Current assets

EXHIBIT 10.2

The “Statement of Work” (SOW) is part of the “Consulting Agreement” document where all global contractual terms & conditions — which are common for each project with this subcontractor — are determined. The Statement of Work is determining all project specific items.

Statement of Work contract for IPSX-Software-Development – Phase II
entered under
the Software Support Outsourcing Agreement 001

Between

Cosine Communications, Inc Delaware Corporation organised under the laws of USA, having its registered office at 1200 Bridge Parkway, CA 94065, herein represented by Sachin Desai, Director, Engineering

And

Wipro Limited, a company organised under the laws of India, having its registered office Dodda Kannelli, Sarjapur Road, Bangalore.

Where as on May 30^th 2003 CoSine Communications Inc (“CoSine”) and Wipro Limited

(“Wipro”) have entered into a Software Support Outsourcing Agreement (“Agreement”), where as under this Agreement, CoSine Communications and Wipro are willing to conclude a Statement of Work contract, for the execution of a project to be performed by Wipro, and the results of which have to be delivered to CoSine Communications. It has been agreed that Wipro will perform the project described below.

TABLE OF CONTENTS

1. INTRODUCTION

From the edge of the Service Provider network, CoSine’s IPSX Service Processing Switches deliver scalable customized IP services that generate new revenue streams while minimizing capital and operational costs.

CoSine’s IPSX Family marries switching, routing and computing capabilities with a flexible operating system to deliver scalable customized IP services at multi gigabit line rates from the edge of a Service Provider’s (SP’s) network.

The IPSX Family includes two switches: the 26-slot IPSX 9500 Service Processing Switch and the 8-slot IPSX 3500 Service Processing Switch. Both IPSX switches can be configured with any combination of CoSine’s dual-slot IP Service Generators (IPSGs) to deliver CoSine’s full IP Services Suite from Virtual Private Networks (VPNs) and firewall to URL filtering and Network Address Translation (NAT).

CoSine has been working with Wipro since June 2003, where Wipro is contributing to the sustenance and enhancement of IPSX software. Refer SoW version 1.1.

This statement of work (SOW) describes the details of ownership of TAC and QA activities of IPSX 3500 & IPSX 9500 from Oct 2004- Dec 2005. There will be a team of 6 people dedicated for TAC/QA activities during this period. From July –Dec of 2005 6 people from the existing engineering team will move to the TAC/QA team, making 12 team members between July 2005 – Dec 2005. The engineering support between Oct 04 – June 05 is covered as a part of the earlier SOW signed between Cosine and Wipro dated June 2004.

The scope of the project involves handling of TAC (24*7) and QA activities of releases which are currently deployed in the field including bond, pasta and saboo. TAC activities include – handling of customer calls/queries, reporting technical problems, reproducing technical problems, releasing fixes/patch builds to customers & RMA activities support. CoSine would be responsible for the actual hardware (blades, cards etc.) deployment to the customers. QA activities include – preparing test plans, black box testing of IPSX software for patch releases to customers, reporting technical problems and verifying fixes in the patch releases.

Hardware support activities are out of scope of CIDC & would continue to be handled by Cosine staff. Wipro would not be responsible for any failure of deliverables to the customers due to failure of hardware support. The migration support of customers from IPSX to other platforms is also out of scope CIDC. The customer reported problems in the following areas would not be handled by CIDC.

Product Description

IPSX software can be classified into different domains.

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Currently different software releases are in the field.

Major releases for maintenance are

Bond and Pasta are very widely deployed release in the field. Saboo is relatively new version, which is not yet widely deployed in the field.

Acronyms and naming conventions

Abbreviations

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Contact persons

CoSine

Sachin Desai
Director — Engineering
Tel: ++ ###-###-####
Email: sachin. ***@***

WIPRO

Ramadurai Ramalingam.
Technical Manager
Tel: ++91/80/51195880
E-Mail: ***@***

Shivaji Hogale
Project Manager
Tel: ++++91/80/28520408 ext-81017
E-mail: ***@***

Timothy Burke
Senior Business Manager
Tel: + ###-###-####
E-mail: ***@***

References

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Project Description

Requirement References

Customer escalations would be recorded using bug tracking system & this would form input for TAC, QA & sustenance activities. This includes records for defects found at end-customer site and defects found in CoSine TAC/QA lab during patch release testing.

Activity descriptions, deliverables and planning

Activities

In general following activities are indicated. Wipro shall contribute towards

Training

CoSine should provide adequate training for TAC & QA team members in all the areas to TAC & QA activities self dependent & fully operational at CIDC. Any other new training requirements, if any, will be decided after mutual discussions. Wipro shall not be responsible for any non performance arising due to lack of training from Cosine to Wipro.

CoSine Deliverables

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Wipro Deliverables

Resources

Wipro provided Resources

CoSine provided Resources

As part of the existing cooperation, Cosine has provided the required infrastructure to carry out the sustenance activities. Wipro would ensure that the resources would be optimally used and shared for TAC/QA activities on need basis. The additional resources specific for the successful execution of TAC/QA activities is provided in the subsequent section.

Additional resources to be provided by CoSine

Additional resources required in future can be discussed & mutually agreed upon.

Cosine is also responsible for providing licenses & AMC for software / hardware, third part tools to be used in CIDC & RWC

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Project Environment (to be provided by COSINE)

QA Environment

IPSX Switches
Third party Hardware/Software Tools & Test equipments.
IPNOS software:
Invision Software;
Systems for execution of tests.

TAC Environment

IPSX Switches
Third party routers and switches
Bug tracking system
Call centre.

Reporting and monitoring

The PM and CIDC manager will monitor the project on a continuous basis and provide a Project Status report to CoSine once a week. There will be a weekly teleconference (if required) call to clarify any issues reported in status report or otherwise. The status report will summarise the following details:

Any changes in the status report shall be mutually agreed.

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Customer escalation management

TAC team would be responsible for handling customer escalation. Cosine representative may be involved as when required. The priority of all the bugs would be decided by TAC lead based on customer requirements.

Patch fixes / Patch release management

TAC team lead would be responsible for delivering patch fixes to the customer.

Testing processes

QA lead would define the schedule for testing of patch releases. QA team would follow the existing QA processes.

Risk management

Any risks which will be identified as a part of this project will be jointly reviewed and agreed by both Wipro and CoSine.

Best efforts

Wipro acknowledges and understands that Client’s end customers are dependent upon Wipro to provide the services outlines in Section 2.2. Wipro and CoSine agree to work together in good faith and to use best efforts to ensure that the services are provided in conformance with this project plan. In the event that CoSine’s end customers request to contract with Wipro directly for support services described herein, CoSine’s and Wipro will meet and discuss whether such requests can be accommodated. Any accommodation must be approved by both parties. Cosine has communicated to its end customers that there will not be an escalation point provided from Cosine in this SOW, and that best efforts will be made from Wipro without the support of Cosine representation.

Escalation Management

This section defines the escalation process to be followed both by the CIDC team and CoSine in case of need. If there is a need for onsite travel by a Wipro engineer to the end customer location, it will be discussed and agreed with on between Wipro and end customer. The cost for this onsite travel would be paid for in advance by the end customer. For any query from customers of CoSine, following is the escalation path.

Level 5- A representative will be made available from Cosine on an as needed basis.

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FINANCIAL CONDITIONS

Payment plan

Project Cost:

The total cost of the project is for the duration 1st October 2004 – 31st December 2005 is USD 1087884 excluding AMC, Lab expansion charges & billing for existing 23 people from sustenance team till June 2005 .

Entire Expenses for setting up TAC / QA operations & infrastructure would be borne by Cosine.

The projected costs includes the following costs

The project cost break is given below:

Monthly Recurring cost:

Single Time Infrastructure investment cost:

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Total project Cost:

Note1: The TAC & QA people will be billed 1.5 times the normal billing rate.

Note2: Outgoing call made by TAC / QA team will be charged on actual. Outgoing call would be approximately around 2000 USD per month.

Note3: AMC for all additional servers will be charged once all the servers are setup.

Note 4: The existing SOW and this TAC/QA SOW invoices will be combined and submitted quarterly starting Oct 2004.

     Assumption. Expenses mentioned in that above table are based on the information/requirements available as on date. It may vary based on future additional requirements. Once the project value as mentioned in the SOW is exhausted, Wipro shall further provide any services only upon receipt of approval for increased value from Cosine.

     Contingency:

It is envisaged that there could be additional expenditure to reasons beyond the control of Wipro. These expenditures shall be discussed and mutually agreed upon prior to their incurrence. These expenditures have a bearing on the project cost, if and when they occur. Hence, a contingency amount (20%) may be required if such additional expenditures are encountered. This is estimated to be USD 181314. The total cost of the project including contingency is USD 1087884. The break-up is given in the table below:

     The parties agree that the contingency balance shall be separately maintained and treated as a deposit, and any expenditure that is applied against the contingency shall be mutually agreed upon between the parties. At the end of the project term, any unused portion of the contingency shall be promptly refunded in full to Client.

The Client acknowledges and agrees that the services fees for the services in excess of the estimated workload for the project (estimated workload is understood to be approximately

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forty-five (45) hours per person assigned to the project per week)shall be calculated on the basis of the following rates:

USD 4100 (Till December 2004) & USD 4500 (from Jan 2005 to Dec 2005) for software engineer per month for services performed out of India. For services to be performed in USA for the software engineer per month would be USD 10,000 and 2000 USD per travel towards travel fare & Visa fees.

WIPRO will begin billing Cosine in October 2004, quarterly for both the existing SOW and this TAC/QA SOW through December of 2005. The combined invoice will be payable within in Net 15 days. Wipro acknowledges that the above represents payment in advance by CoSine for services to be rendered by Wipro during a specified service term. CoSine shall be entitled to a pro rata refund of any unearned service fees from Wipro for any portion of the paid-up service term during which Wipro does not actually provide the services. Any non receipt of payment will be treated as a breach and Wipro has an option to terminate immediately without any notice on the happening of such an event. In any case of conflict between parties, this SOW will govern the agreement between Wipro and Cosine.

     TAC / QA People Resource Plan:

     CIDC Engineering People Resource Plan:

     INTELLECTUAL PROPERTY

All developed modules are the Intellectual Property of CoSine

     Others

Wipro shall be only obligated to provide services under this SOW upon the following:

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     SIGN-OFF PAGE

In witness whereof, the parties have caused this Statement of Work to be executed by their duly authorised representatives, and entered into as of the effective date set forth upon final execution by the last signatory hereto,

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