CONFIDENTIAL TREATMENT REQUESTED BY 724 SOLUTIONS INC. HP 724 AMENDMENT 7 TO PRIOR TERMS AND CONDITIONS BETWEEN 724 SOLUTIONS (US) INC. AND HEWLETT-PACKARD COMPANY

The order of precedence for the HP and 724 Solutions agreements are as follows:

1.

HP Purchase Order

2.

New Statement of Work for the 2004 customer requirements

3.

HP 724 Amendment 7

4.

Previous Statement of Work

5.

Original HP and 724 Solutions Contract

[**] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED.

[**] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED.

1.

HP will pay for the license to use the NGG Application Software on a quarterly and monthly fixed fee basis.  The fixed fees defined in the following table will be paid for [**] consecutive months with the first quarterly invoice being issued on the Effective Date of this Amendment 7.

Invoice Milestone

Estimated Invoice Date

Invoice Amount

Upon [**]

[**]

$[**]

Upon [**]

[**]

$[**]

Month [**] through [**]

[**] through [**]

$[**] per Month

Month [**] through [**]

[**] through [**]

$[**] per Month

2.

Based on HP making payment of each required quarterly or monthly payments, there are no restrictions regarding the number of Subscribers that Sprint can enlist during such quarter or month.

3.

After HP has made the [**] payments and the [**], Sprint will then have the right to continue to add an unlimited number of Subscribers on a perpetual basis at no additional cost to Sprint for use of the software.

4.

In the event HP chooses to discontinue payment of the quarterly or monthly fees prior to the payment of the [**] payments and the [**] payment, Sprint will be entitled to continue to use the licenses on a perpetual basis for the total number of Subscribers Sprint has enlisted up to and including the final quarter or month for which Sprint has paid the quarterly or monthly fee.

[**] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED.

Quarterly Reports:

1.

No later than [**] business days following the end of each quarter for which HP pays the fees defined above, Sprint shall submit to HP & 724 a report including at least the number of Subscribers enlisted during the previous quarter.  The actual content and format of this report will be mutually agreed upon by the parties.  In the event HP chooses to discontinue making the required quarterly or monthly payment, this information will be used to calculate the number of Subscribers that Sprint can continue to have using the software on a perpetual basis.

4.1  Support for XMG and SSE Code.

1.

HP will pay for XMG Support on a monthly/quarterly fixed fee basis, in advance per quarter or month per the following table:

Invoice Milestone

Estimated Invoice Date

Invoice Amount

Upon [**]

[**]

$[**]

Upon [**]

[**]

$[**]

Months [**] through [**]

[**] through [**]

$[**]

Months [**] through [**]

[**] through [**]

$[**]

2.

HP will pay for SSE Code Support on a monthly/quarterly fixed fee basis, in advance per quarter or month, per the following table:

Invoice Milestone

Estimated Invoice Date

Invoice Amount

Upon [**]

[**]

$[**]

Upon [**]

[**]

$[**]

Months [**] through [**]

[**] through [**]

$[**]

[**] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED.

[**] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED.

•

HP employees with access to 724 software code will sign all necessary Non-Disclosure Agreements

•

724 will continue to own all rights to intellectual property that they currently have within the existing NGG agreements.

•

HP’s understands that 724 & Sprint have joint ownership of SSE Code and that 724 has full ownership of everything else.

•

Access will be provided in a controlled environment, (e.g., clean room at 724 facilities).

•

724 will make all reasonable efforts to incorporate the identified improvements within a timely manner.

•

All code modifications resulting from code access will be managed and owned by 724.

[**] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED.

Predetermined Procedure for Code Access:

•

Sprint formally notifies HP Project Lead in writing of “event.”

•

HP formally notifies 724 Project Lead in writing of “event.”

•

HP and 724 mutually agree that such “material” access to source code is necessary

•

724 provides access to code within 7 business days of receipt of mutual agreement.

•

724 and HP Team begin access review in clean room.

•

Improvements identified and feed into the Planning Process.

•

Planning Process schedules improvements.

•

Weekly status reports provided to Sprint throughout this process.

•

“Site Availability” – The requirement for availability at an individual Site will not have been met by HP in the event two (2) or more Site Outages occur at single Site during the period of one (1) calendar month.

•

“Site Outage”– An error caused by the 724 XMG and/or SSE applications that affects performance of the System resulting in a material degradation of the System response time, but which does not rise to the level of a Severity 1 error.

HP and Sprint PCS will mutually analyze the Site Availability data to determine the cause of the various Site Outages that occur pursuant to the definition for Site Outage.  In the event a Site Outage is caused by one of the following conditions, HP will not be accountable for payment of any penalties, liquidated damages, etc. associated with such Site Outage:

*

Unplanned downtime due to resolution times of Sprint PCS’ 3rd party support providers that are not under the direct control of HP.

*

Unplanned downtime due to activities outside the reasonable control of HP.

*

Unplanned downtime caused as the result of a problem for which HP has notified Sprint PCS that Planned Downtime should be scheduled.

*

Unplanned downtime caused by failures of Sprint PCS firewalls or the Public Data Switched Network.

*

Unplanned downtime caused by any damage to any facility outside of the Sprint PCS facilities.

*

Unplanned downtime caused by any damage to any Sprint PCS facility.

*

Unplanned downtime caused by Sprint PCS’ non-compliance with the operational procedures jointly agreed to in the BCS Account Support Plan, which will be jointly agreed upon by the parties prior to commencement of Business Critical Support (BCS) described in Schedule II.

*

Unplanned downtime caused by hardware or software other than the Equipment or Software purchased from HP under the SPA (i.e. database, middleware, etc.).

*

Unplanned downtime caused by Sprint PCS’ changes to the NGG System configurations that are not authorized by HP.

*

Unplanned downtime caused by Sprint PCS’ inability to upgrade Sites to keep pace with Subscriber demand.

In the event Site Availability is not met at four (4) or more Sites within the period of one (1) calendar month, HP will:

(i)

Enforce their agreement with their subcontractor “724” to be given Material Access to the necessary 724 code within fifteen (15) days of notification of the fourth Site Outage.  HP access to 724 software code is described in Section 5.4 of this addendum.

724 SOLUTIONS (US) INC.

HEWLETT-PACKARD COMPANY

(Signature)

(Signature)

(Print Name)
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(Print Name)

(Title)
cfo

(Title)

(Date)

(Date)

Deliverables -

System Integration (General):

•

Project Management – (one HP program manager with responsibility for establishing a PMO and System Integration and one HP project manager to assist in managing the day-to-day activities)

•

Recurring Program Update – HP, 724 and Sprint will jointly agree upon a format and schedule in which a recurring program update (i.e. weekly status report) will be provided

•

Change Management Process Document – HP & 724 will provide a document that explicitly details the methods and procedures that will be followed for change management

•

Change Control Process Document – HP & 724 will provide a document that explicitly details the methods and procedures that will be followed in the Change Control process

•

Release Management Process Document – HP & 724 will provide a document that outlines the methods and procedures that will be followed for release management

System Integration (Concept Phase):

•

Change Request – as Sprint’s requirements evolve and changes are required to the application that were not originally designed into the NGG System, Sprint will provide HP with a written, high-level requirements document that will serve as a request for change.  Once received, HP and a resource directly from 724 will analyze the request for change and prepare a high-level approach document known as a Change Order.  In following Sprint’s TDP, Change Orders will be delivered as a Level 0 estimate (+150% / - 50%) within 5 business days of Sprint’s written request as outlined in the SPA.  Finalized Change Orders will be delivered to Sprint with different SLAs based upon complexity and the date of Sprint’s written request:

•

Low complexity projects ($100,000 or less to Sprint) = 4 business days

•

Medium complexity projects ($100,000 - $250,000 to Sprint) = 8 business days

•

High complexity projects ($250,000 + to Sprint) = 13 business days

System Integration (Design / Analyze Phase):

•

Change Order – for Sprint approved Change Orders; HP and a technical resource from the 724 team, will prepare a detailed design document to be approved by Sprint prior to work commencing.  If requested by HP, 724 will produce a statement of work to accompany the design document.  In preparing the Change Order, HP and a 724 resource will analyze and report any impact to the overall NGG project timeline, estimated impact analysis, testing requirements, and provide a revised Rough Order Magnitude (ROM) estimate (+/- 10%).

System Integration (Test Approach and Plan):

Based on the type, magnitude, impact, and time sensitivity of a Change Order, HP may request 724 to provide one or more of the following deliverables:

•

Test Plan – a detailed document defining the scope and objective of the test cycle, the resources (people and data) required to perform the test, testing timeline, and the test location or environment.

•

Test MOP – a Methods of Procedures document detailing the individual steps/procedures to be performed in a chronological manner in order to successfully complete the test cycle for a given Change Order

•

Test Cases - a Test cases and expected results, a series of individual test cases/conditions that make up a test plan and their expected results.  There should be both positive and negative test cases that will allow each logical path through the application to be tested for an expected result.

•

Test Scripts - Test scripts,  a series of test scripts designed and written to be executed during a given test cycle

•

Test Release Notes - a detailed document describing the exact test lab setup, applicable hardware and software configurations, test criteria, results of the tests any known issues and/or workarounds for a given software release or patch.  This document would typically also include information related to any new features and associated functionalities, along with required system and application details.

•

Test results – a detailed document created as a result of a given test cycle that contains the outcomes of the test cases related to that test cycle

System Integration (Lab Build/Test):

For a given Change Order, any changes to the HP NGG Test Lab and/or configuration activities will primarily be the responsibility of HP, unless otherwise defined by the Change Order which has been mutually agreed upon.

•

Release Notes for HP NGG Test Lab - 724 will provide Release Notes, a detailed document identifying the original baseline and any new features and associated functionalities, along with required system and application details

•

MOP for HP NGG Test Lab - 724 will provide a MOP, Methods of Procedures document detailing the installation and migration procedures required to move from existing setup/configuration to the setup/configuration required for a given release

System Integration (FIT Build/Test):

•

724 will provide Support as described in the existing service levels defined in the current NGG Agreements

System Integration (Production Rollout):

•

724 will provide Support per existing service levels defined in the current NGG Agreements

•

IF requested by HP, 724 will provide at no additional cost to HP Post-mortem report – a high-level document summarizing the lessons learned, the activities that were performed well, and activities which need improvement and ideas on how those improvements might be made on subsequent test cycles and/or releases.

Acceptance Criteria —

This activity is considered accepted when:

•

HP and 724 collaborate to define and document the Systems Integration Methodology (SIM)

•

724 has provided HP with:

•

System Development Life Cycle (SDLC) document

•

Information about 724’s test processes and deliverables as defined in its SDLC

•

End-Customer (Sprint) Acceptance of deliverable

724 Responsibilities -

•

724 will work with the HP team to provide information about 724’s test processes to the HP NGG Test Lab to allow seamless integration.

•

If, and when, Sprint’s TDP is modified, such that a change to the SIM is required, at HP’s request, 724 will collaboratively support the changes to the SIM.

•

724 will provide test plans, test scripts, and test data used to test 724’s Sprint NGG System Application Software and support HP’s development of an NGG Test Lab that can properly reproduce a STIC-like testing environment.

•

724 will work with HP to define interface points between the SIM and 724’s SDLC.

•

724 will collaborate with both HP and Sprint to define a set of test cases that, when the tests are properly executed and the anticipated results achieved, will result in 724 certifying that the HP NGG Test Lab is both functionally and operationally ready.

•

724 will provide a Project Manager to oversee and ensure all 724 resources are assigned as needed, documentation is reviewed and approved, action items are completed on time and is the interface to the 724 management team.

•

724 will provide adequate resources as mutually agreed upon.

HP Responsibilities

•

In support of the preparation of the SIM, HP will provide resources with knowledgeable of the NGG STIC processes, release to production processes, and support processes.

•

HP will collaboratively work with 724 to define, the primary goals, objectives, and success criteria to be achieved by developing the Systems Integration Methodology.  The SIM will be used as the guiding principals and criteria by which work is scoped, prioritized, and scheduled for every release.

•

HP will obtain Sprint’s STIC test plans, test scripts, and test data and methods as they will provide a more comprehensive means of properly producing a STIC-like test environment.

•

HP will collaborate with 724 on the schedule for the completion of the SIM.

•

HP will provide 724 with at least one (1) week notice of resources required.

•

In order to scope the level of effort HP requires of 724 to support the creation of the SIM as outlined in this Exhibit 1, section1.2.1, HP will conduct one or more sessions with 724 to define 724 responsibilities related to the creation of the SIM.

•

HP will provide Operating System, Oracle database, and other third party expertise on other third-party components within the NGG System, as required in support of developing the SIM.

•

In order to scope the level of effort HP requires of 724 to support all Special Programs outlined in this Exhibit 1, HP will conduct one or more sessions with 724 to define 724 responsibilities related to this process.

•

Sprint will work with the HP/724 team to provide information about Sprint’s test processes to the HP NGG Test Lab to allow seamless integration.

•

If, and when, Sprint’s TDP are modified, Sprint will provide HP with these updated processes and procedures so that the changes can be integrated into HP’s System Integration Common Methods.

•

Sprint will provide access to Sprint’s STIC test plans, test scripts, and test data and methods as they will provide a more comprehensive means of properly producing a STIC-like test environment.

•

Sprint will provide the HP NGG Test Lab with access to test plans, test scripts, and test data used in the Sprint STIC Lab to ensure that the HP NGG Test Lab can properly reproduce a STIC-like testing environment.

•

Sprint will work with HP to define interface points in Sprint’s design phase in order for HP to compress development test and implementation cycles

•

Sprint will provide written certification that the HP NGG Test Lab is both functionally and operationally ready prior to the HP NGG Test Lab beginning operation.

•

Sprint will communicate application requirements during the analysis and design phase, before HP will begin the development phase

•

Sprint will provide feedback an agreed upon time frame for each release from test results, to enable HP to meet agreed upon SLAs.

•

Sprint will be responsible for reviewing and approving the HP weekly status reports.

•

Sprint needs to provide a Project Manager to oversee and ensure all Sprint resources are assigned as needed, documentation is reviewed and approved, action items are completed on time and is the interface to the Sprint management team.

Assumptions —

•

HP NGG Test Lab will use the Sprint NPO Entrance/Exit checklist as a prerequisite for receiving application code from 724.  Modifications and/or additions will be made to this checklist as deemed necessary by HP.

•

HP will have access to Sprint’s project resources as and when required to enable HP deliverables to be developed and completed in accordance within the agreed schedules.

Deliverables –

•

Certification by 724 that the HP NGG Test Lab is both functionally and operationally ready.

•

Updated Common Test Life Cycle Methodology – this is a detailed document outlining  the methods and procedures used in the HP NGG Test Lab for testing, tracking, entrance and exit criteria in collaboration with HP.

•

Approved HP NGG Test Lab Agreement in Principle – this document will be jointly created by Sprint/HP/724 in order to clearly outline the roles and responsibilities of each party in regards to the creation and operation of the HP NGG Test Lab.  In addition to the methods and processes that will be implemented and enforced to ensure that the 724 software releases and patches delivered to the HP NGG Test Lab can be efficiently and thoroughly tested prior to release to the Sprint STIC Lab.

•

HP NGG Test Lab is production certified by all parties (724, HP, Sprint)

•

Tools and methods for testing of NGG software are in place

•

Agreement in Principle is established and agreed upon

•

Deliverables for which 724 is responsible have been received

•

Establishment of Configuration Management and Change Order Methodology for the HP NGG Test Lab

•

724 will work with HP and Sprint to Create an Agreement in Principle for the creation and operation of the HP NGG Test Lab.

•

724 will adhere to the Configuration Management and Change Order Process developed by HP– these documents describe both the change order and configuration management process the will be implemented and enforced by the HP NGG Test Lab in the testing of 724 software releases and patches

•

724 will own resolution of 724 product and 724 SSE Code issues discovered in the Load Test process.

•

724 will work with the HP team to provide information about 724’s test processes to the HP NGG Test Lab to allow seamless integration.

•

724 will provide the HP NGG Test Lab with access to test plans, test scripts, and test data used in during the 724 SDLC to ensure that the HP NGG Test Lab can properly reproduce a STIC-like testing environment.

•

724 will provide written certification that the HP NGG Test Lab is both functionally and operationally ready prior to the HP NGG Test Lab beginning operation.

•

724 will provide a Project Manager to oversee and ensure all 724 resources are assigned as needed, documentation is reviewed and approved, action items are completed on time and is the interface to the 724 management team.

•

HP will expand the physical architecture of the HP NGG Test Lab for the purpose of testing [**] TPS Certification.

•

Sprint will work with the HP/724 team to provide information about Sprint’s test processes to the HP NGG Test Lab to allow seamless integration.

•

If, and when, Sprint’s test procedures are modified, Sprint will provide HP with these updated processes and procedures so that the changes can be integrated into HP’s System Integration Common Methods.

•

Sprint will provide the HP NGG Test Lab with access to test plans, test scripts, and test data used in the Sprint STIC Lab to ensure that the HP NGG Test Lab can properly reproduce a STIC-like testing environment.

•

Sprint will provide written certification that the HP NGG Test Lab is both functionally and operationally ready prior to the HP NGG Test Lab beginning operation.

•

Sprint will provide timely communication regarding test cases and test results to enable HP to be better able to test the 724 application code prior to delivery to the Sprint STIC Lab.

•

In order to scope the level of effort HP requires of 724 to support all Special Programs outlined in this Exhibit 1, HP will conduct one or more sessions with 724 to define 724 responsibilities related to this process

•

Sprint will communicate any and all changes to the Sprint STIC Entrance Criteria so that the HP NGG Test Lab can make the appropriate modifications to test processes, test scripts, test cases, and/or test data.

[**] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED.

•

Sprint will provide any and all new wireless devices to the HP NGG Test Lab in order that they may be properly tested on the NGG platform before being used in production.

•

HP NGG Test Lab will use the Sprint NPO Entrance/Exit checklist as a prerequisite for receiving application code from 724.  Modifications and/or additions will be made to this checklist as deemed necessary by HP.

Phase 1: Labor - $[**]

Travel - $[**]

Phase 2: Labor - $[**]

Travel - $[**]

•

Sprint HP and 724 will work together in defining the [**] TPS certification plan within 45 days of the date of execution of the SPA

•

HP and 724 will work together to execute the [**] TPS certification plan.

•

[**] TPS Certification Plan – this will be a detailed documented created jointly by Sprint, HP and 724 HP on how the TPS certification test will be setup, administered, and measured.

•

[**] TPS Certification Results – this document will be created with data and/or statistics gathered before/during/after the actual execution of the TPS Certification test.  The document will be created by Sprint, HP and 724.

•

Acceptance of the [**] TPS Certification Plan is when the plan is completed and delivered to Sprint

•

Acceptance of the [**] TPS Certification of the NGG application is when the results document has been completed and presented to Sprint indicating a successful result

•

724 will work with the HP and Sprint teams to create an unbiased TPS Certification Test Plan that will simulate a load of [**] TPS within 45 days of the date of notification from Sprint to proceed with the TSA.

•

724 will provide the HP NGG Test Lab with access to test plans, test scripts, and test data used in the 724 SDLC to enable HP to construct a load test harness for certification testing.

[**] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED.

•

724 will provide timely communication regarding test cases and test results to enable HP to be better able to test the SSE and XMG application code and meet the [**] TPS certification requirement.

HP Responsibilities

•

Sprint will work with the HP team and it’s subcontractors to create an unbiased TPS Certification Test Plan that will simulate a load of [**] TPS within 45 days of the date of execution of the SPA

•

Sprint will provide the necessary commitment to working with HP to provide a timely agreement on customized reports to be provided.

•

Sprint will provide the HP NGG Test Lab with access to test plans, test scripts, and test data used in the Sprint STIC Lab to enable HP to construct a load test harness for certification testing.

•

Sprint will provide written verification of [**] TPS certification upon receipt of verifiable certification test results document.

•

Sprint will provide timely communication regarding test cases and test results to enable HP to be better able to test the SSE and XMG application code and meet the [**] TPS certification requirement.

•

Sprint will provide the HP NGG Test Lab with intellectual test property and devices to enable HP to be better able to test the SSE and XMG application code prior to construction of the certification test plan and test harness.

Assumptions —

•

Sprint will communicate any and all changes to the Sprint STIC Entrance Criteria so that the HP NGG Test Lab can make the appropriate modifications to test processes, test scripts, test cases, and/or test data.

•

Sprint will provide any and all new wireless devices to the HP NGG Test Lab in order that they may be properly tested on the NGG platform before being used in production.

•

HP NGG Test Lab will use the Sprint NPO Entrance/Exit checklist as a prerequisite for receiving application code from HP’s Subcontractor.  Modifications and/or additions will be made to this checklist as deemed necessary by HP.

[**] REPRESENTS MATERIAL WHICH HAS BEEN REDACTED.

ROLE

MINIMUM AVAILIBILITY TO PROJECT

Sponsor

As required to overcome Sprint issues that impede progress on the engagement

Steering Committee / Project Board

A group of Sprint and HP Executives who will represent the highest authority on the engagement.  Issues to be the responsibility of this body include strategy, resource allocation, issue resolution, the apex of the escalation process, authorization of major change requests, etc.

Project Manager

25% availability required

Capacity Planning Team Lead

Available to the team as needed

System Administrator

Available to the team as needed

Sr. Network Engineer

Available to the team as needed

NGG Ops Engineer

Available to the team as needed

STIC Lab engineer

Available to the team as needed

IT Manager

Available to the team as needed