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07/15/2008 08 Computer System from Paladin Data Systems Corporation
BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON III AGENDA STATEMENT Item No. 2 For Meeting of July 15, 2008 ITEM TITLE: Consideration of Legislation Authorizing Acquisition and Implementation of Utility Billing, Customer Services, Permitting, Code Administration, Business License, Animal License, Complaints, Accounts Receivable, and Public Portal Computer Application Systems from Paladin Data Systems Corporation. SUBMITTED BY: Rita DeBord, Finance Director Doug Mayo, Wastewater Manager Dave Brown, Water & Irrigation Manager Nancy Fortier, Refuse & Recycling Manager Joe Caruso, Acting Code Administration Manager Pete Hobbs, Utility Services Manager Cindy Epperson, Financial Services Manager Rick Pettyjohn, Information Systems Manager CONTACT PERSON/TELEPHONE: Rick Pettyjohn, Information Systems Manager, 575- 6098 SUMMARY EXPLANATION: The existing computer systems that support the Utility Billing, Customer Services, Permitting, and Code Administration functions are all fifteen years old or older, utilize obsolete technology, and lack many functional and efficiency advantages of current computer system technology. fa Recognizing the need to replace these systems, the City Council has approved Major Policy Issues in 2005, 2006, and 2007 related to the progressive phases of the replacement effort. Pursuant to these Policy Issues, the City issued a Request for Proposal (RFP) in September of 2005 to acquire replacement systems. The RFP development and evaluation process involved all the Utility Divisions, Permitting and Code Administration Division, and the Financial Services, Utility Services, and Information Systems Divisions of the Finance Department. After a very thorough evaluation process, the RFP Committee selected the proposal offered by Paladin Data Systems Corporation as the most appropriate proposal. Their proposal not only best met the RFP requirements, but also had the added advantage of including integrated Business License, Animal License, Complaints, Accounts Receivable, and Public Portal systems. The award process was significantly extended due to fiscal constraints in 2006 and 2007. The process was revived at the beginning of 2008 and contract negotiations began. The attached contract is the result of those negotiations and has been reviewed by both the City Legal Department and K&L Gates law firm. (continued on next page) Resolution X Ordinance Other (Specify) Contract Mail to (name and address): Robert Johnston COO, Paladin Data Systems Corp., 19362 Powder Hill Place NE, Poulsbo, WA 98370 Phone: 1-800- 532 -8448 Funding Source Cumulative Reserve for Capital Improvement — 392 (Utility Contributions) APPROVED FOR City Manager STAFF RECOMMENDATION: Adopt Resolution BOARD/ COMMISSION /COMMITTEE RECOMMENDATION: COUNCIL ACTION: The projected timeline for this project in the contract is one year, which provides for a completion date in 2009. Because, the utilities portion is a system development project that may have some unforeseen issues, and because the City staff of the affected divisions is already fully occupied, the schedule may extend into 2010. The total cost of the project is estimated to be $1,013,000 calculated as follows: Paladin Licensing & Professional Services $630,000 Computer Hardware 15,000 • Estimated Sales Tax 10,000 Total Extemal Project Costs $655,000 Internal Costs $125,000 Project Contingency (20% of Extemal Costs) 125,000 Estimated Paladin & Oracle Maintenance Costs (2008 & 2009) 108,000 Total Internal, Contingency and Support Costs $358,000 Total Project Costs $1,013,000 Implementing any large, complicated computer application system requires significant participation of the staff from the affected divisions. Because the utility portion of this project is a system development effort that requires thorough analysis, data gathering and testing activities, we expect an already busy staff to be seriously impacted. This will particularly affect Customer Services and Information Systems where one of the two supervisors is assigned as the project manager. Temporary staff may be required to assist that supervisor with the additional duties. Therefore, we have proposed a additional budget to cover the intemal costs of overtime and temporary employees, possible travel and training, and other incidental costs. We have also included a 20% contingency budget which is a standard for large system development projects. The total project cost falls well within the $1,500,000 originally estimated in the Policy Issues adopted by the City Council. This project is funded through contributions from the Utility Divisions into the Cumulative Reserve for Capital Improvement — Fund 392. The contribution amounts were anticipated by and included in the recent cost-of-service studies for the utilities. The total resources currently earmarked for the development and implementation portion of the project through 2010 is $1,219,475 calculated as follows: Year Wastewater Water Irrigation 392 Fund Balance Total 2008 $250,000 $75,000 $50,000 $44,475 $419,475 2009 250,000 100,000 50,000 400,000 2010 250,000 100,000 50,000 400,000 Total $750,000 $275,000 $150,000 $44,475 $1,219,475 The $419,475 in 2008 is currently budgeted and will be sufficient to fund the project through the end of the year. The remaining amounts will be budgeted in the appropriate years. If the project is completed in the one year estimated schedule, a larger appropriation may be required in 2009. If this is necessary, the appropriation amount for the-subsequent year will be reduced. The utility cost -of- service studies also include funding for the on -going annual rt maintenance costs. This Utility / Permitting project has been in the research and planning stage for nearly five years. The City staff has been extremely thorough in the development of the RFP requirements and the analysis of the resulting proposals. We believe that the choice of Paladin i i Data Systems Corporation and a cooperative system development process will best meet the City's system requirements. We are all looking forward to beginning this project and to start realizing the benefits of modem information systems for the Utility and Permitting Divisions. RESOLUTION NO. R -2008- A RESOLUTION authorizing and directing the City Manager for the City of Yakima to sign a contract with Paladin Data Systems Corporation for the development and implementation of computer application systems to support the Utility Billing, Customer. Services, Permitting, Code Administration, Business License, Complaints, Accounts Receivable, and Public Portal functions of the City of Yakima. WHEREAS, The existing computer systems that support the Utility Billing, Customer Services, Permitting, Code Administration, and related functions of the City are all fifteen years and older, utilize obsolete technology, and lack many functional and efficiency advantages of current computer system technology; and WHEREAS, The City of Yakima has found it in the best interest of the. City to replace these existing computer application systems; and WHEREAS, The City of Yakima has utilized a Request for Proposal (RFP) process to identify the computer application systems and vendor that best fulfill the City's requirements for such systems, and WHEREAS, That RFP process determined that the proposal provided by Paladin Data Systems Corporation best satisfies those City requirements, and WHEREAS, Sufficient funds have been designated for the acquisition and implementation of the Utility Billing, Customer Services, Permitting, Code Administration, and related systems proposed by Paladin Data Systems Corporation, NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF E CITY OF YAKIMA: The City Manager for the City (or designee) is hereby authorized to sign contracts necessary for the City of Yakima to acquire and implement the Utility Billing, Customer Services, Permitting, Code Administration, and related systems proposed by Paladin Data Systems Corporation. ADOPTED BY THE CITY COUNCIL this 15 day of July, 2008. David Edler, Mayor ATTEST: City Clerk • SOFTWARE LICENSE AND PROFESSIONAL SERVICES AGREEMENT THIS SOFTWARE LICENSE AND SERVICES AGREEMENT ( "Agreement ") is between PALADIN DATA SYSTEMS CORPORATION, a Washington corporation, ( "Paladin "), and the CITY OF YAKIMA, a Washington municipal corporation ( "Customer "). The terms of this Agreement will apply to each Software license granted by Paladin under this Agreement, which will be identified on the Order Form. The Effective Date will be the date of the last signer of this Agreement. In consideration of the mutual promises, covenants, and conditions set forth below, the receipt and adequacy of which are hereby acknowledged, the parties to this agreement hereby agree as follows: 1. Definitions. Unless specifically identified differently elsewhere in this agreement, terms will be defined and interpreted as follows: 1.1 "Acceptance" means the earlier of: (a) notification by Customer that the Software is in compliance with the Specifications or (b) use of the Software by Customer for at least 30 days for any purpose other than testing, unless Customer has notified Paladin that Software does not meet the Specifications. 1.2 "Delivery Date" means the date on which Paladin delivers the Software to Customer as set forth in Section 13.13 herein, or if no delivery is necessary, the date Customer first uses the Software. 1.3 "Designated Center" means the computer hardware operating system, customer - specific application(s), customer - specific relational database(s) at the geographic location designated on the Order Form. • 1.4 "Designated Support Contact" means the contact person or group designated by Customer on the Order Form who will coordinate all Support requests to Paladin. 1.5 "Desupport" means that Paladin withdraws maintenance and support for a software module or release for customers using that module or release, as specified in EXHIBIT D. 1.6 "Documentation" means the user guides and manuals for installation and use of the Software. Documentation may be provided in CD -ROM, DVD or printed form. 1.7 "Error" means a reproducible defect in the Supported Program or Documentation when operated on a Supported Environment which causes the Supported Program not to operate substantially in accordance with the Documentation or Specifications. 1.8 "Go -Live Date" means the date the Customer begins using a Software module in a production environment. This date is reset if the Software module is removed from production to correct errors and subsequently put back into production. 1.9 "License Fee" means the fee(s) payable by Customer pursuant to SECTION 9 - PAYMENT PROVISIONS and as set forth in the EXHIBIT A - ORDER FORM. 1.10 "Object Code" means the Software (not including the Documentation) in a form that results from the translation or processing of the Source Code by a computer into machine language or intermediate code. An Object Code copy of the Software is appropriate for execution or interpretation by a computer. 1.11 "Order Form" means the form attached as EXHIBIT A - ORDER FORM by which Customer orders Software licenses and services. The Order Form will reference the Effective Date and be governed by the 4111 terms of this Agreement and will be agreed to and signed by both parties. • CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION — INTERNAL REVIEW DRAFT - 4/24/08] 1.12 "Resolution" means a modification . or workaround to the Supported Program and /or Documentation and /or other information provided by Paladin to Customer intended to resolve an Error, as specified in EXHIBIT D. 1.13 "Source Code" means the human - readable version of the Software (not including the Documentation) in the form in which the Software was developed, that may be compiled or interpreted into equivalent Object Code. 1.14 "Software" means the specific software referenced in the Order Form attached as EXHIBIT A - ORDER FORM, additional Order Forms as may be added to this Agreement in the future, and any and all software created by Paladin resulting from the services provided under EXHIBIT C - PALADIN PROFESSIONAL SERVICES. Software includes the Object Code form distributed by Paladin for which Customer is granted a license pursuant to this Agreement. and all associated Source Code, Paladin proprietary development tools, media, Documentation and any Updates thereto. 1.15 "Specifications" means the functional and operational characteristics of the Software as set forth EXHIBIT B — SPECIFICATIONS. 1.16 "Support" means ongoing support provided by Paladin pursuant to the terms of this Agreement, including EXHIBIT D. "Supported Program" or "Supported Software" will mean the then - current version of the Software for which Customer has paid the then- current Support Fee, the immediately prior version of such Software, and any version of the Software released less than 18 months before the current version. 1.17 "Support Fee" means the fee(s) payable by Customer pursuant to SECTION 9 - PAYMENT PROVISIONS, EXHIBIT A - ORDER FORM, EXHIBIT D - SUPPORT POLICIES, and as set forth in any additional Order Forms subsequently added to this AGREEMENT. 1.18 "Support Hours" means 8:00 AM to 5:00 PM, Pacific Time. Monday through Friday, excluding 411 holidays, as specified in EXHIBIT D — Support Policies. 1.19 "Support Period" means the period during which Customer is entitled to receive Support on a particular Supported Program, in accordance with EXHIBIT A and EXHIBIT D - SUPPORT POLICIES. 1.20 "Supported Environment" means the configurations of hardware and releases of the operating software and platforms as specified in EXHIBIT E and as updated by mutual agreement of the parties that the Current Release of the Software will run on and for which Paladin provides Support for use with the Supported Program. 1.21 "Update" means a subsequent release of the Software that Paladin generally makes available for Supported Software licensees at no additional license fee other than shipping and handling charges. Update will not include any release, option or future product that Paladin licenses separately unless such product replaces the Supported Software product and Paladin withdraws support from the previously Supported Product in which case the release, option, or future product will be considered an Update for the purpose of this Agreement. Paladin will provide Updates for the Supported Programs to Customer as and when developed. Paladin will support an Update in accordance with their then current Release Policy, attached hereto as EXHIBIT D - SUPPORT POLICIES. If Paladin renames a program for which Customer has obtained a license, and Paladin either (i) makes another program generally available under a different name as a replacement and /or successor for the discontinued program which has substantially similar functionality as the discontinued program, or (ii) splits the program into two or more separately named and /or priced programs, then Customer will be entitled to receive the replacement and /or successor program or programs as an update to the renamed program, without payment of additional fees, provided that Customer is current on its Support obligations for such program, to the extent that such replacement and /or successor program does not include any substantially different functionality. If Paladin discontinues a program for which Customer has obtained a license, so that the program is no longer generally available, and Paladin makes another program generally available as a replacement and /or successor for the discontinued program which has substantially similar functionality as the discontinued program, Customer will be entitled to receive the replacement 2 • • CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION – INTERNAL REVIEW DRAFT – 4/24/08] and /or successor program as an update to the discontinued program, without payment of additional fees, provided that Customer is current on its Support obligations for such program, to the extent that such replacement and /or successor program does not include any substantially different functionality. 2. SOFTWARE LICENSE. 2.1 General. The parties to this Agreement expressly acknowledge that: (i) the Software is the property of and embodies the proprietary trade secret technology of Paladin or has been licensed to Paladin; (ii) any other use other than expressly licensed under Section 2.2 hereof is strictly prohibited. 2.2 Rights Granted. Subject to the terms and conditions of this Agreement and in consideration of the payment by Customer of the License Fee in accordance with Section 9 below, Paladin hereby grants to Customer a perpetual, non- exclusive, non - transferable (except as provided by Section 2.7) and non - assignable license to: (i) use, reproduce, publicly perform and display the Software (in Object Code form) and Documentation at the Designated Center; (ii) and provide services to other public entities as specified in EXHIBIT F — POLICIES FOR PROVIDING SERVICES TO OTHER AGENCIES. Customer's rights with respect to the Source Code form of the Software are set forth in Section 2.8 below. 2.3 . Designated Center. Customer may relocate the Designated Center, in its sole discretion so long as Customer (i) provides prompt notice to Paladin and (ii) installs the Software on a Supported Environment. 2.4 Limited License. Customer agrees that, except as otherwise provided in this Agreement, it will not (i) disassemble, decompile or reverse engineer the Software or create any derivative works based thereon; (ii) sublicense, lease, distribute or enter into any time share or service bureau arrangement with respect to the Software except as specified in EXHIBIT F - POLICIES FOR PROVIDING SERVICES TO OTHER AGENCIES (iii) assign this Agreement, including without limitation any license granted hereunder, without the prior written • consent of Paladin; (iv) export the Software to any foreign country without Paladin's prior written consent; and (v) allow any third party other than Customer to use the Software or Documentation except as specified in EXHIBIT F – POLICIES FOR PROVIDING SERVICES TO OTHER AGENCIES (except that any member of the public may use the portions of the Software intended for public use). 2.5 Interfaces. Customer may create interfaces between the Software and other software systems such that data and functions may be shared among Customer software systems. Such Interfaces must be developed by Customer employees and must not expose the Software to any third party. Interfaces, when combined with the Software, are not part of the Software and do not release Customer of any responsibilities listed in SECTION 2.4 - LIMITED LICENSE of this AGREEMENT. 2.6 Not a Sale. Customer understands and agrees the Software is licensed and not sold. This Agreement does not constitute a "first sale" under copyright law. 2.7 Transfer. Customer may transfer the Software within its organization upon notice to Paladin. 2.8 Source Code. 2.8.1 Paladin will provide Customer with one copy of the Source Code. Paladin agrees that the Source Code will contain all information necessary to enable a reasonably skilled programmer or analyst to understand, maintain, use and correct the Object Code. 2.8.2 Customer may access and use the Source Code as indicated below 2.8.3 Paladin hereby grants to Customer a non - exclusive, worldwide, perpetual, paid in full license, to install, use, copy, and modify the Source Code • 2.8.4 The following restrictions will apply to the Source Code held by Customer: (i) Customer will not copy the Source Code other than as necessary for installation on Customer's equipment and for backup 3 CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION — INTERNAL REVIEW DRAFT - 4/24/08] copies on Customer's equipment, (ii) Customer will keep the Source Code in a secure, safe place when not in use, (iii) Customer will use the Source Code only in accordance with the terms of this Agreement, and for the purposes of support, maintenance and interfaces of the Software, (iv) Customer will not distribute the Source Code to any third parties, and (v) Customer will be obligated to use reasonable efforts to maintain the confidentiality of the Source Code in accordance with Section 10. 3. SUPPORT SERVICES. Paladin will provide Support Services to Customer under the terms of this AGREEMENT and in accordance with EXHIBIT D - SUPPORT POLICIES. 4. PROFESSIONAL SERVICES. 4.1 Professional Services. Paladin will provide Professional Services to Customer under the terms of this Agreement and in accordance with the descriptions and schedules contained in EXHIBIT C - PALADIN PROFESSIONAL SERVICES. Professional Services will be provided both from Paladin's principal place of business and at Customer's facilities as necessary. 4.2 Travel. Paladin will at a minimum travel to Customer site the number of times and for the duration indicated in the SOFTWARE DEVELOPMENT AND IMPLEMENTATION PROJECT SCHEDULE contained in EXHIBIT C — PALADIN PROFESSIONAL SERVICES. 4.3 Implementation Services. As part of these Professional Services, Paladin will provide the Implementation Services for the Permitting, Inspection Code Administration, Inspection Assistant, Business License, Animal License, Complaints, Public Portal and Receivables /Cash Receipting modules of the Software as described and scheduled in EXHIBIT C — PALADIN PROFESSIONAL SERVICES. 4.4 Implementation Services Results. The Implementation Services will enable: 1) the Software to 411 meet the specifications contained in EXHIBIT B — SPECIFICATIONS; 2) the Software to be fully operational and running successfully in production mode at Customer's site; and 3) Customer's staff to be fully trained in both the operational and administrative functions of the Software. 4.5 System Development Services. Paladin will provide the System Development Services for the Utility Billing & Customer Services system, as described and scheduled in EXHIBIT C — PALADIN PROFESSIONAL SERVICES. 4.6 System Development Services Results. The System Development Services specified in EXHIBIT C will enable: 1) the Utility Billing & Customer Services system to meet the Specifications; 2) the Utility Billing & Customer Services system to be fully operational and running successfully in production mode at Customer's site; and 3) Customer's staff to be fully trained in both the operational and administrative functions of the Utility Billing & Customer Services system. 4.7 Documentation. Paladin will provide complete operational and administrative documentation for the Permitting, Inspection Code Administration, Inspection Assistant, Business License, Animal License, Complaints, Public Portal and Receivables /Cash Receipting modules and the Utility Billing & Customer Services system in the Documentation. 5. CUSTOMER RESPONSIBILITIES. 5.1 Communications Equipment. Customer will at its sole expense, install (or enable Paladin to install) and maintain communications equipment that will permit Paladin to have encrypted VPN access to Customer's Computer System. 4 CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION — INTERNAL REVIEW DRAFT — 4/24/08] 4111 5.2 Site Condition. Customer will maintain site conditions that conform to common industry standards for its type of computer systems and /or media devices. 5.3 Records. Customer will create and maintain timely, accurate and readable electronic back -ups of all data, program and system files and will maintain such file for at least thirty days. 5.4 Computer Virus Protection. Customer will, at its own expense, install and periodically update a computer virus program to protect its Computer System and database from computer viruses that may from time -to- time be transmitted or downloaded. Paladin will not be responsible for any computer viruses not introduced into Customer's computer system from the Software or Paladin provided computer data or media or Paladin access to Customer. 5.5 Security. Customer will, at its own expense, protect the security of its Computer System and prohibit unauthorized access to the Computer System. 6. TERM AND TERMINATION. 6.1 Term. This AGREEMENT and each Software License granted under this AGREEMENT will continue indefinitely unless terminated in accordance with this SECTION 6 - TERM AND TERMINATION. 6.2 Agreement Termination by Customer. Customer may terminate this AGREEMENT at any time upon written notice if Paladin materially breaches this AGREEMENT and fails to correct the breach within thirty (30) days following written notice specifying the breach or such longer period as may be required to cure a breach so long as Paladin is diligently pursuing the cure; however, termination will not relieve Customer's obligations to pay all fees that have accrued or are otherwise owed by Customer under any Order Form that is part of this AGREEMENT and Customer's license to the Software under Section 2 will continue for any such Software for which Customer has provided payment. 6.3 Agreement Termination by Paladin. Paladin may terminate this AGREEMENT upon written notice if Customer materially breaches this AGREEMENT and fails to correct the breach within thirty (30) days following written notice specifying the breach or such longer period as may be required to cure a breach so long as Customer is diligently pursuing the cure. Other than the right to cancel Support Services, Customer is not entitled to any cure period in the event of a breach of the provisions of SECTION 9 - PAYMENT PROVISIONS of this AGREEMENT: however, termination will not eliminate or suspend any licensing rights or professional services products already accrued to Customer. 6.4 Effect of Agreement Termination as a result of Customer's Default. Termination of this AGREEMENT or any license will not limit Paladin's right to pursue other remedies available to it, including without limitation, obtaining injunctive relief. 6.5 Effect of Agreement Termination as a result of Paladin's Default. Termination of this AGREEMENT or any license will not limit Customers right to pursue other remedies available to it, including without limitation, obtaining injunctive relief. 6.6 Termination of Support Services. Customer may terminate any or all Support Services without affecting any license or other rights to use the Software as may have accrued to Customer. 6.7 Termination of Licenses. Customer may terminate the use of the Software Licenses at any time. Upon termination of the Software Licenses, Customer will cease using, and will return or destroy, all copies of the applicable Software and Documentation within thirty (30) days. 6.8 Survival. The parties' rights and obligations in Sections 2, 7, 8, 10, 11, 12 and 13 will survive the termination of this Agreement. • 5 • CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION — INTERNAL REVIEW DRAFT — 4/24/08] 7. INDEMNITY, WARRANTIES, REMEDIES. 7.1.1 Indemnity • (a) Paladin will defend and indemnify Customer from and against liability, costs, damages and fees, including but not limited to fees of attorneys and other professionals ( "Liabilities ") incurred by Customer resulting from the infringement or violation by the Software of any valid patent, copyright, trademark, trade secret or other proprietary right. (b) Customer agrees to: (i) promptly give Paladin written notice of any claim; and (ii) give Paladin full authority, information and assistance and sole control over the defense /settlement of such claim. (c) If a third party claim against Customer results in a judicial order preventing Customer from using the Software, Paladin, in its sole discretion, but only after consultation with Customer, may: (i) procure from such third party the right to allow Customer to continue to use the Software; (ii) modify or replace the Software or infringing portions thereof to become non - infringing. If neither (i) nor (ii) are commercially reasonable under the circumstances Customer may elect to receive a full refund of the applicable License Fees and the Professional Services Fees related to the development and implementation of the affected Software but retains its right to pursue other available remedies. (d) In any action, Customer may elect to appear through counsel of its own choosing and at its sole expense. Paladin will not be responsible for any settlement made by Customer without Paladin's written permission, which will not be unreasonably withheld. (e) Paladin's obligation to defend, indemnify and hold Customer harmless for claims of infringement may be limited to the extent that a claim of infringement is based on (a) Customer's unauthorized modification of the Software and the alleged infringement would not have occurred but for such unauthorized modification, (b) Paladin's strict compliance with the written designs or specifications supplied by Customer and such compliance is the direct cause of the alleged infringement, (c) Customer's combination of the Software with products or services not reasonably contemplated by Paladin and the alleged infringement would not have occurred but for such combination, or (d) Customer's failure to adhere to Paladin's instructions for the use and maintenance of the Software and the alleged infringement would not have occurred but for such failure. 7.1.2 Limited Software Warranty. Paladin warrants for a period of ninety (90) days from the GO -LIVE DATE ( "Warranty Period "), Paladin represents and warrants to Customer that the Software will function in all material respects in accordance with the Specifications. PALADIN DOES NOT WARRANT THAT THE SOFTWARE WILL BE ERROR -FREE OR WILL PERFORM WITHOUT INTERRUPTION, THE SOFTWARE WILL NECESSARILY MEET CUSTOMER'S REQUIREMENTS; OR ANY ERROR CAN OR WILL BE CORRECTED. Customer shall give Paladin prompt written notice of any claim under the foregoing warranty; and in such event, Paladin's sole obligation shall be to use its reasonable commercial efforts to modify or repair the Software to conform to the Specifications. The foregoing warranty will not apply to the extent that any alleged defect derives from (i) a combination of the Software with any program, equipment or device not supplied by Paladin not described in or contemplated by the Specifications; (ii) any modification or customization of the Software by or on behalf of Customer that is not provided by or expressly agreed to by Paladin, (iii) Customer's failure to use a currently supported version of' the Software provided at no cost to Customer or (iv) failure of a third party software component. Paladin warrants any Professional and Support Services provided hereunder will be of the highest quality and performed in a professional and workmanlike manner in accordance with generally accepted industry practices. Paladin further warrants that all Software resulting from any Professional Services will function in all material respects in accordance with the Documentation and Specifications. 6 CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION — INTERNAL REVIEW DRAFT — 4/24/08] • 7.1.3 Media Warranty. Paladin warrants the tapes, diskettes or other media to be free of defects in materials and workmanship under normal use for ninety (90) days from the Delivery Date. Customer's sole and exclusive remedy for breach of the media warranty will be to require Paladin to replace defective media returned within ninety (90) days of the Delivery Date. 7.1.4 Virus Free Warranty. Paladin will scan with commercially available virus detection software all media and digital information including data 'files, programs, and all other information resulting from services under this AGREEMENT and placed on Customer's data network and computers. Paladin warrants that any computer data, media and services provided to Customer as part of this AGREEMENT are free of any detectable viruses and other forms of malware. Paladin will be responsible for rectifying any problems, repairing any damage, and reimbursing any reasonable costs that may result from detectable viruses or malware introduced into Customer's computers systems by detectable viruses or malware in Paladin provided computer data, media, or services. 7.1.5 Hardware Warranty Pass - Through. Paladin disclaims any warranty on hardware provided as part of or in association with this agreement or sale. Paladin agrees that any hardware Paladin provides to Customer under this Agreement will be obtained from reputable and well known industry and will include commercially appropriate and reasonable warranties. Any manufacturers' warranty available for pass- through to Customer will be passed through to Customer by Paladin. 7.1.6 Disabling Code. Paladin represents and warrants that it has not included or embedded any disabling code or devices within the Software and will make all reasonable efforts to ensure no such code gets included or embedded. 7.1.7 Ownership and Authority. Paladin warrants that it has full power and authority to grant the licenses and the rights granted under this AGREEMENT to Customer with respect to the Software without the fa consent of any other person. Neither the license to and use by Customer of the Software (including the copying thereof) nor the performance of the Services by Paladin will in any way constitute an infringement or other violation of any copyright, trade secret, trademark, patent, or other intellectual rights of any third party. 7.1.8 Disclaimer of Warranties. Paladin gives and makes no representation or warranty of any kind, express or implied other than those expressly set forth in this SECTION 7..No representative of Paladin is authorized to give or make any other representation or warranty or modify the warranty provided herein in any way. Without limiting the foregoing, no implied warranty or merchantability, no implied warranty of fitness for any particular purpose, and no implied warranty arising from usage or trade, course of dealing, or course of performance is given or made by Paladin or will arise by or in connection with this Agreement, and in no event will Paladin have any liability or obligation whatsoever in connection with any such warranty. 8. LIMITATION OF LIABILITY. To the extent permitted by law, and except for indemnity obligations arising under Section 7, Paladin's aggregate cumulative liability for damages arising out of or related to this Agreement (whether arising from contract, tort, or otherwise) will in no event exceed the amount of License, Professional Services, and Support fees and Hardware costs paid by Customer under this Agreement. Neither party will be liable to the other for any indirect, special, incidental, punitive, or consequential damages, whether based upon contract, tort, and any other legal theory, arising out of or related to this Agreement. 9. PAYMENT PROVISIONS. 9.1 Invoicing. All License, Professional Services and Support Fees will be invoiced. by Paladin in accordance to the terms set forth in EXHIBIT A - ORDER FORM, EXHIBIT D — SUPPORT POLICIES, and the III SOFTWARE DEVELOPMENT AND IMPLEMENTATION SCHEDULE in EXHIBIT C - PALADIN PROFESSIONAL SERVICES, and as may be amended from time to time with written agreement from both parties. 7 CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION — INTERNAL REVIEW DRAFT - 4/24/08] Payments are due within 30 days from receipt of an invoice expressly authorized by an Order Form and will be ISO made without deductions based on any taxes or withholdings. Any amounts not paid within thirty (30) days will be subject to interest of the lower of the legal interest rate or one percent (1 %) per month, which interest will be immediately due and payable except that Customer may challenge any invoiced amount they believe is inaccurate and /or for which delivery of specified services /products in unsatisfactory to Customer. In such case, Customer may withhold payment and no penalties of any nature will apply. 9.2 Payments. All payments made by Customer will be in United States Dollars and directed to: Paladin Data Systems Corporation 19362 Powder Hill Place NE. Poulsbo. WA 98370 Attn: Accounts Receivable 9.3 Taxes. The fees listed in this AGREEMENT or the Order Form do not include Taxes. For all payments due to Paladin by Customer under the terms of this Agreement, Paladin agrees to collect and Customer agrees to pay, indemnify and hold Paladin harmless from, any sales, use, transaction, excise, import export, value added or similar tax or duty, and any other tax not based on Paladin's net income( "Taxes ") as well as penalties, interest and all government permit fees, license fees, customs fees and similar fees levied upon the delivery of the Software or other deliverables which Paladin may incur in respect of this AGREEMENT. Paladin agrees to remit any Taxes paid by Customer to the appropriate taxing authority in a timely manner. Further, Paladin agrees to separately state on all invoices all charges and applicable Taxes. 10. OWNERSHIP AND CONFIDENTIALITY. 10.1 Ownership. Customer acknowledges that all patents, copyrights trademarks. trade names, trade secrets and any other intellectual property rights subsisting in or used in connection with any Software. Documentation or other materials provided by Paladin under this AGREEMENT are and will remain the exclusive - property of Paladin, or its third -party licensors, and Customer will not remove or alter any copyright, trademark or other proprietary notice on any Software or Documentation or other materials provided by Paladin under this AGREEMENT. Customer agrees (except as required by law) to (i) reproduce Paladin's copyright and trademark notices on any copy (whether in machine readable or human readable form) of the Software, Documentation or any other materials provided by Paladin under this AGREEMENT; and (ii) notify Paladin immediately if Customer becomes aware of any unauthorized use in whole or part of the Software. Documentation or any other materials provided by Paladin under this AGREEMENT, by any third party. Nothing in this AGREEMENT will be construed to create a "work made for hire," and no Software will be a "work made for hire." • 10.2 Confidentiality. Paladin represents that the Software is its valuable, proprietary information and that it maintains the Software as a trade secret. Customer agrees to use reasonable efforts to maintain the confidentiality of the Software, subject to the requirements of the Washington State Public Disclosure Act, RCW 42.56, or other applicable law. 11. INSURANCE. 11.1. -In General. Paladin will maintain sufficient insurance coverage to enable it to meet its obligations created by this Agreement and by law. Without limiting the foregoing, Paladin will obtain the following lines of coverage (with minimum limits of One Million U.S. Dollars (US$1,000,000.00) per occurrence) to the extent this Agreement creates exposures generally covered by these insurance policies: Commercial General Liability (Occurrence Form), Automobile Liability, Workers' Compensation (statutory limits), and Employer's Liability. Paladin will name Customer, its subsidiaries, and their respective directors, officers and employees as additional insured's under such policy to the extent of contractual liability assumed by Paladin in this Agreement. 11.2 Additional Requirements. In addition, if the Work consists of, includes, or results in any intellectual property; or Paladin's performance of the Work constitutes such professional consulting services as 8 CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION — INTERNAL REVIEW DRAFT - 4/24/08] 4111) system development, design, or maintenance; or technical support; financial services, then Paladin will maintain Professional Liability and Errors & Omissions Liability Insurance with policy limits of not less than Two Million U.S. Dollars (US$2,000,000.00) each claim with a deductible of not more than One Hundred Thousand U.S. Dollars (US$100,000.00). Paladin will maintain such insurance to include coverage for infringement of any proprietary • right of any third party, including copyright, trade secret, and trademark infringement as related to Paladin's performance under this Agreement with a retroactive coverage date no later than the Effective Date. Upon expiration or termination of this Agreement, Paladin will maintain an active policy, or purchase an extended reporting period providing for claims first made and reported to the insurance company within one (1) year after Customer's final payment for the Work. 11.3 Proof of Coverage. Upon request, Paladin will deliver to Customer proof of such insurance coverage. In the event that Paladin's proof evidences coverage that Customer reasonably determines to be less than that required to meet Paladin's obligations created by this Agreement, then Paladin will promptly acquire such coverage and notify Customer in writing. , 12. DISPUTE RESOLUTION. 12.1 Negotiation. In the event a dispute arises over the interpretation or application of any provision of this AGREEMENT or the grounds for termination, the parties shall meet within ten (10) working days of a request • by one or both parties to resolve the dispute by negotiation. The parties shall act through the appropriate officers with full decision- making authority to promptly resolve the matter in good faith with a cooperative, problem - solving approach. If within ten (10) working days after the first meeting, the parties have not resolved the dispute, either party may request that they extend the time for negotiation for fifteen (15) additional working days with the objective of achieving final resolution. 411 12.2 Mediation. In the event a dispute exists relating to the interpretation or performance of this A GREEMENT or the grounds for its termination and after compliance with the negotiation required in Subsection 12.1, the parties shall enter into mediation in accordance with Subsection 12.2. The party requesting mediation of the dispute must notify the other party in writing of the requesting party's intent to seek mediation by a third -party who is an expert ( "Expert") in the subject and technology under dispute. Each party must, within fifteen (15) working days after such notification, submit its position regarding the dispute in writing to the other party. If within fourteen (14) days after each party has submitted its position to the other the dispute is not resolved, the parties shall mutually select an independent Expert in a joint letter of appointment to the Expert. The Expert shall render a written decision containing an analysis and explanation of the decision within fifteen (15) working days or, where necessary, twenty (20) working days of his/her receipt of the joint letter of appointment from the parties. A party may not unreasonably withhold consent to the selection of an Expert. Any person who is a current or former employee, agent, representative, shareholder or subsidiary of either party, or relative of one, or a current or former consultant for either party or relative of one, is not eligible to serve as the Expert. The parties shall share equally the costs of the Expert and the mediation. 12.3 Post - Mediation Alternative. If the parties are not able to resolve the dispute through mediation in Subsection 12.2, they may agree to use another form of alternative dispute resolution including arbitration. The parties shall share equally the costs of the arbitrator. 12.4. Confidentiality. All discussions and documents prepared pursuant to the attempt to resolve a dispute under Section 12 are confidential and for settlement purposes only and shall not be admitted in any court or forum as an admission or otherwise against a party for any purpose including the applicability of Federal and State court rules. 12.5. Statute of Limitations. The parties agree to toll any applicable statutes of limitations during the pendency of any of the above dispute resolution proceedings. • 9 CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION — INTERNAL REVIEW DRAFT — 4/24/08] 12.6. Judicial Remedies. Nothing in SECTION 12 — DISPUTE RESOLUTION will prevent any party from seeking equitable remedies in a judicial proceeding if interim relief from a court is necessary to preserve the status quo pending resolution or to prevent serious and irreparable injury to that party or others. 13. MISCELLANEOUS. 13.1 Export Restrictions. The U.S. Export Administration Regulations permit the exportation from the United States under General License G.T.D.R. of technical data (as such term is defined and used in the Regulations) relating to certain commodities. including the Software provided the exporter has obtained certain written assurances from the foreign importer. Accordingly, Customer hereby gives its assurance, in regard to any United States - origin technical data (including the Software) that, unless prior authorization is obtained from the United States Office of Export Administration, Customer will not knowingly export or re- export, or knowingly permit the re -export of, the Software or any technical data relating to the Software, directly or indirectly, (a) to any country to which the U.S. has embargoed or restricted the export of goods or services, which include. but are not necessarily limited to, those countries listed in Country Groups D:I or E:2 of the Export Administration Regulations, 15 C.F.R. Pt. 740 (Supp. No. 1), or to any national of any such country who Customer knows intends to transmit or transport the Software or any technical data relating to the Software to such country; (b) to any end user who Customer knows will use the Software or any technical data relating to the Software in the design, development or production of nuclear, chemical or biological weapons; or (c) to any end user who has been prohibited from engaging in export transactions with U.S. persons under applicable U.S. laws. 13.2 Notices. All notices, including notices of address change, required to be sent hereunder will be in writing and will be deemed to have been given three (3) business days following the date when mailed by first class mail postage prepaid or the next business day if sent by nationally recognized overnight courier to the addresses listed below: If to Paladin, then to: Paladin Data Systems Corporation 19362 Powder Hill Place NE Poulsbo, WA 98370 Attn: Chief Financial Officer Fax: 360- 779 -2600 . If to Customer, then to: Office of the City Clerk City of Yakima City Hall 129 North Second Street Yakima. Washington 98901 Attn: City Clerk Fax: 509 -576 -6365 To expedite order processing. Customer agrees that Paladin may treat documents faxed by Customer to Paladin as original documents. 13.3 Force Majeure. Neither party will be liable hereunder by reason of any failure or delay the performance of its obligations hereunder (except for the payment of money) on account of strikes, shortages, riots, 10 CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION — INTERNAL REVIEW DRAFT — 4/24/08] • insurrection, fires. Flood, storm. explosions, acts of God, war, governmental action, labor conditions, earthquakes, material shortages or any other cause which is beyond the reasonable non - financial control of such party. 13.4 Assignment. Neither this AGREEMENT nor any rights or obligations of either party hereunder may be assigned in whole or in part without the prior written approval of the other party, which approval will not be unreasonably withheld. Paladin's rights and obligations, in whole or in part under this AGREEMENT may be assigned by Paladin following any merger or acquisition of or by Paladin with another entity. However, any such assignment may be grounds for Customer to terminate this AGREEMENT without cause or penalty. If Customer initiates termination for reason stated above, Customer will pay Paladin amount due for services and products provided up to the date the termination notice is provided to Paladin. In such an event, Customer will retain all licensing and rights to use Software as Customer has accrued up to the point of termination. 13.5 Waiver. The failure of either party to require performance by the other party of any provision hereof will not affect the right to require such performance at any time thereafter: nor will the waiver by either party of' a breach of any provision hereof be taken or held to be a waiver of the provision itself. 13.6 Severability. In the event that any provision of this AGREEMENT will be unenforceable or invalid under any applicable law or court decision, such unenforceability or invalidity will not render this Agreement unenforceable or invalid as a whole and, in such event, any such provision will be changed and interpreted so as to best accomplish the objectives of such unenforceable or intended provision within the limits of applicable law or applicable court decisions. 13.7 Law, Jurisdiction and Venue. This AGREEMENT and all matters arising out of or relating to this AGREEMENT, will be governed by, and construed and enforced in accordance with the internal laws of the State of Washington without regard to its conflicts of laws rules. Any action at law, suit in equity or other judicial proceeding arising out of this AGREEMENT must be instituted and maintained only in a court of competent • jurisdiction located in Yakima County, Washington. 13.8 No Agency. Nothing contained herein will be construed as creating any agency, partnership or other form of joint enterprise between the parties. 13.9 Headings. The section headings appearing in this AGREEMENT are inserted only as a matter of convenience and in no way define, limit, construe or describe the scope or extent of such Section or in any way affect such section. 13.10 Counterparts. This AGREEMENT may be executed simultaneously in two or more counterparts, each of which will be considered an original but all of which together will constitute one and the same instrument. 13.11 Disclaimer. The Software is not specifically developed or licensed for use in any nuclear, aviation, mass transit or medical application or in any other inherently dangerous applications. Customer agrees that Paladin and its suppliers will not be liable for any claims or damages arising from Customer's use of the Software for such applications. • 13.12 Personnel. Paladin will assign Dan Ellis, Kelly Luna, Burt Smith, and Aliene Chase as their project core team members. While other Paladin personnel will also contribute to the project, these team members have the primary responsibility of working directly with the Customer personnel. Any changes of personnel in this project core team will require approval of both parties to this agreement which approval will not be unreasonably withheld. 13.13 Customer Reference. Paladin may refer to Customer as a customer in sales presentations, marketing vehicles, and activities. Such activities may include, but are not limited to: a press release issued within sixty (60) days of the Effective Date of the Agreement and a Customer user story completed by Paladin upon implementation of the Software. • 11 CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION — INTERNAL REVIEW DRAFT — 4/24/08] 13.14 Delivery. The parties agree that delivery is deemed to have occurred when the Software has been received by Customer. Paladin will not deliver any product without prior notification to and authorization from Customer. Customer accepts no responsibility or liability for any loss or damage to or caused by any product shipped without Customer's prior written or e -mail authorization from either the Customer's Information Systems Manager or the Designated Support Contact or prior to Customer's receipt. 13.15 Entire Agreement. This AGREEMENT, applicable Order Form(s), together with any exhibits completely and exclusively state the agreement of the parties. In the event of any conflict between the terms of this AGREEMENT and any exhibit hereto, the terms of this AGREEMENT will control. In the event of any conflict between the terms of this AGREEMENT and any Order Form, the individualized terms of such Order Form will control, provided Customer has agreed to such terms and executed the Order Form. Pre - printed terms on Customer's purchase order, if any, will be of no effect. This Agreement supersedes, and its terms govern all prior proposals, agreements or other communications between the parties oral or written, regarding the subject matter of this AGREEMENT. This AGREEMENT will not be modified except by a subsequently dated written amendment signed by the parties and any "pre- printed" terms on a Customer purchase order or other document purporting to supplement the provisions hereof will be void. 13.16 Time of performance is of the essence and a substantial and material term of this AGREEMENT. 4 0 12 CONFIDENTIAL ATTORNEY CLIENT PRIVILEGED COMMUNICATION — INTERNAL REVIEW DRAFT — 4/24/08] • EXHIBIT LIST: EXHIBIT A - ORDER FORM EXHIBIT B — SPECIFICATIONS EXHIBIT C - PALADIN PROFESSIONAL SERVICES, SOFTWARE DEVELOPMENT AND IMPLEMENTATION PROJECT SCHEDULE EXHIBIT D - SUPPORT POLICIES EXHIBIT E - HARDWARE AND DATABASE SPECIFICATIONS EXHIBIT F - POLICIES FOR PROVIDING SERVICES TO OTHER AGENCIES IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized representatives. PALADIN DATA SYSTEMS CORPORATION CUSTOMER: Signature Signature el Robert Johnston Richard A. Zais, Jr. Chief Operating Officer City Manager Date Date Attest: City Clerk • 13 0 EXHIBIT A - ORDER FORM Agreement Information Paladin Software Corporation Software License and Professional Services Agreement Agreement Effective Date: Date of Last Signer of the Agreement Customer Name: City of Yakima Purchase Order Number: Delivery Date: To Be Determined Customer Telephone Number: (509) 575 -6098 Designated Support Contact: Corinne Choy Contact's E -Mail Address: cchoy @ci.yakima.wa.us This Order Form ( "Order Form ") is placed in accordance with and will be governed by the terms of the Agreement ( "Agreement ") specified above. Customer hereby orders the Software Licenses, Professional Services, Support Services, and Travel & Incidental Expenses for use as follows: A: SOFTWARE LICENSES Al - Paladin Permitting System, Inspection Code $ 100, 000.00 less 100% discount of $100,000, Net price $0 Administration, Inspection Assistant, Business License, Unlimited Named User License Animal License, Complaints, Public Portal, and Receivables /Cash Receipting Modules. A2 - Oracle Software as specified in EXHIBIT E — HARDWARE $70,000 plus applicable Washington State sales tax AND DATABASE SPECIFICATIONS. B: SOFTWARE IMPLEMENTATION SERVICES B1 - Server Configuration, Software Configuration Analysis. $65,500 plus applicable Washington State sales tax. Application Software Configuration, Data Conversion, Report Configuration, System Delivery, Configuration Acceptance This is fixed cost including all services, travel, and Support, System Testing, Training, Go Live Support, and miscellaneous costs. Acceptance as specified in EXHIBIT C — PALADIN PROFESSIONAL SERVICES — SECTION C2 SOFTWARE IMPLEMENTATION SERVICES. C: SYSTEM DEVELOPMENT SERVICES Cl - Needs Analysis, Requirements Specification, Build Test $493,500 plus applicable Washington State sales tax. & Migrate Data, Transition into Production, System Testing, Go Live Support, and Acceptance as specified in EXHIBIT C — This is fixed cost including all services, travel, and PALADIN PROFESSIONAL SERVICES — SECTION C3 SYSTEM miscellaneous costs. DEVELOPMENT SERVICES. 0 Page l of 15 • • e • D: ANNUAL SUPPORT FEES D1 - Support Fees are based on the current License Fee of the Supported Program. Fees do not include applicable sales tax. Fees are billed in accordance with SECTION 9 — PAYMENT PROVISIONS of the AGREEMENT. The Annual Support Fees include Technical Support, Update Subscription Service, and Product Support, as described in EXHIBIT D — HUPPORT POLICIES. The Support Fees defined below include support for the Paladin Permitting System, Inspection Code Administration, Inspection Assistant, Business License, Animal License, Complaints, Public Portal, Receivables /Cash Receipting, and Utility Billing /Customer Services modules. D2 - Oracle Database & Development Tool Annual $15,500 Maintenance The initial annual Oracle Maintenance Fee will be paid to Paladin at the annual rate of $15,500. In all subsequent years, the annual maintenance fee will be billed to the Customer by Oracle and paid directly to Oracle by the Customer. D3 - Initial Paladin Support Fee — to be prorated based on an To be calculated at time of Software Acceptance- . annual fee of $106,500. - to be prorated based on an annual fee of $106,500. . The initial Paladin Support Fee will be as follows: At Permitting & Licensing System Go -Live Date, the 90 day Limited Software Warranty will take effect and no Support Fees will be charged. After the 90 days, $25,000 will be prorated through January 31' of the next calendar year and invoiced. At Utility Billing & Customer Service System Go -Live Date, t he 90 day Limited Software Warranty will take effect and no Support Fees will be charged. After the 90 days, $81,500 will be prorated through January. 31 of the next calendar year and invoiced. D4 - First Five Years Annual Paladin Support Fees $106,500 per year The Annual Paladin Support Fee for each year beginning February 1st of the calendar year following Customer Acceptance of the Software, for the initial five years of this . Agreement. D5 - Subsequent Years Annual Paladin Support Fees To be calculated at Software Support Services renewal. The Annual Paladin Support Fees for years subsequent to the first five years will be Paladin's then current published rates for the Support Services as provided in EXHIBIT D — SUPPORT POLICIES AT D2.2. DESIGNATED CENTER: City of Yakima - 129 North Second Street, Yakima WA 98901 • • • Page 2 of 15 • EXHIBIT B — SPECIFICATIONS 0 B1. Literature. Any publicly available formal literature, descriptions, drawings, and technical criteria, including physical operating, timing, maintenance, compatibility and modularity characteristics provided to the City by Paladin. B2. Request for Proposal. City of Yakima Request for Proposal (RFP) #10512. B3. Paladin Response. Paladin's December 2, 2005 response to the Customer RFP #10512 dated September 7, 2005. B4. Additional Specifications. Additional specifications to be developed based on the Detailed Needs Analysis and Detailed Requirements Definition, Software Development and Testing Phases of the Professional Services described in EXHIBIT C — PALADIN PROFESSIONAL SERVICES. Such mutually agreed specifications will become a part of this EXHIBIT B — SPECIFICATIONS and will be included here by reference. B5. Priority. For any inconsistencies in the above documents, the order of precedence from highest to lowest is B4, B3, B2, and B1. • O Page 3of15 EXHIBIT C - PALADIN PROFESSIONAL SERVICES C1. OVERVIEW. C1.1 Overview. Paladin will provide to Customer under the terms of this AGREEMENT the professional services as described in this EXHIBIT C — PALADIN PROFESSIONAL SERVICES and the attached EXHIBIT A - ORDER FORM. Additional ORDER FORMS may be added to this AGREEMENT when agreed in writing by both Customer and Paladin. C2. SOFTWARE IMPLEMENTATION SERVICES. C2.1. Software Implementation. Paladin will provide to Customer implementation services for the Permitting, Inspection Code Administration, Inspection Assistant, Business License, Animal License, Complaints, Public Portal, and Receivables /Cash Receipting modules (Application Software) in accordance with and subsequent updates of the attached SOFTWARE DEVELOPMENT AND IMPLEMENTATION PROJECT SCHEDULE. C2.2. Server Configuration. Customer will order the Computer Server hardware and operating system in accordance with EXHIBIT E — HARDWARE AND DATABASE SPECIFICATIONS and have it shipped directly to Paladin. Paladin will order the Oracle Data Base and Development Tools and other third -party software in accordance with EXHIBIT E — HARDWARE AND DATABASE SPECIFICATIONS. Paladin will load onto the Computer Server the operating system, Oracle database and development tools, and other third party software and configure appropriately. C2.3. Software Configuration Analysis. Paladin will visit Customer's site for one week, or as necessary, to analyze the Customer's application software needs. The Paladin analyst will conduct interviews with subject matter 411 experts (SME) from each application area. The analyst will leave data collection tools with each SME and will train the SME in the use of the tools. Customer staff will utilize the data collection tools to collect and transmit the required data to Paladin over the next several weeks. Paladin will review data and provide feedback to assure the highest possible quality data to use in system configuration. The results of this Software Configuration Analysis will become part of EXHIBIT B — SPECIFICATIONS of this AGREEMENT. C2.4. Application Software Configuration. Paladin will load onto the Computer Server the Source Code and Object Code of the Application Software. Paladin will make any programming changes and configuration settings necessary to make the Software meet the Specifications resulting from the Detailed Needs Analysis. C2.5. Data Conversion. Paladin will convert the data from Customer's current applications into the appropriate format and Toad the data into the Software's database. Customer will perform data extraction and create data files in a mutually acceptable format. C2.6. Report Configuration. Paladin will configure the Software's standard reports to meet Customer's requirements and properly reflect Customer's name and naming conventions. C2.7.. System Delivery. Paladin will deliver the Computer Server with the properly configured Software and assist Customer install the Computer Server and configure the data communications network to properly function within Customer's environment. C2.8. Configuration Acceptance Support. Paladin will, at Customer's site, assist and support Customer's personnel to verify the Software's proper operations and compliance with the Specifications. Paladin will make any additional programming and configuration changes to correct any problems discovered during this Configuration Acceptance process. Customer will perform Acceptance of the Software configuration upon completion of the Configuration Acceptance process. C2.9. System Testing. Paladin will, in conjunction with the Customer, thoroughly test the Software to include field, module, function, system and interface testing. • Page 4 of 15 C2.10. User, Administration, and Inspector Training. Paladin will, at Customer's site, provide separate and 4110 appropriate training sufficient to satisfy the Customer's requirements for Customer's Software Office Users, System Administrators, and Code, Building, and Fire Inspectors. C2.11. Go Live Support. Paladin will, at Customer's site, provide go live support during the first five days production operation, or as necessary, to assure the proper use of the Software by Customer's personnel and to assure the proper operation of the Software. Paladin will perform a final data conversion to ensure the. Application Software Database contain the most current data. Paladin will correct any configuration, programming, or training problems discovered during the go live process. C2.12. Acceptance. The Customer will perform Acceptance in accordance with Section 1.1. C2.13. Software Implementation Costs. Paladin will utilize approximately four hundred (400) professional services hours to configure and implement the Software. Approximately two hundred (200) of these hours will be on -site at the Customer's premises. Paladin will spend 5 to 6 weeks at Customer's location for on -site services. Total Software implementation cost will be $65,500 plus appropriate sales tax. This is a fixed cost including all services, travel, and miscellaneous cost for SOFTWARE IMPLEMENTATION SERVICES. C2.14. Software Implementation Schedule. Paladin will provide the Software Implementation Services in accordance with and subsequent updates of the schedule on page 2 of the SOFTWARE DEVELOPMENT AND IMPLEMENTATION PROJECT SCHEDULE within this EXHIBIT C — PALADIN PROFESSIONAL SERVICES. C2.15. Customer Responsibilities. Customer will perform the tasks as indicated in the Project Schedule and will make the appropriate personnel available to assist Paladin perform their tasks at Customer's site and via phone and electronic communications during off -site tasks. C3. SYSTEM DEVELOPMENT SERVICES O C3.1 Utility Billing /Customer Service System. Paladin will develop and implement a Utility Billing / Customer Services (UB /CS) system for Customer in accordance to the specifications in EXHIBIT B — SPECIFICATIONS of this AGREEMENT. C3.2 Utility Billing /Customer Services Development. Paladin will utilize the procedures identified in C3.1 through C3.12 to develop and implement the UB /CS System. C3.3 Needs Analysis. Paladin will review the requirements included in Customer's RFP 10512 and Paladin's response to that RFP, will review Customer's current systems and procedures, and will interview all appropriate Customer personnel. As a result of these activities, Paladin will produce two documents. One will be the Development Plan which will include the Development Scope and a Detailed Development Timeline with Activities. The other will be the Requirements Document which will include the definition of Major Application Areas, Functional Requirements per Area, and Non - Functional Requirements. Upon approval of Customer, these documents will become part of EXHIBIT B — SPECIFICATIONS of this AGREEMENT. C3.4 Requirements Specification. Paladin will perform a thorough analysis of the Specifications, will further refine the system Requirements, and will begin prototyping the UB /CS application system. As a result of this process, Paladin will produce three products. They will be: a. A more extensive and refined Requirements Document b. User Interface Prototype containing Example Screen Functionality c. A more extensive and refined Development Plan Upon approval of Customer, these documents will become part of EXHIBIT B — SPECIFICATIONS of this AGREEMENT. C3.5 Build, Test, Migrate Data. Paladin will program the UB /CS System and, with the assistance of Customer, migrate the data and thoroughly test the application system to assure it meets the Specifications. Paladin will perform this process on a Paladin computer. As a result of this process, Paladin will produce five products. They are: a. Application Model including the Data Model, Screen Designs, Report Designs, and Major Logic Flows. Page 5of15 • • • • b. Test Plan for Customer approval including detailed test scenarios. c. Testing Results including Completed Test Cases and summary of Testing Report, d. Functional Application ready for deployment e. Deployment Plan Upon approval of Customer, the documents will become part of EXHCBIT B — SPECIFICATIONS of this AGREEMENT and the UB /CS Application System will be approved for deployment. C3.6 _ Transition into Production. Paladin will install the UB /CS Application System on the Computer Server, and perform Final Testing, User Acceptance Testing, and User Training. The User training will include a minimum of eighty-four (84) on -site hours and the Administrator training will include a minimum of twelve (12) on- site hours. Paladin will provide a User Training Manual and an Administrator's Training Manual for this training. As the result of this process, Paladin will provide a Deployed Application, User and Administrator Training Manuals, and User Documentation. C3.7. 'System Testing. Paladin will, in conjunction with the Customer, thoroughly test the Software to include field, module, function, system and interface testing C3.8 Go -Live Support. Paladin will, at Customer's site, provide on -site support during the first five days from the GO -LIVE DATE, or as necessary, to assure the proper use of the Software by Customer's personnel and to assure the proper operation of the Software. Paladin will perform a final data conversion to ensure the Application Software Database contain the most current data. Paladin will correct any configuration, programming, or training problems discovered during the Go -Live process. C3.9. Acceptance. The Customer will perform Acceptance in accordance with Section 1.1. Paladin can then invoice Customer for the final payment for the UB /CS Application System. C3.10. System Development Costs. Paladin will utilize approximately sixty-four hundred (6400) professional services hours to develop and implement the UB /CS Application System. Approximately six hundred (600) of these hours will be on -site at the Customer's premises. Paladin will make approximately fifty (50) trips to Customer's location for a total of approximately one hundred (100) staff days of on -site services. Total UB /CS system development and implementation services costs will be $493,500 inclusive of all services, travel, and miscellaneous costs. This is a fixed cost for UB /CS Application System development and implementation. C3.11 Software Implementation Schedule. Paladin will provide the Software Implementation Services in accordance with and subsequent updates of the schedule on page 1 of the Project Schedule. This schedule may change after the Needs Analysis and periodically thereafter according to Customer or project needs. Any schedule change will become part of the Development Plan and must be approved by both parties to this Agreement which approval will not be unreasonably withheld by either party. Completion and delivery of contracted deliverables ahead of schedule is acceptable and, upon acceptance, constitutes an approved change of schedule. C3.12 Customer Responsibilities. Customer will perform the tasks as indicated in the Project Schedule and will make the appropriate personnel available to assist Paladin perform their tasks at Customer's site and via phone and electronic communications during off -site tasks. C4. INVOICING AND PAYMENTS. C4.1 Invoicing Schedule. Paladin may invoice Customer in accordance with the amount, plus any applicable Washington State Sales Tax, as indicated and updated periodically in the Project Schedule and upon delivery and Customer Acceptance of the Deliverables specified in the Project Schedule. C4.2 Customer Payments. Customer will pay Paladin in US Dollars for all undisputed invoices within 30 days, of receipt of the invoice at Customer Accounts Payable department. • Page 6 of 15 • Exhibit C - Paladin Professional Services 0 Software Development and Implementation Project Schedule Line Functions Deliverables Week Number 0 ©©© 4 5 6 7 8 9 10 m® 13 14 15 16 17 18 19 20 21 MOM 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 m�� ® ®mmm 57 58 59 60 mmmm 1 Order Deliver Com•uterServer 15 000 �MM —�M_ .— i-_._---. 3 Order Deliver Oracle Software 70 000 Min - `M— . .. —.... 4 Annual Maintenance for Oracle $15,500 . . — ... -.... 5 Total Oracle Costs 1 85 500 .- _. --... I_ �- ______. I 7 UM Customer Services S stem 1 == =�- =-'= . _. --... 8 Needs Anal sis .— .'_. —..-- 9 Kickoff Meetin. . -PM =M ._.'_- ----- 10 Meetin•s & Interviews .— .-_. ----- 11 Sco.in. & Requirements 1111 an m m Warran Period • 12 Create Develo. ment Plan Mill 1111 a= lm .— .._ ---.. 13 Deliver Requirements Document MIN N MIM NM .— _ --..- 14 Development Plan and 1 M. I 76 000 Needs Anal sls Invoice El - ---.- j 15 Requirements Document I MINI IN 1 1 . — .. .. 1 = 16 R- • uirements S. • - ification .11. MI .— - ----. 1___ 17 Refine Re•uirernents 1.11. -� .— - ----- 18 Protot .e User Interface MEI MME_ ■ ._.-_ ----- 19 Desi• n Data Model MIMI MIIMM_ '— .— .-_ ----- 20 Desi•n A. •lication Model MIMI — .- - ----- �M . 21 Refine Develo .ment Plan M� a— IM�Yr IMIEM ���— 22 User Interface Prototype •Ill MM. 99 000 Re uirements Invoice M— .a - -IIMMIEN 23 Build, Test, Migrate Data MEI Ell .— - -.--. 24 Baseline the Specifications I ME . Mil 25 Build Application I 1 liami . _ —MIME. I 26 Create Test Cases I . -_1111 I 27 Functional Testin. 28 A • • lication Model MO NM= Mill '.- -- - -.... 29 Testin • Results and MON MEM 216 000 Build Test Mi • rate Invoice MMIN. 30 Functional A • • licat/on •• Min -- .-_ —..-- 32 Transition into Production M- OM — `- = =:= == 32 Final System Testing ME 33 User Acceptance Testing 1 M� .-- 34 User Training I M� -�.... 1_ 35 Product Delive . - ----- '6 Customer Acce.tance ME MEIN --- '— ---- •7 Su..ort Be.ins 102 500 81 500 38 De • lo ed A • •lication Trainin • MN MEM Transition to Production Invoice Su • • ort and 39 Manuals & User Documentation •• Mai —IMMI Maintenance Invoice 40 M. —��M 41 Cumulative Utility Invoices $100 500 176 �� — �� �� 6 500 275 500 491 500 594 000 • 675 500 42 1 MIE MIMI MM. . - --- - -- 43 Week Number 0 1 ©© 4 5 6 7 8 9 mm® 13 14 15 16 17 18 19 20 21 ®® 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 m 46 47 48 49 50 51 ®® 54 55 56 57 58 59 m 61 62 63 m 44 MM. UM ME _ - -__ _ —M 45 * Customer will • urchase Server direct) from manufacturer and shi. to Interlockin• EEO - - -.. . —. 46 ** This is support for the Utility System. The initial .ayment will beprorated in accordance with Exhibit A - Section D. _ 47 * ** Payments include all associated travel charges. 1 1 7 1 1 ) 1 1 L 1 1 1 1 1 1 1 1 1 Project Schedule Page 1 of 3 Exhibit C - Paladin Professional Services "I Software Development and Implementation Project Schedule 48 [ I I I L 49 Week Number 50 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52_53_54 55 56 57 58 59 60 61 62 63 64 51 Permiting & Licensing Systems 52 Configuration (at Customer) 532 750 Startup Invoice I I , 53 Server Configuration I I 54 Implementation Kickoff Meeting I 55 Identify Users & Roles 1 56 Establish Data Collection I I 57 Scope Reports 1 1 58 Scope Interfaces 1 1 59 Send Configuration Data I 1 1 60 Configure Hardware (at Interlocking) _ 61 Acquire Hardware Warranty Period 62 Install Software _ 63 Setup Baseline Application 1 1 1 64 Enter Configuration Data I 1 1 65 Customization 1 1 I 66 Create Standard Reports 1 i I . 67 Create Additional Reports 1 1 1 _ 68 Create Parcel Interface 1 1 1 _ 69 Create Financial Interface I 1 1 _ _ 70 Create GIS Interface 71 Validation 1 1 I 72 System Install & Setup 1 ' 1 73 Train Users for Validation 1 74 Users Validate Configuration 1 1 75 Users Validate Reports i I I 76 Users Validate Legacy Data 1 I I- 77 Users Validate Financial Data 1 1 1 78 Users Validate GIS Data 1 I I 79 Resolve Testing Issues 1 I I _ 80 Go Live 81 Install Inspection Assistant 1 I I 82 Train Users _ I 11.11I I 83 Go Live _ I 1 84 On -site Go Live Support 1 1 5 Follow UP 1 1 I 6 Discoverer Training 1 87 Install Public Portal 1 I 1 88 Validate Public Portal 89 Turn On Public Portal 1 1 90 I I I I 91 Customer Acceptance I 32,750 Final Invoice 25 000 Su Sport & Maintenance 92 Support Begins I 1 93 1 I I _ 94 Cumulative Permitting Invoices $32,750 $65,500 590,500 95 I I I I I I 96 * This is support for the Permitting & Licensing S stem. The initial payment will be prorated in accordance with Exhibit A - Section D. _ 97 98 99 Week Number 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 _47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 100 Project Schedule Page 2 of 3 Exhibit C - Paladin Professional Services Software Development and Implementation Project Schedule 101 1 1 1 1 102 _ Week Number 103 0_ 1 _ 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 _22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 _ 104 105 Utility Development Phases Startup Needs Analysis Requirments Specifications Build, Test Migrate Data Transition into Production 106 $15,000 Computer ' 76 000 Development • $99 000 Development Development 216,000 in Development $102,500 107 $85,500 Oracle I ( 1 1 1 1 1 I 1 1 1 1 1 1 1 1 1 1 1 1 1 Support $81,500 108, 1100,500 Total • S76 000 Total in, S99 000 Total Total $216,000 111 Total • $102,500 Total $81,500 , 109 110 111 Utility Cumulative Total $100,500 1111 $176,500 1M 275,500 $491,500 $594,000 $675,500 IN 112 113 114 Week Number 115 0 1 2_ 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 116 117 Permiting Implementation Phases Start Up Final Support & Maintenance 118 II $32 750 IN $32 119 II $25,000 120 Permitting Cumulative Total • $32 750 II $65 500 $90,500 121 122 123 Cumulative Project Totals Week Number 124 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 171 181 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 125 126 Cumulative Computer Hardware , $15,000 Hardware $15,000 Hardware $15,000 Hardware $15,000 Hardware $15,000 $15 000 Hardware $15,000 127 Cumulative Oracle $85,500 Oracle $85,500 Oracle _ $85,500 Oracle $85,500 Oracle $85,500 $85,500 Oracel $85,500 128 Cumulative Utility Invoices Utility II $76,000 Utility , $175,000 Utility $175,000 Utility $391,000 lir $493,500 II Utility $493,500 129 Cumulative Permitting Invoices • $32,750 Permitting $32,750 Permitting r 65 500 Permitting $65,500 Permitting $65,500 $65,500 Permitting _ $65,500 130 Cumulative Support & Maintenance Support Support Support $25,000 Support S25 000 $25 000 Support $106,500 131 I I I I I I I 1 ) I 1 I _ 1 1 1 132 Protect Cumulative Total El $133,250 II $209,250 M $341,000 $366,000 $582,000 ME $ M $766,000 M 111 Project Schedule Page 3 of 3 • EXHIBIT D - SUPPORT POLICIES D1. OVERVIEW. D1.1. Overview. Paladin Support Services include Updates Subscription Service, Technical Support Services, and Product Support as defined below in SECTION D2 — SUPPORT SERVICE LEVELS and will be provided in . accordance with the polices described in this EXHIBIT D — SUPPORT POLICIES. These Paladin Support Services are limited to Paladin Software that is within the Warranty Period or for which Customer has contracted for Paladin Support Services. D1.2. License Set. A license set consists of all licenses that Customer owns of a program and all licenses of any programs which are technically dependent, e.g., Database and Options or Applications and Options. D1.3. Policy Changes. These Technical Support policies are subject to change only at renewal and require a sixty-day notice of change before Support Service Renewal. Paladin can Desupport the Software provided under this Agreement only at renewal and must provide at least 60 days notice of such cancellation and comply with the, requirements of section D1.7 below. D1.4. Support Period. Except for the initial support period, which may be defined to be the period set forth n the Order Form of Exhibit A, Paladin Support Services pricing reflects a 12 month support period (the "support period "). D1.5. Reinstatement of Support. In the event that Support Services lapses or was never originally procured, a . reinstatement fee may be assessed upon the commencement of Support Services, as specified below. In order to reinstate Support Services for licenses not currently available on the Paladin price list, customers must first migrate 40 their program licenses to currently available licenses. D1.6. Cancellation. All technical support services acquired for a support period are non - cancelable during that support period by either party to this agreement and non - refundable. Customer may cancel Support Services at • renewal time by Notifying Paladin in writing or by rejecting the annual Support Services invoice. D1.7. Right to Desupport. Paladin reserves the right to desupport its programs. Desupport can only occur at Paladin Support Services renewal and Paladin must provide Customer sixty days notice. If Paladin is desupporting a Software product because it is being replaced by a new software product, that new Software Product must be provided to Customer at no additional charge. If Paladin desupports any version of the Software, Paladin must continue to provide support for the prior version of the Software and any version of the Software released within 18 months of the then - current version of the Software. D2. SUPPORT SERVICE FEES AND TRAVEL COSTS. D2.1. Initial Support Service Fees. Paladin Support Services will be initially invoiced in accordance with SECTION 9.2 — PAYMENT PROVISIONS of this AGREEMENT. Annual Support Fees will be as specified in EXHIBIT A ORDER FORM for the first five years. These fees include all three Support Service Levels as defined in SECTION D3 - SUPPORT SERVICES LEVELS below for all Software Licenses included in EXHIBIT A — ORDER FORM of this AGREEMENT and for the Utility Billing / Customer Services system developed by Paladin under this AGREEMENT. D2.2. , Subsequent Support Service Fees. Annual Support Fees for year six (6) of this AGREEMENT and subsequent years will be at Paladin's then current published rates or will increase at no more than the Seattle Tacoma Bremerton CPI -W for the year ending in the June prior to the price increase which ever is lower. D2.3. Reinstatement Fees. The reinstatement fee is equal to 100% of the list price of Paladin Support Service ID Fees on Paladin's price list in effect at the time Paladin Support Services are ordered, prorated from the date the Paladin Support Service are being ordered back "to the date that the Paladin Support Services lapsed (or the license Page 7of15 order date if Paladin Support Services were never purchased). Once the reinstatement fee has been assessed, Paladin Support Services will be offered to Customer at Paladin's then current prices for support after reinstatement. • In the event that Product Support was not acquired with program licenses, and provided that customer has continuously maintained Updates Subscription Service, Product Support may be purchased at Paladin's then current prices for Product Support. If Product Support lapses, and provided that customer has continuously maintained Updates Subscription Service, Product Support may be repurchased after six months from the termination or lapse date. D2.4. Travel Costs. If correcting a problem that is the result of a system mal- function caused by Paladin in the supported Program requires Paladin to Customer's site, Paladin will pay for all travel and incidental costs incurred. If Paladin sends personnel to Customer site(s) to resolve problems resulting from Customers incorrect use of the Supported Software, Customer will be obligated to pay Paladin's reasonable travel and incidental expenses. D3. SUPPORT SERVICE LEVELS. D3.1. Included Support Services. Paladin will provide Subscription Service, Technical Support Services, and Product Support for the first five years at the fees listed in EXHIBIT A — ORDER FORM. Upon renewal of Support Services for year six (6) and subsequent years, Customer may select different levels of Support Services. D3.2. Updates Subscription Services. Updates Subscription Services include 1) Program Updates, 2) Patches, 3) General Maintenance Releases, 4) Functional Releases. 5) Documentation Updates, 6) Access to Bug Fix Information and Patches, and assistance implementing the foregoing. All modifications and updates to the Software provided under this Section C1.3 must include provision to Customer of the corresponding Source Code. D3.3. Technical Support. Technical Support is provided for problems that are demonstrable in the current • release(s) of a Paladin licensed program, running unaltered or with Paladin approved modifications on an appropriate hardware and operating system configuration as specified in the EXHIBIT E — HARDWARE AND DATABASE SPECIFICATIONS or as may be modified with future releases of the Software. Technical Support includes support for problems resulting from conflicts between Paladin Software and any third party software provided or approved by Paladin and part of the Paladin approved system configuration. Current Paladin product release information is accessible via Paladin's webbed customer support system (WWW.ILSC.US). D3.4. Product Support. Product Support includes 1) Ability to log Technical Assistance Requests (TARs), 2) Assistance with TARs, 3) Non - technical Customer Service, and 4) Operational Assistance. D3.5. Matching Service Levels. When acquiring Support Services, all licenses supported in any given License Set must be supported under the same technical Support Service Level, e.g., Updates Subscription Service or Updates Subscription Service and Product Support: Customer may choose to leave all licenses of a particular program within a License Set unsupported, but may not select varying levels of technical support for licenses within a License Set and may not desupport a subset of licenses in a License Set. D3.6. Unsupported Programs. Customers with unsupported programs do not receive updates, maintenance releases, patches, telephone assistance, or any other technical support services and may not purchase CD packs for the unsupported programs subsequent to the original CD pack purchase to obtain the licensed programs. D4. SOFTWARE UPDATES. D4.1. Software Updates. "Update" means a subsequent release of the Software which Paladin generally makes available for program licenses to its supported customers at no additional license fee, other than shipping charges, provided customer has ordered Paladin Support Services for such licenses for the relevant time period. Update will not include any release, option or future program which Paladin licenses separately unless such product replaces the functionality of Customer's currently licensed Software and Paladin has cancelled support for that licensed Software products. In such an event, Paladin will provide the new Software to Customer at no charge. Page 8 of 15 For any updates to the Software, Paladin will ship to the specified customer location one update copy, including corresponding Source Code and Documentation, for each operating system for which customer's program licenses were ordered. Customer will be responsible for copying and installing the updates. D4.2. Covered Software. These Software Update Policies apply to all Software provided by Paladin including both to the existing Paladin Permitting System, Inspection Code Administration, Inspection Assistant, Business License, Animal Control, Complaints, Public Portal, and Receivables /Cash Receipting modules and to Customer Services and Utility Billing modules developed by Paladin's Professional Services as described in EXHIBIT C PALADIN PROFESSIONAL SERVICES of this AGREEMENT. D4.3. Update Levels. There are three release levels: Major Release, Functional Release, and Maintenance Release. The following describes the differences between these release levels and sets out the associated support policy for each: • • Length of Time for Release Release Number Support of Prior Level Definition Distinction Current Release, and Type of • Support Provided Major Significant functional First digit number change Up to 12 Months - enhancements, architectural (3.x.x to 4.0.0) Production Critical changes, data migration, fixes only • cumulative fixes 4110 Functional Functional enhancements, Second digit change • Up to 6 Months cumulative fixes (3:0.0 to 3.1.0) Production Critical fixes only Maintenance Cumulative fixes Third digit change Up to 90 Days - (3.1.0 to 3.1.1) Focus on workaround solution Current Paladin product release information is accessible via Paladin's webbed Customer support system (WWW.ILSC.US). D5. SEVERITY DEFINITIONS AND PALADIN RESPONSE. D5.1. Severity Definitions. _ TARs are defined as individual problems referred by customers to Paladin. Paladin support center analysts categorize TARs identified by customers into one of the following Severity Levels: D5.2.1. Severity Level 1. The problem causes complete loss of service. Work cannot reasonably continue, the operation is mission critical to the business and the situation is an emergency.. A Severity 1 problem has one or more of the following characteristics: • • Data corrupted • A critical function is not available • System hangs indefinitely, causing unacceptable or indefinite delays for resources or response • System crashes, and crashes repeatedly after restart attempts D5.2.2. Level 1 Response. Paladin provides a 24 Hour Commitment to Severity 1 TARs: Paladin will work 24x7 until the issue is resolved or as long as useful progress can be made. Customer must provide Paladin with a 1111 contact during this 24x7 period, either on site or by pager, to assist with data gathering, testing, and applying fixes. Customers are requested to propose this classification with great care, so that valid Severity 1 situations obtain the necessary resource allocation from Paladin. Page 9of15 D5.3.1. Severity Level 2. The problem causes a severe loss of service. No acceptable workaround is available; 411 however, operation can continue in a restricted fashion. D5.3.2. Level 2 Response. Paladin will devote technical support resources during normal business hours to Severity 2 TARS. Paladin will work on the issue during normal business hours until it is resolved or as long as useful progress can be made. Paladin will prioritize work on Level 2 TARS below Level 1 TARS, but above Level 3 and Level 4 TARS. Customer must make available to Paladin staff who are knowledgeable with the TAR during this resolution period. D5.4.1. Severity Level 3. The problem causes minor loss of service. The impact is an inconvenience, which may require a workaround to restore functionality. D5.4.2. Level 3 Response. Paladin will devote technical support resources during normal business hours to Severity 3 TARS. Paladin will work on the issue during normal business hours until it is resolved; a workaround is identified, or as long as useful progress can be made. Paladin will prioritize work on Level 3 TARS below Level 1 TARS and Level 2 TARS, but above Level 4 TARS. Customer must make available to Paladin staff who are knowledgeable with the TAR during this resolution period. D5.5.1. Severity Level 4. The problem causes no loss of service. The result is a minor error, incorrect behavior, or a documentation error that does not impede the operation of a system. D5.5.2. Level 4 Response. Paladin will devote technical support resources during normal business hours to Severity 4 TARS. Paladin will work on the issue during normal business hours until it is resolved; a workaround is identified, or as long as useful progress can be made. Paladin will prioritize work on Level 4 TARS below Level 1 TARS, Level 2 TARS and Level 3 TARS. Customer must make available to Paladin staff who are knowledgeable with the TAR during this resolution period. D6. CUSTOMER RESPONSIBILITIES. D6.1. Customer Designated Technical Contacts. Customer may designate one primary and one backup individual ( "technical contact ") per license set, to serve as liaisons with Paladin. With each US$250,000 in net support fees per license set, customer has the option to designate an additional two (2) primary and four (4) backup technical contacts. Customer's designated technical contacts are the sole liaison between Customer and Paladin for technical support of programs. To avoid interruptions in support services, customer must notify Paladin whenever its technical contact responsibilities are transferred to another individual. D6.2. Customer CPU Support Identification (CSI) Number or Local Country Equivalent. Customers will receive a CPU Support Identification ( "CSI ") number when purchasing Paladin Support Services. The CSI number assists Paladin's technical support representatives to identify the following customer information when a customer calls a Paladin support center: • Company Name and Address • Program Set and Version • Technical Support Level and Duration • Technical Contact Information • License Set To locate your CSI number, check the following documents: • The Welcome Letter inside the Support Welcome Pack following purchase of a Paladin Software Support Service • The packing slip of the Support Welcome Pack Page l0 01'15 • D6.3. Information Customers Need When Requesting Support. Before Paladin can begin work on any Technical Assistance Request ( "TAR "), information about the nature and location of the .problem is required. Whenever a call is placed to a Paladin support center, the following information should be provided: • The CSI number or PC registration number • The area code and phone number listed under the CSI number • FAX (phone) number including area code • Operating system (including version) on which Paladin programs are installed • The Paladin program component and version number that the TAR concerns • The relevant program version(s) • Any program error numbers associated with the TAR • • Detailed description of the problem • D6.4 Access to Personnel and Equipment. Customer, will provide Paladin with access to Customer's personnel and its equipment during Support Hours. This access must include the ability connect via a VPN connection over the internet from Paladin facilities to the equipment on which the Supported Programs are operating and to obtain access to the equipment necessary to perform the support. Customer will provide Paladin with the choice of either a software or hardware VPN client at Customer's expense. Paladin will be responsible for the actual installation of the VPN client and making appropriate changes to Paladin's internet firewall to allow the required outbound VPN protocols. Customer will provide all configuration parameters and phone support with installation. Paladin agrees to direct its employees not to access areas of Customer's premises or computer network other than those specifically designated. Paladin must receive Customer's permission before accessing Customer's equipment. D7. CONTACT INFORMATION. D7.1. Contact Information. As of the Effective Data of this AGREEMENT, the Paladin Support Services I. contact information is: Paladin Data Systems Corporation 19362 Powder Hill Place NE Poulsbo, WA. 98370 360.779.2400 Paladin will notify Customer in writing at least thirty (30) days prior to changing contact information or processes. Additional contact information also may be found on the Paladin Software website at www.ILSC.us Page 11 of 15 EXHIBIT E - HARDWARE AND DATABASE SPECIFICATIONS 410 El HARDWARE SERVER SPECIFICATIONS E1.1 APPLICATION SERVER SPECIFICATIONS j Ap p l i ca tion S S i _ I Base Unit: Dual Core Xeon 5160 Processor 4MB Cache, 3.0GHz, 1333MHz FSBPE2950 (223 - 4926) !Processor: Dual Core Xeon 2nd Processor 5160, 4MB Cache, 3.00GHz 1333MHz FSB, PE 2950 (311 -6222) Memory: 4GB 667MHz (4XIGB), Dual Ranked Fully Buffered DIMMs (311 -6154) Video Card: LOM NICs are TOE Ready (430 -2968) Video Memory: Riser with 2 PCI -X Slots (3 Volts) and 1 PCIe Slot for PowerEdge 2950 (320 -4608) Hard Drive: 73GB 15K RPM Serial- Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (341 -3029) Hard Drive Controller: PERC 5 /i, x6 Backplane Integrated Controller Card (341-3066) Floppy Disk Drive: No Floppy Drive for x6 Backplane (341-3685) Operating System: Windows Server 2003 R2 Standard Edition with SP2 Includes 5 CALs (420 -7118) NIC: ONBOARD BROADCOM 5708 1GBE NETWORKING (430 -1764) CD -ROM or DVD -ROM Drive: 8X DVD -ROM for PowerEdge 2950 (313 -3933) Sound Card: Bezel for PE 2950 (313 -3920) Speakers: 1x6 Backplane for 3.5 -inch Hard Drives (311 -7936) Documentation Diskette: Electronic Documentation and OpenManage DVD Kit (310 -7415) Additional Storage Products: 73GB 15K RPM Serial- Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (341-3029) 1 Feature 'Integrated SAS /SATA RAID Level 1, PERC 6/i Integrated /SASE /iR (341 -5721) Feature I Universal Sliding RapidNersa Rails, includes Cable Management Arm (310 -7412) • Service: Dell Hardware Warranty Plus Onsite Service Inital YR (984 -1399) Basic Enterprise Support: Business Hrs 5X10 Tech Support 4HR Onsite Service Service: Post Problem Diagnosis !nit YR (970 -4100) Service: 1 Dell Hardware Warranty, Extended Year(s) (984 -1417) Service: Basic Enterprise Support: Business Hrs 5X10 Tech Support 4HR Onsite Service Post Problem Diagnosis 2YR Ext (960 -8212) Service: BASIC Enterprise Support: Business Hrs 5x10 Hardware Only Tech Phone Support, 3Yr, Declined Software Support (960 -8242) !Service: DECLINED CRITICAL BUSINESS SERVER OR STORAGE SOFTWARE SUPPORT PACKAGE -CALL YOUR DELL SALES REP IF UPGRADE NEEDED (989 -9208) Installation: On -Site Installation Declined (900 -9997) Misc: Redundant Power Supply with Dual Cords (310 -9905) Misc: 73GB 15K RPM Serial -Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (341-3029) I Misc: 73GB 15K RPM Serial -Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (341-3029) Misc: 300GB 15K RPM Serial- Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (341 -4424) Misc: 300GB 15K RPM Serial - Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (341 -4424) CFI,Information,Hard Drive,Install Increasing Order,Factory Install (361 -1722) CFI Titan Code for CFI FIDA orBypass SI (364 -1846) CFI Bypass EIDO (364 -7502) CFI Routing SKU (365 -0257) CFI,Rollup,Integration, OR -Raid 1,Without OS,Sery (366-4303) CFI,Information,Order Ready, 9104C1,Factory Install (372 -1457) CFI,Multi,lnformation, RAID Level 1, 2HD,Factory Install (361-6553) CFI,Multi,lnformation, RAID Level 1, 2HD,Factory Install (361 -6553) CFI,Multi,Information, RAID Level 11, 2HD,Factory Install (361 -6553) Page 12 of 15 • E1.2 DATABASE SERVER SPECIFICATIONS Database Server Specifications Base Unit: Dual Core Xeon 5160 Processor 4MB Cache, 3.0GHz, 1333MHz FSBPE2950 (223- 4926) 'Processor: Dual Core Xeon 2nd Processor 5160, 4MB Cache, 3.00GHz 1333MHz FSB, PE 2950 1 (311 -6222) 1 Memory: 4GB 667MHz (4XIGB), Dual Ranked Fully Buffered DIMMs (311 -6154) 1 Video Card: LOM NICs are TOE Ready (430 -2968) Video Memory: ( Riser with 2 PCI -X Slots (3 Volts) and 1 PCIe Slot for PowerEdge 2950 (320 -4608) Hard Drive: [73GB 15K RPM Serial -Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (341-3029) Hard Drive Controller: PERC 5 /i, x6 Backplane Integrated Controller Card (341 -3066) Floppy Disk Drive: 1 No Floppy Drive for x6 Backplane (341 -3685) Operating System: j Windows Server 2003 R2 Standard Edition with SP2 Includes 5 CALs (420 -7118) NIC: I ONBOARD BROADCOM 5708 1GBE NETWORKING (430 -1764) 1 CD -ROM or DVD -ROM Drive: 8X DVD -ROM for PowerEdge 2950 (313 -3933) Sound Card: Bezel for PE 2950 (313 -3920) Speakers: 1x6 Backplane for 3.5 -inch Hard Drives (311 -7936) 1 Documentation Diskette: I Electronic Documentation and OpenManage DVD Kit (310 -7415) Additional Storage 73GB 15K RPM Serial -Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (341-3029) Products: Feature Integrated SAS /SATA RAID Level 1, PERC 6/i Integrated (341 -5723) Feature ( Universal Sliding RapidNersa Rails, includes Cable Management Arm (310 -7412) ;Service: I Dell Hardware Warranty Plus Onsite Service Inital YR (984 -1399) Service: Basic Enterprise Support: Business Hrs 5X10 Tech Support 4HR Onsite Service Post Problem Diagnosis Init YR (970 -4100) Service: 1 Dell Hardware Warranty, Extended Year(s) (984 -1417) Service: Basic Enterprise Support: Business Hrs 5X10 Tech Support 4HR Onsite Service Post Problem Diagnosis 2YR Ext (960 -8212) 'Service: BASIC Enterprise Support: Business Hrs 5x10 Hardware Only Tech Phone Support, 3Yr, Declined Software Support (960 -8242) Service: DECLINED CRITICAL BUSINESS SERVER OR STORAGE SOFTWARE SUPPORT PACKAGE -CALL YOUR DELL SALES REP IF UPGRADE NEEDED (989 -9208) 1 Installation: I On-Site Installation Declined (900 -9997) Misc: I Redundant Power Supply with Dual Cords (310 -9905) 1 Misc: 173GB 15K RPM Serial -Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (3413029) 1 Misc: 173GB 15K RPM Serial -Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (341-3029) 1 Misc: 173GB 15K RPM Serial- Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (341 -3029) 1 Misc: 73GB 15K RPM Serial -Attach SCSI 3Gbps 3.5 -in HotPlug HardDrive (341 -3029) • Page 13of15 E1.3 ORACLE DATABASE SPECIFICATIONS Oracle Database Specifications Oracle Database Standard Edition is an affordable, full- featured database Oracle Standard for servers with up to four sockets. It includes Oracle Real Application Edition One- Clusters for higher availability, provides enterprise -class performance and Processor Plus security, is simple to manage, and can easily scale as demand increases. It Perpetual -2 is also upwardly compatible with Enterprise edition and can easily grow with you, protecting your initial investment Oracle Application Server offers a comprehensive solution for developing, integrating, and deploying your enterprise's applications, Oracle Internet portals, and Web services. Based on a powerful and scalable J2EE server, ;Application Server Oracle Application Server provides complete business integration and Enterprise Edition - Processor Plus business intelligence suites, and best -of -breed portal software. As the only !Perpetual -2 platform designed for grid computing as well as full lifecycle support for Service- Oriented Architecture (SOA), Oracle Application Server gives you unmatched scalability, availability, manageability, and security. • Page 14 of 15 • EXHIBIT F - POLICIES FOR PROVIDING SERVICES TO OTHER AGENCIES Fl. SERVICE PROVISION POLICIES F1.1. System Source. The additional users from the Other Agencies must log onto and use the same production installation of the InterLocking Suite of Software that the Customer's users log on to. F1.2. Location. The other Agencies must be located within Yakima County. F1.3. Population. The Other Agencies must not have a population of more than 10,000 F1.4. Professional Services. Paladin Professional Services must be used for configuration, data migration, and deployment of the Other Agencies. F1.5. Support Services. Each additional Other Agency must have a separate Paladin Support Services contract with Paladin. • 411 Page 15 of 15