Document:

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                                                                    EXHIBIT 10.9

                          QUALITY CARE SOLUTIONS, INC.

                     SOFTWARE LICENSE AND SUPPORT AGREEMENT

                                       AND

                            CONFIDENTIALITY AGREEMENT

THIS AGREEMENT IS MADE AND ENTERED INTO AS OF THE 23RD DAY OF MAY, 1996, BETWEEN
QUALITY CARE SOLUTIONS, INC. ("QCSI" OR THE LICENSOR"), AN ARIZONA CORPORATION
WITH EXECUTIVE OFFICES IN PHOENIX, ARIZONA AND MOLINA MEDICAL CENTERS INC., A
CALIFORNIA CORPORATION (THE WITH PRINCIPAL OFFICES IN LONG BEACH, CA (THE
"LICENSEE").
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                                TABLE OF CONTENTS

<TABLE>
<S>                                                                         <C>
DEFINITIONS...............................................................    3

THE LICENSE...............................................................    6

DELIVERABLES..............................................................    8

SUPPORT SERVICES..........................................................    9

SPECIAL RESPONSIBILITIES OF LICENSEE......................................   12

RESTRICTIONS..............................................................   13

WARRANTY, PATENT AND COPYRIGHT INFRINGEMENT,..............................   14

LIMITATIONS ON LIABILITY AND REMEDIES, AND LICENSEE'S LIABILITY...........   14

TERMINATION AND DISCONTINUANCE............................................   17

GENERAL PROVISIONS........................................................   18

SPECIFICATIONS OF QMACS SOFTWARE..........................................   23

CONFIDENTIALITY AGREEMENT.................................................   35

FEES, RATES AND PAYMENT SCHEDULES.........................................   39

HARDWARE/SOFTWARE ELEMENTS................................................   43

LOCATION AND NOTICES:.....................................................   44
</TABLE>

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                                   WITNESSETH

WHEREAS, Licensor has created and developed computer software which operates on
micro computers and mid-range computers for financial, administrative and
operational uses in the managed care business, health maintenance organizations
and by third party administrators and is willing to grant Licensee a non
exclusive license to use such Software in accordance with the terms and
conditions hereof; and

WHEREAS, Licensee owns, controls and/or operates a Managed Care Organization, a
Health Maintenance Organization, a Third Party Administrator or other health
care business and wishes to obtain a non-exclusive license to use the Licensors
Software, as specified hereinafter; and

WHEREAS, Licensee and Licensor desire to enter into an Agreement formalizing the
terms and conditions of a license, the supply of future software and related
support and other services (the "Agreement"); and

WHEREAS, Licensor and Licensee are considered each to be a "Party" to this
Agreement and are hereinafter jointly referred to as the Parties.

NOW, THEREFORE, in consideration of the promises and mutual representations
herein contained, the Parties hereto agree to as follows:

                                   ARTICLE I.

                                   DEFINITIONS

      "AGREEMENT FEES" shall mean any fee specified on Exhibit C.

      An "APPLICATION" is defined as one or more Client Executables designed to
      accomplish a specified business function as listed in Exhibit A.

      An "APPROVED CLIENT" is defined as a computer whose hardware and software
      configuration have been approved by Licensor as appropriate to execute the
      Client portions of the QMACS(TM) Software.

      An "APPROVED DATA SERVER" is defined as a computer whose hardware and
      software configuration have been approved by Licensor as appropriate to
      execute the Data Server portions of the QMACS(TM) Software.

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      "APPROVED HARDWARE" means Approved Data Servers, Approved Clients and
      Approved Operating Systems.

      An "APPROVED OPERATING SYSTEM" is defined as a Microsoft's WindowsNT(TM)

      AUTHORIZED LOCATION(S) means those locations where the Software is
      authorized to be installed as specified on Exhibit _______.

      A "BENEFIT PLAN" is any reimbursement plan administered by an
      administrator that has members and pays claims.

      A "BILLING MONTH" is defined as a monthly period for which the Licensor
      and Licensee agree to for billing purposes.

      A "CLIENT" is defined as a computer used generally by staff personnel,
      which communicates with one or more Data Servers and runs Client
      Executables to access, analyze and update databases stored on a Data
      Server.

      A "CLIENT EXECUTABLE" is defined as a program which is part of the
      Software designed to execute on a computer operating as a Client on a
      network connecting to and utilizing a Data Server.

      "DATA BASE ADMINISTRATION" is defined as the Licensor's activities to
      maintain on the Approved Data Server data table definitions, views, user
      defined data types, triggers, stored procedures and other attributes of
      the data base definitions integral to the Software.

      A "DATA SERVER" is defined as a computer used to hold large amounts of
      electronic data plus provide database management and access services to
      Client computers on a computer network. Portions of the QMACS(TM) Software
      reside on the Data Server.

      A "DERIVATIVE WORK" means any modifications of QMACS(TM) Software or a
      work which is based upon the QMACS(TM) Software code, either source or
      object, or which requires the QMACS(TM) Software to function.

      "DOCUMENTATION" is defined as manuals, training tapes, training workbooks,
      help screens, quick reference guides and other written information that
      explains the Software and its operations.

      "EXECUTABLE CODE" is defined as a program which is part of the Software
      and actually performs the functions in conjunction with the Client or the
      Data Server as compared to source code which is the code developed to
      create the Executable Code.

      "EXECUTION DATE" means the date that the last Party hereto executes this
      Agreement.

      "ENHANCED SOFTWARE" means the revised Software that Licensor may, from
      time to time, release which is a new version or updates of QMACS(TM)
      Software, including

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      Executable Code and which may, but is not required to, increase the
      functionality, ease of use or productivity of the Software.

      "HARDWARE AND SOFTWARE ELEMENTS" means the required computer hardware and
      software identified in Exhibit D.

      "IMPLEMENTATION" shall mean consulting services related to the conversion
      of data as well as the set-up of operating system software, core
      relational database software, database tables and training unless other
      arrangements are agreed to and set forth in writing and signed by both
      Parties.

      "LICENSEE" is defined as not only Molina Medical Centers, Inc. but any
      wholly owned affiliates.

      "LICENSEE'S ADDRESS" means that address stated in Exhibit E of this
      Agreement or changed from such address by giving Licensor proper written
      notice.

      "LICENSOR'S ADDRESS" means that address stated in Exhibit E of this
      Agreement or changed from such address by giving Licensee proper written
      notice.

      "MATERIAL NONCONFORMITY" is defined as any operation of the Software which
      causes material erroneous data or unrecoverable data loss due to the
      execution of the Software's Applications.

      "MEMBER" is defined as a person who is eligible for benefits under any
      benefit plan managed by the Software.

      "MEMBER ENROLLMENT" is defined as the active and enrolled Members in a
      Benefit Plan using QMACS(TM) software. For purposes of Monthly Agreement
      Fee computation, multiple enrollments by the same Member during the same
      month shall be counted as a single enrollment.

      "MONTHLY FEES" means the recurring Agreement Fees due each month specified
      on Exhibit C.

      "NEW SOFTWARE" means new Executable Code, new modules and new Applications
      which would allow the Licensee to perform significant functions not listed
      in the Specifications. By way of example, an Application that allowed the
      Licensee to evaluate the quality of care members are receiving would be
      considered New Software. New Software is not enhancements, modifications
      and new versions of QMACS(TM) software.

      "ON-SITE SUPPORT" means that consultation, assistance and similar services
      provided by Licensor at the Authorized Location(s) or Licensee's main
      premises. Any On site support is subject to Licensor's then current hourly
      rates. The reasonable costs of travel, meals and lodging and other
      expenses incurred by representatives (e.g., employees, subcontractors,
      etc.) of Licensor in providing on-site support shall be paid by Licensee.

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      "OUTSIDE EXECUTABLE CODE" means Executable Code relating to third party
      applications which Licensor or Licensee has been granted the right to
      sublicense.

      "PER MEMBER PER MONTH(PMPM)" is defined as the average number of Member
      Enrollments actively managed by the QMACS(TM) software during a Billing
      Month.

      "PLAN YEAR" is defined as a twelve month(12) period from when Member
      Enrollments were first accepted into a specific benefit plan managed by
      the QMACS(TM) software.

      "QMACS(TM)" or the SOFTWARE is defined as all the current computer
      software developed by the Licensor including but not limited to all Client
      Executables, Applications, all display screens, the Source Code, any Data
      Server Based Programs and any Schema, Stored Procedures, Triggers or
      Wizards.

      "QMACS(TM) EXECUTABLE CODE" means Executable Code relating to the Software
      Applications which Licensor hereby licenses.

      "SPECIFICATIONS" are defined as the features and functions of the
      QMACS(TM)

      Software delivered as described in Exhibit A attached hereto.

      The "SOFTWARE" means the QMACS(TM) programs.

      "VENDOR" is defined as a third party supplier of computer hardware,
      software or services.

      "WAN" is defined as a Wide Area Network.

                                   ARTICLE II.

                                   THE LICENSE

      2.1   LICENSE GRANT. Licensor hereby grants to Licensee and Licensee
            hereby accepts a nonexclusive, non-transferable license (the
            "License") to use QMACS(TM) Software on Approved Clients and
            Approved Data Servers using Approved Operating Systems. The License
            is expressly made and granted subject to the terms, conditions,
            limitations and restrictions of this Agreement. Licensee shall be
            entitled to receive any Enhanced Software produced by Licensor
            during the Term of this Agreement. Unless specified otherwise by
            Licensor to Licensee in writing to Licensee's Address, this License
            and all the other terms of this Agreement shall also apply to any
            New Software or Enhanced Software supplied to Licensee by Licensor
            after the Execution Date of this Agreement. This Section does not
            entitle Licensee to New Software, customized versions or "beta"
            versions of the QMACS(TM) Software not yet generally released to all
            Licensees of QMACS(TM) Software. All Enhanced Software, or New
            Software if licensed by Licensee, shall be covered under and
            governed by the terms of this Agreement.

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      2.2   USE OF THE QMACS EXECUTABLE CODE. If the Agreement Fees for the
            QMACS Executable Code are fully paid by Licensee in accordance with
            the terms established for such fees, Licensee shall have a
            non-exclusive, non-transferable, limited License to use the QMACS
            Executable Code related to the QMACS(TM) Software as expressly
            permitted by this Agreement and said Executable Code shall be deemed
            to be QMACS(TM) Software hereunder.

      2.3   USE OF OUTSIDE EXECUTABLE CODE. Licensor may place a copy of Outside
            Executable Code in magnetic form in the possession of Licensee for
            Licensor's convenience and use in providing services or support to
            Licensee. Such copy shall be clearly marked by Licensor as Outside
            Executable Code under the License. Except as Licensor expressly
            authorizes in writing in each instance, said copy of Outside
            Executable Code shall be immediately returned to Licensor upon
            Licensor's request. Regardless, such request shall be deemed given
            upon expiration or termination of this License. The Parties agree
            that Licensor is not responsible for maintenance, support, updates
            or enhancement of said Outside Executable Code.

      2.4   COPYING. Licensor will provide Licensee with a reasonable number of
            back-up copies of the QMACS(TM) Software or Licensee may make a
            reasonable number of controlled copies of the QMACS(TM) Software as
            reasonably necessary to utilize the QMACS(TM) Software on the
            Approved Hardware. In such case, Licensee may make a reasonable
            number of copies of the Documentation for use by Licensee's
            employees in connection with the duly authorized use of QMACS(TM)
            Software (the "Copies"). Licensee shall reproduce and include in all
            Copies made by it, whether of Software or Documentation, any and all
            notices of copyright and other proprietary rights included by
            Licensor in or on the QMACS(TM) Software and Documentation provided
            to Licensee. All Copies of QMACS(TM) Software or Documentation or
            rights granted hereunder to copy the Software and the Documentation
            are provided to Licensee only for the duration of this License under
            this Agreement and only for the purpose of facilitating the licensed
            use by Licensee of QMACS(TM) Software. Licensee shall indemnify and
            ensure Licensor that such Copies are not used for any other purpose.

      2.5   OWNERSHIP. All Copies of QMACS(TM) Software and the Documentation
            (including Copies under Section 2.4) are the sole property of
            Licensor and Licensor shall hold sole title thereto. Licensee hereby
            assigns to Licensor any title or ownership interest Licensee may
            have or acquire in any Copies made in accordance hereunder.

      2.6   RETURN OF COPIES. Upon expiration or termination of the License, all
            Copies of the QMACS(TM) Software and the Documentation shall
            promptly be delivered to Licensor or destroyed by Licensee. Within
            15 days of termination or expiration of the License, Licensee shall
            deliver to Licensor a certification in writing that all Copies have
            been delivered to Licensor or destroyed.

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      2.7   SAFEGUARD. Licensee shall safeguard all Executable Code and Copies
            against non-Licensee use, copying or inspection by any third-party
            and against transfer to any third-party. Licensee shall require all
            persons and entities to whom Licensee has granted operations
            authority to save data or who have access to any Executable Code to
            execute and submit to Licensor a Confidentiality Agreement as set
            forth in Exhibit B.

      2.8   TERM OF THE AGREEMENT. Provided that all Agreement Fee(s) are paid
            timely, and Licensee complies with the terms and conditions of this
            Agreement, the initial term of this Agreement shall be for a period
            of five (5) years beginning on the first of the month after the
            Execution Date. Thereafter, this License shall be automatically
            renewed under the terms of this Agreement on a month to month basis
            assuming Agreement Fees are timely paid. Regardless, Licensee will
            give Licensor a six months notice of Licensee's intent to cancel
            this Agreement after its initial term.

      2.9   FEES. To maintain its License hereunder, Licensee shall pay to
            Licensor all Monthly Fees, Implementation Fees and other fees and
            costs as provided in Exhibit C attached hereto or as otherwise
            required by this Agreement.

                                  ARTICLE III.

                                  DELIVERABLES

      3.1   DELIVERABLES. Prior to the completion of the Implementation,
            Licensor will deliver at least one machine readable copy (in binary
            or object code form) of each program for each QMACS(TM) Application
            in accordance with the Specifications. Two (2) copies of any
            Documentation corresponding to each Application shall be provided to
            Licensee as such Documentation is published. At Licensee's option,
            Licensee may purchase additional copies of Documentation from
            Licensor at Licensor's list price in effect from time to time

      3.2   IMPLEMENTATION. Licensor shall be responsible for the initial
            installation of QMACS(TM) Software on the Approved Hardware and
            Implementation. Licensee shall cooperate fully with Licensor in such
            installation and Implementation. The Implementation shall proceed in
            accordance with a mutually acceptable Implementation Schedule.

      3.3   INITIAL TRAINING. Licensor shall provide initial training services
            to Licensee's personnel. The initial training sessions will take
            place in accordance with the mutually agreed Training Schedule.
            Licensee shall pay all reasonable, travel, rooms, meals and other
            expenses incurred by either Party as a result of such training.

      3.4   SUBSEQUENT TRAINING. Subsequent training services, other that those
            provided as initial training, shall only be supplied upon the mutual
            agreement of the Parties.

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                                   ARTICLE IV.

                                SUPPORT SERVICES

      4.1   SUPPORT SERVICES GENERALLY. As part if its Monthly Fee Licensor
            shall provide to Licensee the Certain support services as specified
            below to unmodified QMACS(TM) Software (the "Support Services").

      4.2   MAINTENANCE. Licensor's sole support services obligation hereunder
            is to provide the programming or documentation services necessary to
            conform any Application to the Specifications. This obligation shall
            remain in effect until the expiration or termination of this
            Agreement only if the Licensor can duplicate the defect. Upon the
            detection of any Material Nonconformity with the Specifications,
            Licensee shall provide to Licensor such output listings, data and
            other assistance as Licensor shall request. Licensor shall remedy
            any Material Nonconformity between the original QMACS(TM) Software,
            or any Enhanced Software, and the Specifications within thirty (30)
            days after notification in writing by Licensee. Upon receipt of such
            notice, Licensor, at no cost to Licensee, shall remedy the Material
            Nonconformity. This obligation of Licensor does not extend to
            QMACS(TM) Software modified by Licensee or caused by running the
            Software on non-Approved Hardware.

      4.3   DATA BASE ADMINISTRATION. Licensor shall supply Data Base
            Administration to Licensee. This obligation shall remain in effect
            until the expiration or termination of this Agreement. Licensor may
            terminate any obligation for Data Base Administration hereunder if
            the Licensee or any third parties alter, add, delete or make any
            structural or technical modifications to the database without
            written permission of the Licensor. It is agreed that selection,
            querying, access or reading of data contained in the database tables
            by the Licensee is excluded from this Section 4.3. Licensor may also
            choose, in it sole discretion, to terminate the License upon such
            structural or technical modifications.

      4.4   METHOD OF SUPPORT. Licensor shall provide support via WAN to
            Licensee. This support will consist of direct line or WAN access to
            the QMACS(TM) Software installed on the Approved Hardware. Licensee
            shall obtain and maintain a direct line or WAN link and other
            telecommunication equipment and software such as are required and
            approved by Licensor to enable Licensor to supply Data Base
            Administration, support and Maintenance of the Applications.
            Licensor's approval of direct line or WAN link and telecommunication
            equipment and software is necessary to ensure compatibility with
            Licensor's modems and telecommunication equipment and software. The
            Licensee's modems, WAN, telephone line and other telecommunication
            equipment and software shall be the responsibility of Licensee.
            Licensee shall reimburse Licensor for direct line, WAN or telephone
            charges incurred by Licensor in connection with WAN or modem
            support.

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      4.5   HELP DESK SUPPORT. Licensor shall provide "help desk support" as
            defined herein to Licensee during Licensor's normal business hours.
            Help Desk support will consist of telephone consultation, WAN,
            E-Mail or Internet communication with a representative of Licensor
            to provide Licensee with information, advice and assistance with
            respect to the operation and use of QMACS(TM) Software. Licensee may
            obtain help desk support by communicating with Licensor's designated
            representative or following Licensor's process for help desk
            support. Licensee will use its best efforts to maintain the training
            level of its employees on the software. Licensor's Help Desk is not
            a substitute for training and Licensee agrees to maintain a
            reasonable number of trained personnel to use the Software and train
            other of Licensee's personnel.

      4.6   SOFTWARE MODIFICATION PURSUANT TO GOVERNMENT REGULATION. After
            notice to Licensor, Licensee shall be entitled to receive, without
            additional charge, such modifications to the Applications as are
            required to reflect any mandatory changes in federal or state
            government managed care regulations that are applicable in any
            states where Licensee is utilizing the QMACS(TM) Software. Licensor
            shall be obligated to provide only a single solution which is
            acceptable by the appropriate controlling government agency.

      4.7   ADDITIONAL SERVICES. Subject to the mutual agreement of the Parties
            and additional compensation as scheduled or agreed upon, Licensor
            will provide to Licensee some or all of the following additional
            services which shall be made available to Licensee for fees, terms
            and conditions in effect concerning the following services.

            A.    On-Site Support;

            B.    New Software;

            C.    Custom Programming;

            D.    Special services.

            These "Additional Services" are not "Support Services" and are not
            covered by the Monthly Agreement Fees.

      4.8   SPECIAL SERVICES. Licensor may offer Licensee other services
            ("Special Services") to enhance the utility, user-friendliness
            and/or value of QMACS(TM) Software to Licensee. Such Special
            Services may include, but are not necessarily limited to, consulting
            services, training, classes, training modules, computer assisted
            education modules, and the provision of Support Services for
            modified QMACS(TM) Software. Fees and charges for the foregoing will
            be quoted from time to time to Licensee by Licensor.

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      4.9   EQUIPMENT AND ACCESS TO DATA. To facilitate the performance of
            Support Service and any Additional Services, Licensee, at its
            expense, shall:

            A.    Direct line or WAN. Acquire and maintain in good operating
                  condition at each Authorized Location a telecommunication
                  hardware/software configuration (including router, direct
                  telephone line link and other telecommunication equipment and
                  software) as Licensor shall reasonably require for
                  compatibility with Licensor's telecommunication
                  hardware/software configuration, Licensor may require Licensee
                  to upgrade said communication configuration from time to time
                  at the sole discretion of the Licensor,

            B.    Cooperation. Make available to Licensor such personnel, time,
                  supplies, equipment, assistance and cooperation of Licensee as
                  Licensor shall reasonably request;

            C.    Licensor Access to Software and Data. Permit Licensor support
                  personnel to have full and free access to the QMACS(TM)
                  Software installed on the Approved Hardware and data used in
                  connection with any QMACS(TM) Software. Such data shall be
                  held in confidence by Licensor and used exclusively to enable
                  Licensor support personnel to accomplish or facilitate Support
                  Services or any Additional Services. Licensee will provide
                  Licensor system password(s) necessary to operate and support
                  the QMACS(TM) applications and related databases;

            D.    Back-Up Data. Maintain adequate back-ups of all data provided
                  to Licensor support personnel in order to ensure continued
                  data security and retention. LICENSOR SHALL NOT BE OBLIGATED
                  TO RECREATE OR RESTORE, OR BE LIABLE IN ANY WAY FOR, LICENSEE
                  DATA IN THE EVENT OF LICENSEE'S FAILURE TO MAINTAIN ADEQUATE
                  BACK-UP OF ALL DATA;

            E.    Licensee Information. Provide Licensor's support personnel
                  access to all Licensee information specific to QMACS(TM)
                  Application(s) maintained on the Licensee's Data Server.
                  Licensor shall comply with all applicable laws relating to the
                  confidentiality of such information and promises to comply
                  with reasonable confidentiality policies of the Licensee;

            F.    Install Modifications. Promptly install or have installed all
                  new releases of QMACS(TM) Software required by Licensor for
                  continued support.

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                                   ARTICLE V.

                      SPECIAL RESPONSIBILITIES OF LICENSEE.

      5.1   LICENSEE PROVISIONS TO LICENSOR'S SUPPORT TEAM MEMBERS. Licensee
            shall provide to Licensor's Support and Implementation staff the
            following while on site performing installation, development,
            Implementation or support work:

            A.    A business-like working environment including, but not limited
                  to, office space, desks, furnishings, telephone with access to
                  an outside line for business calls relating to Licensor's
                  performance under this Agreement. Licensee agrees to use
                  reasonable efforts to provide space and furnishings consistent
                  with the space and furnishing made available to Licensee's
                  employees' of similar responsibility.

            B.    An Approved Client connected to Licensee's Data Server(s) and
                  /or the WAN network.

            C.    Unrestricted access to the Approved Hardware shall be granted
                  to all members of the Licensor's Installation, Development,
                  Support or Implementation staff. Licensee shall provide to the
                  Licensors support manager system password clearance.

            D.    Licensee shall make available to Licensor's staff other
                  available equipment reasonably necessary for Licensor to
                  perform its services including but not limited to
                  communications equipment such as faxes, modems, telephones and
                  Internet connections, if available.

      5.2   Licensee's Project Leader or Agent. Licensee shall provide a Project
            Leader or agent. Such Project Leader shall be authorized by Licensee
            to:

            A.    make decisions, approve plans and grant requests on behalf of
                  Licensee in connection with the Implementation of the
                  QMACS(TM) Software consistent with the terms of this
                  Agreement;

            B.    make management decisions and provide personnel, including the
                  appointment of Application Coordinators, and other
                  Representatives as reasonably required by Licensor, in order
                  to accomplish and facilitate the Implementation services
                  provided by Licensor in a proper and efficient manner;

            C.    maintain Licensee's Approved Hardware or cause the same to be
                  maintained in proper working order during the term of the
                  License; and

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            D.    exercise its best efforts in the performance of Licensee's
                  obligations hereunder in connection with the Implementation of
                  QMACS(TM) Software and preparation of the Authorized
                  Location(s) therefor.

      5.3   HARDWARE AND SOFTWARE ELEMENTS. Licensee shall insure that the
            minimal Hardware and Software Elements identified in Exhibit D
            attached hereto are in place and operational at the Authorized
            Location(s) prior to the Implementation commencement date set forth
            herein. Licensee shall be responsible for the continued operation
            and maintenance of such hardware and software elements and shall
            comply with the operational, environmental and maintenance
            recommendations and requirements of the vendors and manufacturers
            thereof.

                                   ARTICLE VI.

                                  RESTRICTIONS

      6.1   USE BY OTHERS. Licensee may use QMACS(TM) Software and the
            Documentation only for Licensee's own internal purposes to process
            data for Licensee. Licensee shall not allow any third-party to
            access, copy or use QMACS(TM) Software or the Documentation.
            Licensee shall not use the QMACS(TM) Software to provide
            time-sharing or data processing services to a third-parties without
            written permission of Licensor. Notwithstanding any other provisions
            of this Agreement, Licensee may disclose the QMACS(TM) Software and
            Documentation to any third party for the limited purpose of
            maintenance or modification of computer hardware or software for use
            by Licensee provided that such disclosure is pursuant to a
            Confidentiality Agreement delivered to Licensor. Any software
            modified or changed by a third party will not be covered under
            Article VII without a separate written agreement.

      6.2   DUTY TO SAFEGUARD. QMACS(TM) Software and the Documentation, and the
            trade secrets and intellectual property embodied therein, are of
            great value to Licensor. Accordingly, Licensee shall exercise
            reasonable care and diligence to protect the same against any
            unauthorized copying, piracy and misappropriation.

      6.3   MODIFICATIONS. Licensee shall notify Licensor in writing on any
            Derivative Work. Any and all such Derivative Works and modifications
            shall be the property of Licensor and Licensee hereby assigns all
            title and ownership interest therein to Licensor. Such Derivative
            Works and modifications shall be deemed to be QMACS(TM) Software for
            the purposes of this Agreement, provided, however, that Licensor's
            representations, warranties and liabilities shall not extend to such
            Derivative Works and modifications.

      6.4   Confidentiality Breach. In the event of a breach or the threat of a
            breach of any of the provisions of this Article, Licensor, in
            addition to any other remedies it may have at law or in equity or
            under this Agreement, shall be entitled to a restraining order,
            preliminary injunction, and other appropriate relief so as to
            specifically

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            enforce the terms of this Article. The Parties agree that a breach
            of this Article would cause Licensor injury not compensable in
            monetary damages alone, and that the remedies provided herein are
            appropriate and reasonable.

                                  ARTICLE VII.

                  WARRANTY, PATENT AND COPYRIGHT INFRINGEMENT,

        LIMITATIONS ON LIABILITY AND REMEDIES, AND LICENSEE'S LIABILITY.

      7.1   WARRANTIES: Licensor warrants that it shall remedy any Material
            Nonconformity within thirty (30) days after notification in writing
            is received from Licensee only if Licensor can duplicate the defect.
            Upon receipt of such notice, Licensor, at no cost to Licensee, shall
            remedy the Material Nonconformity. This warranty does not extend to
            QMACS(TM) Software modified by Licensee or for nonconformities due
            to Licensee misuse. Licensor's warranty covers only service to
            correct Material Nonconformities reported during the term of this
            Agreement. Telephone and WAN support, and other services are
            excluded from Licensor's warranty.

      7.2   LIMITATIONS ON WARRANTY. Except as set forth in the Specifications,
            Licensor does not warrant that the QMACS Software will meet
            Licensee's requirements or will operate in the combinations which
            may be selected for use by Licensee, or that the operation of the
            QMACS(TM) Software will be uninterrupted or error free.

      7.3   SCOPE OF WARRANTY. THE FOREGOING IS IN LIEU OF ALL OTHER WARRANTIES
            EXPRESS OR IMPLIED. LICENSOR HEREBY DISCLAIMS ALL WARRANTIES NOT
            EXPRESSLY SET FORTH IN THIS AGREEMENT INCLUDING BUT NOT LIMITED TO,
            ANY IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
            PARTICULAR PURPOSE. LICENSEE HEREBY DISCLAIMS ANY RELIANCE ON ANY
            WARRANTY OR REPRESENTATION NOT EXPRESSLY SET FORTH IN THIS
            AGREEMENT.

      7.4   LICENSOR'S PATENT AND COPYRIGHT INDEMNIFICATION OF LICENSEE.
            Licensor promises to indemnify Licensee, at Licensor's expense,
            against any claim that the QMACS(TM) Software or the corresponding
            manual(s) infringe on a valid patent or copyright in the United
            States. Licensor will also pay all costs, damages, and attorneys'
            fees that a court finally awards as a result of such claim, to the
            limit of Licensor's liability as determined by the court. Licensor's
            duties under this Section 7.4 are conditioned upon the following:

            A.    Licensee shall give to Licensor prompt written notice or any
                  actual or threatened claim;

            B.    Licensor shall have control of the defense of any claim and of
                  all negotiations for the settlement or compromise of such
                  claim;

                                       14
<PAGE>   15
            C.    Licensee shall cooperate with Licensor in the defense or
                  settlement of any claim; and

            D.    The claim does not arise out of Licensee's modification of the
                  QMACS(TM) Software or the use of QMACS(TM) Software in
                  combination with anything not approved by Licensor.

      7.5   LICENSOR'S OPTION IF INFRINGEMENT OCCURS. If a patent or copyright
            infringement occurs, or in Licensor's judgment is likely to occur.
            Licensor, at Licensor's option and expense, may either procure the
            right for Licensee to continue using the QMACS(TM) Software and the
            manual(s), or replace or modify them so that they become
            non-infringing. If neither of the foregoing alternatives is
            reasonably available in Licensor's judgment, Licensee shall return
            all copies of the Application(s) in question and corresponding
            manual(s) to Licensor upon written request.

      7.6   LIMITATION. The above promise of indemnification extends only and
            strictly to the QMACS(TM) Software and manual(s) in the forms
            provided by Licensor and expressly precludes any indemnification
            with respect to claims based upon the QMACS(TM) Software, manual(s)
            or any software or documentation which has been modified by anyone
            besides Licensor.

      7.7   LIMITATIONS ON LIABILITY AND REMEDIES. Licensee expressly agrees
            that Licensor's entire liability and Licensee's exclusive and sole
            remedies shall be as follows:

            A.    CONFORMITY/NONCONFORMITY OF THE QMACS(TM) SOFTWARE. In all
                  situations involving conformance or nonconformity of the
                  QMACS(TM) Software during the period as set forth in Section
                  7.1 of this Software License Agreement, Licensee's sole remedy
                  is the correction by Licensor at its expense of any Material
                  Nonconformity with the Specifications provided written notice
                  of such nonconformity is received by Licensor, or Licensor
                  shall have no liability or obligation under this Agreement
                  with respect to any nonconformity with the Specifications not
                  reported in writing by Licensee to Licensor during the
                  applicable Warranty Period.

            B.    DISCLAIMER OF LIABILITY. IN NO EVENT WILL LICENSOR BE LIABLE
                  FOR ANY DAMAGES CAUSED BY LICENSEE'S FAILURE TO PERFORM
                  LICENSEE'S RESPONSIBILITIES, OR FOR ANY LOST PROFITS, LOST
                  SAVINGS, LOSS OF DATA, LOSS OF USE OF THE QMACS(TM)SOFTWARE,
                  COSTS OF RECREATING LOST DATA, OR ANY OTHER INDIRECT, SPECIAL
                  OR OTHER CONSEQUENTIAL DAMAGES, EVEN IF LICENSOR HAD BEEN
                  ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, OR FOR ANY CLAIM
                  AGAINST LICENSEE BY ANY OTHER PARTY.

                                       15
<PAGE>   16
            C.    MAXIMUM LIABILITY. LICENSOR'S AGGREGATE LIABILITY FOR DAMAGES
                  TO LICENSEE FOR ANY CAUSE WHATSOEVER, AND REGARDLESS OF THE
                  FORM OF ACTION, INCLUDING CONTRACT, TORT, COMPUTER
                  MALPRACTICE, PRODUCTS LIABILITY, STRICT LIABILITY, AND/OR
                  OTHERWISE SHALL BE LIMITED TO THE LESSER OF FIFTY THOUSAND
                  ($50,000) DOLLARS OR THE APPLICABLE LICENSE FEES PAID TO
                  LICENSOR FOR THE APPLICATION THAT CAUSED THE DAMAGES OR THAT
                  IS THE SUBJECT MATTER OF, OR IS DIRECTLY RELATED TO, THE CAUSE
                  OF ACTION. THIS SUBSECTION SHALL NOT APPLY TO SECTIONS 7.4
                  "Licensor's Patent and Copyright Indemnification of Licensee"
                  OR Section 7.5 "Licensor's Option if Infringement Occurs".

            D.    CARE BY LICENSEE. After installation of the Application, it is
                  the duty solely of Licensee to verify the results and
                  information provided by the Application, that the Application
                  is operated properly by trained personnel, and to satisfy
                  itself that all such results and information are true,
                  complete and correct. Licensee shall indemnify and hold
                  Licensor harmless from third-party claims or lawsuits of
                  Licensee's failure to perform those responsibilities.

            E.    TIME LIMITATIONS. No action, regardless of form, arising out
                  of this Agreement may be brought by Licensee later than one
                  (1) year after the cause of action has arisen and Licensee has
                  (or should have) acquired knowledge thereof.

            F.    ALLOCATION OF RISK. This Agreement in general, and the
                  foregoing limitations on liabilities and warranties in
                  particular, represent a mutually agreed upon allocation of
                  risk and the consideration provided for in this Agreement has
                  been calculated to reflect such allocation of risk.

      7.8   SOFTWARE MISUSE. Licensee agrees to indemnify Licensor from
            liability due to Licensee's misuse of the Software.

      7.9   SANCTIONS. The Licensor shall be liable for sanctions imposed on
            Licensee by State, County or Federal governments or governmental
            agencies as a result of the Licensor's failure to meet any of its
            responsibilities under this agreement, to the extent such failure is
            the fault of the Licensor. The Licensor's liability under the this
            section during any plan year shall be limited to Twenty-Five percent
            (25%) of the total Per Member Per Month fees paid by the Licensee
            during the Plan Year. If there appears to be reasonable grounds to
            appeal an imposed sanction, Licensor and Licensee will cooperate in
            preparing and presenting the appeal. However, any sanctions that are
            attributable to Licensee shall not be deemed as Licensor's
            responsibility.

                                       16
<PAGE>   17
                                  ARTICLE VIII.

                    TERMINATION, DISCONTINUANCE AND REMEDIES

      8.1   TERMINATION OF THE LICENSE.  This Agreement may be terminated by
            either Party if:

            A.    the other Party hereto fails to comply with the terms,
                  conditions or any covenant or agreement on its part under this
                  Agreement and fails to perform or cure the same within thirty
                  (30) days of receipt of written notice to cure (the "Cure
                  Date").

            B.    either Party shall commence a voluntary case or other
                  proceeding seeking liquidation, reorganization or other relief
                  with respect to itself or its debts under any bankruptcy or
                  similar law and such case shall remain undismissed and
                  unstayed for a period of sixty days subject to Bankruptcy Code
                  S,365(n).

            In such events, the Party failing to perform or comply with the
            terms or conditions of this Agreement will be deemed to be in
            default, and the non-defaulting Party shall be entitled to the
            remedies specified below.

      8.2   LICENSOR REMEDIES.

            A.    Licensor may demand any money due and owning to it under this
                  Agreement.

            B.    Licensor may electronically terminate Licensor's use of the
                  Applications and Support Services.

            C.    Seek an injunction against the continued use of the Software
                  and to protect the Licensor's intellectual and proprietary
                  rights.

      8.3   LICENSEE REMEDIES

            A.    Licensee can seek monetary damages from Licensor for breach of
                  this Agreement.

            B.    Licensee may defend itself against a termination claim by
                  Licensor by escrowing disputed funds. If the breach claimed is
                  related to disputes regarding payment, Licensee may interplead
                  the maximum funds due with a court of competent jurisdiction
                  in which case Licensor will consent to Licensee continuing to
                  use the Software until such dispute is resolved in accordance
                  with this Agreement.

      8.4   OBLIGATIONS OF THE PARTIES UPON TERMINATION. Upon termination of the
            License, neither Party shall have any further obligations hereunder
            except for

                                       17
<PAGE>   18
            A.    Obligations accruing prior to the Cure Date;

            B.    Obligations or promises contained herein which relate to the
                  protection or confidentiality of QMACS(TM) Software (including
                  Executable Code) or the Documentation, which arise hereunder
                  or which are expressly made to extend for ten years past the
                  Term of this Agreement; and

            C.    The obligation of Licensee to certify in writing to Licensor
                  within twenty (15) (SIC) days of expiration or termination of
                  the License that all copies of the QMACS(TM) Software and the
                  manual(s) have been destroyed by Licensee or delivered to
                  Licensor.

      8.5   ESCROW STATEMENT. The Licensor shall maintain a copy of the most
            recent Source Code for the QMACS(TM) Software with a trustee
            mutually acceptable to Licensee and Licensor. In the event that
            Licensor becomes insolvent, makes an assignment of assets for the
            benefit of creditors, has a trustee or receiver appointed (either
            voluntary or involuntarily), is adjudicated bankrupt, or involuntary
            bankrupt proceedings are commenced against Licensor or receiver,
            commences any dissolution or liquidation proceedings, or transfers
            all or substantially all of either of their assets to another
            entity, then the trustee shall be directed to deliver the Source
            Code to Licensee. Licensor shall notify Licensee who the appointed
            trustee is, and give notice prior to any of the actions mentioned
            herein. Licensee shall reimburse Licensor for any costs of Source
            Code escrow.

                                   ARTICLE IX.

                               GENERAL PROVISIONS.

      9.1   AGENCY. Except as specifically permitted under this Agreement,
            neither Licensor nor Licensee shall make any representations
            warranties or incur any liability on behalf of the other. Neither
            party is the agent, representative, partner or joint venturee of or
            with the other Party.

      9.2   APPLICABLE LAW AND ARBITRATION. This Agreement shall be construed
            and interpreted in accordance with the laws of the State of Arizona.
            In the event that the Parties are unable to resolve within a
            reasonable time any controversy, dispute or claim arising out of or
            in connection with this Agreement, or its interpretation,
            performance or termination, arbitration shall be conducted in
            accordance with the rules of the American Arbitration Association.
            Arbitration awards shall be binding and conclusive upon the Parties,
            their successors and assigns and they shall comply with such awards
            in good faith. If reasonably necessary, judgment upon an arbitration
            award may be entered in any court having jurisdiction. In the event
            of arbitration or litigation, the non-prevailing Party shall pay the
            costs and expenses including reasonable attorneys fees, incurred in
            arbitration or litigation, or in preparation therefor, by it and by
            the prevailing Party.

                                       18
<PAGE>   19
      9.3   ASSIGNMENTS, SUB-LICENSES, ETC. BY THE LICENSEE. Licensee shall not
            have the power or the right (1) to delegate any duty under this
            Agreement, (2) to grant any sublicense under the License, or (3) to
            assign or transfer the License, this Agreement or any right
            thereunder, except to a parent corporation, holding company, or
            subsidiary, or to a corporation, partnership or other entity which
            succeeds to all or substantially all of the business or assets of
            the Licensee, subject to the approval of the other party which shall
            not be unreasonably withheld.

      9.4   ASSIGNMENTS, SUB-LICENSES, ETC. BY THE LICENSOR. Licensor shall not
            have the power or the right to delegate any duty under this
            Agreement, except that either party may make such an assignment to a
            parent corporation, holding company, or subsidiary, or to a
            corporation, partnership or other entity which succeeds to all or
            substantially all of the business or assets of the party, subject to
            the approval of the other party which shall not be unreasonably
            withheld. However, Licensor, in its sole discretion and without the
            approval of the Licensee, may assign the economic benefits of this
            Agreement. In no way is this Agreement restrict the rights of the
            Licensor to grant licenses or enter into agreements with others.

      9.5   AUTHORIZATION. Each Party represents and warrants to the other that
            it is duly authorized to execute and perform under this Agreement
            and that this Agreement constitutes its valid obligation,
            enforceable according to the provisions hereof.

      9.6   CALENDAR DAYS. Unless otherwise stated, all periods of days referred
            to in this Agreement shall be measured in calendar days.

      9.7   CONFIDENTIALITY-LICENSEE. Licensee shall not divulge any information
            contained in this Agreement to any third-party during the term of
            this License except as required by federal, state or local
            regulatory agencies or in the course of sanctioned audits or
            reviews. Any other release of information will be done only with
            Licensor's prior written authorization.

      9.8   CONFIDENTIALITY-LICENSOR. Licensor shall not divulge, furnish, or
            make accessible to anyone else any trade secrets or data of
            Licensee.

      9.9   EXHIBITS. The following exhibits are hereby incorporated into this
            Agreement by reference:

            Exhibit A entitled "Specifications of QMACS(TM) Software:"

            Exhibit B entitled "Confidentiality Agreement:"

            Exhibit C entitled "Fees, Rates and Payment Schedules:"

            Exhibit D entitled "Hardware and Software Elements:"

            Exhibit E entitled "Locations and Notices"

                                       19
<PAGE>   20
            Exhibit F entitled "Data Conversion Plan"

            Exhibit G entitled "Programming Services"

      9.10  EXPORT ACT. Licensee hereby warrants and certifies that no part of
            the QMACS(TM) Software, modifications thereof, documentation
            thereto, applicable manual(s) or any related item or product will be
            made available or exported to any country in contravention of any
            law of the United States, including the Export Administration Act of
            1979 and regulations relating thereto.

      9.11  FORCE MAJEURE. Either Party shall be excused for failures and delays
            in performance of their respective obligations under this Agreement
            caused by war, riots or insurrections, laws and regulations,
            strikes, floods, fires, explosions, or other catastrophes beyond the
            control and Without the fault of such Party. This provision shall
            not, however release such Party from using its best efforts to avoid
            or remove such cause, and such Party shall continue performance
            hereunder with the utmost dispatch whenever such causes are removed.
            Upon claiming any such excuse or delay for nonperformance, such
            Party shall give prompt written notice thereof to the other Party.
            This Section 9.11 shall not apply to any obligation to pay money.

      9.12  LATE PAYMENTS. In addition to any other rights it may have, Licensor
            reserves the right to assess, and Licensee agrees to pay, an
            interest charge on any undisputed fee or charge not timely paid
            within thirty (30) days from the invoice date or in accordance with
            the provisions of this Agreement including any Exhibit thereto. The
            interest shall be applied at the rate of one percent (1.0%) per
            month (or the highest rate allowed by applicable law if lower) to
            the unpaid balance.

            In the event that Licensee determines in its reasonable judgment
            that a billing error has occurred, Licensee must notify Licensor in
            writing within thirty (30) days of receipt of such erroneous items.
            Licensee agrees to timely pay all undisputed items on any invoice
            which may have disputed items contained thereon. Licensor agrees
            that no late payment fee shall be applicable for contested invoice
            items until thirty (30) days following Licensors response to
            Licensee's notice of billing error.

      9.13  LOSS OR DAMAGES TO QMACS(TM) SOFTWARE. In the event of loss, damage,
            or destruction of any of the Licensed Software, the lost, damaged,
            or destroyed QMACS(TM) Software shall be replaced by Licensor upon
            the written request of Licensee. Licensee shall pay Licensor's
            reasonable reproduction and delivery expenses for such replacement
            unless the loss, damage, or destruction is caused by Licensor.

      9.14  MODIFICATION OF THE AGREEMENT. This Agreement contains the entire
            understanding of the Parties. Any modification, amendment,
            cancellation, or waiver of rights under this Agreement shall be
            effective only if in writing signed

                                       20
<PAGE>   21
            by an Officer of the Party against whom enforcement of the same is
            sought. No waiver of any breach of this Agreement shall be construed
            as a waiver of any other rights under this Agreement. No delay in
            acting with regard to any breach shall be construed as a waiver of
            the breach.

      9.15  NOTICES. Any notices required or permitted hereunder shall be
            sufficiently given if sent by registered or certified mail, postage
            prepaid, addressed or delivered as set forth in Exhibit E, attached
            hereto.

            A Party hereto may change its address for notice purposes by
            furnishing the new address in writing to the other Party. Any such
            notice shall be deemed to have been given, if mailed to the last
            known address as provided herein, on the fifth (5th) day after the
            date on which the notice is mailed.

      9.16  RESERVATION OF RIGHTS. All rights of Licensor not expressly granted
            to Licensee in writing are reserved.

      9.17  SECTION HEADINGS. The headings of Articles and sections herein are
            used for convenience and ease of reference and shall not limit the
            scope or intent of the Articles or Sections.

      9.18  SEVERABILITY. In the event that any provision of this Agreement
            shall become or be unenforceable, invalid, void or voidable, the
            same shall be limited, construed or, if necessary, limited to the
            extent necessary to remove such defect and the remaining provisions
            shall continue to bind the Parties as though the unenforceable,
            invalid, void or voidable part are not a part of the Agreement.

      9.19  STATE AND FEDERAL LAWS. The Parties recognize that this Agreement is
            at all times are subject to applicable state, local, and federal law
            including, but not limited to, the National Health Planning and
            Resources Development Act of 1974, the Social Security Act, and the
            rules, regulations and policies of the Department of Health and
            Human Services (including the light of the Secretary of HHS or his
            designee to access for a period of four years from termination of
            the License, Licensor's relevant books and records evidencing
            Licensor's contractual relations with Licensee), all public health
            and safety provisions of state law and regulations, the rules and
            regulations of the applicable Health Systems Agency and applicable
            Executive Orders. For example, the Equal Employment Opportunity
            clause as required by Section 202 of Executive Order 11246 (1965)
            and as contained in and required by 41 C.F.R, Section 60-1.4 (1984),
            "Equal Opportunity Clause," is incorporated herein by reference, if
            applicable. The Parties further recognize that the Agreement shall
            be subject to Amendments in such laws and regulations and to new
            legislation such as a new federal or state economic stabilization or
            health insurance program. Any provisions of law that invalidate, or
            otherwise are inconsistent with, the terms of this Agreement or that
            would cause one or both of the Parties to be in violation of law,
            shall be deemed to have superseded the terms of this Agreement,
            provided, however, that the

                                       21
<PAGE>   22
            Parties shall exercise their best efforts to accommodate the terms
            and the intent of this Agreement to the greatest extent possible
            consistent with the requirements of law.

      9.20  SUCCESSORS IN INTEREST. Subject to the foregoing provision on
            assignability, this Agreement shall inure to the benefit of and be
            binding upon the parties, their successors, trustees, assigns,
            receivers, and legal representatives, and shall not inure to the
            benefit of any other person, firm or corporation.

      9.21  SUPERSEDING EFFECT. This Agreement supersedes all oral or written
            agreements, if any, between the Parties and constitutes the entire
            agreement between the parties with respect to the matters contained
            herein.

      9.22  TAXES AND DUTIES. The License Fees, Implementation Fees, and all
            other fees, charges. and payments specified herein are exclusive of
            any taxes, duties, or other tariffs imposed by any governmental
            agency on the QMACS(TM) Software, the Manual(s) or Licensee's use
            thereof, for any goods or services provided pursuant to this
            Agreement. Licensee shall be liable for any such taxes, duties, or
            tariffs, including, but not limited to, state and local sales, use,
            and property taxes, exclusive of taxes based upon Licensor's or a
            third-party vendor's income.

      IN WITNESS WHEREOF, the Parties hereto have executed this Agreement which
      is effective as of the 23rd day of May, 1996.

      LICENSOR:                                 Quality Care Solutions, Inc.
                                                By: /s/ A. Bruce Oliver
                                                Name: A. Bruce Oliver
                                                Title: President

      LICENSEE:                                 Molina Medical Centers Inc.
                                                By: /s/ John C. Molina
                                                Name:  John C. Molina
                                                Title:  Vice-President

This contract is contingent upon the QMACS System successfully completing the
test phase as outlined in Exhibit H and Licensor warrants that standards
achieved during the test phase shall be maintained throughout the life of the
contract.

                                       22
<PAGE>   23
                                    EXHIBIT A

                      SPECIFICATIONS OF QMACS(TM) SOFTWARE

These specifications apply only to the QMACS(TM) Software as originally provided
to Licensee under this Agreement. Updates, Enhancements and new versions of the
QMACS(TM) Software delivered after the Acceptance of any Application hereunder
which increase the function thereof, unless otherwise specifically and
exclusively provided for in the Agreement or agreed upon by the Parties, and
which may be offered by Licensor to Licensee, may not conform to these
Specifications.

The Parties recognize the possibility of differences in interpretation and
meaning between the questions included in the Licensee's Request for
Information(RFI) and Licensor's responses thereto as incorporated herein and
included in this Exhibit A, if applicable. The Parties therefore agree that in
the event of a difference of opinion as to the nature or extent of any function
to be performed by any of the Licensor's Applications or Licensor's reasonable
interpretation and meaning of a question and/or response in the RFI, then the
Licensor's interpretation shall prevail.

Further, if the matter of interpretation is of a material nature, it is agreed
the matter shall be resolved in accordance with the dispute resolution and
arbitration provisions set forth in the Agreement in Article IX section 9.2.

The following are the specifications and functions of the QMACS(TM) software
system:

      1.    QMACS(TM) is a software solution designed for Managed Care
            Organizations (MCO's) requiring the following business processes:

      2.    QMACS(TM) was developed in Microsoft Visual Basic Version 3.0 and
            4.0 to operate with Microsoft SQL Server database. The QMACS(TM)
            software system requires the use of Microsoft WindowsNT server as an
            operating system on the server and WindowsNT workstation the client
            processor. The Licenses for Microsoft products are not included in
            this agreement.

      3.    The QMACS(TM) Software system will accommodate the following
            business functions of a Managed Care Organization as interpreted by
            the Licensor.

GENERAL

The ability to report all claims expense information by the following:

      A.    Rate Code.

      B.    Month of Service.

      C.    Provider number (in excess of a user input dollar amount).

                                       23
<PAGE>   24
      D.    Member.

      E.    Paid date range.

      F.    Plan

      G.    Provider Classification

The ability to report all authorized services for a member which have not yet
been paid for.

The ability to report all claims with a given diagnosis.

The ability to generate a membership per month report by:

      A.    Line of Business

      B.    Plan

      C.    Rate Code

      D.    Member coverage type

      E.    Employer Group

      F.    Member Delegation

The ability to report utilization by the following selection criteria:

      A.    By diagnosis.

      B.    By provider.

      C.    By facility.

      D.    By plan.

      E.    By category of service.

      F.    By provider specialty.

      G.    By place of service.

      H.    By member demographics (age, sex...)

      I.    By rate code.

      J.    By dollar amount

                                       24
<PAGE>   25
      K.    By member coverage type

      L.    By member delegation

      M.    By Provider Category

BENEFIT PLAN CONFIGURATION

The ability to configure benefit plan packages to pay claims based on whether
the:

      A.    Members PCP must render service.

      B.    Service requires an authorization.

      C.    Provider of service is a plan participating provider.

      D.    Service is allowed/disallowed by the benefit plan as defined by
      user specified:

            1.    Diagnosis code (ICD-9) (Enhancement to be delivered in late
                  1996)

            2.    Procedure code (CPT-4 or HCPCS).

            3.    Revenue code (UB92).

            4.    Range of the above codes.

            5.    Diagnosis/procedure combinations (Enhancement to be
                  delivered in late 1996)

      E.    Visit Limits

            1.    Rolling Year

            2.    Calendar Year

            3.    Plan Year

            4.    Rolling Months

            5.    Rolling Days

      E.(SIC) Month coverage starts

      F.      Lifetime Limits

      G.      Per visit limits

      H.      Bill type (UB-92)

                                       25
<PAGE>   26
      I.    Provider specialty

The ability to specify which edits to apply, and thus which edit code
descriptions, appear on claims and EOBs/remits.

The ability to specify the following by procedure:

      A.    Deductible.

      B.    Co-pay amount.

      C.    Cost Share amount

      D.    Dollar maximums allowed.

      E.    Unit maximum allowed.

      F.    Coinsurance

      G.    Benefit period (i.e. days, weeks, months, years).

The ability to adjudicate claims according to the following benefit plan and
member information:

      A.    The benefit plan rules for the date of service.

      B.    The member's eligibility for the date of service.

      C.    The member's benefit plan package for the date of service.

      D.    The eligibility of the member's contract group for the date of
            service.

The ability to establish rates and bill benefit plan riders in the following
ways:

      A.    Bill riders separately from the member's benefit plan rate.
            (Enhancement to be delivered in late 1996)

      B.    Include the price of the rider with the member's benefit plan
            rate (Enhancement to be delivered in late 1996)

The ability to vary plan rates by the following:

      A.    Policy group.

      B.    Member age (provisions for unlimited age groups).

      C.    Member sex.

      D.    Medicare vs. Non-Medicare members (Secondary coverage)

                                       26
<PAGE>   27
      E.    Medicare Part A vs. Part B (Secondary Coverage)

      F.    Member coverage dates,

The ability to maintain date of effective benefit plan rates.

The ability to identify different categories of benefit plan types (e.g.
medical, dental, vision, etc.)

BENEFIT PLAN ACCUMULATION

The ability to offer multiple benefit plans per contract group.

The ability to assign multiple benefit plans per member.

The ability to enroll all members in a specified benefit plan to another
specified benefit plan via batch process (i.e., Without having to enroll each
member individually).

THIRD PARTY ADMINISTRATION

The ability to administer claims adjudication and payment, authorizations,
utilization review, and financial reporting in a third party administration role
(TPA) for an entity with:

      A.    The same provider network as the HMO.

      B.    A different provider network from the HMO.

CAPITATION

The ability to assign capitation rates structures to specific providers.

The ability to process manual adjustments made to capitation pools.

The ability to have capitation rates vary by:

      A.    Group

      B.    Plan

      C.    Rate Code

      D.    Age/Sex

      E.    Provider

      F.    Service Zip Code

                                       27
<PAGE>   28
      G.    Enrollment totals (Enhancement-No Charge)

The ability to process prorated capitations.

The ability to recon previous capitations

CLAIMS ENTRY/MAINTENANCE

The ability to adjudicate claims during on-line entry.

The ability to enter and adjudicate claims through a batch interface via tape
from an outside provider.

The ability for providers entering claims via modem to add, change, view and
delete only:

      A.    Their own provider information.  (Enhancement to be delivered in
            late 1996)

      B.    Members serviced by that provider.  (Enhancement to be delivered
            in late 1996)

      C.    Service plans for that member.  (Enhancement to be delivered in
            late 1996)

      D.    Referrals generated by that provider.  (Enhancement to be
            delivered in late 1996)

      E.    Their own claims information.  (Enhancement to be delivered in
            late 1996)

The ability to capture all HCFA 1500 information.

The ability to capture all UB 92 information

The ability to capture all Universal (Pharmacy) information (Enhancement to
be delivered in late 1996)

The ability to capture all information required by state Medicaid agencies.

CLAIMS ADJUDICATION/PRICING

The ability to adjudicate a claim based on the benefit plan of the member and
contract of the Provider.

The ability to pend a claim at the line item level.

The ability to pay, pend, or deny a claim based on the existence of a valid
authorization.

The ability to pend or deny a claim based on the provider number and a user
defined set of either valid or invalid values for that provider using the
following codes:

      A.    Procedure codes

                                       28
<PAGE>   29
      B.    Service Location

      C.    Modifier Code

      D.    Age (Enhancement-No Charge)

      E.    Diagnosis (Enhancement-No Charge)

The ability to price claims based on the following payment mechanisms:

      A.    Provider Fee Schedule.

      B.    Percent of billed.

      C.    Per Diem.

      D.    Lesser of billed or covered.

      E.    Capitated

      F.    Pay claims up to a funded amount (a maximum dollar amount to be
            spent) Enhancement

      G.    Per diem based on tiers

COORDINATION OF BENEFITS (Third Party Liability)

The ability to enter other insurance carrier information for members into the
system.

The ability to enter the amount of COB for a claim which has already been paid
by another insurance carrier.

The ability to calculate the paid amount by deducting the COB amount from
allowed amount.

CLAIMS INQUIRY

The ability to access the following information On line (windows) from the
claims window:

      A.    Referrals.

      B.    Service Plan (Enhancement to be delivered in late 1996).

      C.    Member Information.

      D.    Provider Information.

      E.    Code values (CPT, ICD, revenue codes).

                                       29
<PAGE>   30
      F.    Historical claims

      G.    Member and Provider Memos and Alerts

      H.    Limit and deductible accruals

The ability to access claims by:

      A.    Claim number.

      B.    Member number

      C.    Member name.

      D.    Provider number

      E.    Provider name

      F.    Referral number

CLAIM PAYMENTS

The ability generate checks for claims.

The ability to generate remittances for both claims and encounters.

MEMBERSHIP INFORMATION INQUIRY/LISTING - On-line or Reports

The ability to view membership information and accumulate totals using the
following selection criteria:

      A.    Primary Care Physician

      B.    Zip Code

      C.    Age/User specified Age Range.

      D.    Rate Code

      E.    By benefit plan within all above mentioned criteria.

      F.    To obtain above statistics by Group Id calculating percentage of
            totals.

      G.    Language spoken (Enhancement-No Charge)

The ability to produce a member enrollment analysis by Plan that lists the total
members enrolled by age group and sex within rate code.

                                       30
<PAGE>   31
The ability to record, track and resolve member grievances.  (Specified
Enhancement-No Charge)

GROUP POLICY MAINTENANCE

The ability to establish effective dated policy group (i.e., employer group)
policies to which members and benefit plan products can be assigned.

The ability to add/change/review/ the following policy group information
on-line:

      A.    Group demographics (name, address, contacts, etc.)

      B.    Plans/Riders offered by the group.

      C.    Billing information (billing cycle, etc.)

      D.    Rate Codes and corresponding premiums/member Capitation dollar
            amounts for each plan assigned to the group.

The ability to assign multiple rate codes (codes that can be tied to a dollar
premium/capitation amount) to a benefit plan.

The ability to administer the following types of policies:

      A.    Per diems

      B.    Discounts off a set fee schedule.

      C.    Discounts off the provider's billed charges.

      D.    RBRVS, RVS, Set pricing.

      E.    DRG's

      F.    Per Unit

MEMBER MAINTENANCE

The ability to enroll, modify, and disenroll the following member information
on-line:

      A.    Demographic information (name, address, sex birthdate, etc.)

      B.    Plan/coverage information.

      C.    PCP.

      D.    Coordination of benefit (COB) information.

                                       31
<PAGE>   32
      E.    Medicare coverage information.

      F.    Enrollment dates (enrollment and disenrollment dates.)

      G.    User definable alert flags.

PRIMARY CARE PHYSICIAN ASSIGNMENT

The ability to assign a Primary Care Physician(PCP) to each member.

The ability to indicate when a provider is not accepting new patients on the
provider's on-line a group by group basis on the provider's on-line profile.

The ability to automatically assign PCP's to a member, during enrollment,
based on the member's zip code. (age, sex, and language -(Enhancement- No
Charge)

The ability to assign a non-PCP provider to each member.

AUTHORIZATION MANAGEMENT

The ability to add/read/modify/delete the following authorization (referral)
information on-line:

      A.    Authorization control number.

      B.    Member ID number.

      C.    Carrier ID number other than member ID.

      D.    Referral service code (user maintainable).

      E.    Diagnosis (presenting signs and symptoms).

      F.    Accrued benefits relating to authorization in units

      G.    Provider of service (Referred to provider).

      H.    Referring provider.

      I.    Authorized service date range.

      J.    Authorized referral days/number of visits (units).

      K.    Option of indicating estimate cost of service.

      L.    Authorized cost of service.

      M.    Operator ID number to enter the authorization.

                                       32
<PAGE>   33
      N.    Operator ID number to last change authorization.

      O.    Date of last change.

      P.    Deny days and reason for in patient authorizations.

      Q.    Deny request for services by referral service code (w/reason).

      R.    Emergency, non emergency, urgent care code indicator.

      S.    Screen alert for member special requirements.

      T.    Memo/comment area capabilities.

The ability to create temporary providers who are not on the system.

The ability to automatically generate a control number to uniquely identify an
authorization abstract.

The ability to access and display an authorization number on-line.

The ability to record, track and resolve appeals of denied services
(Enhancement-No Charge)

BILL PROCESSING

The ability to accommodate multiple tier premium structures (i.e., single,
family, etc.)

The ability to adjust the premium by:

      A.    Age.

      B.    Sex.

      C.    Medicare Vs non Medicare.

      D.    Contract Group.

      E.    Benefit Plan (rate code).

The ability to track current, historical, and future rate history and billing
provision.

The ability to process retroactive premium billing and credits for enrolls,
disenrolls, and changes.

The ability to accommodate COBRA billing.

                                       33
<PAGE>   34
BILL PRINTING

The ability to process the following billing cycles:

      A.    Monthly.

      B.    Bimonthly

      C.    Quarterly.

      D.    Semi-Annually.

PROVIDER MAINTENANCE

The ability to add, change, review and delete provider demographic and contract
information online.

The ability to restrict deletion of any physician with claims, encounters, or
referrals for that physician.

The ability to delete terminated providers from the data file after a user
specified period of time.

The ability to maintain two separate addresses for each provider (i.e.,
service address vs billing address.)

The ability to maintain at least one provider specialty for which the provider
is authorized.

The ability to maintain at least two separate addresses for each provider (i.e.
service address & billing address). Can be expanded to as many as ten separate
addresses for each provider.

Ability to allow more than one provider specialty in the provider maintenance
file.

The ability to track facility inspections and approvals for each provider.
(Enhancement-No Charge)

The ability to classify providers as both PCP and Specialists.

The ability to generate Providers Directories based on:

      A.    Group Affiliation

      B.    Zip Code

      C.    Specialty

      D.    Other user defined categories

                                       34
<PAGE>   35
                                    EXHIBIT B

                             CONFIDENTIALITY AGREEMENT

B 1.  AGREEMENT

      The undersigned has received and will receive access to Licensor's
      Software and Information subject to the terms and conditions set forth
      below.

B 2.  DEFINITIONS

      Licensor refers to Quality Care Solutions, Inc. Licensee refers to Molina
      Medical Centers Inc. and its affiliates, the other party signing this
      Confidentiality Agreement. Licensor Product refers to a software product
      and all documentation related thereto created and produced by Licensor and
      its subsidies. Licensor Information refers to all information, whether
      oral or written, manuals or on-line documentation, relating to Licensor
      products and the business operations (e.g. management, methods, finances,
      customers and business plans and strategies) of Licensor and its
      subsidiaries, except such information which Licensee documents (A) is or
      becomes generally known to Licensor's industry through no fault of
      Licensee, (B) is already rightfully known by Licensee through means other
      than disclosure by Licensor, (C)is rightfully received by Licensee from a
      third party having no obligation of confidence regarding such information,
      or (D) is independently developed by Licensee without breach of this
      Confidentiality Agreement.

      Licensor's use of particular information in its products and its business
      operations is confidential, whether or not the particular information is
      generally known, unless one of the exceptions applies to the fact of
      Licensors use of that particular information. A combination of information
      is confidential, even if exceptions apply to parts of the combination,
      unless one of the exceptions applies to the combination and its principles
      of operation and its economic value.

B 3.  ACKNOWLEDGMENTS

      B 3.1 Licensor Products and all techniques, algorithms, data models,
      stored procedures, schema's, and processes contained therein or any
      modification, extraction, or extrapolation thereof are the property and
      trade secrets of Licensor. The expression thereof is also protected under
      the copyright laws. The copyright notice on Licensor products does not
      imply unrestricted or public access to these materials. No duplication,
      usage, disclosure, or publication thereof, in whole or in part, for any
      purpose is permitted, except that which is expressly permitted by this
      Confidentiality Agreement or other written agreement with Licensor. All
      rights are reserved.

      B 3.2 Licensor information is the property and trade secret of Quality
      Care Solutions, Inc.

                                       35
<PAGE>   36
      B 3.3 Licensee acknowledges that any Licensor Products or Information
      which may have been disclosed to Licensee prior to the Confidentiality
      Agreement is subject to the terms and conditions herein.

      B 3.4 This Confidentiality Agreement does not grant a license or any other
      right to Licensor Products or Information, except the disclosure rights
      expressly set forth herein.

      B 3.5 The provisions of this Confidentiality Agreement are in addition to
      and not exclusive of any and all other obligations and duties of the
      Licensee with respect to Licensor Products and Information, whether
      express or implied, oral or written, in fact or in law.

      B 3.6 For the sole purpose of Licensor enforcing this Confidentiality
      Agreement through injunctive relief, Licensee acknowledges that the
      unauthorized use or disclosure of Licensor Products or Information would
      cause irreparable harm to Licensor. Such remedy shall not limit Licensor
      from pursuing any other remedy, in law or in equity, available to Licensor
      for a breach or anticipatory breach of this Confidentiality Agreement.

B 4.  DISCLOSURE TERMS

      B 4.1 Licensee shall hold in confidence all Licensor Products and
      Information which Licensee has received or will receive, using at least
      the same degree of care as Licensee exercises for its own trade secrets.

      B 4.2 Licensee shall not use or disclose Licensor Products or Information
      which Licensee has received or will receive, without Licensor's prior
      written approval, except as set forth in Sections B 4.3 and 5.

      B 4.3 Licensee may disclose appropriate portions of Licensor Products and
      Information to such of Licensee's employees who have been informed of
      Licensee's obligation to protect the intellectual property rights of
      Licensor and who have a specific, legitimate need to access such portions
      of Licensor's Product and Information for the purpose of evaluating
      Licensor and Licensor Products. Licensee may copy the Licensor Product and
      Information as reasonably necessary to accomplish such purpose with due
      regard for Licensee's obligations herein (e.g. to limit use and disclosure
      and to return all copies).

      B 4.4 Licensee shall notify Licensor of any potential breaches of
      security. Licensee agrees to reproduce Licensor's copyright and
      proprietary notices on all copies or transmissions of Licensor Products
      and information. Licensee shall not remove or obscure any copyright or
      other proprietary notices from Licensor Products or Information. Licensee
      shall not take any action inconsistent with Licensor's intellectual
      property rights in the Licensor Products. Licensee shall not take any
      action to reverse engineer any Licensor product or any part thereof.
      Licensee and standard reports generated from QMACS(TM) software are
      specifically excluded from requirements of displaying Copyright notices of
      Licensor.

                                       36
<PAGE>   37
B 5.  DISCLOSURE REQUIRED BY LAW

      B 5.1 If Licensee is ordered by a court or other governmental body of
      competent jurisdiction to disclose Licensor Product information, Licensee
      shall not be liable for disclosures required by such order if the Licensee
      reasonably complies with the following requirements: (a) when Licensee
      becomes aware of such an order or the possibility of such an order.
      Licensee shall immediately notify Licensor by the most expedient means,
      (b) Licensee shall join a motion by Licensor for an order protecting the
      confidentiality of Licensor Products or Information, including a motion
      for leave to intervene by Licensor, and if an issued order calls for
      immediate disclosure, Licensee shall immediately request a stay of such
      order to permit Licensor to respond as set forth in subparagraph(b).

B 6.  TERMINATION

      B 6.1 Within fifteen(15) days of notice or termination, Licensee agrees
      to immediately return or destroy all copies of all Licensor Products and
      Information as directed by Licensor and to provide written certification
      to Licensor of having complied with Licensors direction.

      B 6.2 Licensee's obligations under this Confidentiality Agreement shall
      continue for a period of five (5) years after termination of License
      Agreement.

B 7.  GENERAL PROVISIONS

      B 7.1 Governing Law. This Confidentiality Agreement shall be governed by
      the laws of the State of Arizona, without regard to its choice of law
      principles. Licensor and Licensee consent to the personal jurisdiction of
      the federal courts located in the State of Arizona.

      B 7.2 Modifications to Agreement. Licensor and Licensee acknowledge that
      neither has been induced into this Confidentiality Agreement by any
      condition, representation, or warranty not set forth in this
      Confidentiality Agreement. Any modifications to this Agreement are invalid
      unless confirmed in a writing which states that it amends this Agreement
      and which is signed by an authorized officer of Licensee and Licensor's
      President. Any subsequent agreements are invalid unless confirmed in a
      writing which is signed by an authorized officer of the Licensee and
      Licensor's President.

      B 7.3 No Waiver. The failure of either party at any time to require
      performance by the other party of any provision of the Confidentiality
      Agreement shall in no way affect the right of such party to require
      performance of that provision. Nor shall such failure be constructed as a
      waiver of any continuing or succeeding breach of such provision, a wavier
      of the provision itself, or a wavier of any right under this
      Confidentiality Agreement.

      B 7.4 Partial Invalidity. If any provision of this Agreement is held
      invalid, such invalidity shall not affect other provisions of this
      Agreement which can be given effect

                                       37
<PAGE>   38
      without the invalid provisions. Provisions deemed to be invalid shall be
      reformed to the minimum extent necessary to render them valid at such time
      and, to the extent possible, in accordance with the original intent of the
      parties. For example, it is the intention of the parties that, if a court
      deems any provision of this contract to be invalid because of the duration
      of such provision or the area or matter covered thereby, such court shall
      reduce the duration, area, or matter of such provision and, in its reduced
      form, such provision shall be enforced.

      B 7.5 Interpretation. "Include", "includes", and "including" shall be
      interpreted as introducing a list of examples which do not limit the
      generality of the concept they illustrate. "Modification" to the product
      includes corrections to the product, additions to the product, and
      translations of the product. "Intellectual property rights" refers to
      patent right, copyright, or trade secret right.

      B 7.6 Notice. Any notice given pursuant to this Confidentiality Agreement
      shall be in writing, shall state that it is a notice given pursuant to
      this Confidentiality Agreement, and shall be sent by certified mail to the
      address indicated below

      IN WITNESS WHEREOF, the parties hereto have caused this Confidentiality
      Agreement to be written, and the persons signing warrant they are duly
      authorized to sign on behalf of their respective parties.

For Licensee: Molina Medical Centers Inc.

      By:  /s/ John C. Molina

      Name: John C. Molina

      Title:      Vice President

      Address:    One Golden Shore Drive, Long Beach, CA 90802

      Date:  May 24, 1996

For Licensor: Quality Care Solutions, Inc.

      By:  /s/ A. Bruce Oliver

      Name: A. Bruce Oliver

      Title:      President

      Address:    14440 W. 13th Place, Phoenix AZ  85048

      Date:  May 28, 1996

                                       38
<PAGE>   39
                                    EXHIBIT C

                        FEES, RATES AND PAYMENT SCHEDULES

C 1.  SOFTWARE LICENSE AND SUPPORT FEE:

      In consideration of the licenses granted hereunder, Licensee hereby agrees
      to pay Licensor at the first of each month according to the following
      Software License Fee schedule as defined in this Section 1 of Exhibit C.
      Licensee hereby agrees to permit Licensor electronic access to Licensee's
      enrollment database monthly for the purpose of determining the count of
      members enrolled on the first day of the respective month for License Fee
      billing purposes. In the event Licensor is unable to determine the proper
      enrollment on the first of each month, Licensee agrees to accept and pay
      an estimation of Licensee Fee provided by Licensor. All estimations of
      monthly License Fees will be reconciled within ninety (90) days to a
      corrected amount.

      C 1.1 SOFTWARE LICENSE AND SUPPORT FEE SCHEDULE. [Confidential treatment
      has been requested]

      Licensee agrees to pay Licensor a Software and Support Fee for using the
      QMACS(TM) Software in managing and administering its Benefit Plans.
      Licensee agrees to pay the Software License and Support Fee schedule as
      follows:

            $ [****] Per Member Per Month ("PMPM") up to [****] members plus

            $ [****] Per Member Per Month ("PMPM") from [****] to [****]
            members plus

            $ [****] PMPM from [****] members up to [****] members plus

            $ [****] PMPM over [****] members.

      The above rates are cumulative up to the respective total number of
      Licensee's Members.

      C 1.2 CLAIMS PROCESSING PRODUCTIVITY INCENTIVE (CPPI) [Confidential
      treatment has been requested] - Licensee agrees to increase the payment of
      the Software License and Support Fee by [****] (ten cents per member per
      month) across each member category as defined in Section C1.1 if the
      Software is capable of processing and adjudicating [****] claims per
      claims examiner per month or [****] (*****************) adjudicated claims
      per examiner per 8(eight) hour day.

      The measurement for the CPPI is based on the following non-software
      criteria:

            a)    A QMACS(TM) experienced claims examiner entering and
                  adjudicating claims from a mix of standard HCFA 1500 or UB-92
                  claim forms. The Licensor will be allowed to demonstrate to
                  Licensee the ability to reach the goal of [****] claims per 8
                  (eight) hour day using experienced Licensor personnel.

            b)    A Claims Data Server and Network configured according to
                  Licensor specifications.

                                       39

                    **** - Confidential Treatment Requested
<PAGE>   40
            c)    A Client Workstation configured according to Licensor
                  specifications.

            d)    A properly configured QMACS(TM) Software system.

      The CPPI is payable when Licensor demonstrates the ability to process and
      adjudicate [****] claims per 8 (eight) hour day. The CPPI can be reviewed
      on a quarterly basis if deemed necessary.

      C 1.3 LATE PAYMENT AND INTEREST - Licensee agrees any payment under this
      Exhibit C which is more that thirty (30) days late will accrue interest at
      the rate of Twelve (12%) percent per annum (or the highest rate of
      interest allowed by applicable law if lower) until paid in full. Licensor
      shall have the right to suspend all its obligations under this Contract in
      the event that payment is more than thirty (30) days late. Licensor agrees
      to notify Licensee in writing at least 15 days prior to suspending its
      obligations for late or non payment. Notices of intent to suspend
      obligations will be delivered in accordance with Exhibit E.

      In the event that Licensee determines in its reasonable judgment that a
      billing error has occurred. Licensee must notify Licensor in writing
      within thirty (30) days of receipt of such erroneous items. Licensee
      agrees to pay all undisputed items on an invoice which may have disputed
      items contained thereon. Licensor agrees that no late payment fee shall be
      applicable for contested invoice items until thirty (30) days following
      Licensor's response to Licensee's notice of billing error.

      C 2.  DATA CONVERSION FEES: [Confidential treatment has been requested]

            C 2.1 Licensee agrees to pay Licensor for Data Conversion work as
            outlined in Exhibit F at the rate of [****] for the Test Phase and
            [****] for subsequent data conversion plus reasonable and customary
            travel, lodging and per diem expenses for Licensor's project
            personnel not stationed within 75 miles of Licensor's work site.
            Licensee hereby agrees to accept and abide by the Licensor's Travel
            and Expense guidelines in Section 8 of Exhibit C for on site data
            conversion work requested or authorized by Licensee.

      C 3. IMPLEMENTATION SERVICE FEES:[Confidential treatment has been
           requested]

            C 3.1 Licensee agrees to pay Licensor for additional or optional
            Implementation service fees at the following rate schedule:

            Manual data entry for software set-up.............$ [****] per Hour

            Report Design, Implementation and Production......$ [****] per Hour

            Project Management Services.......................$ [****] per Hour

                                       40

                    **** - Confidential Treatment Requested
<PAGE>   41
            Specific or Proprietary modification of basic
            software...........................................$ Per Quotation

            Construction of Interfaces to other software
            applications......................................[****] per Hour

            Exclusive development of new modules,
            sub-systems.......................................[****] per Hour

            Licensor and Licensee agree that additional and optional services
            may be requested. Such requests will be in the form of written work
            order requests, written quotations and signed authorizations before
            any work will commence for the Licensee.

      C 4.  TRAINING FEES: [Confidential treatment has been requested]

            Licensor agrees to provide Licensee start-up training of not more
            than one hundred twenty (120) hours without training cost. Travel
            and lodging costs for all training will be the responsibility of
            Licensee as outlined in Section C8. Continuing education will be
            charged according to the following fee schedule:

            Additional Training Fees:

            Licensor Application Training Fees.........................[****]

            Third Party Application Training Fees......................[****]

            Operating System, Language, Network Management, Database
            Training, System Management, Systems Integration...........[****]

      C 5.  CONSULTING FEES:

            Licensor agrees to provide technical consulting to Licensee upon
            request of an authorized executive of the Licensee's organization on
            a quoted time and material basis.

      C 6.  HARDWARE CONFIGURATION:

            Licensor agrees to provide Licensee reasonable hardware
            configuration consulting necessary to operate Licensor's software
            products on Licensee's computer equipment without additional charge.

            Licensor reserves the right to charge Licensee for hardware
            consulting and servicing Licensor deems outside the scope and intent
            of Licensor's service.

      C 7. DELIVERY AND INSTALLATION:

            Licensee agrees to the following terms and condition of the Licensor
            if the Licensee requests or hires the Licensor to act as an agent to
            procure, set-up and install computer hardware and equipment on
            behalf of the Licensee.

                                       41

                    **** - Confidential Treatment Requested
<PAGE>   42
            C 7.1 The "delivery date" for each item of Vendor's Hardware and
            Operating system software shall be the date on which Licensor
            delivers and fully installs the specific item of hardware at
            location specified in Exhibit E.

            C 7.2 Shipment of the Vendor's hardware and software shall be F.O.B.
            the location specified in Exhibit E. All freight charges on the
            hardware and operating system software shall be the responsibility
            of the Licensee.

            C 7.3 The Licensee is responsible to ensure all wiring,
            environmental, safety codes and equipment manufacturer's
            installation specifications are met prior to installation. The
            Licensee agrees to pay or reimburse Licensor for additional costs
            incurred as a result of unsatisfactory installation preparation,
            practices, procedures or site conditions corrected by Licensor.

            C 7.4 Title to Vendor's Hardware and operating system software shall
            pass to Licensee at the F.O.B. Point, but subject to a security
            interest until the date the Licensee has fully paid for the Hardware
            and operating system software.

      C 8. TRAVEL AND EXPENSE GUIDELINES.

            C 8.1 Travel and Lodging guidelines. Licensee agrees to reimburse or
            pay Licensor for reasonable travel, meals, lodging, per diem
            expenses which are incurred by Licensor on installation,
            implementation, training, maintenance, support, consulting at the
            Licensee's office or location defined in Exhibit E or if Licensee's
            work location is in excess of seventy-five (75) miles of Licensor's
            main office.

                                       42
<PAGE>   43
                                    EXHIBIT D

                           HARDWARE/SOFTWARE ELEMENTS

      The following is the standard computer specification necessary to operate
      the Licensor's QMACS(TM) software system:

      DATA SERVER SPECIFICATIONS:

      CLIENT SPECIFICATIONS:

                       TO BE DETERMINED AFTER THE TEST PHASE

                                       43
<PAGE>   44
                                    EXHIBIT E

                              LOCATION AND NOTICES:

      Locations for Installation of QMACS(TM) software and Approved Computer(s)
      will be listed below.

      Any notices required or permitted hereunder shall be sufficiently given if
      sent by registered or certified mail, postage prepaid, addressed or
      delivered as follows:

                                      NOTICES:

      A.     To Licensor:           Quality Care Solutions, Inc.
                                    14440 S. 13th Place
                                    Phoenix, AZ 85048
                                    Attention: Mr. J. Mikel Echeverria

      B.    To Licensee:            Molina Medical Centers Inc.
                                    One Golden Shore Drive
                                    Long Beach, CA 90802

      INSTALLATION LOCATIONS:
                                    Molina Medical Centers Inc.
                                    One Golden Shore Drive
                                    Long Beach, CA 90802

                                       44
<PAGE>   45
      Licensor shall not bill for any time spent in the development or
      preparation of written work orders, quotations for work or detail
      specifications of program design.

      C 3.  TRAINING FEES: [Confidential treatment has been requested]

      Licensor agrees to provide Licensee start-up training of [****] hours
      without additional training cost. Travel and lodging costs for all
      training will be the responsibility of Licensee as outlined in Section C7.
      Continuing education will be charged according to the following fee
      schedule:

            Additional Training Fees:

            Licensor Application Training Fees [****] Third Party
            Application Training Fees [****]

            Operating System, Language, Network Management, Database
            Training, System Management, Systems Integration [****]

            Additional Training required for implementation of Licensee
            affiliated Health Plans beyond the establishment of Maryland Care,
            Inc. shall be provided at rates [****] below each above identified
            hourly rate.

      C 4.  CONSULTING FEES:

      Licensor agrees to provide technical consulting to Licensee upon request
      of an authorized executive of Licensee on a quoted time and material
      basis.

      C 5.  HARDWARE CONFIGURATION:

      Licensor agrees to provide Licensee reasonable hardware configuration
      consulting necessary to operate Licensor's software products on Licensee's
      computer equipment without additional charge.

      Licensor reserves the right to charge Licensee for hardware consulting and
      servicing Licensor deems outside the scope and intent of Licensor's
      service.

      C 6.  DELIVERY AND INSTALLATION:

      Licensee agrees to the following terms and conditions of the Licensor if
      the Licensee requests or hires the Licensor to act as an agent to procure,
      set-up or install computer hardware and equipment on behalf of the
      Licensee. Vendors Hardware and Operating system refers to computers,
      operating system software and database software listed in Exhibit D to be
      procured from a third party supplier on behalf of the Licensee.

            C 6.1 The "delivery date" for each item of Vendors Hardware and
            Operating system software listed in Exhibit D shall be the date on
            which Licensor delivers and fully installs the specific item of
            hardware at locations specified in Exhibit E.

                                       45

                    **** - Confidential Treatment Requested
<PAGE>   46
            C 6.2 Shipment of the Vendor's hardware and software shall be F.O.B.
            the location specified in Exhibit E. All freight and handling
            charges on the hardware and operating system software shall be the
            responsibility of the Licensee.

            C 6.3 The Licensee is responsible to ensure all wiring,
            environmental, safety codes and equipment manufacturers'
            installation specifications are met prior to installation. The
            Licensee agrees to pay or reimburse Licensor for additional costs
            incurred as a result of unsatisfactory installation preparation,
            practices, procedures or site conditions corrected by Licensor.

            C 6.4 Title to Vendor's Hardware and Operating system software shall
            pass to Licensee at the F.O.B. Point, but subject to a security
            interest until the date the Licensee has fully paid for the Hardware
            and Operating system software.

      C 7.  TRAVEL AND EXPENSE GUIDELINES.

            C 7.1 Travel and Lodging guidelines. Licensee agrees to reimburse or
            pay Licensor for reasonable travel, meals, lodging, per diem
            expenses which are incurred by Licensor on installation,
            implementation, training, maintenance, support, consulting at the
            Licensee's office or location defined in Exhibit E or if Licensee's
            work location is in excess of seventy-five (75) miles of Licensor's
            main office.

                                       46
<PAGE>   47
                                    EXHIBIT D

                           HARDWARE/SOFTWARE ELEMENTS

      Attached to this Agreement is a mutually agreed upon computer
      specification necessary to operate Licensor's QMACS(TM) Software system.
      Utility Software, Operating System Software and Hardware Equipment
      procurement are Licensee's responsibility.

      Recognizing the fluid technological environment in existence relative to
      available hardware and software, Licensor and Licensee mutually agree that
      the listed hardware and operating/network software constitute an approved
      operating platform and network topology to assure an acceptable level of
      operating performance of the QMACS(TM) Software based on membership
      projections and user topology provided by Licensee.

      Licensor and Licensee mutually agree that this environment may, from time
      to time, need to be updated to accommodate the then current industry
      acceptable standards. Licensor warrants, however, that substantive changes
      in the QMACS(TM) product which mandate upgrades of hardware and/or
      operating or network software will not be implemented without concurrence
      by Licensee in or on any Managed Health Plan and, further, that Licensor
      will make every effort to allow at least a one hundred eighty (180) day
      advance notice of such change requirements. Changes as described do not,
      in any way, make null or void any obligation of Licensor as described in
      this Agreement.

                                       47
<PAGE>   48
                                    EXHIBIT E

                              LOCATION AND NOTICES:

      Locations for Installation of QMACS(TM) Software and Approved Computer(s)
      will be listed below.

      Any notices required or permitted hereunder shall be sufficiently given if
      sent by registered or certified mail, postage prepaid, addressed or
      delivered as follows:

                                      NOTICES:

      A.    TO LICENSOR:      Quality Care Solutions, Inc.
                              5030 E. Sunrise Drive
                              Phoenix, AZ 85044
                              Attention: Mr. A. Bruce Oliver

      B.    TO LICENSEE:

      INSTALLATION LOCATIONS:

                                       48
<PAGE>   49
                                    EXHIBIT F

   PROPOSED DATA CONVERSION PLAN: [Confidential treatment has been requested]

      It is agreed that no data will be converted for the implementation of
      [****]

      Subsequent implementations of other Licensee affiliated Health Plans may
      involve the conversion of data from other systems. Each such
      implementation shall have a unique data conversion plan, the content of
      which shall be mutually agreed upon by Licensor and Licensee and the cost
      of which shall be defined and agreed upon prior to the initiation of the
      implementation project.

                                       49

                    **** - Confidential Treatment Requested
<PAGE>   50
                                    EXHIBIT G

                              PROGRAMMING SERVICES

      G 1. CUSTOM QMACS(TM) SOFTWARE. If Licensor shall agree in writing to
      develop any customized software or modification of the QMACS(TM) Software
      (the "Customized Software") for Licensee, such Customized Software or
      modifications shall be deemed to be jointly owned by Licensor and Licensee
      for purposes of this Agreement and shall not be made available to the
      Licensor customer base, or licensed by Licensor without the express
      written permission of Licensee. Licensor warrants that the Customized
      Software will meet the specifications for Customized Software and be
      covered by the warranty provisions of Article VII of the Software License
      and Support Agreement. If Licensee shall cancel any Customized Software
      request, Licensee shall be obligated to pay to Licensor an amount equal to
      Licensors then current hourly fees multiplied by the number of hours
      Licensor has expended on the Customized Software project up to the date of
      receipt of Licensee's notice to terminate the project. In addition,
      Licensee shall pay to Licensor all expenses (except for programming
      expenses which shall be calculated as set forth in the preceding sentence)
      incurred by Licensor to develop the Customized Software up to the time of
      termination of the project. Such amounts shall be paid by Licensee to
      Licensor within thirty (30) days of receipt by Licensee of Licensor's
      invoice.

      G 2. PROGRAMMING SERVICES. Upon Licensee's request, Licensor may provide
      custom programming services for Licensee at Licensor's then current hourly
      rates. The Support Services provided under the Monthly Fees do not cover
      Support Services for programs and applications developed pursuant to this
      Programming Services Section. Upon Licensee's request, Support Services
      for such customized programs and applications may be provided to Licensee
      at either Licensee's hourly rates as defined in the Software License and
      Support Agreement or at a fixed cost to be determined and mutually agreed
      upon on a per project basis. Unless the Parties agree otherwise in
      writing, the programs and applications developed pursuant to this Section
      in collaboration with each other and all corresponding copyrights and
      intellectual property shall be owned and held by Licensor with Licensee
      holding a paid up exclusive license to use and copy said programs and
      applications as permitted in this Agreement but Licensee may not transfer
      or disclose them to any third party.

      G 3. INSTRUCTIONS FOR CUSTOM PROGRAMMING. In the event that Licensor
      provides to Licensee Custom Programming by the mutual written agreement of
      the Parties. Licensor shall provide brief written instructions on the
      operation of the Customized Software requested by Licensee. Such
      instructions may not be as detailed as those provided in Licensors
      Documentation. Inasmuch as the mutually agreed upon specifications shall
      serve as the basis for Custom Program development, Licensor shall still be
      obligated to incorporate and provide standard documentation for any
      customized program to a level and degree as provided with the base
      QMACS(TM) Software. This documentation is to be made available to Licensee
      upon acceptance, approval and implementation of such customized
      programming into production for at least one Managed Health Plan.

                                       50
<PAGE>   51
                                    EXHIBIT H

                       STANDARD SUPPORT AND RELEASE POLICY

      1.    Released software will only be modified to handle problem fixes,
            not enhancements.

      2.    Problems will be classified as urgency 1, 2, or 3 (L11, L12, L13)

            A U1 problem is a problem (Material Non-Conformity) that prevents a
            major function from working or causes data integrity issues, and for
            which there are no workarounds. Any operation of the Software which
            causes material erroneous data or unrecoverable data loss due to the
            execution of the Software's Applications.

            A U2 problem is a problem that prevents a non-major function from
            working and for which there is no workaround.

            A U3 problem is a problem that is an annoyance but does not prevent
            a non-major function from working or there is a workaround.

            a)    Example of a U1 problem.  Can't adjudicate a claim, can't
                  add or modify a provider, can't add or modify an
                  enrollment, etc.

            b)    Example of a U2 problem.  Can't add a new licensing board
                  to the credentialing module.

            c)    Example of a U3 problem.  Authorization history doesn't
                  refresh when a new authorization is issued.

      3.    Every attempt will be made to turn around U1 problem fixes within
            eight (8) working days of duplication.

      4.    U2 problem fixes will be supplied within [****] working days.

      5.    U3 problem fixes will be released at the next major release, or, no
            later than [****] days from the notification of such problem by
            Licensee or Affiliates. [Confidential treatment has been requested]

      6.    Licensor's Customer service representative will be responsible
            for clearly distinguishing between a problem fix and an enhancement
            to the Licensee.

      7.    Enhancements require scheduling for design, development, testing,
            documentation, release notes and training before they can be
            released into a production environment for Licensee use.

      8.    Software released before testing, documentation, release notes and
            training phases are complete is classified as 'beta test' software.
            Beta test software will require beta test

                                       51

                    **** - Confidential Treatment Requested
<PAGE>   52
      agreements to be signed and approved by Licensee before the beta test
      software will be released for use by the Licensee.

      9. All Software released for use or testing by Licensee shall be placed in
      an agreed upon location on the Licensee's Approved Application Server for
      appropriate disposition by Licensee.

      10.   The use and maintenance of an application test environment shall
      be the sole responsibility of the Licensee.

                                       52
<PAGE>   53
                                    EXHIBIT I

                          CLAIMS, PROCEEDINGS, ACTIONS

      Redpath Computer Services, Inc. v. Regional AHCCCS Health Providers,
      Inc., Digital Sciences, Inc., Ventana Health Systems and Intergroup
      Healthcare Com., Case No. CIV 96-1732-PHX-ROS.

                                       53<PAGE>   1
                                                                   EXHIBIT 10.10

                          QUALITY CARE SOLUTIONS, INC.
                     SOFTWARE LICENSE AND SUPPORT AGREEMENT
                                       AND
                            CONFIDENTIALITY AGREEMENT

THIS AGREEMENT is made and entered into as of the 23rd day of November, 1996,
between Quality Care Solutions, Inc. ("QCSI" or the "Licensor"), an Arizona
Corporation with executive offices in Phoenix, Arizona and Schaller Anderson of
Arizona, L.L.C., an Arizona Limited Liability Company with principal offices in
Phoenix, Arizona (the "Licensee").

                                       1
<PAGE>   2
<TABLE>
<CAPTION>
                                Table of Contents
<S>                                                                 <C>
DEFINITIONS.......................................................    3
THE LICENSE.......................................................    6
DELIVERABLES......................................................    8
SUPPORT SERVICES..................................................   10
SPECIAL RESPONSIBILITIES OF LICENSEE..............................   13
RESTRICTIONS......................................................   15
WARRANTY, PATENT AND COPYRIGHT INFRINGEMENT, LIMITATIONS ON
LIABILITY AND REMEDIES, AND LICENSEE'S LIABILITY..................   16
TERMINATION, DISCONTINUANCE AND REMEDIES..........................   19
GENERAL PROVISIONS................................................   21
EXHIBIT A - SPECIFICATIONS OF QMACS(TM)SOFTWARE...................   25
EXHIBIT B - CONFIDENTIALITY AGREEMENT.............................   35
EXHIBIT C - FEES, RATES AND PAYMENT SCHEDULES.....................   41
EXHIBIT D - HARDWARE/SOFTWARE ELEMENTS............................   45
EXHIBIT E - LOCATION AND NOTICES:.................................   46
EXHIBIT F - PROPOSED DATA CONVERSION PLAN:........................   47
EXHIBIT G - PROGRAMMING SERVICES..................................   48
EXHIBIT H - STANDARD SUPPORT AND RELEASE POLICY...................   49
EXHIBIT I - CLAIMS, PROCEEDINGS, ACTIONS..........................   51
EXHIBIT J - ESCROW INSTRUCTIONS...................................   51
</TABLE>

                                       2
<PAGE>   3
                                   WITNESSETH

WHEREAS, Licensor has created and developed computer software which operates on
micro computers and mid-range computers for financial, administrative and
operational uses in the managed care business, by health maintenance
organizations and by third party administrators and is willing to grant Licensee
a non-exclusive license to use such software in accordance with the terms and
conditions hereof; and

WHEREAS, Licensee owns, controls and/or operates a managed care organization, a
health maintenance organization, a third party administrator or other health
care business and wishes to obtain a non-exclusive license to use the Licensor's
software, as specified hereinafter; and

WHEREAS, Licensee and Licensor desire to enter into an agreement formalizing the
terms and conditions of a license, the supply of future software and related
support and other services (the "Agreement"); and

WHEREAS, Licensor and Licensee are considered each to be a "Party" to this
Agreement and are hereinafter jointly referred to as the Parties.

NOW, THEREFORE, in consideration of the promises and mutual representations
herein contained, the Parties hereto agree as follows:

                                   ARTICLE I.

                                   DEFINITIONS

"AFFILIATE" shall mean an entity controlled by, controlling, or under common
control with Licensor or Licensee.

"AGREEMENT FEES" shall mean any fee specified on Exhibit C.

An "APPLICATION" is defined as one or more Client Executables designed to
accomplish a specified business function, as listed in Exhibit A.

An "APPROVED APPLICATION SERVER" is defined as a computer whose hardware and
software configuration have been approved by Licensor as appropriate to execute
the Client portions of the QMACS(TM) Software in a test environment maintained
by Licensee. The Approved Application Server will also operate
Licensee-initiated functions such as Electronic Mail, Communications, updates
and releases of software, back-up of data, data transfers and other utility
functions.

An "APPROVED CLIENT" is defined as a computer whose hardware and software
configuration have been approved by Licensor as appropriate to execute the
Client portions of the QMACS(TM) Software.

                                       3
<PAGE>   4
An "APPROVED DATA SERVER" is defined as a computer whose hardware and software
configuration have been approved by Licensor as appropriate to execute the Data
Server portions of the QMACS(TM) Software.

"APPROVED HARDWARE" means Approved Data Servers, Approved Clients, Approved
Operating Systems and Approved Network as identified in Exhibit D.

"APPROVED NETWORK" is defined as the wiring, communication lines, networking and
software, communication protocols and equipment necessary for the connectivity
and communication between Approved Clients and Approved Data Servers via local
or wide area networks.

An "APPROVED OPERATING SYSTEM" is defined as Microsoft's WindowsNT(TM).

"AUTHORIZED LOCATION(S)" means those locations where the Software is authorized
to be installed, as specified on Exhibit E.

A "BENEFIT PLAN" is any reimbursement plan administered by an administrator that
has members and pays claims.

A "BILLING MONTH" is defined as a monthly period that the Licensor and Licensee
agree to for billing purposes.

A "CLIENT" is defined as a computer used generally by staff personnel, which
communicates with one or more Data Servers and runs Client Executables to
access, analyze and update databases stored on a Data Server.

A "CLIENT EXECUTABLE" is defined as a program which is part of the Software
designed to execute on a computer operating as a Client on a network connecting
to and utilizing a Data Server.

"DATA BASE ADMINISTRATOR" is defined as the Licensor's activities to maintain on
the Approved Data Server data table definitions, views, user defined data types,
triggers, stored procedures and other attributes of the data base definitions
and structure integral to the Software.

A "DATA SERVER" is defined as a computer used to hold large amounts of
electronic data plus provide database management and access services to Client
computers on a computer network. Portions of the QMACS(TM) Software reside on
the Data Server.

A "DERIVATIVE WORK" means any modifications of QMACS(TM) Software or a work
which is based upon the QMACS(TM) Software code, either source or object, or
which requires the QMACS(TM) Software to function. Derivative Work shall not
include custom interfaces or custom software developed under Exhibit G.

"DOCUMENTATION" is defined as manuals, training tapes, training workbooks, help
screens, quick reference guides and other information contained in tangible or
electronic media that explains the QMACS(TM) Software and its operations.

                                       4
<PAGE>   5
"EXECUTABLE CODE" is defined as a program which is part of the QMACS(TM)
Software and actually performs the functions in conjunction with the Client or
the Data Server as compared to source code, which is the code developed to
create the Executable Code.

"EXECUTION DATE" means the date that the last Party hereto executes this
Agreement.

"ENHANCED SOFTWARE" means the revised Software that Licensor may, from time to
time, release which is a new version or updates of QMACS(TM) Software, including
Executable Code and which may, but is not required to, increase the
functionality, ease of use or productivity of the QMACS(TM) Software.

"HARDWARE AND SOFTWARE ELEMENTS" means the required computer hardware and
software identified in Exhibit D to operate QMACS(TM) Software.

"IMPLEMENTATION" shall mean consulting services related to the conversion of
data as well as the set-up of operating system software, core relational
database software, database tables and QMACS(TM) training unless other
arrangements are agreed to and set forth in writing and signed by both Parties.

"LAN" shall mean a local area network.

"LICENSEE" is defined as Schaller Anderson of Arizona, L.L.C.

"LICENSEE'S ADDRESS" means that address stated in Exhibit E of this Agreement or
changed from such address by Licensee giving Licensor proper written notice.

"LICENSOR'S ADDRESS" means that address stated in Exhibit E of this Agreement or
changed from such address by Licensor giving Licensee proper written notice.

"MANAGED HEALTH PLAN" is any managed care organization for which Licensee
provides either executive management services, full turnkey management services
or information services management through a service center arrangement and
whose information services needs are accommodated through the use of the
QMACS(TM) Software. Health Plan and Benefit Plan refer to the same concept
relative to the use of the QMACS(TM) Software.

"MATERIAL NONCONFORMITY" is defined as any operation of the QMACS(TM) Software
which causes material erroneous data or unrecoverable data loss due to the
execution of the QMACS(TM) Software's Applications.

"MEMBER" is defined as a person who is eligible and actively enrolled for
benefits under any Benefit Plan managed by the QMACS(TM) Software.

"MEMBER ENROLLMENT" is defined as the active and enrolled Members in a Benefit
Plan using QMACS(TM) Software. For purposes of Monthly Agreement Fee
computation, multiple enrollments by the same Member during the same month shall
be counted as a single enrollment.

                                       5
<PAGE>   6
"MONTHLY FEES" means the recurring Agreement Fees due each month specified on
Exhibit C.

"NEW SOFTWARE" means new Executable Code, new modules and new Applications that
would allow the Licensee to perform significant functions not listed in the
Specifications. By way of example, an Application that allowed the Licensee to
evaluate the quality of care Members are receiving would be considered New
Software. New Software is not enhancements, modifications or new versions of
QMACS(TM) Software.

"ON-SITE SUPPORT" means that consultation, assistance and similar services
provided by Licensor at the Authorized Location(s) or Licensee's main premises.
Any On-Site Support is subject to Licensor's then current hourly rates. The
reasonable costs of travel, meals and lodging and other expenses incurred by
representatives (e.g., employees, subcontractors, etc.) of Licensor in providing
On-Site Support shall be paid by Licensee upon presentation to Licensee of
supporting documentation therefor.

"OUTSIDE EXECUTABLE CODE" means Executable Code relating to third party
applications which Licensor or Licensee has been granted the right to
sublicense.

"PER MEMBER PER MONTH (PMPM)" is defined as the average number of active Member
enrollments actively managed by the QMACS(TM) Software during a Billing Month.

"PLAN YEAR" is defined as a twelve month (12) period from when Member
enrollments were first accepted into a specific Benefit Plan managed by the
QMACS(TM) Software.

"QMACS(TM)" or the "QMACS(TM) SOFTWARE" is defined as all the current computer
software developed by the Licensor including but not limited to all Client
Executables, Applications, all display screens, the Source Code, any Data Server
Based Programs and any Schema, Stored Procedures, Triggers or Wizards.

"QMACS(TM) EXECUTABLE CODE" means Executable Code relating to the QMACS(TM)
Software which Licensor hereby licenses.

"SPECIFICATIONS" are defined as the features and functions of the QMACS(TM)
Software delivered as described in Exhibit A attached hereto.

"VENDOR" is defined as a third party supplier of computer hardware, software or
services.

"WAN" is defined as a wide area network.

                                   ARTICLE II.

                                   THE LICENSE

2.1 LICENSE GRANT. On the terms and conditions set forth herein, Licensor hereby
grants to Licensee and Licensee hereby accepts a nonexclusive, nontransferable
(except as set forth in

                                       6
<PAGE>   7
Section 9.3) license (the "License") to use QMACS(TM) Software on Approved
Clients, Approved Application Servers and Approved Data Servers using Approved
Operating Systems at the Licensee's Address. The License shall also include a
non-exclusive, non-transferable, limited license to use the QMACS(TM) Executable
Code related to the QMACS(TM) Software. Licensee shall be entitled to receive
any Enhanced Software produced by Licensor during the initial or any renewal
term of this Agreement, as defined in Section 2.7. Unless specified otherwise by
Licensor to Licensee in writing to Licensee's Address, this License and all the
other terms of this Agreement shall also apply to any New Software or Enhanced
Software supplied to Licensee by Licensor after the Execution Date of this
Agreement. This Section does not entitle Licensee to New Software, customized
versions or "beta" versions of the QMACS(TM) Software not yet generally released
to all licensees of QMACS(TM) Software.

2.2 USE OF OUTSIDE EXECUTABLE CODE. Licensor may place a copy of Outside
Executable Code in magnetic form in the possession of Licensee for Licensor's
convenience and use in providing services or support to Licensee. Such copy
shall be clearly marked by Licensor as Outside Executable Code under the
License. Except as Licensor expressly authorizes in writing in each instance,
said copy of Outside Executable Code shall be immediately returned to Licensor
upon Licensor's request. Regardless, such request shall be deemed given upon
expiration or termination of this License. The Parties agree that Licensor is
not responsible for maintenance, support, updates or enhancement of said Outside
Executable Code.

2.3 COPYING. Licensor will provide Licensee with a reasonable number of back-up
copies of the QMACS(TM) Software or Licensee may make a reasonable number of
controlled copies of the QMACS(TM) Software as reasonably necessary to utilize
the QMACS(TM) Software on the Approved Hardware. Licensee may make a reasonable
number of copies of the Documentation for use by Licensee's employees in
connection with the duly authorized use of QMACS(TM) Software (the "Copies").
Licensee shall reproduce and include in all Copies made by it, whether of
Software or Documentation, any and all notices of copyright and other
proprietary rights included by Licensor in or on the QMACS(TM) Software and
Documentation provided to Licensee. All Copies of QMACS(TM) Software or
Documentation or rights granted hereunder to copy the QMACS(TM) Software and the
Documentation are provided to Licensee only for the duration of the License
under this Agreement and only for the purpose of facilitating the licensed use
by Licensee of QMACS(TM) Software.

2.4 OWNERSHIP. All Copies and modifications of QMACS(TM) Software and the
Documentation (including Copies under Section 2.3) are the sole property of
Licensor and Licensor shall hold sole title thereto.

2.5 RETURN OF COPIES. Upon expiration or termination of the License, all Copies
of the QMACS(TM) Software and the Documentation shall promptly be delivered to
Licensor or destroyed by Licensee. Within fifteen (15) days of termination or
expiration of the License, Licensee shall deliver to Licensor a certification in
writing that all Copies have been delivered to Licensor or destroyed.

                                       7
<PAGE>   8
2.6 SAFEGUARD. Licensee shall safeguard all Executable Code and Copies against
non-Licensee use, copying or inspection by any third-party and against transfer
to any third-party. Licensee shall require all persons and entities to whom
Licensee has granted operations authority to save data or who have access to any
Executable Code to execute and submit to Licensor a Confidentiality Agreement as
set forth in Exhibit B.

2.7 TERM OF THE AGREEMENT. Provided that all Agreement Fee(s) are paid timely,
and Licensee complies with the terms and conditions of this Agreement, the
initial term of this Agreement shall be for a period of five (5) years beginning
on the first of the month after the Execution Date except as provided for in
Section 8.1; provided, however, that Licensee shall have the right to terminate
this Agreement at any time upon notification to the Managed Health Plan by a
state regulatory agency that a Managed Health Plan contract is terminating, or
notification that the Licensee management services contract with a Health Plan
is terminating; and, provided further, that Licensee shall have the right, at
any time after the third anniversary of the Execution Date to terminate this
Agreement, with or without cause upon one hundred eighty (180) days prior
notice. After the initial term, this License shall be automatically renewed
under the terms of this Agreement from year to year, assuming Agreement Fees are
timely paid, unless Licensee gives one hundred eighty days (180) prior notice of
its intent to terminate this Agreement at the end of the original or any renewal
term.

2.8 FEES. To maintain its License hereunder, Licensee shall pay to Licensor all
Agreement Fees as provided in Exhibit C attached hereto or as otherwise required
by this Agreement.

                                  ARTICLE III.

                                  DELIVERABLES

3.1 QMACS(TM) SOFTWARE. Prior to the completion of the Implementation, Licensor
will deliver at least one machine readable copy (QMACS(TM) Executable Code form)
of each program for each QMACS(TM) Application in accordance with the
Specifications defined in Exhibit A. Two (2) copies of any Documentation
corresponding to each Application shall be provided to Licensee as such
Documentation is published. At Licensee's option, Licensee may purchase
additional copies of Documentation in printed bound form from Licensor at
Licensor's cost. Licensor shall make available to Licensee at least two (2)
copies of Documentation or Documentation updates per Managed Health Plan as new
releases of QMACS(TM) Software or enhancements to QMACS(TM) Software are made
available. Additionally, Licensor shall make available one (1) additional copy
of Documentation per Managed Health Plan as such new Health Plans are
implemented.

3.2 QMACS(TM) IMPLEMENTATION. Licensor shall be responsible for the initial
installation of QMACS(TM) SOFTWARE database software on the Approved Data Server
and made operational on the Approved Data Server. Licensee shall cooperate fully
with Licensor in such installation and Implementation. The Implementation shall
proceed in accordance with a mutually acceptable Implementation Schedule.

                                       8
<PAGE>   9
3.3 QMACS(TM) TRAINING. Licensor shall provide initial training services to
Licensee's training personnel on the operation of QMACS(TM) Software, New
Software or "Beta Software" as such Software becomes available for use by
Licensee. Licensee agrees to Licensor's train the trainer method of training and
acknowledges that Licensor's training program is designed to train key users on
the operation of the QMACS(TM) Software. Licensee agrees adapting the key user
training to Licensee's operation and tailoring Licensee's work flow process
around QMACS(TM) Software is the responsibility of the Licensee. The initial
training sessions will take place in accordance with a mutually agreed training
schedule and the training hours allowance outlined in Exhibit C. Licensee shall
be permitted to videotape all training sessions. Licensee shall be responsible
for all reasonable, travel, lodging, meals and other related expenses incurred
by either Party in connection with training, and shall reimburse Licensor for
such expenses upon presentation of supporting invoices.

3.4 SUBSEQUENT TRAINING. Subsequent training services, other than those provided
as initial training, shall only be supplied upon the mutual agreement of the
Parties. Additional training services will be quoted to Licensee on a time and
materials basis.

3.5 STANDARD REPORTS. Licensor will deliver a set of standard reports, which
shall include at least those set forth in Exhibit 5, Reports, as described in
Licensor's response to Licensee's Request for Proposal, with the installation of
the Software. Licensee acknowledges that third party report writing software
tools are required to be used to modify the standard reports. The license fee,
support and training cost for third party report writing tools are not included
in this Agreement and must be acquired separately. Licensee acknowledges the
standard reports are templates and examples of reports the Licensor has
developed for non specific use. The Licensee acknowledges responsibility for the
production of its own reports and agrees the delivery of Licensor provided
standard reports meets any report production requirements of Licensor.

3.6 THIRD PARTY INTERFACES. Licensee and Licensor mutually agree that the total
number of Licensor developed data exchange interfaces or interfaces to third
party systems to be provided by Licensor without additional cost to Licensee is
limited to ten (10) separate interfaces per Managed Health Plan and/or Health
Plan for which Licensee provides information services through a service center
arrangement. Licensee may develop an unlimited number of interfaces to third
party systems free of any charge by Licensor and such Licensee-developed
interfaces shall be the property of Licensee. Subsequent to the execution of
this Agreement, utilization of such interfaces by Licensor developed at the
expense of Licensee or required by contract of any Managed Health Plan or
Licensee serviced Health Plan shall be with the express permission of Licensee
where such use shall be made by Health Plans not managed or serviced by
Licensee. Licensee and Licensor shall mutually agree upon any compensation to be
paid Licensee for utilization of such custom interfaces by third parties.

                                       9
<PAGE>   10
                                   ARTICLE IV.

                                SUPPORT SERVICES

4.1 SUPPORT SERVICES GENERALLY. As part of its Monthly Fee Licensor shall
provide to Licensee the certain support services as specified below to
unmodified QMACS(TM) Software (the "Support Services") until the expiration or
termination of the initial or any renewal term of this Agreement.

4.2 MAINTENANCE. Licensor's sole Support Services obligation hereunder is to
provide the programming or documentation services necessary to conform any
Application to the Specifications. This obligation shall remain in effect until
the expiration or termination of this Agreement only if the Licensor can
duplicate the defect. Upon the detection of any Material Nonconformity, Licensee
shall provide to Licensor such output listings, data and other assistance as
Licensor shall request. Licensor shall remedy any Material Nonconformity between
the original QMACS(TM) Software, or any Enhanced Software, and the
Specifications within the lesser of the time frame stated in the Licensor's
Support Policy as defined in Exhibit H or within thirty (30) days after
notification in writing by Licensee. Upon receipt of such notice, Licensor, at
no cost to Licensee, shall remedy the Material Nonconformity. This obligation of
Licensor does not extend to QMACS(TM) Software modified by Licensee without
Licensor's approval or caused by operating the Software on non-approved or
malfunctioning computers or networks.

4.3 DATA BASE ADMINISTRATION. Licensor shall supply Data Base Administration
services to Licensee with regard to the QMACS(TM) Software. This obligation
shall remain in effect until the expiration or termination of this Agreement.
Licensor may terminate any obligation in this Agreement if the Licensee or any
third party makes any structural or technical modifications to the QMACS(TM)
databases without written permission of the Licensor. Licensee agrees that
adding, deleting, importing and editing of data in QMACS(TM) data tables by
third party software applications violates QMACS(TM) data integrity and could
cause a QMACS(TM) application to malfunction and therefore Licensor may suspend
or terminate any obligation under this Agreement if Licensee or a third party on
behalf of Licensee engages in such activity. It is agreed by both parties that
selection, querying, accessing, exporting or reading of data contained in the
QMACS(TM) database tables by the Licensee using third party software is excluded
from this Section 4.3.

4.4 METHOD OF SUPPORT. Licensor shall provide support via WAN to Licensee. This
support will consist of direct line or WAN access to the QMACS(TM) Software
installed on the Approved Hardware. Licensee shall obtain and maintain a direct
line or WAN link and other telecommunication equipment and software such as are
required and approved by Licensor to enable Licensor to supply Data Base
Administration, Support Services and Maintenance of the Applications. Licensor's
approval of direct line or WAN link and telecommunication equipment and software
is necessary to ensure compatibility with Licensor's modems and
telecommunication equipment and software. The acquisition, maintenance and
support of Licensee's modems, routers, WAN, telephone line and other
telecommunication equipment and

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<PAGE>   11
software shall be the responsibility of Licensee. Licensee shall reimburse
Licensor for direct line, WAN or telephone charges incurred by Licensor in
connection with WAN or modem support.

4.5 HELP DESK SUPPORT. Licensor shall provide "Help Desk support" as defined
herein to Licensee during Licensor's normal business hours. Help Desk support
will consist of telephone consultation, WAN, Telecopy (Fax), e-mail or Internet
communication with a representative of Licensor to provide Licensee with
information, advice and assistance with respect to the operation and use of
QMACS(TM) Software. Licensee may obtain Help Desk support by communicating with
Licensor's designated representative or following Licensor's process for Help
Desk support. Licensee will use its best efforts to maintain the training level
of its employees on the Software. Licensor's Help Desk is not a substitute for
training and Licensee agrees to maintain a reasonable number of trained
personnel to use the Software and train other of Licensee's personnel. Licensor
Help Desk will respond to Licensee requests for assistance by telephone within
four (4) hours of receiving a call. To assure that the day-to-day operations of
any Managed Health Plan are not impacted by failure of the QMACS(TM) Software to
execute as warranted, Licensor will maintain availability of Help Desk personnel
on a 24x7, 365 day basis via pager outside of the hours of 8:00am to 5:00pm
Mountain Standard Time. Licensor is bound to a twenty-four (24) hour software
problem resolution service level. In the event that as a result of a bug, there
is an interruption or failure in: (i) the ability to process prior
authorizations, eligibility or enrollment and serious, diligent steps towards
resolution of that problem is not achieved within twenty-four (24) hours; or
(ii) the payment or adjudication of claims and serious, diligent steps towards
resolution of that problem is not achieved within five (5) days, then Licensor
shall compensate Licensee monthly License and Support Fees by a credit of 5% of
the then applicable PMPM for the affected Managed Health Plan for each eight (8)
hour period that problem resolution is not achieved.

4.6 SOFTWARE MODIFICATION PURSUANT TO GOVERNMENT REGULATION. After notice to
Licensor, Licensee shall be entitled to receive, without additional charge, such
modifications to the Applications as are required to reflect any mandatory
changes in federal or state government managed care regulations that are
applicable in any jurisdiction relevant to Licensee's use of the QMACS(TM)
Software. Licensee agrees to provide said regulatory requirement information to
Licensor no later than ninety (90) days prior to its effective date, or, as soon
as made available by the appropriate regulatory agency if made available later
than ninety (90) days prior to its effective date. Licensor shall be obligated
to provide only a single solution to any given mandatory change which is
acceptable by the appropriate controlling government agency.

4.7 ADDITIONAL SERVICES. Subject to the mutual agreement of the Parties and
additional compensation as scheduled or agreed upon, Licensor will provide to
Licensee some or all of the following additional services which shall be made
available to Licensee for fees, terms and conditions then in effect concerning
the following services.

         A.       On-Site Support;

         B.       New Software;

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<PAGE>   12
         C.       Custom Programming;

         D.       Special Services.

         These "Additional Services" are not "Support Services" and are not
         covered by the Monthly Agreement Fees.

4.8 SPECIAL SERVICES. Licensor may offer Licensee other services ("Special
Services") to enhance the utility, user-friendliness and/or value of QMACS(TM)
Software to Licensee. Such Special Services may include, but are not necessarily
limited to, consulting services, training, classes, training modules, in
addition to initial training, computer assisted education modules, and the
provision of Support Services for modified QMACS(TM) Software. Fees and charges
for the foregoing will be quoted from time to time to Licensee by Licensor.

4.9 EQUIPMENT AND ACCESS TO DATA. To facilitate the performance of Support
Service and any Additional Services, Licensee, at its expense, shall:

                  A. Direct line or WAN. Acquire and maintain in good operating
         condition at each Authorized Location a telecommunication
         hardware/software configuration (including router, direct telephone
         line link and other telecommunication equipment and software) as
         Licensor shall reasonably require for compatibility with Licensor's
         telecommunication hardware/software configuration, Licensor may request
         Licensee to upgrade said communication configuration from time to time.

                  B. Cooperation. Make available to Licensor such personnel,
         time, supplies, equipment, assistance and cooperation of Licensee as
         Licensor shall reasonably request;

                  C. Licensor Access to Software and Data. Permit Licensor
         support personnel to have full and free access to the QMACS(TM)
         Software installed on the Approved Hardware and data used in connection
         with any QMACS(TM) Software. Such data shall be held in confidence by
         Licensor and used exclusively to enable Licensor support personnel to
         accomplish or facilitate Support Services or any Additional Services.
         Licensee will provide Licensor system password(s) necessary to operate
         and support the QMACS(TM) applications and related databases;

                  D. Back-Up Data. Maintain adequate back-ups of all data
         provided to Licensor support personnel in order to ensure continued
         data security and retention. LICENSOR SHALL NOT BE OBLIGATED TO
         RECREATE OR RESTORE, OR BE LIABLE IN ANY WAY FOR, LICENSEE DATA IN THE
         EVENT OF LICENSEE'S FAILURE TO MAINTAIN ADEQUATE BACK-UP OF ALL DATA;

                  E. Licensee Information. Provide Licensor's support personnel
         access to all Licensee information specific to QMACS(TM) Application(s)
         maintained on the Licensee's Data Server. Licensor shall comply with
         all applicable laws relating to the confidentiality of such
         information; comply with reasonable confidentiality policies of the
         Licensee; and sign confidentiality agreements as requested by Licensee;

                                       12
<PAGE>   13
                  F. Install Modifications. Promptly install or have installed
         on all Client workstations all new releases of QMACS(TM) Software
         required by Licensor for continued support. It is agreed the Licensee
         is responsible for all software updates to the Approved Client
         Workstations including but not limited to operating systems, networking
         software, database connectivity software. Licensor will install any
         QMACS(TM) Software modifications, updates or fixes to an agreed upon
         location on the Approved Application Server provided by Licensee. It
         will be the Licensee's responsibility to test, accept and move the new
         or modified QMACS(TM) Software to the respective Client workstations.

                                   ARTICLE V.

                      SPECIAL RESPONSIBILITIES OF LICENSEE.

5.1 LICENSEE PROVISIONS TO LICENSOR'S SUPPORT TEAM MEMBERS. Licensee shall
provide to Licensor's Support and Implementation staff the following while on
site performing installation, development, training or support work:

                  A. A business-like working environment including, but not
         limited to, office space, desks, furnishings, telephone with access to
         an outside line for business calls relating to Licensor's performance
         under this Agreement. Licensee agrees to use reasonable efforts to
         provide space and furnishings consistent with the space and furnishing
         made available to Licensee's employees of similar responsibility.

                  B. An Approved Client connected to Licensee's Data Server(s)
         and/or the WAN network.

                  C. Reasonable access to the Approved Hardware running
         QMACS(TM) Software or databases shall be granted to all members of the
         Licensor's Installation, Development, Support, Training or
         Implementation staff as is necessary for Licensor to perform Support.
         Licensee shall provide to the Licensor's support manager system
         software support.

                  D. Licensee shall make available to Licensor's staff other
         available equipment reasonably necessary for Licensor to perform its
         services including but not limited to communications equipment such as
         faxes, modems, telephones and Internet connections, if available.

5.2 LICENSEE'S PROJECT LEADER OR AGENT. Licensee shall provide a Project Leader
or agent. Such Project Leader shall be authorized by Licensee to:

                  A. Make decisions, approve plans and grant requests on behalf
         of Licensee in connection with the Implementation of the QMACS(TM)
         Software consistent with the terms of this Agreement;

                  B. Make management decisions and provide personnel, including
         the appointment of Application Coordinators, and other representatives
         as reasonably

                                       13
<PAGE>   14
         required by Licensor, in order to accomplish and facilitate the
         Implementation services provided by Licensor in a proper and efficient
         manner;

                  C. Maintain Licensee's Approved Hardware or cause the same to
         be maintained in proper working order during the term of the License
         and:

                  D. Provide for or develop workflow and organizational
         processes to complement the implementation and training of the
         QMACS(TM) Software.

                  E. Exercise its best efforts in the performance of Licensee's
         obligations hereunder in connection with the Implementation of
         QMACS(TM) Software and preparation of the Authorized Location(s)
         therefor.

5.3 HARDWARE AND SOFTWARE ELEMENTS. Licensee shall insure that the minimal
Hardware and Software Elements identified in Exhibit D attached hereto are in
place and operational at the Authorized Location(s) prior to the Implementation
Commencement date. Licensee agrees to pay Licensor for any services performed by
the Licensor for the set-up, troubleshooting, support or maintenance of any of
the Hardware or Software elements identified in Exhibit D on behalf of the
Licensee. Licensee shall be responsible for the continued operation and
maintenance and support of such Hardware and Software Elements and shall comply
with the operational, environmental, maintenance and support recommendations and
requirements of the vendors and manufacturers thereof.

5.4 DATA. Licensee agrees to enter all data required for the correct operation
of the QMACS(TM) Software in accordance with written documentation and
specifications provided by Licensor. Licensee shall provide to Licensor, in a
mutually acceptable form, that data and material as agreed by Licensor and
Licensee to enable Licensor to provide the services called for in this
Agreement. Licensee is solely responsible for the accuracy and timeliness of its
data and information and the validation thereof if data or materials submitted
by Licensee are incorrect, or not in a form mutually agreed upon by Licensor and
Licensee for processing, Licensor may charge Licensee for costs incurred to
correct or make the data or materials submitted by Licensee as usable for
Licensor's purposes. Licensee agrees to promptly provide Licensor with copies of
documents, other materials, and communications from regulatory agencies that
affect the QMACS(TM) Software or new requirements of the respective agencies.
Licensee agrees to provide said data or information to Licensor no later than
ninety (90) days prior to its effective date, or, as soon as made available by
the appropriate regulatory agency if made available later than ninety (90) days
prior to its effective date. Licensee acknowledges that QMACS(TM) Software is
rule based and the Licensee is responsible for the accurate data definition,
set-up and maintenance of all rules and data elements according to Licensor
supplied documentation and training. Licensee is responsible for all errors,
omissions, penalties and restrictions as a result of improper data set-up or
maintenance.

                                       14
<PAGE>   15
                                   ARTICLE VI.

                                  RESTRICTIONS

6.1 USE BY OTHERS. Licensee may use QMACS(TM) Software and the Documentation
only for Licensee's own internal purposes to process data for Licensee and its
Affiliates. Licensee shall not allow any third party to access, copy or use
QMACS(TM) Software or the Documentation without first obtaining a signed
Confidentiality Agreement similar to Exhibit B from the third party which will
be provided to the Licensor. Licensee may use QMACS(TM) Software and the
Documentation for Licensee's internal purposes and to process data for all
Managed Health Plans directly or through agreements with Affiliates. Licensee
may use the QMACS(TM) Software to provide time sharing or data processing
services for non-Licensee Managed Health Plans on a per client basis as mutually
agreed upon by Licensee and Licensor. Notwithstanding any other provisions of
this Agreement, Licensee may disclose the QMACS(TM) Software and Documentation
to any third party for the limited purpose of maintenance or modification of
computer hardware or software for use by Licensee provided that such disclosure
is pursuant to a Confidentiality Agreement. Any QMACS(TM) Software modified or
changed by a third party on behalf of Licensee other than in accordance with
Section 6.3 will not be covered under Article VII without a separate written
agreement and is cause for termination of this Agreement.

6.2 DUTY TO SAFEGUARD. The QMACS(TM) Software, the Documentation, and the trade
secrets and intellectual property embodied therein, are of great value to
Licensor. Accordingly, Licensee shall exercise reasonable care and diligence to
protect the same against any unauthorized copying, piracy and misappropriation.

6.3 MODIFICATIONS. Licensee shall notify Licensor in writing of any Derivative
Work. Any and all such Derivative Works and modifications shall be the property
of Licensor and Licensee hereby assigns all title and ownership interest therein
to Licensor. Such Derivative Works and modifications shall be deemed to be
QMACS(TM) Software for the purposes of this Agreement, provided, however, that
Licensor's representations, warranties and liabilities shall not extend to such
Derivative Works and modifications.

6.4 CONFIDENTIALITY BREACH. In the event of a breach or the threat of a breach
of any of the provisions of this Article, in addition to any other remedies it
may have at law or in equity or under this Agreement, the non-breaching party
shall be entitled to a restraining order, preliminary injunction, and other
appropriate relief so as to specifically enforce the terms of this Article. The
Parties agree that a breach of this Article would cause injury to the
non-breaching party not compensable in monetary damages alone, and that the
remedies provided herein are appropriate and reasonable.

                                       15
<PAGE>   16
                                  ARTICLE VII.

           WARRANTY, PATENT AND COPYRIGHT INFRINGEMENT, LIMITATIONS ON
               LIABILITY AND REMEDIES, AND LICENSEE'S LIABILITY.

7.1 WARRANTIES. Licensor warrants that it shall remedy any Material
Nonconformity within the lesser of the Support Policy response time as defined
in Exhibit H or thirty (30) days after notification from Licensee only if
Licensor can duplicate the defect. Upon receipt of such notice, Licensor, at no
cost to Licensee, shall remedy the Material Nonconformity. This warranty does
not extend to QMACS(TM) Software modified by Licensee without Licensor's
approval or for nonconformities due to Licensee misuse. Licensor's warranty
covers only service to correct Material Nonconformities reported during the term
of this Agreement. Licensor warrants that the QMACS(TM) Software shall be free
from significant programming errors and from defects in workmanship; shall
conform to the performance capabilities, specifications, functions and other
descriptions and standards applicable thereto as set forth in the Documentation
and the Specifications; and that Support shall be performed in a professional
manner by qualified professional personnel. Licensor further warrants that it
has full power and authority to grant the rights granted by this Agreement to
Licensee and that neither the performance of Support by Licensor nor the license
to and use by Licensee of the QMACS(TM) Software and Documentation will in any
way constitute an infringement or other violation of any copyright, trade
secret, trademark, patent, invention, proprietary information or other rights of
any third party.

7.2 LIMITATIONS ON WARRANTY. Except as set forth in this Agreement, the RFP and
the Specifications, Licensor does not warrant that the QMACS(TM) Software will
meet the particular requirements of any jurisdiction in which Licensee or its
Managed Care Plans operate.

7.3 SCOPE OF WARRANTY. THE FOREGOING IS IN LIEU OF ALL OTHER WARRANTIES EXPRESS
OR IMPLIED. LICENSOR HEREBY DISCLAIMS ALL WARRANTIES NOT EXPRESSLY SET FORTH IN
THIS AGREEMENT. LICENSEE HEREBY DISCLAIMS ANY RELIANCE ON ANY WARRANTY OR
REPRESENTATION NOT EXPRESSLY SET FORTH IN THIS AGREEMENT OR THE RFP.

7.4 INDEMNIFICATION. Licensor promises to indemnify Licensee, at Licensor's
expense, against any claim that the QMACS(TM) Software, the Documentation or the
corresponding manual(s) infringe on a valid patent, copyright, or trade secret.
Licensor will also pay all costs, damages and expenses, including attorneys'
fees, that a court finally awards as a result of such claim, or that is agreed
upon in settlement of such claim. Licensor's duties under this Section 7.4 are
conditioned upon the following:

                  A. Licensee shall give to Licensor prompt written notice of
         any actual or threatened claim.

                  B. Licensor shall have control of the defense of any claim and
         of all negotiations for the settlement or compromise of such claim;

                                       16
<PAGE>   17
                  C. Licensee shall cooperate with Licensor in the defense or
         settlement of any claim at Licensor's expense: and

                  D. The claim does not arise out of Licensee's modification of
         the QMACS(TM) Software or the use of QMACS(TM) Software without
         Licensor's approval in combination with anything not approved by
         Licensor.

If a patent, trade secret or copyright infringement occurs, or in Licensor's
judgment is likely to occur. Licensor, at Licensor's option and expense, may
either procure the right for Licensee to continue using the QMACS(TM) Software,
the Documentation and the manual(s), or replace or modify them to be
functionally equivalent, to the satisfaction of Licensee, so that they become
non-infringing. If neither of the foregoing alternatives is reasonably available
in Licensor's judgment, Licensee shall return all copies of the Application(s)
in question and corresponding manual(s) to Licensor upon written request.
Licensor will refund the cost of Initial Implementation of the Application in
question and service fees.

The above promise of indemnification extends only and strictly to the QMACS(TM)
Software, the Documentation and manual(s) in the forms provided by Licensor and
expressly precludes any indemnification with respect to claims based upon the
QMACS(TM) Software, manual(s) or any software or documentation which has been
modified by anyone besides Licensor unless authorized or approved by Licensor.

7.5 Licensor is a defendant in an action pending in the United States District
Court for the District of Arizona, captioned Redpath Computer Services, Inc. v.
Regional AHCCCS Health Providers, Inc., Digital Sciences, Inc., Ventana Health
Systems, and Intergroup Healthcare Corp., case no. CIV 96-1732-PHX-ROS (the
"lawsuit"). Notwithstanding any other provision in this Agreement to the
contrary, Licensor shall indemnify and hold harmless Licensee from and against
any and all claims, damages, losses, costs and expenses arising from or
relating, directly or indirectly, to the lawsuit.

7.6 LIMITATIONS ON LIABILITY AND REMEDIES. Licensee expressly agrees that
Licensors entire liability and Licensee's exclusive and sole remedies for breach
of Licensor warranties shall be as follows:

                  A. CONFORMITY/NONCONFORMITY OF THE QMACS(TM) SOFTWARE. In all
         situations involving conformance or nonconformity of the QMACS(TM)
         Software during the period as set forth in Section 7.1 of this Software
         License Agreement, Licensee's sole remedy is the correction by Licensor
         at its expense of any Material Nonconformity with the Specifications
         provided notice of such nonconformity is received by Licensor. Licensor
         shall have no liability or obligation under this Agreement with respect
         to any nonconformity with the Specifications not reported in writing by
         Licensee to Licensor during the applicable Warranty Period.

                  B. INSURANCE. Licensor agrees that Licensee's business
         depends, in significant part, on the ability to use the QMACS(TM)
         Software and Documentation.

                                       17
<PAGE>   18
         Licensor therefore covenants and agrees to maintain product liability,
         errors and omissions and any other insurance in an amount of $3,000,000
         to cover any claims by third parties against Licensee, with such
         policies of insurance naming Licensee as an additional insured, and to
         reimburse Licensee for any business interruption and lost profits that
         may result from the breach of any representation or warranty by
         Licensor hereunder up to $3,000,000, subject to Licensor's ability to
         secure all of the above such insurances at mutually agreeable
         reasonable premiums.

         Licensor shall provide to Licensee, upon its reasonable request, copies
         of any insurance policies maintained pursuant to this Section 7.6.

                  C. CARE BY LICENSEE. After installation of the Application, it
         is the duty solely of Licensee to verify the results and information
         provided by the Application, that the Application is operated properly
         by trained personnel, and to satisfy itself that all such results and
         information are true, complete and correct.

                  D. TIME LIMITATIONS. No action, regardless of form, arising
         out of this Agreement may be brought by Licensee later than two (2)
         years after the cause of action has arisen and Licensee has (or should
         have) acquired knowledge thereof.

                  E. ALLOCATION OF RISK. This Agreement in general, and the
         foregoing limitations on liabilities and warranties in particular,
         represent a mutually agreed upon allocation of risk and the
         consideration provided for in this Agreement has been calculated to
         reflect such allocation of risk.

7.7 SOFTWARE MISUSE. Licensee agrees to indemnify Licensor from liability due to
Licensee's failure to follow directions or use for purposes different from those
intended for the QMACS(TM) Software.

7.8 QUALIFICATIONS; AUTHORIZATION. Licensor is a corporation, duly organized,
qualified and in good standing under the laws of the State of Arizona. This
Agreement, and performance of Licensor's obligations hereunder, have been
authorized by all necessary corporate action, and no consents or authorizations
by third parties are necessary or appropriate in order for Licensor to perform
hereunder.

7.9 CLAIMS. There are no claims, proceedings or actions pending or threatened
against Licensor which, if successful, would have a material adverse effect on
Licensors business or operations, except as specifically set forth in Exhibit I
and no voluntary or involuntary bankruptcy proceedings have been filed by or
against Licensor, nor are any such proceedings threatened or imminent.

7.10 OWNERSHIP. The QMACS(TM) Software and Documentation have been independently
developed by Licensor and are owned solely by Licensor free of any claim of
ownership or title by any third party.

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<PAGE>   19
7.11 BETA TESTING. The QMACS(TM) Software has been beta-tested, is currently
operating in at least three sites, and no Material Nonconformities have been
reported to Licensor with respect to any of such sites.

7.12 Successor-In-Interest. Licensor is the successor-in-interest to Digital
Sciences, Inc., an Arizona corporation.

                                  ARTICLE VIII.

                    TERMINATION, DISCONTINUANCE AND REMEDIES

8.1 TERMINATION. Termination of the License. This Agreement may be terminated by
either Party if:

                  A. The other Party fails to comply with the terms, conditions
         or any covenant or agreement on its part under this Agreement and fails
         to perform or cure the same within thirty (30) days of receipt of
         written notice to cure (the "Cure Date").

                  B. A voluntary or involuntary proceeding seeking liquidation,
         reorganization or other relief shall be filed by or against the other
         party under any bankruptcy or similar law and such case shall remain
         undismissed and unstayed for a period of sixty days subject to
         Bankruptcy Code S,365(n).

In such events, the Party failing to perform or comply with the terms or
conditions of this Agreement will be deemed to be in default, and the
non-defaulting Party shall be entitled to the remedies specified below in
section 8.2 or 8.3.

8.2 LICENSOR REMEDIES. [Confidential treatment has been requested]

                  A. Licensor may demand any money due and owing to it under
         this Agreement as set forth in Exhibit C.

                  B. Licensor may electronically terminate Licensor's use of the
         Applications and Support Services.

                  C. Seek an injunction against the continued use of the
         Software and to protect the Licensor's intellectual and proprietary
         rights.

                  D. Licensor acknowledges that PMPM payments are to be paid
         through the end of the last day of the last month in which termination
         of this Agreement occurred and in which Licensee utilized the QMACS(TM)
         Software, including the [****] per month fee during a wind down
         period, if any.

                                       19

                        **** - Confidential Treatment Requested
<PAGE>   20
8.3 LICENSEE REMEDIES

                  A. Licensee can seek monetary damages from Licensor for breach
         of this Agreement.

                  B. Licensee may defend itself against a termination claim by
         Licensor by escrowing disputed funds. If the breach claimed is related
         to disputes regarding payment, Licensee may interplead the maximum
         funds due with a court of competent jurisdiction in which case Licensor
         will consent to Licensee continuing to use the QMACS(TM) Software until
         such dispute is resolved in accordance with this Agreement.

                  C. Licensee may obtain from Licensor and Escrow Agent access
         to the QMACS(TM) Software Source Code for the purposes of maintaining
         and supporting its own version of the QMACS(TM) Software in the event
         the Licensor does not provide support to Licensee within 45 days of
         Cure Date.

8.4 OBLIGATIONS OF THE PARTIES UPON TERMINATION. Upon termination of the
Agreement, neither Party shall have any further obligations hereunder except
for:

                  A. Obligations accruing prior to the Cure Date;

                  B. Obligations or promises contained herein which relate to
         the protection or confidentiality of QMACS(TM) Software (including
         Executable Code) or the Documentation, which arise hereunder or which
         are expressly made to extend for five (5) years past the term of this
         Agreement; and

                  C. The obligation of Licensee to certify in writing to
         Licensor within twenty (20) days of expiration or termination of the
         License that all copies of the QMACS(TM) Software and the manual(s)
         have been destroyed by Licensee or delivered to Licensor.

8.5 ESCROW. The Licensor shall maintain a copy of the most recent Source Code
for the QMACS(TM) Software with an Escrow Agent mutually acceptable to Licensee
and Licensor that agrees to act in accordance with letters of instruction in the
form attached as Exhibit J. Such Source Code shall be updated with each new
release, update and modification. In the event that Licensor fails to provide
Support, becomes insolvent, makes an assignment of assets for the benefit of
creditors, has a trustee or receiver appointed (either voluntary or
involuntarily), is adjudicated bankrupt, or involuntary bankrupt proceedings are
commenced against Licensor or receiver, commences any dissolution or liquidation
proceedings, or transfers all or substantially all of its assets to another
entity, then the Escrow Agent shall be directed by Licensee to deliver the
Source Code to Licensee. In the event that Licensor does not meet Licensee's
Cure Date as defined in Section 8.1 for resolving Material Non-Conformities,
Licensee may obtain access to Licensor's Source Code held in escrow by Escrow
Agent. Licensee shall provide written notification to Licensor and the Escrow
Agent to access Source Code. Licensee shall be responsible for the costs of
Source Code escrow. Licensee has a right, at its expense, to hire an independent
third party to audit and verify Source Code in escrow at any time. Such
independent

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third party shall be under an obligation of confidentiality and shall only
report to Licensee whether or not the Source Code is being held by the Escrow
Agent and is current.

                                   ARTICLE IX.

                               GENERAL PROVISIONS

9.1 AGENCY. Except as specifically permitted under this Agreement, neither
Licensor nor Licensee shall make any representations or warranties or incur any
liability on behalf of the other. Neither Party is the agent, representative,
partner or joint venturer of or with the other Party.

9.2 APPLICABLE LAW AND ARBITRATION. This Agreement shall be construed and
interpreted in accordance with the laws of the State of Arizona. The seat of the
arbitration shall be in Phoenix, Arizona. In the event that the Parties are
unable to resolve, within a reasonable time, any controversy, dispute or claim
arising out of or in connection with this Agreement, or its interpretation,
performance or termination, arbitration shall be conducted in accordance with
the rules of the Arizona Arbitration Act, A.R.S Sections 12-1501 et seq.,
and the Commercial Arbitration Rules of the American Arbitration Association
("AAA") in effect at the time of the arbitration, except as they may be modified
or supplemented herein or by mutual agreement of the parties Arbitration awards
shall be binding and conclusive upon the Parties, their successors and assigns
and they shall comply with such awards in good faith. If reasonably necessary,
judgment upon an arbitration award may be entered in any court having
jurisdiction. In the event of arbitration or litigation, the non-prevailing
Party shall pay the costs and expenses including reasonable attorneys' fees,
incurred in arbitration or litigation, or in preparation therefor, by it and by
the prevailing Party.

9.3 ASSIGNMENTS, SUBLICENSES, ETC. BY THE LICENSEE. Licensee shall not have the
power or the right (1) to delegate any duty under this Agreement, or (2) to
assign or transfer the License, this Agreement or any right thereunder, except
to a parent corporation, holding company, or subsidiary, or to a corporation,
partnership or other entity which succeeds to all or substantially all of the
business or assets of the Licensee, or otherwise with the approval of the
Licensor which shall not be unreasonably withheld. Licensee affiliated entities
or Managed Health Plans are not considered sub-licensees for purposes of this
Agreement and shall have full access to utilize the QMACS(TM) Software under the
terms of this Agreement regardless of when, during the term of this Agreement,
such Health Plan becomes a Managed Health Plan.

9.4 ASSIGNMENTS, SUB-LICENSES, ETC. BY THE LICENSOR. Licensor shall not have the
power or the right to delegate any duty under this Agreement, except that
Licensor may make such an assignment to a parent corporation, holding company,
or subsidiary, or to a corporation, partnership or other entity which succeeds
to all or substantially all of the business or assets of the party, or otherwise
with the approval of the Licensee which shall not be unreasonably withheld.
However, Licensor, in its sole discretion and without the approval of the
Licensee, may assign the economic benefits of this Agreement. In no way is this
Agreement to restrict the rights of the Licensor to grant licenses or enter into
agreements with others.

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9.5 AUTHORIZATION. Each Party represents and warrants to the other that it is
duly authorized to execute and perform under this Agreement and that this
Agreement constitutes its valid obligation, enforceable according to the
provisions hereof.

9.6 CALENDAR DAYS. Unless otherwise stated, all periods of days referred to in
this Agreement shall be measured in calendar days.

9.7 RECRUITMENT OF PERSONNEL. During the initial and any renewal term of this
Agreement, and for a period of one (1) year thereafter, neither Licensor nor
Licensee will hire any key employees of the other including employees of
Licensee's Affiliates for a period of ninety (90) days following termination of
such employee's employment, without the prior written consent of the other.

9.8 EXHIBITS. The following exhibits are hereby incorporated into this Agreement
by reference:

         Exhibit A entitled "Specifications of QMACS(TM) Software:"

         Exhibit B entitled "Confidentiality Agreement:"

         Exhibit C entitled "Fees, Rates and Payment Schedules:"

         Exhibit D entitled "Hardware/Software Elements:"

         Exhibit E entitled "Locations and Notices"

         Exhibit F entitled "Proposed Data Conversion Plan"

         Exhibit G entitled "Programming Services"

         Exhibit H entitled "Standard Support and Release Policy"

         Exhibit I entitled "Claims, Proceedings, Actions"

         Exhibit J entitled Escrow Agent Instructions"

9.9 EXPORT ACT. Licensee hereby warrants and certifies that no part of the
QMACS(TM) Software, modifications thereof, documentation related thereto,
applicable manual(s) or any related item or product will be made available or
exported to any country in contravention of any law of the United States,
including the Export Administration Act of 1979 and regulations relating
thereto.

9.10 FORCE MAJEURE. A Party shall be excused for failures and delays in
performance of their respective obligations under this Agreement caused by war,
riots or insurrections, laws and regulations, strikes, floods, fires,
explosions, or other catastrophes beyond the control and without the fault of
such Party. This provision shall not, however, release such Party from using its
best efforts to avoid or remove such cause, and such Party shall continue
performance

                                       22
<PAGE>   23
hereunder with the utmost dispatch whenever such causes are removed.
Upon claiming any such excuse or delay for nonperformance, such Party shall give
prompt written notice thereof to the other Party. This Section 9.10 shall not
apply to any obligation to pay money.

9.11 LOSS OF OR DAMAGE TO QMACS(TM) SOFTWARE. In the event of loss, damage, or
destruction of any of the QMACS(TM) Software, the lost, damaged, or destroyed
QMACS(TM) Software shall be replaced by Licensor upon the written request of
Licensee. Licensee shall pay Licensor's reasonable reproduction and delivery
expenses for such replacement unless the loss, damage, or destruction is caused
by Licensor.

9.12 MODIFICATION OF THE AGREEMENT. This Agreement supersedes all oral or
written agreements, if any, between the Parties and constitutes the entire
agreement between the parties with respect to the matters contained herein. Any
modification, amendment, cancellation, or waiver of rights under this Agreement
shall be effective only if in writing signed by the Party against whom
enforcement of the same is sought. No waiver of any breach of this Agreement
shall be construed as a waiver of any other rights under this Agreement. No
delay in acting with regard to any breach shall be construed as a waiver of the
breach.

9.13 NOTICES. Any notices required or permitted hereunder shall be deemed to
have been given if sent by registered or certified mail, postage prepaid,
addressed or delivered as set forth in Exhibit E, attached hereto.

A Party hereto may change its address for notice purposes by furnishing the new
address in writing to the other Party. Any such notice shall be deemed to have
been given, if mailed to the last known address as provided herein, on the fifth
(5th) day after the date on which the notice is mailed.

9.14 RESERVATION OF RIGHTS. All rights of Licensor not expressly granted to
Licensee in writing are reserved.

9.15 SECTION HEADINGS. The headings of Articles and Sections herein are used for
convenience and ease of reference and shall not limit the scope or intent of the
Articles or Sections.

9.16 SEVERABILITY. In the event that any provision of this Agreement shall
become or be unenforceable, invalid, void or voidable, the same shall be
limited, construed or, if necessary, limited to the extent necessary to remove
such defect and the remaining provisions shall continue to bind the Parties as
though the unenforceable, invalid, void or voidable part is not a part of the
Agreement.

9.17 STATE AND FEDERAL LAWS. The Parties recognize that this Agreement is at all
times subject to applicable state, local, and federal law including, but not
limited to, the National Health Planning and Resources Development Act of 1974,
the Social Security Act, and the rules, regulations and policies of the
Department of Health and Human Services (including the right of the Secretary of
HHS or his designee to access for a period of four years from termination of the
License, Licensor's relevant books and records evidencing Licensor's contractual
relations with

                                       23
<PAGE>   24
Licensee), all public health and safety provisions of state law and regulations,
the rules and regulations of the applicable Health Systems Agency and applicable
Executive Orders. For example, the Equal Employment Opportunity clause as
required by Section 202 of Executive Order 11246 (1965) and as contained in and
required by 41 C.F.R, Section 60-1.4 (1984), "Equal Opportunity Clause", is
incorporated herein by reference, if applicable. The Parties further recognize
that the Agreement shall be subject to amendments in such laws and regulations
and to new legislation such as a new federal or state economic stabilization or
health insurance program. Any provisions of law that invalidate, or otherwise
are inconsistent with, the terms of this Agreement or that would cause one or
both of the Parties to be in violation of law, shall be deemed to have
superseded the terms of this Agreement; provided, however, that the Parties
shall exercise their best efforts to accommodate the terms and the intent of
this Agreement to the greatest extent possible consistent with the requirements
of law.

9.18 SUCCESSORS IN INTEREST. Subject to the foregoing provision on
assignability, this Agreement shall inure to the benefit of and be binding upon
the parties, their successors, trustees, assigns, receivers, and legal
representatives, and shall not inure to the benefit of any other person, firm or
corporation.

9.19 TAXES AND DUTIES. The Agreement Fees, and all other fees, charges and
payments specified herein are exclusive of any taxes, duties, or other tariffs
imposed by any governmental agency on the QMACS(TM) Software, the Manual(s) or
Licensee's use thereof, for any goods or services provided pursuant to this
Agreement. Licensee shall be liable for any such taxes, duties, or tariffs,
including, but not limited to, state and local sales, use, and property taxes,
and penalties exclusive of taxes based upon Licensors or a third-party vendors
income.

IN WITNESS WHEREOF, the Parties hereto have executed this Agreement which is
effective as of the 23nd day of November, 1996.

LICENSOR:                                 Quality Care Solutions, Inc.

                                          By: /s/ A. Bruce Oliver
                                             ------------------------------
                                          Name: A. Bruce Oliver

                                          Title: President

LICENSEE:                                 Schaller Anderson of Arizona, L.L.C.

                                          By: /s/ Joseph P. Anderson
                                             ------------------------------
                                          Name:  Joseph P. Anderson

                                          Title:

                                       24
<PAGE>   25
                                    EXHIBIT A
                        SPECIFICATIONS OF QMACS(TM) SOFTWARE

These Specifications apply only to the QMACS(TM) Software as originally provided
to Licensee under this Agreement. Updates, Enhancements and new versions of the
QMACS(TM) Software delivered after the acceptance or use of the Software
hereunder which increase the function thereof, unless otherwise specifically and
exclusively provided for in this Agreement or agreed upon by the Parties, and
which may be offered by Licensor to Licensee, may not conform to these
Specifications. Definitions of terms not defined herein shall be mutually agreed
upon by the parties within fourteen (14) days hereof.

The Parties recognize the possibility of differences in interpretation and
meaning between the questions included in the Licensee's Request for Information
(RFI) and Licensor's responses thereto as incorporated herein and included in
this Exhibit A, if applicable. The Parties therefore agree that in the event of
a difference of opinion as to the nature or extent of any function to be
performed by any of the Licensor's Applications or Licensor's reasonable
interpretation and meaning of a question and/or response in the RFI, then the
Licensor's interpretation shall prevail.

If the matter of interpretation is of a material nature, it is agreed the matter
shall be resolved in accordance with the dispute resolution and arbitration
provisions set forth in the Agreement in Article IX section 9.2. Both parties
agree, however, for purposes of conforming to regulatory requirements by Managed
Health Plans that the base QMACS(TM) Software functionality will comply with
regulatory requirements now known and as will be forthcoming by applicable
regulatory agencies following such software enhancement(s) which may be
necessitated or required by the regulatory agency.

The following are the specifications and functions of the QMACS(TM) Software
system:

         1. QMACS(TM) was developed in Microsoft Visual Basic Version 3.0 and
         4.0 to operate with Microsoft SQL Server relational database and TCP/IP
         networking protocol. The QMACS(TM) Software system requires the use of
         Microsoft WindowsNT(C) 4.0 Server as an operating system on the Data
         Server and WindowsNT(C) Workstation on the Client processor. The
         Licenses or cost for Licenses for any Microsoft or third party products
         are not included in this Agreement and must be obtained by Licensee.

         2. The QMACS(TM) Software is rule based and will accommodate the
         following business functions of a Managed Care Organization as
         interpreted by the Licensor.

GENERAL

The ability to report all claims expense information by the following:

         Rate Code
         Month of Service
         Provider number
         Member

                                       25
<PAGE>   26
         Paid date range
         Plan Provider Classification

The ability to report all authorized services for a member which have not yet
been paid for.

The ability to report all claims with a given diagnosis.

The ability to generate a membership per month report by:
Line of Business

         Plan
         Rate Code
         Member coverage type
         Employer Group
         Member Delegation

The ability to report utilization by the following selection criteria:

         By diagnosis
         By provider
         By facility
         By plan
         By category of service
         By provider specialty
         By place of service
         By member demographics (age, sex)
         By rate code
         By dollar amount
         By member coverage type
         By member delegation
         By Provider Category

BENEFIT PLAN CONFIGURATION

The ability to configure benefit plan packages to pay claims based on whether
the:

    -    Member's PCP must render service.

    -    Service requires an authorization.

    -    Provider of service is a plan participating provider.

    -    Service is allowed/disallowed by the benefit plan as defined by user
         specified:

         1.   Diagnosis code (ICD-9)
         2.   Procedure code (CPT-4 or HCPCS).
         3.   Revenue code (LIB92).

                                       26                RFT QCSI EAL SYNERTECH
<PAGE>   27
         4.   Range of the above codes.
         5.   Diagnosis/procedure combinations

         Visit Limits

         1.   Rolling Year
         2.   Calendar Year
         3.   Plan Year
         4.   Rolling Months
         5.   Rolling Days

         Month coverage starts

         Lifetime Limits

         Per visit limits

         Bill type (UB-92)

         Provider specialty

The ability to specify which edits to apply, and thus which edit code
descriptions, appear on claims and EOBs/remits.

The ability to specify the following by procedure:

         Deductible
         Co-pay amount
         Cost Share amount
         Dollar maximums allowed
         Unit maximum allowed
         Coinsurance Benefit period (i.e. days, weeks, months, years)

The ability to adjudicate claims according to the following benefit plan and
member information:

         The benefit plan rules for the date of service.

         The member's eligibility for the date of service.

         The member's benefit plan package for the date of service.

         The eligibility of the member's contract group for the date of service.

The ability to establish rates and bill benefit plan riders in the following
ways:

                  Bill riders separately from the member's benefit plan rate

                                       27
<PAGE>   28
                  (Enhancement to be delivered in early 1997)

                  Include the price of the rider with the member's benefit plan
                  rate

                  (Enhancement to be delivered in early 1997)

The ability to vary plan rates by the following:

                  Policy group

                  Member age (provisions for unlimited age groups)

                  Member sex Medicare vs. Non-Medicare members (Secondary
                  coverage)

                  Medicare Part A vs. Part B (Secondary Coverage)

                  Member coverage dates The ability to maintain date of
                  effective benefit plan rates

The ability to identify different categories of benefit plan types (e.g.
medical, dental, vision, etc.)

BENEFIT PLAN ACCUMULATION

The ability to offer multiple benefit plans per contract group. The ability to
assign multiple benefit plans per member.

The ability to enroll all members in a specified benefit plan to another
specified benefit plan via batch process (i.e., without having to enroll each
member individually).

THIRD PARTY ADMINISTRATION

The ability to administer claims adjudication and payment, authorizations,
utilization review, and financial reporting in a third party administration role
(TPA) for an entity with:

         The same provider network as the HMO.

         A different provider network from the HMO.

CAPITATION

The ability to assign Capitation rates structures to specific providers.

The ability to process manual adjustments made to capitation pools.

The ability to have capitation rates vary by:

         Group
         Plan
         Rate Code
         Age/Sex
         Provider
         Service Zip Code

                                       28
<PAGE>   29
         Enrollment totals (Enhancement-No Charge)

The ability to process prorated capitations,

The ability to recon previous capitations

CLAIMS ENTRY/MAINTENANCE

The ability to adjudicate claims during on-line entry.

The ability to enter and adjudicate claims through a batch interface via tape
from an outside provider.

The ability for providers entering claims via modem to add, change, view and
delete only:

         Their own provider information. (Enhancement to be delivered in early
         1997)

         Members serviced by that provider. (Enhancement to be delivered in
         early 1997)

         Service plans for that member. (Enhancement to be delivered in early
         1997)

         Referrals generated by that provider. (Enhancement to be delivered in
         early 1997)

         Their own claims information. (Enhancement to be delivered in early
         1997)

The ability to Capture all HCFA 1500 information.

The ability to capture all UB 92 information

The ability to capture all Universal (Pharmacy) information (Enhancement to be
delivered before March 31, 1997)

The ability to capture all information required by state Medicaid agencies.

CLAIMS ADJUDICATION/PRICING

The ability to adjudicate a claim based on the benefit plan of the member and
contract of the Provider.

The ability to pend a claim at the line item level.

The ability to pay, pend, or deny a claim based on the existence of a valid
authorization.

The ability to pend or deny a claim based on the provider number and a user
defend set of either valid or invalid values for that provider using the
following codes:

         Procedure codes

                                       29
<PAGE>   30
         Service Location

         Modifier Code

         Age (Enhancement-No Charge)

         Diagnosis (Enhancement-No Charge)

The ability to price claims based on the following payment mechanisms:

         Provider Fee Schedule

         Percent of billed

         Per Diem

         Lesser of billed or covered

         Capitated

         Pay claims up to a funded amount (a maximum dollar amount to be spent)

         Enhancement to be delivered before March 31, 1997

         Per diem based on tiers

COORDINATION OF BENEFITS (THIRD PARTY LIABILITY)

The ability to enter other insurance carrier information for members into the
system.

The ability to enter the amount of COB for a claim which has already been paid
by another insurance carrier.

The ability to Calculate the paid amount by deducting the COB amount from
allowed amount.

CLAIMS INQUIRY

The ability to access the following information On line windows from the claims
window:

         Referrals

         Service Plan (Enhancement to be delivered in early 1997)

         Member Information

         Provider Information

         Code values (CPT, ICD, revenue codes)

         Historical claims

         Member and Provider Memos and Alerts

         Limit and deductible accruals

The ability to access claims by:

                   Claim number
                   Member number
                   Member name
                   Provider number
                   Provider name

                                       30
<PAGE>   31
Referral number

CLAIM PAYMENTS

The ability generate checks for claims.

The ability to generate remittances for both claims and encounters.

MEMBERSHIP INFORMATION INQUIRY/LISTING - ONLINE OR REPORTS

The ability to view membership information and accumulate totals using the
following selection criteria:

         Primary Care Physician
         Zip Code
         Age/User specified Age Range
         Rate Code
         By benefit plan within all above mentioned criteria

To obtain above statistics by Group Id calculating percentage of totals.

         Language spoken

The ability to produce a member enrollment analysis by Plan that lists the total
members enrolled by age group and sex within rate code.

The ability to record, track and resolve member grievances.

GROUP POLICY MAINTENANCE

The ability to establish effective dated policy group (i.e. employer group)
policies to which members and benefit plan products can be assigned.

The ability to add/change/review/ the following policy group information
on-line: Group demographics (name, address, contacts, etc.)

         Plans/Riders offered by the group

         Billing information (billing cycle, etc.)

         Rate Codes and corresponding premiums/member capitation dollar amounts
         for each plan assigned to the group

The ability to assign multiple rate codes (codes that can be tied to a dollar
premium/capitation amount) to a benefit plan.

The ability to administer the following types of policies:

                  Per diems

                                       31
<PAGE>   32
         Discounts off a set fee schedule

         Discounts off the provider's billed charges

         RBRVS, RVS, Set pricing

         DRG's

         Per Unit

MEMBER MAINTENANCE

The ability to enroll, modify, and disenroll the following member information
on-line:

Demographic information (name, address, sex, birthdate, etc.)

         Plan/coverage information.
         PCP
         Coordination of benefit (COB) information
         Medicare coverage information
         Enrollment dates (enrollment and disenrollment dates)
         User definable alert flags

PRIMARY CARE PHYSICIAN ASSIGNMENT

The ability to assign a Primary Care Physician (PCP) to each member.

The ability to indicate when a provider is not accepting new patients on the
provider on-line a group by group basis on the providers on-line profile.

The ability to automatically assign PCP's to a member, during enrollment, based
on the member's zip code (age, sex, and language (Enhancement-No Charge).

The ability to assign a non-PCP provider to each member.

AUTHORIZATION MANAGEMENT

The ability to add/read/modify/delete the following authorization (referral)
information on-line:

         Authorization control number.

         Member ID number.

         Carrier ID number other than member ID.

         Referral service code (user maintainable).

         Diagnosis (presenting signs and symptoms).

         Accrued benefits relating to authorization in units

         Provider of service (Referred to provider).

         Referring provider.

         Authorized service date range.

         Authorized referral days/number of visits (units).

         Option of indicating estimate cost of service.

                                       32
<PAGE>   33
         Authorized cost of service.

         Operator ID number to enter the authorization.

         Operator ID number to last change authorization.

         Date of last change.

         Deny days and reason for in patient authorizations.

         Deny request for services by referral service code (w/reason).

         Emergency, non emergency, urgent care code indicator.

         Screen alert for member special requirements.

         Memo/comment area capabilities.

The ability to create temporary providers who are not on the system.

The ability to automatically generate a control number to uniquely identify an
authorization abstract.

The ability to access and display an authorization number on-line.

The ability to record, track and resolve appeals of denied services
(Enhancement-No Charge)

BILL PROCESSING

The ability to accommodate multiple tier premium structures (i.e., single,
family, etc.)

The ability to adjust the premium by:

         Age
         Sex
         Medicare vs. non Medicare
         Contract Group
         Benefit Plan (rate code)

The ability to track current, historical, and future rate history and billing
provision.

The ability to process retroactive premium billing and credits for enrolls,
disenrolls, and changes.

The ability to accommodate COBRA billing.

BILL PRINTING

The ability to process the following billing cycles:

         Monthly
         Bimonthly
         Quarterly
         Semi-Annually

                                       33
<PAGE>   34
PROVIDER MAINTENANCE

The ability to add, change, review and delete provider demographic and contract
information online.

The ability to restrict deletion of any physician with claims, encounters, or
referrals for that physician.

The ability to delete terminated providers from the data file after a user
specified period of time.

The ability to maintain two separate addresses for each provider (i.e., service
address vs billing address.)

The ability to maintain at least one provider specialty for which the provider
is authorized.

The ability to maintain at least two separate addresses for each provider (i.e.
service address & billing address). Can be expanded to as many as ten separate
addresses for each provider.

Ability to allow more than one provider specialty in the provider maintenance
file.

The ability to track facility inspections and approvals for each provider.

The ability to classify providers as both PCP and Specialists.

The ability to generate Providers Directories based on:

         Group Affiliation

         Zip Code

         Specialty

         Other user defined categories

                                       34
<PAGE>   35
                                    EXHIBIT B
                            CONFIDENTIALITY AGREEMENT

B 1.     AGREEMENT

The undersigned has received and will receive access to trade secrets and
confidential information subject to the terms and conditions set forth below.

B 2.     DEFINITIONS

Licensor refers to Quality Care Solutions, Inc. Licensor Product refers to a
software product and all documentation related thereto created and produced by
Licensor and its subsidiaries. Licensor Information refers to all information,
whether oral or written, manuals or on-line documentation, relating to Licensor
Products and the business operations (e.g. management, methods, finances,,
customers and business plans and strategies) of Licensor and its subsidiaries,
except such information which Licensee demonstrates (A) is or becomes generally
known to Licensor's industry through no fault of Licensee, (B) is already
rightfully known by Licensee through means other than disclosure by Licensor,
(C) is rightfully received by Licensee from a third party having no obligation
of confidence regarding such information, or (D) is independently developed by
Licensee without breach of this Confidentiality Agreement.

Licensor's use of particular information in its Products and its business
operations is confidential, whether or not the particular information is
generally known, unless one of the exceptions applies Licensor's use of that
particular information. A combination of information is confidential, even if,
exceptions apply to parts of the combination, unless one of the exceptions
applies to the combination and its principles of operation and its economic
value.

Licensee refers to Schaller Anderson of Arizona, L.L.C. and its Affiliates.
Licensee Product refers to any product or service and all documentation related
thereto created and produced by Licensee and its Affiliates. Licensee
Information refers to all information, whether oral or written, manuals or
documentation, relating to Licensee Products and the business operations (e.g.
management, methods, finances, customers, business plans and strategies) of
Licensee, its Affiliates or clients, including Managed Health Plans, except such
information which Licensor demonstrates (A) is or becomes generally known to
Licensee's industry through no fault of Licensor, (B) is already rightfully
known by Licensor through means other than disclosure by Licensee, (C) is
rightfully received by Licensor from a third party having no obligation of
confidence regarding such information, or (D) is independently developed by
Licensor without breach of this Confidentiality Agreement.

Licensee's use of particular information specific to its business is
confidential, whether or not the particular information is generally known,
unless one of the exceptions applies to the fact of Licensees use of that
particular information. A combination of information is confidential, even if
exceptions apply to parts of the combination, unless one of the exceptions
applies to the combination and its principles of operation and its economic
value.

                                       35
<PAGE>   36
B 3.     ACKNOWLEDGMENTS

         B 3.1 Licensor. Products and all techniques, algorithms, data models,
         stored procedures, schemas, and processes contained therein or any
         modification, extraction, or extrapolation thereof are the property and
         trade secrets of Licensor. The expression thereof is also protected
         under the copyright laws. The copyright notice on Licensor Products
         does not imply unrestricted or public access to these materials. No
         duplication, usage, disclosure, or publication thereof, in whole or in
         part, for any purpose is permitted, except that which is expressly
         permitted by this Confidentiality Agreement or other written agreement
         with Licensor. All rights not granted are reserved.

         Licensee Products and all techniques, algorithms, data models, stored
         procedures, schemas, and processes contained therein or any
         modification, extraction, or extrapolation thereof are the property and
         trade secrets of Licensee. The expression thereof is also protected
         under the copyright laws. The copyright notice on Licensee Products
         does not imply unrestricted or public access to these materials. No
         duplication, usage, disclosure, or publication thereof, in whole or in
         part, for any purpose is permitted, except that which is expressly
         permitted by this Confidentiality Agreement or other written agreement
         with Licensee. All rights not granted are reserved.

         B 3.2 Licensor Information is the property and trade secret of Quality
         Care Solutions, Inc. Licensee Information is the property and trade
         secret of Licensee.

         B 3.3 Both parties acknowledge that any Products or Information which
         may have been disclosed prior to the Confidentiality. Agreement are
         subject to the terms and conditions herein.

         B 3.4 This Confidentiality Agreement does not grant a license or any
         other right to either party's Products or Information, except the
         disclosure rights expressly set forth herein.

         B 3.5 The provisions of this Confidentiality Agreement are in addition
         to and not exclusive of any and all other obligations and duties set
         forth in the Software License and Support Agreement to which this
         Confidentiality Agreement is attached as Exhibit B with respect to each
         party's Products and Information.

         B 3.6 For the sole purpose of each party enforcing this Confidentiality
         Agreement through injunctive relief, both parties acknowledge that the
         unauthorized use or disclosure of each others Products or Information
         would cause irreparable harm to the respective parties and that either
         party may seek injunctive relief for any actual or threatened violation
         of this Confidentiality Agreement. Such remedy shall not limit the
         respective parties from pursuing any other remedy, in law or in equity,
         available for a breach or anticipatory breach of this Confidentiality
         Agreement.

                                       36
<PAGE>   37
         B. 3.7 Each party shall indemnify the other against any expenses,
         damages, costs and reasonable attorneys' fees incurred as a result of
         the indemnifying party's, or its agents' or employees' breach of this
         Confidentiality Agreement.

B 4.     DISCLOSURE TERMS

         B 4.1 Licensee shall hold in confidence all Licensor Products and
         Information which Licensee has received or will receive, using at least
         the same degree of care as Licensee exercises for its own trade
         secrets.

         Licensor shall hold in confidence all Licensee Products and Information
         which Licensor has received or will receive, using at least the same
         degree of care as Licensor exercises for its own trade secrets.

         B 4.2 Licensee shall not disclose Licensor Products or Information
         which Licensee has received or will receive, without Licensor's prior
         written approval, except as set forth in Sections B 4.3 and 5 or in the
         Software License and Support Agreement.

         Licensor shall not disclose Licensee Products or Information which
         Licensor has received or will receive, without Licensee's prior written
         approval, except as set forth in Sections B 4.3 and 5 or in the
         Software License and Support Agreement.

         B 4.3 Licensee may disclose appropriate portions of Licensor Products
         and Information to such of Licensee's employees and consultants who
         have been informed of Licenses obligation to protect the intellectual
         property rights of Licensor and who have a specific, legitimate need to
         access such portions of Licensor's Products and Information for the
         purpose of evaluating Licensor and Licensor Products and to perform and
         exercise Licensee's rights under the Software License and Support
         Agreement between Licensor and Licensee. Licensee may copy the Licensor
         Products and Information as reasonably necessary to accomplish such
         purpose with due regard for Licensee's obligations herein (e.g. to
         limit use and disclosure and to return all copies).

         Licensor may disclose appropriate portions of Licensee Products and
         Information to such of Licensor's employees and consultants who have
         been informed of Licensors obligation to protect the intellectual
         property rights of Licensee and who have a specific, legitimate need to
         access such portions of Licensee's Products and Information for the
         purpose of evaluating Licensee and Licensee Products and to perform and
         exercise Licensee's rights under the Software License and Support
         Agreement between Licensor and Licensee. Licensor may copy the Licensee
         Products and Information as reasonably necessary to accomplish such
         purpose with due regard for Licensor's obligations herein (e.g. to
         limit use and disclosure and to return all copies).

                                       37
<PAGE>   38
         B 4.4 Licensee shall notify Licensor of any breaches of security.
         Licensee agrees to reproduce Licensor's copyright and proprietary
         notices on all copies or transmissions of Licensor Products and
         Information. Licensee shall not remove or obscure any copyright or
         other proprietary notices from Licensor Products or Information.
         Licensee shall not take any action to reverse engineer any Licensor
         Product or any part thereof. Licensee and standard reports generated
         from QMACS(TM) Software are specifically excluded from requirements of
         displaying copyright notices of Licensor.

         Licensor shall notify Licensee of any breaches of security. Licensor
         agrees to reproduce Licensee's copyright and proprietary notices on all
         copies or transmissions of Licensee Products and Information. Licensor
         shall not remove or obscure any copyright or other proprietary notices
         from Licensee Products or Information. Licensor shall not take any
         action to reverse engineer any Licensee Products or any part thereof.

B 5.     DISCLOSURE REQUIRED BY LAW

         B 5.1 If Licensee is ordered by a court or other governmental body of
         competent jurisdiction to disclose Licensor Products or Information,
         Licensee shall not be liable for disclosures required by such order if
         the Licensee reasonably complies with the following requirements: (a)
         when Licensee becomes aware of such an order or the possibility of such
         an order, Licensee shall immediately notify Licensor by the most
         expedient means, (b) Licensee shall join a motion by Licensor for an
         order protecting the confidentiality of Licensor Products or
         Information, including a motion for leave to intervene by Licensor, and
         if an issued order calls for immediate disclosure, Licensee shall
         immediately request a stay of such order to permit Licensor to respond
         as set forth in subparagraph (b).

         If Licensor is ordered by a court or other governmental body of
         competent jurisdiction to disclose Licensee Products or Information,
         Licensor shall not be liable for disclosures required by such order if
         the Licensor reasonably complies with the following requirements: (a)
         when Licensor becomes aware of such an order or the possibility of such
         an order, Licensor shall immediately notify Licensee by the most
         expedient means, (b) Licensor shall join a motion by Licensee for an
         order protecting the confidentiality of Licensee Products or
         Information, including a motion for leave to intervene by Licensee, and
         if an issued order calls for immediate disclosure, Licensor shall
         immediately request a stay of such order to permit Licensee to respond
         as set forth in subparagraph (b).

B 6.     TERMINATION

         B 6.1 Within fifteen (15) days of notice or termination, Licensee
         agrees to immediately return or destroy all copies of all Licensor
         Products and Information as directed by Licensor and to provide written
         certification to Licensor of having complied with Licensor's direction.

                                       38
<PAGE>   39
         Within fifteen (15) days of notice or termination, Licensor agrees to
         immediately return or destroy all copies of all Licensee Products and
         Information as directed by Licensee and to provide written
         certification to Licensee of having complied with Licensee's direction.

         B 6.2 Licensee's obligations under this Confidentiality Agreement shall
         continue for a period of five (5) years after termination of the
         Software License and Support Agreement.

         Licensor's obligations under this Confidentiality Agreement shall
         continue for a period of five (5) years after termination of the
         Software License and Support Agreement.

B 7.     GENERAL PROVISIONS

         B 7.1 Governing Law. This Confidentiality Agreement shall be governed
         by the laws of the State of Arizona, without regard to its choice of
         law principles. Licensor and Licensee consent to the personal
         jurisdiction of the federal courts located in the State of Arizona.

         B 7.2 Modifications to Agreement. Licensor and Licensee acknowledge
         that neither has been induced into this Confidentiality Agreement by
         any condition, representation, or warranty not set forth in this
         Confidentiality Agreement. Any modifications to this Agreement are
         invalid unless confirmed in a writing which states that it amends this
         Agreement and which is signed by an authorized officer of Licensee and
         Licensor. Any subsequent agreements are invalid unless confirmed in a
         writing which is signed by an authorized officer of each party.

         B 7.3 No Waiver. The failure of either party at any time to require
         performance by the other party of any provision of the Confidentiality
         Agreement shall in no way affect the right of such party to require
         performance of that provision. Nor shall such failure be construed as a
         waiver of any continuing or succeeding breach of such provision, a
         waiver of the provision itself, or a waiver of any right under this
         Confidentiality Agreement.

         B 7.4 Partial Invalidity. If any provision of this Agreement is held
         invalid, such invalidity shall not affect other provisions of this
         Agreement which can be given effect without the invalid provisions.
         Provisions deemed to be invalid shall be reformed to the minimum extent
         necessary to render them valid at such time and, to the extent
         possible, in accordance with the original intent of the parties. For
         example, it is the intention of the parties that, if a court deems any
         provision of this contract to be invalid because of the duration of
         such provision or the area or matter covered thereby, such court shall
         reduce the duration, area, or subject matter of such provision and, in
         its reduced form, such provision shall be enforced.

                                       39
<PAGE>   40
         B 7.5 Interpretation. Defined terms used herein but not defined herein
         shall have the meanings given them in the Software License and Support
         Agreement. "Include", "includes", and "including" shall be interpreted
         as introducing a list of examples which do not limit the generality of
         the concept they illustrate. "Modification" to the products includes
         corrections to the product, additions to the product, and translations
         of the product. "Intellectual property rights" refers to patent,
         copyright, or trade secret right.

         B 7.6 Notice. Any notice given pursuant to this Confidentiality
         Agreement shall be in writing, shall state that it is a notice given
         pursuant to this Confidentiality Agreement, and shall be sent by
         certified mail to the address indicated below.

         B 7.7 This Agreement and the Software License and Support Agreement
         between Licensor and Licensee contain the entire agreement between the
         Parties relating to the subject matter hereof. To the extent there is a
         conflict with respect to the confidentiality obligations of the
         Parties, the provisions of this Agreement shall control.

IN WITNESS WHEREOF, the parties hereto have caused this Confidentiality
Agreement to be written, and the persons signing -warrant they are duly
authorized to sign on behalf of their respective parties.

FOR LICENSEE: SCHALLER ANDERSON OF ARIZONA, L.L.C.

By:

Name:

Title:

Address:

Date:

FOR LICENSOR: QUALITY CARE S v S, INC.

By:

Name:  A. Bruce Oliver

Title:  President

Address:  5030 E. Sunrise Drive, Phoenix AZ 85044

Date:

                                       40
<PAGE>   41
                                    EXHIBIT C
                        FEES, RATES AND PAYMENT SCHEDULES

C 1. SOFTWARE LICENSE AND SUPPORT FEE:

In consideration of the licenses granted hereunder, Licensee hereby agrees to
pay Licensor according to the following Software License Fee schedule as defined
in this Section C1. Licensee hereby agrees to permit Licensor electronic access
to Licensee's enrollment database monthly for the purpose of determining the
count of members enrolled on the first day of the respective month for License
Fee billing purposes, if applicable. In the event Licensor is unable to
determine the proper enrollment on the first of each month, Licensee agrees to
accept and pay an estimation of Licensee Fee provided by Licensor. All
estimations of monthly License Fees will be reconciled within ninety (90) days
to a corrected amount.

C 1.1 Software License and Support Fee Schedule. [Confidential treatment has
been requested]

Licensee agrees to pay Licensor a Software and Support Fee for using the
QMACS(TM) Software in managing and administering its Managed Care Plans.
Licensee agrees to pay the Software License and Support Fee schedule as follows:

Initial Implementation, Set Up & Training for initial Health Plan implementation
[****] payable as follows:

         [****] on the Execution Date
         [****] on the monthly anniversary of the Execution Date for the next
         six months; provided, however, that if final acceptance occurs prior to
         the six month period, then the full balance of the [****] fee shall
         be paid on final acceptance. Final acceptance shall mean when Licensee
         is successfully paying claims using the QMACS(TM) Software.

Monthly Software License and Support Fee. The obligation to pay the Monthly
Software License and Support Fee (the "Monthly Fee") shall commence when the
QMACS(TM) Software is fully implemented so that it is capable of accepting
enrollment. At such time, and until there is one enrolled member, the Monthly
Fee shall be [****]. Thereafter, the following schedule applies:

$ [****] per month from 1 - [****] Members
$ [****] Per Member Per Month ("PMPM") from [****] Members
$ [****] Per Member Per Month ("PMPM") from [****] Members
$ [****] Per Member Per Month ("PMPM") from [****] Members
$ [****] Per Member Per Month ("PMPM") over [****] Members

In the event that Licensee is terminated by a particular Managed Health Plan,
but this Software License and Support Agreement remains in effect, then with
respect to such Managed Health Plan, the monthly fee shall be [****].

                                       41

                    **** - Confidential Treatment Requested
<PAGE>   42
The above rates are cumulative up to the respective total number of Licensee's
Members for all Licensed affiliated Health Plans. Changes to the above listed
fees can only be made by written mutual consent by Licensee and Licensor for the
length of this contract.

         C 1.2 Late Payment and Interest - If Monthly Fees are not paid within
         thirty (30) days of invoice date, Licensee agrees to pay a late payment
         penalty of five percent (5%) of the Monthly Fee due in addition to the
         Monthly Fee. Licensee agrees any payment under this Exhibit C which is
         more than thirty-one (31) days late will accrue interest at the rate of
         twelve percent (12%) per annum (or the highest rate of interest allowed
         by applicable law, if lower) until paid in full. Licensor shall have
         the right to suspend all its obligations under this Agreement in the
         event that any payment is more than forty-five (45) days late. Licensor
         agrees to notify Licensee in writing at least fifteen (15) days prior
         to suspending its obligations for late or non payment. Notices of
         intent to suspend obligations will be delivered in accordance with
         Exhibit E.

In the event that Licensee determines in its reasonable judgment that a billing
error has occurred. Licensee must notify Licensor in writing within thirty (30)
days of receipt of such erroneous items. Licensee agrees to pay all undisputed
items on an invoice which may have disputed items contained thereon. Licensor
agrees that no late payment penalty shall be applicable for contested invoice
items until thirty (30) days following Licensor's response to Licensee's notice
of billing error.

         C 1.3 Licensee shall be entitled to reasonable compensation for all
         software, including Derivative Works, collaboratively developed by
         Licensor and Licensee and such compensation shall be offset against the
         moneys otherwise owed Licensor by Licensee.

C 2.     IMPLEMENTATION SERVICE FEES:

Licensor and Licensee agree that additional and optional services may be
requested. Such requests will be in the form of written work order requests,
written quotations and signed authorizations before any work will commence for
the Licensee.

Licensor shall not bill for any time spent in the development or preparation of
written work orders, quotations for work or detail specifications of program
design.

C 3.     TRAINING FEES:

Licensor agrees to provide Licensee start-up training of one hundred twenty
(120) hours without additional training cost. Travel and lodging costs for all
training will be the responsibility of Licensee as outlined in Section C7.
Continuing education will be charged according to the following fee schedule:

         Additional Training Fees:

                                       42
<PAGE>   43
         Licensor Application Training Fees $ 50.00 Third Party Application
         Training Fees $ 65.00

         Operating System, Language, Network Management, Database Training,
         System Management, Systems Integration $ 125.00

         Additional Training required for implementation of Licensee affiliated
         Health Plans beyond the establishment of Maryland Care, Inc. shall be
         provided at rates 25% below each above identified hourly rate.

C 4.     CONSULTING FEES:

Licensor agrees to provide technical consulting to Licensee upon request of an
authorized executive of Licensee on a quoted time and material basis.

C 5.     HARDWARE CONFIGURATION:

Licensor agrees to provide Licensee reasonable hardware configuration consulting
necessary to operate Licensor's software products on Licensee's computer
equipment without additional charge.

Licensor reserves the right to charge Licensee for hardware consulting and
servicing Licensor deems outside the scope and intent of Licensor's service.

C 6.     DELIVERY AND INSTALLATION:

Licensee agrees to the following terms and conditions of the Licensor if the
Licensee requests or hires the Licensor to act as an agent to procure, set-up or
install computer hardware and equipment on behalf of the Licensee. Vendors
Hardware and Operating system refers to computers, operating system software and
database software listed in Exhibit D to be procured from a third party supplier
on behalf of the Licensee.

         C 6.1 The "delivery date" for each item of Vendors Hardware and
         Operating system software listed in Exhibit D shall be the date on
         which Licensor delivers and fully installs the specific item of
         hardware at locations specified in Exhibit E.

         C 6.2 Shipment of the Vendor's hardware and software shall be F.O.B.
         the p location specified in Exhibit E. All freight and handling charges
         on the hardware and operating system software shall be the
         responsibility of the Licensee.

         C 6.3 The Licensee is responsible to ensure all wiring, environmental,
         safety codes and equipment manufacturers' installation specifications
         are met prior to installation. The Licensee agrees to pay or reimburse
         Licensor for additional costs incurred as a result of unsatisfactory
         installation preparation, practices, procedures or site conditions
         corrected by Licensor.

                                       43
<PAGE>   44
         C 6.4 Title to Vendor's Hardware and Operating system software shall
         pass to Licensee at the FOR Point, but subject to a security interest
         until the date the Licensee has fully paid for the Hardware and
         Operating system software.

C 7.     TRAVEL AND EXPENSE GUIDELINES.

         C 7.1 Travel and Lodging guidelines. Licensee agrees to reimburse or
         pay Licensor for reasonable travel, meals, lodging, per them expenses
         which are incurred by Licensor on installation, implementation,
         training, maintenance, support, consulting at the Licensee's office or
         location defined in Exhibit E or if Licensee's work location is in
         excess of seventy-five (75) miles of Licensors main office.

                                       44
<PAGE>   45
                                    EXHIBIT D
                           HARDWARE/SOFTWARE ELEMENTS

  Attached to this Agreement is a mutually agreed upon computer specification
necessary to operate Licensor's QMACS(TM) Software system. Utility Software,
Operating System Software and Hardware Equipment procurement are Licensee's
responsibility.

Recognizing the fluid technological environment in existence relative to
available hardware and software, Licensor and Licensee mutually agree that the
listed hardware and operating/network software constitute an approved operating
platform and network topology to assure an acceptable level of operating
performance of the QMACS(TM) Software based on membership projections and user
topology provided by Licensee.

Licensor and Licensee mutually agree that this environment may, from time to
time, need to be updated to accommodate the then current industry acceptable
standards. Licensor warrants, however, that substantive changes in the QMACS(TM)
product which mandate upgrades of hardware and/or operating or network software
will not be implemented without concurrence by Licensee in or on any Managed
Health Plan and, further, that Licensor will make every effort to allow at least
a one hundred eighty (180) day advance notice of such change requirements.
Changes as described do not, in any way, make null or void any obligation of
Licensor as described in this Agreement.

                                       45
<PAGE>   46
                                    EXHIBIT E
                              LOCATION AND NOTICES:

 Locations for Installation of QMACS(TM) Software and Approved Computer(s) will
be listed below.

Any notices required or permitted hereunder shall be sufficiently given if sent
by registered or certified mail, postage prepaid, addressed or delivered as
follows:

                                    NOTICES:

A. TO LICENSOR:          Quality Care Solutions, Inc.
                         5030 E. Sunrise Drive
                         Phoenix, AZ 85044
                         Attention: Mr. A. Bruce Oliver

B. TO LICENSEE:

INSTALLATION LOCATIONS:

                                       46
<PAGE>   47
                                    EXHIBIT F
                         PROPOSED DATA CONVERSION PLAN:

It is agreed that no data will be converted for the implementation of Maryland
Care Inc.

Subsequent implementations of other Licensee affiliated Health Plans may involve
the conversion of data from other systems. Each such implementation shall have a
unique data conversion plan, the content of which shall be mutually agreed upon
by Licensor and Licensee and the cost of which shall be defined and agreed upon
prior to the initiation of the implementation project.

                                       47
<PAGE>   48
                                    EXHIBIT G
                              PROGRAMMING SERVICES

G 1. CUSTOM QMACS(TM) SOFTWARE. If Licensor shall agree in writing to develop
any customized software or modification of the QMACS(TM) Software (the
"Customized Software") for Licensee, such Customized Software or modifications
shall be deemed to be jointly owned by Licensor and Licensee for purposes of
this Agreement and shall not be made available to the Licensor customer base, or
licensed by Licensor without the express written permission of Licensee.
Licensor warrants that the Customized Software will meet the specifications for
Customized Software and be covered by the warranty provisions of Article VII of
the Software License and Support Agreement if Licensee shall cancel any
Customized Software request, Licensee shall be obligated to pay to Licensor an
amount equal to Licensor's then current hourly fees multiplied by the number of
hours Licensor has expended on the Customized Software project up to the date of
receipt of Licensee's notice to terminate the project. In addition, Licensee
shall pay to Licensor all expenses (except for programming expenses which shall
be calculated as set forth in the preceding sentence) incurred by Licensor to
develop the Customized Software up to the time of termination of the project.
Such amounts shall be paid by Licensee to Licensor within thirty (30) days of
receipt by Licensee of Licensor's invoice.

G 2. PROGRAMMING SERVICES. Upon Licensee's request, Licensor may provide custom
programming services for Licensee at Licensor's then current hourly rates. The
Support Services provided under the Monthly Fees do not cover Support Services
for programs and applications developed pursuant to this Programming Services
Section. Upon Licensee's request, Support Services for such customized programs
and applications may be provided to Licensee at either Licensee's hourly rates
as defined in the Software License and Support Agreement or at a fixed cost to
be determined and mutually agreed upon on a per project basis. Unless the
Parties agree otherwise in writing, the programs and applications developed
pursuant to this Section in collaboration with each other and all corresponding
copyrights and intellectual property shall be owned and held by Licensor with
Licensee holding a paid up exclusive license to use and copy said programs and
applications as permitted in this Agreement but Licensee may not transfer or
disclose them to any third party.

G 3. INSTRUCTIONS FOR CUSTOM PROGRAMMING. In the event that Licensor provides to
Licensee Custom Programming by the mutual written agreement of the Parties.
Licensor shall provide brief written instructions on the operation of the
Customized Software requested by Licensee. Such instructions may not be as
detailed as those provided in Licensor's Documentation. Inasmuch as the mutually
agreed upon specifications shall serve as the basis for Custom Program
development, Licensor shall still be obligated to incorporate and provide
standard documentation for any customized program to a level and degree as
provided with the base QMAC(TM) Software. This documentation is to be made
available to Licensee upon acceptance, approval and implementation of such
customized programming into production for at least one Managed Health Plan.

                                       48
<PAGE>   49
                                    EXHIBIT H
                       STANDARD SUPPORT AND RELEASE POLICY

1. Released software will only be modified to handle problem fixes, not
enhancements.

2. Problems will be classified as urgency 1, 2, or 3 (L11, U2, L13)

         A U1 problem is a problem (Material Non-Conformity) that prevents a
         major function from working or causes data integrity issues, and for
         which there are no workarounds. Any operation of the Software which
         causes material erroneous data or unrecoverable data loss due to the
         execution of the Software's Applications.

         A U2 problem is a problem that prevents a non-major function from
         working and for which there is no workaround.

         A U3 problem is a problem that is an annoyance but does not prevent a
         non-major function from working or there is a workaround.

         a) Example of a U1 problem. Can't adjudicate a claim, can't add or
         modify a provider, can't add or modify an enrollment, etc.

         b) Example of a U2 problem. Can't add a new licensing board to the
         credentialing module.

         c) Example of a U3 problem. Authorization history doesn't refresh when
         a new authorization is issued.

3. Every attempt will be made to turn around U1 problem fixes within eight(8)
working days of duplication.

4. U2 problem fixes will be supplied within 30 working days.

5. U3 problem fixes will be released at the next major release, or, no later
than 90 days from the notification of such problem by Licensee or Affiliates.

6. Licensor's Customer Service Representative will be responsible for clearly
distinguishing between a problem fix and an enhancement to the Licensee.

7. Enhancements require scheduling for design, development, testing,
documentation, release notes and training before they can be released into a
production environment for Licensee use.

8. Software released before testing, documentation, release notes and training
phases are complete is classified as 'beta test' software. Beta test software
will require beta test agreements to be signed and approved by Licensee before
the beta test software will be released for use by the Licensee.

                                       49
<PAGE>   50
9. All Software released for use or testing by Licensee shall be placed in an
agreed upon location on the Licensee's Approved Application Server for
appropriate disposition by Licensee.

10. The use and maintenance of an application test environment shall be the sole
responsibility of the Licensee.

                                       50
<PAGE>   51
                                    EXHIBIT I
                          CLAIMS, PROCEEDINGS, ACTIONS

Redpath Computer Services, Inc. v. Regional AHCCCS Health Providers, Inc.,
Digital Sciences, Inc., Ventana Health Systems and Intergroup Healthcare Corp.,
Case No. CIV 96-1732-PHX-ROS.

                                       51
<PAGE>   52
                                    EXHIBIT J
                               ESCROW INSTRUCTIONS

                              [Omitted On Original]

                                       52

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