440 Davis Court #1602
San Francisco, CA 94111-2496
415 781 5700

August 22, 2002

03 00050 61 02082202

Mr. Morris E. Jones
Business Unit Manager
Cable Network Operation
Intel Corporation
350 East Plumeria; Mail Stop CHP3-105
San Jose, CA 95124
Subject:   Microsoft to Reveal Code for Windows
Ownership of SDS

Dear Morris,

Assume you are back from vacation, and hope all is well. Sent you a letter on August 13, but have not received a response. Perhaps you have been busy getting caught up from things that accumulate during vacation.
Two issues are pending...
  1. On August 13, 2002 Gary Johnson said he is ready to begin using SDS as soon as we can make that happen...
    Accordingly, the letter to you on August 13 asks about IP issues first raised in connection with Gary on July 23, 2002, and saying generally....
    Can we come up with an agreement to protect IP by granting Gary some ownership in SDS. I want to structure an agreement based on Gary producing deliverables that contribute toward a commercial product, for example an SRS, and I want to create contractual terms that vest him with entitlements as well as prevent selling or otherwise giving over the SDS design to others.

    Initially, I am thinking of 10% ownership for Gary.
    As I have mentioned previously, for similar potential deals that never materialized, I have represented that you are 25% vested in SDS and I have 75%. Giving Gary 10% would change this to 20% and 70%.

    I would like input from you so that going forward we are in sync on these issues, unless you have decided to withdraw entirely from the SDS effort.
    For example, we are contemplating vesting Gary with ownership interest in SDS in exchange for contributing to product development and perhaps some business promotion at Boeing and other contacts he may be able to devleop. This step has been done often in the industry, so I am wondering if you can suggest some common terms for this sort of arrangement which fit our particular situation, based on your experience as a founder with start-up on Chips and Technologies?
  2. The second issue concerns an announcement by Microsoft on August 5, that some Windows code will be released to the public. You have previously mentioned being a Windows developer.

    Has the code been released?
    Have you reviewed it, and is there anything in this release that might assist with accomplishing an interim solution for the memory issue we have been discussing, per your letter to Microsoft on June 13?

    If the code has been released and you find nothing to assist, do any new ideas emerge from what was released that might suggest further questions to Microsoft based on this new policy to release some of the code?

Can you let me know on this stuff. Would like to get back to Gary. I sent you a copy of a letter to Gary today, commenting on recent efforts he has made to help make SDS records on the Internet more compliant with HTML standards. This is the kind of support would like to expand.



Rod Welch