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ARCHITECTURE STUDY PROPOSAL
Prepared for
[DOCTOR DESIGN LOGO]
Path 1 Network Technologies, Inc.
Proposal Number: 99PAT1B
Proposal Date: JUNE 4, 1999
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PROJECT DESCRIPTION
Doctor Design (DDI) proposes to perform an Architecture Study to review the
requirements, features, and specification of an enhanced gigabit Ethernet switch
and develop a suggested architecture as input to the development phase of the
project.
An initial project meeting between Path 1 Network Technologies, Inc. (Path 1)
and DDI will be held at DDI as soon as it can be arranged to determine the
features and specifications of the development project and the scope of the
Architecture study. At this meeting, Path 1 will provide to DDI, any
information in its possession that is related to the Architecture Study,
including Path 1 Deliverables below.
A comprehensive study of the issues relating to the development project will be
conducted by DDI. DDI will review existing requirements, propose additional
requirements, suggest an architecture, perform necessary trade-off analyses, and
evaluate software and hardware tools required.
STATEMENT OF WORK
DDI shall perform the following tasks during the Architecture Study:
- Review requirements and planned features.
- Recommend additional requirements and features, which would enhance
the resulting product.
- Evaluate components and perform trade-off analyses to aid in defining
architecture.
- Recommend system architecture to satisfy requirements and features.
- Evaluate development tools and recommend development environment.
- Prepare an Architecture Study Document summarizing the results.
- Identify design tasks and prepare a development project schedule.
DELIVERABLES
PATH 1 DELIVERABLES
Any existing information or documentation relating to the Architecture Study.
This may include requirements documents, industrial design sketches, user
interface drawings, specifications, schematics, block diagrams, data sheets,
etc.
DDI DELIVERABLES
DDI will prepare and deliver an Architecture Study Document to Path 1. This
document will summarize the results of the requirements review, trade-off
analyses and will make recommendations with respect to features, architecture,
and tools.
DDI will identify design tasks, create a statement of work for the development
project, prepare a development project schedule, estimate design services fees
associated with the development project,
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Path 1 Network Technologies, Inc. Proposal Number:[99PAT1B]
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ESTIMATED SCHEDULE AND ESTIMATED FEES
ESTIMATED SCHEDULE
perform an analysis of the final cost of the development project (when
appropriate), and prepare an engineering services proposal for the
development project.
DDI will deliver the Architecture Study Document approximately 5 weeks after
beginning the Architecture Study.
ESTIMATED FEES
All fees contained in this Architecture Study Proposal are based on time and
materials ESTIMATES and are subject to change by DDI.
ESTIMATED HOURLY CHARGES
Based on the Statement of Work and estimated schedule above, the following are
estimated fees for engineering services:
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TYPE OF ENGINEERING EFFORT MAN-WEEKS ESTIMATED COST
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<S> <C> <C>
Systems Architect [***] $65,280
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TOTAL HOURLY ESTIMATE: $65,280
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</TABLE>
TRAVEL COSTS
Any travel outside the San Diego area required of DDI employees and its
subcontractors is not included in the above estimates and will be separately
approved by Path 1. Path 1 will reimburse DDI for actual, reasonable travel and
living expenses. DDI will provide Path 1 with detailed expense reports for such
travel.
HOURLY RATES
The following hourly rates have been used in determining the estimated fees
above for this Architecture Study. Resulting from previous discussions
between Path 1 and DDI, these rates include a [***]. The standard hourly
rate for a Systems Architect is $160.
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<CAPTION>
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TYPE OF ENGINEERING EFFORT COST PER HOUR
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<S> <C>
Systems Architect [***]
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Specialized Expertise or On-Site Consulting Market Rate*
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</TABLE>
* In cases where specialty skills such as User Interface
Engineering, FDA Compliance Consultant, ESD Specialists, Database
Design Engineer, etc., are required, the hourly rate will be based
on the actual Market Rate for the skill. Special hourly
rates will also apply where a substantial proportion of Project
activity is based at a location away from DDI. If Path 1 will be
subject to this rate, DDI will provide written notification in advance
if this rate applies.
[*** Confidential treatment requested]
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PROPOSAL AGREEMENT [DOCTOR DESIGN LOGO]
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PROPOSAL AGREEMENT
This Proposal Agreement (hereinafter "AGREEMENT"), is entered into by and
between Integrated Systems Design Center, Inc., doing business as Doctor Design,
Inc. (hereinafter "DDI"), a California corporation, having its principal place
of business at 10505 Sorrento Valley Road, San Diego, California 92121-1608 and
Path 1 Network Technologies, Inc., (hereinafter "Path 1"), a California
corporation, having its principal place of business at 3636 Nobel Drive, Suite
275, San Diego, California 92122. DDI and Path 1, desire to enter into a
mutually beneficial relationship, whereby DDI agrees to perform engineering
services, based upon and pursuant to the provisions of the Technical Proposal
Revision Number 99PAT1B dated June 4, 1999, containing the Statement of Work,
Deliverables, Estimated Schedule and Estimated Fees described therein
(hereinafter "Project"). The Technical Proposal described above is herein
incorporated by reference.
PAYMENT TERMS
INVOICES
DDI will be pleased to start the Project upon Path 1's acceptance of this
Agreement including the terms and conditions herein and receipt of an advance
payment (hereinafter "Start Payment"), in the amount of Ten Thousand Dollars
($10,000), which shall be applied against invoices as set forth below. All
prototyping fees are also due upon execution of this Agreement.
This is a time and materials estimate. All fees contained in this Agreement
are estimates and are subject to change. Path 1 agrees to promptly pay DDI's
invoices for services performed during the term of this Agreement. DDI will
credit the Start Payment amount to Path 1 on each invoice at the rate of ten
percent (10%) of the invoice amount until the total amount of the Start
Payment is reimbursed. DDI will refund the balance of any non-reimbursed
Start Payment at the end of the Project. In the event the Start Payment is
exhausted prior to the end of the Project, Path 1 agrees that it shall
provide another payment in an amount reasonably requested by DDI, within
seven (7) days from such request.
The Project hourly charges will be invoiced weekly, and are due within ten
(10) days of the billing date. All billings that are not paid within that
period will accrue interest at the rate of one and one-half percent (1 1/2%)
per month. The payment terms set forth herein are contingent upon DDI
obtaining satisfactory credit information and the approval of Path 1 for the
payment terms based upon that information. DDI has the right to immediately
terminate this Agreement upon written notice to Path 1 if any payment is not
made in a timely manner, and DDI shall have no responsibility for any loss
that may be sustained by Path 1 in the event of such termination.
TRAVEL COSTS
Any travel outside the San Diego area required of DDI employees and its
subcontractors is not included in the fees and costs outlined for the Project,
and will be approved by Path 1. Path 1 will
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Path 1: RDF
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DDI: MPC
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reimburse DDI for actual, reasonable travel and living expenses. DDI will
provide Path 1 with detailed expense reports for such travel.
While traveling pursuant to this Agreement, Path 1 will be billed at the
Standard Hourly Rates set forth herein for the actual time DDI employees and its
subcontractors are in transit, to a maximum of eight (8) hours per day.
In cases of multi-day on-site work, Path 1 will be billed, at the Standard
Hourly Rates set forth herein, a minimum of eight (8) hours per day or actual
time worked by DDI employees and its subcontractors, whichever is higher,
including weekends and holidays.
Business or better class of service will be used for flight segments in excess
of six (6) hours. Round trip business or better class of service will be used
for all flights to destinations outside North America.
PROTOTYPING FEES
Any prototype fees, if applicable, shall be detailed in the Technical
Proposal and are based on average costs of similar projects performed by DDI.
Third party prototyping services will be billed with a [***]. Internal
prototyping services will be billed at Standard Hourly Rates. The prototype
fees shall be due upon the start of the Project, terms Net Zero (0) Days. If
actual prototype costs exceed the prototype estimate, the excess will be
billed monthly at terms Net Thirty (30) Days. If the prototype estimate
exceeds actual cost, the excess will be refunded at the end of the Project.
OTHER COSTS
Any other costs or fees for which Path 1 is responsible shall be separately
listed in the Technical Proposal. Path 1 will also be responsible for all
requirements for international shipments including, but not limited to,
import/export documentation, documentation preparation, expenses, duties, fees
and taxes. All amounts in this Agreement are in U.S. Dollars and all invoices
are payable in U.S. Dollars. Path 1 will also be responsible for any banking
fees, if any, associated with payment of all invoices, including but not limited
to, wire transfer fees, exchange rates, or processing fees.
FINAL ACCEPTANCE
Path 1 shall prepare an Acceptance Test Plan (hereinafter "ATP") acceptable
to DDI which defines criteria for final acceptance of DDI deliverables
outlined in the Technical Proposal that are subject to acceptance testing.
If Path 1 has not delivered an ATP four (4) weeks prior to the scheduled
delivery of the first deliverable or has failed to complete the ATP testing
within fifteen (15) working days following receipt of any deliverable, such
deliverable shall be deemed accepted.
[*** Confidential treatment requested]
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Path 1: RDF
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DDI: MPC
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Doctor Design, Inc. Proposal Agreement
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TERMINATION
This Agreement may be terminated thirty (30) days following DDI's receipt of
written notice from Path 1. Path 1 shall compensate DDI for all work performed
and costs incurred, including, but not limited to, engineering services at
Standard Hourly Rates, prototype expenses, or DDI's inability to reassign
personnel, prior to the effective date of termination.
CONFLICT
Path 1 may use its standard purchase order form for the purpose of effecting or
releasing payment hereunder. Except as specifically agreed to in writing
between DDI and Path 1, any terms and conditions of such purchase order or other
document delivered pursuant hereto shall not apply to this Agreement and are
expressly rejected.
NOTICES
Any and all notices to be given under this Agreement shall be in writing and
shall be delivered or mailed via certified mail, return receipt requested to the
other party at the addresses of each party set forth below or at such other
address as either party shall designate in writing according to this paragraph.
DDI PATH 1
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Doctor Design, Inc. Path 1 Network Technologies, Inc.
10505 Sorrento Valley Road 3636 Nobel Drive, Suite 275
San Diego, California 92121-1608 San Diego, California 92122
Attn: Legal Department Attn: Legal Department
ATTORNEY FEES
In the event of any dispute, California law shall apply and arbitration shall be
promptly commenced in San Diego County, California. The prevailing party shall
be entitled to recover all of its attorneys' fees and costs incurred as a result
of the dispute and those incurred in protecting any rights in any Bankruptcy
proceeding or any action pursuant to any statutory right.
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Path 1: RDF
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DDI: MPC
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Doctor Design, Inc. Proposal Agreement
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The parties executing this Agreement on behalf of DDI and Path 1 warrant that
they have the authority to enter into this Agreement and to bind their
respective companies to all of the terms and conditions of this Agreement.
DOCTOR DESIGN, INC. PATH 1 NETWORK TECHNOLOGIES, INC.
By: /s/ Michael P. Cusick By: /s/ Ronald D. Fellman
Name: Michael P. Cusick Name: Ronald D. Fellman
Title: V.P. Sales & Marketing Title: Chief Executive Officer
Date: June 4, 1999 Date: June 4, 1999
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