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EXHIBIT 10.01
Confidential treatment with respect to certain information in
this Exhibit has been requested of the Commission pursuant to
Rule 24b-2 under the Securities Exchange Act of 1934, as amended. The
bracketed portions of this Exhibit have been omitted from the
material filed in accordance with Rule 24b-2 and have been filed
separately with the Commission.
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DEVELOPMENT AGREEMENT NO. 19-001-96
SSAM ASSESSMENT
This Development Agreement is entered into on the 2nd day of
JANUARY, 1996 by and between U S West Advanced Technologies, Inc.,
a Colorado corporation ("USW-Technologies"), U S WEST Communications, Inc., a
Colorado corporation ("USW-Communications"), (hereinafter USW-Technologies,
USW-Communications and their Affiliates will be collectively referred to as
"Licensee"), and Carnegie Group, Inc., a Delaware corporation with a principal
place of business at Five PPG Place, Pittsburgh, PA 15222 ("CGI").
ARTICLE 1 - RECITALS
1.1 Licensee and CGI entered into a General License Agreement (the
"GLA") on December 17, 1992 in which the parties committed to enter into a
series of Artificial Intelligence ("AI") technology research, experimentation
and development agreements ("Development Agreements") over a period beginning
on the Effective Date, as defined in the GLA, and ending on the fourth
anniversary of the Effective Date.
1.2 Licenses and CGI now desire to enter into this Development
Agreement pursuant to which the parties, as contemplated by the GLA, will
commit to a project of specific research, experimentation and development as
stated herein.
NOW, THEREFORE, in consideration of the mutual covenants set forth in
this Development Agreement, Licensee and CGI agree as follows:
ARTICLE 2 - DEFINITIONS
2.1 Defined terms used in this Development Agreement shall have
the meanings set forth in Article 2 of the GLA, unless different meanings are
specifically set forth in this Development Agreement.
2.2 "Project" means the specific research, experimentation and
development which CGI will perform for Licensee under this Development
Agreement.
19-001-96 JANUARY 2, 1996
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2.3 "Project Description" means a detailed written description of
the Project, including but not limited to:
(a) any Deliverable Performance Specifications; and
(b) a listing which identifies and describes, as to
the Project:
(i) any Deliverables intended to be created in
the course of the Project; and
(ii) any Licensee Specific Technology intended
to be created in the course of the Project;
and
(iii) any Licensee Proprietary Information or
Licensee Confidential Information to be
made available to CGI in the course of
the Project; and
(iv) any Generic Research Technology intended to
be created in the course of the Project.
2.4 "Projected Cost" means that projected cost referred to in
Article 9 of the GLA and set forth in Article 5 hereof.
2.5 "Projected Date" means the projected date for completion of
the Project agreed upon by the parties and set forth in Article 6 hereof,
including any Agreed Completion Date.
ARTICLE 3 - EFFECT OF THE GLA
This Development Agreement is subject in all respects to the terms and
conditions of the GLA. Ownership of Generic Research Technology developed
hereunder is vested in U S WEST, in accordance with Article 3.3 of the GLA
and the payment of ALLIANCE rates by Licensee to CGI as provided in Exhibit 2,
attached hereto.
ARTICLE 4 - PROJECT DESCRIPTION
4.1 The Project Description is set forth in Exhibit 1 attached
hereto.
4.2 CGI shall use its best efforts to complete the Project in
accordance with the Project Description. Except for the warranties set forth
in Article 8 of the GLA regarding any Deliverable Performance Specifications
set forth in
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Exhibit 1 of this Development Agreement, CGI hereby disclaims any express or
implied warranty that all or any portion of the Project intended to be created
or developed pursuant to this Development Agreement will perform in accordance
with the Project Description or any other criteria.
ARTICLE 5 - PROJECTED COST; PAYMENT
5.1 CGI's Projected Cost for the Project is $ [ ]. An
itemized account of the Projected Cost including person-year rates applied as
Alliance, Technology and/or Co-Development Rates as defined in the GLA is set
forth in Exhibit 2 attached hereto. Modifications to the Projected Cost (and
any payments under Section 5.2) shall be governed by Sections 9.4 and 14.7 of
the GLA.
5.2 Licensee shall pay to CGI, in consideration for CGI's
performance of its obligations under this Development Agreement, the sum
of $ [ ] in accordance with the payment schedule set forth in Article 5
of the GLA.
ARTICLE 6 - PROJECTED DATE
6.1 The Projected Date for completion of the Project is FEBRUARY
29, 1996. A time schedule listing projected dates for completion of interim
stages of the Project is set forth in Exhibit 3 attached hereto.
6.2 CGI shall use its best efforts to complete the Project by the
Projected Date. Except for the obligations set forth in Article 9 of the GLA
regarding any Agreed Completion Date set forth in Exhibit 3 of this Development
Agreement, CGI hereby disclaims any express or implied warranty that all or any
portion of the Project intended to be created or developed pursuant to this
Development Agreement will be completed on any date certain, including the
Projected Date.
ARTICLE 7 - TERMS OF DELIVERY AND RISK OF LOSS
7.1 CGI will deliver, at its expense, to Licensee any Deliverables
and Licensee Specific Technology in accordance with the Exhibits hereto.
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7.2 CGI will bear the risk of loss or destruction of such
Deliverables and Licensee Specific Technology until the delivery of such items
to Licensee at the location designated by Licensee. For the purposes hereof,
"delivery" shall mean physical delivery to a facility and shall not include
installation.
ARTICLE 8 - INSTALLATION
8.1 CGI will provide, at Licensee's request and expense, technical
assistance to Licensee sufficient for the proper installation of Deliverables
and Licensee Specific Technology in Licensee facilities. Such assistance may
include, if deemed necessary by Licensee, the presence of one or more CGI
employees at Licensee facilities to assist in such installation. Licensee will
pay, in accordance with the GLA, travel, room and board expense incurred by
such employees of CGI.
8.2 Licensee will bear the risk of loss or destruction of the
Deliverables, Licensee Specific Technology or any other items delivered to
Licensee facilities during and after installation.
ARTICLE 9 - OPERATIONAL TRAINING
CGI will provide, in accordance with Article 6 of the GLA, adequate
training to no more than 0 Licensee employees regarding the proper operation
and use of Deliverables, Licensee Specific Technology and Generic Research
Technology created in the course of the Project.
ARTICLE 10 - MAINTENANCE
CGI will perform maintenance and repair services on Deliverables,
Licensee Specific Technology and Generic Research Technology in accordance with
the GLA.
ARTICLE 11 - MODIFICATIONS AND AMENDMENTS
Any modifications to the Project or to this Development Agreement,
including but not limited to modifications to the Project Description, the
Projected Costs, or the Projected Date, to which the parties agree after the
date of execution of the Development Agreement, will be evidenced by a written
supplement to this Development Agreement executed by both parties.
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ARTICLE 12 - INTEGRATION
This Development Agreement, the Exhibits attached hereto and the terms
of the GLA set forth the entire and exclusive agreement and understanding of
the parties relating to the subject matter contained herein, and supersede all
prior and contemporary discussions. Neither party will be bound by any
definition, condition, warranty or representation except as expressly set forth
in this Development Agreement or the GLA or as subsequently set forth in
writing signed by authorized representatives of each party.
IN WITNESS WHEREOF, Licensee and CGI have executed this Development
Agreement in duplicate by their respective authorized representatives.
CARNEGIE GROUP, INC. LICENSEE
BY: /s/ DENNIS YABLONSKY BY: /s/ CAT REUSSWIG
-------------------- ------------------
TITLE: President/CEO TITLE: Director
-------------------- ------------------
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EXHIBIT 1
PROJECT DESCRIPTION
This agreement covers the consulting services to be performed by Carnegie
Group, Inc. for U S WEST in support of the Sales Support and Account
Management (SSAM) Assessment project and is the follow-on agreement to
Development Agreement 19-001-95. The objective of this assessment is to
develop an integrated sales support and account management strategy (i.e.,
systems approach) for Mass Markets to coordinate the efforts currently underway
to meet the needs of the sales consultants in the business centers.
[ ]
[ ]
[ ]
[ ]
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EXHIBIT 2
PROJECTED COST
The total cost of the work to be performed will be $ [ ] based on
estimated time and materials and 1995 actual and 1996 estimated travel
expenses. The 1995 actual travel expenses are a result of work that was
performed under the preceding Development Agreement 19-001-95 and have been
approved by U S WEST for deferral and payment under this Agreement.
U S WEST may, at its discretion, close the consulting project or the
involvement of CGI resources by providing a written notice to the CGI Program
Manager. If such an eventuality occurs, the respective resources will be given
a ramp down period of two weeks to find other work.
Estimated costs for the project are provided below. Note that the Alliance and
Volume discounts are subtracted from the standard time and material costs.
Total Time and Materials Costs [ ]
Less 5% Alliance Discount [ ]
Less 5% Volume Discount [ ]
Total Contract Engineering $[ ]
Estimated Travel [ ]
---------------- ---------
TOTAL PROJECT COSTS $[ ]
Additionally, we are providing the estimated hours by functional labor
category:
CATEGORY HOURS
- - ---------------------------------------------
Sr. Manager [ ]
- - ---------------------------------------------
Sr. Business Consultant [ ]
- - ---------------------------------------------
Business Consultant [ ]
- - ---------------------------------------------
Admin Support [ ]
- - ---------------------------------------------
CGI Total Hours [ ]
- - ---------------------------------------------
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EXHIBIT 3
SCHEDULE
The proposed work was initiated in 1995 under Development Agreement 19-001-95
and will be continued in 1996 with a continuation date of January 1, 1996 and
completion scheduled for no later than February 29, 1996.
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EXHIBIT 4
DELIVERABLES
CGI will provide two (2) detailed Analysis Reports to U S WEST, one each for
SBG and H&PS. The reports will detail the investigations, analysis,
requirements and recommendations for addressing the high priority needs of
each organization. The reports will include a mapping of the functional
requirements found during the analysis across Mass Markets to specific
applications: [ ] etc. The reports will also include an asset
evaluation of the [ ] and [ ] systems, and will incorporate the
recommended transition implementation steps to achieve the consolidation of
these systems.
Additionally, CGI will provide U S WEST with regular status updates in the form
of scheduled meetings that detail the efforts performed and the time consumed
to perform those efforts.
Other than these reports, CGI does not have any specific project deliverables
but is providing expertise on an hourly basis. Project deliverables are under
U S WEST direction.
19-001-96 JANUARY 2, 1996