The license to use the programs or those portions of any
programs which are developed by NWS specifically for the
Customer is included in addition to the standard software
•license. NWS shall have the right to use any data
processing ideas, techniques, concepts, and/or know-how
acquired by it in the performance of services under this
Agreement for the advancement of its own technical
expertise and the performance of other service agreements;
and that NWS shall have, without restriction, the right to
use all program, procedures, information, and techniques
that are publicly available,
Page 4
obtained or obtainable from third parties and/or developed
independently by NWS without specific reference to
.Customer's organization. Under no circumstances shall the
Customer be' allowed to sell, copy, or distribute any
programs or documentation developed for Customer by NWS -
to any other computer users.
d) Usage of Software Developed by Customer
Without Customer written permission, including any agreed
upon reimbursement, NWS shall not use any software,
programs, or documentation developed by Customer personnel
and/or third party agents of Customer.
e) Integration with U.S. Copyright Act
In addition to all provisions and restrictions provided
under this Agreement, Customer further agrees to be bound
by and to comply with any and all provisions of the U.S.
Copyright Act. In the event any provision of the U.S.
Copyright Act and a provision of this Agreement conflict,
the more restrictive of the two applies. In the event it
cannot be determined which is the more restrictive, then
the provision within the Agreement applies.
In the event of a termination of this Agreement by either party,
the Terms and Conditions of this Paragraph shall remain in
effect for both parties after the termination.
6. Insurance Requirements
NWS shall not commence work under this Agreement until it has
obtained the insurance required under this paragraph.
a) Workers' Compensation Insurance. NWS shall procure and
maintain during the life of this contract, Workers'
Compensation Insurance for all of its employees who engage
in the work to be performed; and, in case any such work is
sublet, if the contractor, shall require the subcontractor
to provide similar insurance for all of the latter's
employees who engage in the work.
b) Liability and Property Insurance - Comprehensive Form. NWS
shall procure and maintain during the life of this
contract, Liability and Property Damage Insurance in an
amount not less than $500,000 on account of each accident;
and in an amount not less than $500,000 for each accident
for damage to property.
c) Automobile .Liability Insurance. NWS will procure and
maintain during the life of this contract, Hired and Non-
Ownership Motor Vehicle Bodily Injury and Property Damage
Insurance in an amount not less than $300,000 for injuries,
including accidental death, to each person; and, subject to
the same limit for each person, in an amount not less than
$300,000 for each accident; and in an amount not less than
$300,000 on account for each accident for damage to
property.
Page 5
71, Liabilities
NWS is an independent contractor. The personnel of one party
shall not in any way be considered agents or employees of the
other. As provided by law, each party shall be responsible for
the acts of its employees.
8. Disclaimer, Release and Limitation of Liabilities
NWS specifically warrants that our standard software will
perform as represented in user manuals (based on then current
release of software).
THE WARRANTIES, OBLIGATIONS AND LIABILITIES OF NWS AND THE
RIGHTS AND REMEDIES OF CUSTOMER SET FORTH IN THIS AGREEMENT ARE
EXCLUSIVE AND IN SUBSTITUTION FOR, AND CUSTOMER HEREBY WAIVES,
RELEASES AND RENOUNCES, ALL OTHER WARRANTIES, OBLIGATIONS,
REPRESENTATIONS AND LIABILITIES OF NWS NOT SPECIFICALLY
WARRANTED HEREIN, TOGETHER WITH ALL RIGHTS, CLAIMS AND REMEDIES
OF CUSTOMER AGAINST NWS, EXPRESS OR IMPLIED, ARISING BY LAW OR
OTHERWISE, WITH RESPECT TO ANY NON-CONFORMANCE OR IMPERFECTION
IN ANY SOFTWARE LICENSED HEREUNDER, INCLUDING BUT NOT LIMITED
TO:
a) ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE;
b) ANY IMPLIED WARRANTY ARISING FROM COURSE OF PERFORMANCE,
COURSE OF DEALING OR USAGE OF TRADE;
c) ANY OBLIGATIONS, LIABILITIES, RIGHTS, CLAIMS OR REMEDIES
(i) FOR LOSS OF USE, REVENUE OR PROFIT; AND/OR
(ii) FOR ANY OTHER DIRECT, INCIDENTAL AND/OR CONSEQUENTIAL
DAMAGES INCLUDING, WITHOUT LIMITATION, ANY LIABILITY
OF CUSTOMER TO THIRD PARTY.
CUSTOMER'S DAMAGES RECOVERABLE HEREUNDER ARE LIMITED TO THE
SOFTWARE COST LISTED ON EXHIBIT A. IN THE EVENT THAT, FOR
WHATEVER REASON, IT IS DETERMINED A LIMITATION OF REMEDY
CONTAINED HEREIN, IF ANY, FAILS OF ITS ESSENTIAL PURPOSE, THEN
THE PARTIES AGREE THAT THE EXCLUSION OF INCIDENTAL AND/OR
CONSEQUENTIAL DAMAGES IS STILL EFFECTIVE. IT IS AGREED THAT NWS
MAKES ABSOLUTELY NO WARRANTY, UNDERTAKING OR REPRESENTATION
OTHER THAN THOSE EXPRESSLY STATED IN THIS AGREEMENT, AND THAT
CUSTOMER IS NOT RELYING ON ANY OTHER REPRESENTATIONS OR
STATEMENTS MADE BY OR ON BEHALF OF NWS.
Page 6
9. Customer Responsibility
The Customer will be responsible for direct payment to IBM or
other parties for the purchase, lease, or rental of the
equipment components of this service.
The Customer must provide the management interface and support
necessary to successfully complete the installation of software.
This includes policy and procedure reviews, priority setting,
and timely involvement in supporting change in an environment
where systems are being restructured and the organization is
being modified.
Customer shall assign a responsible person to act as liaison
between the Customer and NWS for the duration of the software
installation. The person shall: (i) be responsible for
obtaining responses to all of NWS's requests for information;
(ii) ,have authority to sign for and obligate Customer to any
changes relating to design or delivery times; and (iii) have
authority to sign acceptance test documents evidencing
Customer's acceptance of each software deliverable pursuant to
the provisions of the applicable systems test procedures
specified in Paragraph 16.
The Customer must provide timely participation in systems
definition, detail design, and direction of user data collection
where appropriate.
The Customer must approve the overall system design according to
the implementation plan.
The Customer must edit and control the master file data - this
is required for accurate systems performance.
The Customer must provide qualified personnel to learn the
operations of the system(s) and to use the output from the
applications to be implemented.
Customer shall have appropriate personnel available for training
at the times scheduled, upon reasonable notice.
Customer shall make available at no charge to NWS adequate
access to reasonable office and desk space for NWS employees.
This Agreement for the license and installation of application
software requires the cooperation of both NWS and the Customer.
To the extent the Customer imposes additional requirements on
NWS for services other than expressly provided for in this
Agreement, NWS retains the right to make additional price
adjustments and/or any other adjustments that may be
necessitated. To the extent the Customer refuses to cooperate
with NWS as provided for in this paragraph or elsewhere in this
Agreement, NWS may, at its option, rightfully terminate any
further performance on this Agreement, retaining all moneyr
collected to that date, and hold Customer liable for moneys the
due but not yet paid.
an 4
10. Arbitration
Page 7
Except for matters which relate to Customer's failure to pay
promptly, or matters which are enforceable by injunction and/or
other equitable remedies, or are related to the employee,
confidentiality and/or non -disclosure paragraphs (paragraphs 1, 2,
5, and 13 of Exhibit D) any controversy or claim arising out of or
relating to this Agreement, or breach thereof, shall be settled in
arbitration in accordance with the rules then prevailing of the
American Arbitration Association. Judgment upon any award rendered
by the arbitrator(s) may be entered in any court having
jurisdiction thereof.
As a condition precedent to arbitration, the parties agree that
before beginning an arbitration preceding, the management of both
parties shall have met at least two times in face-to-face meetings
in an effort to resolve any dispute or controversy through normal
business management practices. A minimum of one meeting shall take
place at each party's offices or other mutually agreeable location.
11. Patents and Trademark Indemnification
r
NWS agrees to indemnify and save the Customer harmless from and
against any and all judgments, suits; costs, and expenses resulting
from any alleged infringement or any patent or copyright arising
from the sale of software pursuant to this Agreement and covenants
that NWS will, defend or assist in the defense of any alleged
infringement of any patent or copyrights provided that the Customer
notifies NWS in writing of such allegation within (30) days of the
date upon which the Customer first receives notice thereof.
Failure of the Customer to give such notice shall relieve NWS of
all obligations to indemnify the Customer under this paragraph.
12. Billing
The Exhibit(s) or Letter describing Fees explains how Fees will be
allocated. Payment shall be due as defined in the Exhibit(s) or
letter. NWS shall have the right to add a service charge of 1.0%
per month on past due amounts. Customer agrees to pay service
charges applied to such amounts.
13. Non -disclosure and Security Agreement on Software
a) No unauthorized copies - in any form - will be made of New
World Systems property, including the following:
- Program libraries, whether source or object
- Operating control language
- Test Data or sample files
- Program Listings
- Record Layouts
- All written documentation, such as user manuals and/or
systems manuals.
c
Page 8
The only authorized copies allowed for this Agreement are
copies to be used for backup - which may be stored offsite if
kept in a locked area that has restricted access. All other
copies are unauthorized unless the Customer receives written
permission from New World prior to copying.
b) No use of the programs or documentation (noted above) will be
allowed other than processing the records of the end user who
originally licensed the software.
c) A failure by Customer (or third parties with access to the
software) to comply with the above restrictions will entitle
NWS to all legal remedies available to NWS.
d) Customer agrees that third parties with access to the software
will be required to sign a Non -disclosure Agreement that
includes all of the terms in this Paragraph 13. Customer must
obtain and provide NWS a signed Non -Disclosure Agreement from
any third party before the third party is given access to the
software.
In the event of a termination of this agreement by either party,
the Terms and Conditions of this Paragraph shall remain in effect
for both parties after the termination.
14. Termination
a) Termination - Bv Customer
In the event NWS does not satisfactorily complete the
installation of software in accordance with the terms of this
Agreement, Customer may at its option notify NWS of Customer's
intention to cancelor terminate this Agreement at any time
upon: written notice to NWS. Such notice shall provide a
detailed documentation and definition (with examples) of any
deficiencies claimed. NWS shall have ninety (90) days from
receipt of said notice to correct deficiency in order to
satisfy the terms of this Agreement. Customer agrees to
cooperate with NWS at all times and shall use best efforts to
apply sound management practices to the resolution of any
claimed deficiencies - including reassignment of personnel by
both'parties if necessary to improve working relationships.
b) Termination - Bv NWS
NWS shall be allowed to terminate this Agreement for either of
the following reasons:
(i) Failure of Customer to make prompt payments for software
installed and/or installed and accepted.
(ii)1Failure of Customer to fulfill his responsibilities as
,outlined in Exhibit D, paragraph 9, of this Agreement.
r
Page 9
Except for Customer's failure to make prompt payments, NWS
shall not be allowed to terminate during the first 180 days of
this Agreement. After 180 days, NWS may, for the reasons
stated above at its option, notify Customer of NWS's intention
to cancel or terminate this Agreement at any time upon written
notice to Customer. Such notice shall provide a detailed
documentation and definition of any deficiencies claimed.
Customer shall have ninety (90) days from receipt of said
notice to correct deficiencies that are related to Exhibit D,
paragraph 9, responsibilities - and Customer shall have ten
(10)days from receipt of said notice to correct deficiencies
that: are, related to, failure to make prompt payment.
In the event of termination by either party, NWS shall continue to
provide its services, as previously scheduled, through the
termination date and the Customer shall continue to pay all fees
and charges as provided in Exhibits A, B, and C.
15. Notices
0
Notices to Customer or NWS shall be deemed effective when sent by
Registered or Certified U.S. Mail to their respective addresses
below:
New World Systems Corporation City of Fayetteville
3270LWest Bia Beaver, suite 300 113 W. Mountain
Troy, Michigan 48084 Fayetteville, AR 72703
Attention: President Attention: DP Manager
16. Software Acceptance Tests
Successful systems performance will be determined by either of the
following acceptance criteria:
Acceptance Criteria 1
- The successful entry and editing of at least 100 transactions
concurrently entered from multiple terminals using the
established procedures and controls.
- The successful processing of at least 50 file maintenance
transactions for the master files.
The successful generation of standard output reports using the
established procedures and controls.
Customer's acceptance of NWS software and products shall occur upon
successful completion of the systems test procedure as specified
above. As defined in the training and implementation schedule, NWS
and Customer shall mutually agree on the test date of each software
productdeliverable - and Customer shall not
Page 10
unreasonably delay the systems test procedure. Both parties shall
jointly; conduct the systems test procedure for each software
product. In the event that NWS and Customer cannot agree on a test
date and if NWS has notified the Customer of the test date of a
software product and Customer delays the start of the system test
procedure for more than thirty (30) calendar days, then acceptance
shall be deemed to have occurred for that software product
deliverable.
Acceptance Criteria 2
Customer's acceptance of the software products shall occur based
on Customer using the software products to produce data or output
which is distributed for actual use and/or otherwise utilized as
"live data" (e.g. payroll checks, water bills, tax bills, general
ledger .reports, data base searches and/or inquiries, police
reports, fire reports, etc.)
17. Performance Bond Rectuirement
In those situations where Customer requests NWS to provide a
Performance Bond, NWS shall provide a Performance Bond for the
software on Exhibit A. Customer shall pay for the cost of the
Performance Bond. Customer also agrees to pay promptly for the
Performance Bond when invoiced by NWS.
18. General
This Agreement is the entire Agreement between the parties
superseding all other communications, written or oral, between the
parties relating to the subject matter of this Agreement and it may
be amended or modified only in writing signed by both parties.
This Agreement shall be. governed by the laws of the State of
Arkansas and it shall be binding on the successors and assigns of
the parties. The paragraph headings which appear herein are
included solely for convenience and shall not be used in the
interpretation of this Agreement.
19. Non -funding Provision
In the :event Customer does not appropriate funds to complete
payments for any amount due on NWS Exhibits A, B, C and F of the
Agreement, the balance of the amounts owed in the Agreement shall
be terminated subject to the following conditions:
a) Assuming all Exhibits B and C amounts invoiced are fully paid,
Customer shall retain the right to use any software for which
the license fee has been paid in full. Paid in full includes:
i. payment of the Exhibit A Total Software Cost
ii. I full payment of the Exhibit F cost for any enhancements
installed
Page 11
y,
b) Customer shall return to NWS any other software for which the
license fee has not been paid in full, and shall lose the right
to use such software and documentation.
F
I
EXHIBIT E
DEMONSTRATION SITE DISCOUNT
Upon the installation of New World Systems' software on Customer's
equipment, the Customer agrees toact as a demonstration site for
prospective New World Customers. The Customer also agrees to act
in the same capacity as •a telephone reference for prospective
customers. Such demonstrations will be coordinated with the
appropriate Customer personnel and will be on a non-interference
basis. Reasonable notice for preparation will be provided by New
World Systems.
If Customer is requested to serve as a demo location and/or
telephone °reference, and Customer, has reservations about any
aspects of NWS product or services, Customer agrees to tell NWS
about their reservations in advance and not to discuss them with
the reference contacting them prior to discussing them with their
NWS sales contact person.
Since this Agreement has provided a substantial discount and
savings to, Customer as consideration for serving as a reference
location; should Customer not serve in this capacity, NWS shall
have the right to ask Customer to pay the amount discounted and
Customer agrees to pay if invoiced under these circumstances.
Both parties understand the Customer is not endorsing the NWS
software and that Customer will not actively participate in any
type of marketing and advertising campaign for NWS.
CONFIDENTIAL
lc -
1
A
fl
1
EXHIBIT .F
SOFTWARE ENHANCEMENTS
DEFINITION OF ENHANCEMENTS
NWS will provide software enhancements to Exhibit A modules as
discussed below to address the Customer's requirements.
Customer agrees to cooperate in not making enhancements too
extensive as defined in B -2a below.
ENHANCEMENTS INCLUDED IN FIXED COST UNDER B-4 BELOW
From the software specifications in Exhibit G, NWS will
provide the following modifications.
1. Page 55 Number 11
2. Page 88
3. Page 95
4. Page 96
5. Page 102
6. Page 103
7. Page 106
8. Page 120
9. Page 123
Items X. Y, Z, AE, and AF
Number 29
Number 37(g)
Number 20
Number 26, 27
Number 39, 40, 41, 42, 43, 44, 45, 46, 47
Number 107
Add enhanced inquiry for utility payments
METHODOLOGY TO PROVIDE SOFTWARE ENHANCEMENTS
1. Protect Definition
This project includes the following activities to be
performed by NWS.
Review of required features with Customer
- Preparation of Software Specifications Design Document
(SSDD) to include:
- menu samples
- screen samples
report samples
Programming and programming test using RPG
- Update user manual to include enhancements
NWS will only submit design documents that meet NWS
standard software requirements (and customer agrees to
work within their design parameters)
CONFIDENTIAL
•y gs5p
EXHIBIT F
Page 2
2. Implementation Plan
Activity
a. Complete Design Review with
:Customer Staff. Customer
•;agrees to be reasonable and
flexible in not attempting
to design the enhancements
to be more extensive than
called for in the scope (cost
and schedule) on this project.
b. 'NWS submits first draft of SSDD
c. Customer completes review of
•first draft of SSDD
d. NWS submits revised SSDD
e. SSDD acceptance and sign -off
by Customer (no programming
,will be done by NWS until the
formal sign -off and Customer's
authorization to proceed in
.writing.)
f. 'NWS completes programming from
•SSDD and installs software
g. Software acceptance test
,(source code and user manual
updated and provided)
3. Customer Responsibility
Targeted Time Period
Within 90 days of
Agreement being
signed.
As scheduled
As scheduled
As scheduled
As scheduled
As scheduled
As scheduled
Customer's responsibilities are additionally defined
in Paragraph 9 of Exhibit D of this Agreement. All
Customer requested changes after design sign -off must be
documented by -Customer and authorized in writing including
added costs, if any. Additional changes will most likely
delay the schedule.
CONFIDENTIAL
s4 Y
EXHIBIT F
Page 3
4. Cost and Payment for Enhancements
The cost for the enhancements is $5,000 to be paid as
follows:
30% on Signing of this Agreement 5 1.500
30% on Customer Approval of SSDD 1,500
- 40% on Acceptance Testing 2,000
Total Cost 5,000
* Travel costs for NWS employees to complete the tasks for
Exhibit F enhancements are billed under the provisions of
Exhibit B services. All travel to be mutually agreed upon
by customer and NWS.
CONFIDENTIAL
I
EXHIBIT G
i CUSTOMER SOFTWARE REQUIREMENTS FROM RFP
The software in Exhibit A (or IBM software) will address the
software requirements from the RFP as they were coded and qualified
in the NWS Bid Response (see the Satisfied by Standard Package
column). The coding only applies to RFP software actually included
in Exhibit,A. Approved Modifications are addressed in Exhibit F.
No other modifications are included.
s
CONFIDENTIAL
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