Document:

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nct ____________________________________________________________ NCT GROUP, INC.

June 22, 1999

Mr. Richard Hennessey
President
Pro Tech Communications, Inc.
311 Industrial 25th Street
Ft. Pierce, Florida 34946

Dear Mr. Hennessey:

     The purpose of this letter is to set forth the basic terms by which Pro
Tech communications, Inc. or an entity succeeding to its assets and liabilities
(collectively, the "Seller") would be willing to sell to NCT Hearing Products,
Inc. ("NCT") or an entity created by it (collectively, such entity and NCT are
herein referred to as the "Buyer") all of the ownership interests in Seller. We
are writing to you in order to seek you approval of the following basic terms
around which we would proceed to develop terms and conditions of a definitive
agreement (the "Definitive Agreement") under which the acquisition would be
consummated. Except as specifically set forth herein, this Letter of Intent
shall be non-binding and in the event that the parties are unable to reach a
Definitive Agreement, neither party shall have any claims against the other
except for breach of the parties' respective obligations in the confidentiality
agreement referred to in paragraph 11 hereof.

     1. PURCHASED INTERESTS. Buyer will acquire the majority ownership interest
     in Seller, via a purchase by Buyer from Seller of stock of Seller (the
     "Purchased Interest"). Pursuant to such purchase, Buyer will succeed to
     the indirect ownership of Seller's assets and shall assume Seller's
     liabilities.

     2. PURCHASE PRICE. In consideration for the Purchased Interests to be
     acquired by Buyer, Buyer shall license to Seller its technology for use
     with Products in the Market as defined in Schedule B for shares of the
     Seller's common stock having a value of $0.31 per share, or an aggregate
     value of Six Million One Hundred Thirty Six Thousand Dollars ($6,136,000)
     (the "Purchase Price"). The Buyer also agrees to raise Two Million dollars
     ($2,000,000) of additional equity. Schedule A outlines the structure of the
     ownership after the transaction is completed.

       One Dock Street, Suite 300, Stamford, CT 06902 * Tel 203-961-0500,
                     Fax 203-348-4106 * www.nct-active.com
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     3. SELLER'S EMPLOYEES. Buyers shall provide employment opportunities to
     Seller's management employees listed on Exhibit A attached hereto upon
     terms and conditions no less favorable than those in existence as of the
     date hereof. In addition, Buyer shall employ sufficient numbers of
     Seller's non-management employees after Closing to ensure that Seller is
     not in violation of the worker Adjustment and Retaining Notification Act
     and/or any similar state law.

     4. DIRECTORSHIP. The Buyer and Seller agree that pursuant to an agreed
     upon Shareholder Agreement the Seller and Buyer will each have three
     Directors on the BOD.

     5. RESTRICTIVE COVENANT. At the Closing, the management of Seller shall
     deliver to Buyer non-competition agreements prohibiting management of
     Seller from competing with Buyer, the terms of which shall be mutually
     agreed upon by Buyer and Seller.

     6. DUE DILIGENCE. The parties hereto acknowledge that Buyer has not had
     ample opportunity to engage in due diligence review of Seller, and,
     consequently, additional due diligence period shall be available to Buyer,
     and the Definitive Agreement shall be conditional to Closing based on
     Buyer's investigation of Seller. Seller will make available to Buyer and
     its representatives all information and records relating to the Seller and
     the Purchased Interests and shall provide access to management personnel
     to discuss such information. Buyer shall conduct its due diligence as
     expeditiously as possible after execution of this letter and in a manner
     so as not to interfere with the Seller or its business. The Buyer will
     bear primary responsibility for drafting the Definitive Agreement.

     7. CONDUCT OF BUSINESS. From the date hereof until August 23, 1999, the
     Seller shall continue to conduct its business in the ordinary course and
     shall not engage in any sale of its assets or shares of its capital stock,
     enter into any transaction, contact or commitment, incur any liability or
     obligation, or make any disbursement not in the ordinary course of
     business. Buyer shall not be obligated to close if there is nay material
     adverse change in the financial or operational condition of the Seller
     after the date executed hereof. The Seller and the Buyer will agree to
     limitations on the occurrence prior to closing of any new indebtedness,
     the issuance of any new securities, debt or equity, and similar status quo
     limitations as are customary for an acquisition of this nature.

     8. BROKERAGE. Seller has not and will not retain any broker, finder,
     placement agent or other party who would be entitled to any fee,
     commission or other compensation, except for Union Atlantic LC, whose fee
     of two percent (2%) of the total number of the Seller's shares of common
     stock issued and outstanding at the completion of the transaction will be
     paid equally by Seller and Buyer at the Closing. It is understood and
     agreed by the parties hereto that with respect to such shares, Union
     Atlantic LC shall have the piggyback registration rights as set forth in
     Addendum "A" to the Consulting Agreement between the Seller and

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     Union Atlantic LC. This paragraph shall not apply to any parties
     furnishing legal services or accounting services to Buyer or Seller in
     connection with the acquisition nor shall it apply to the Buyer's
     obligation to raise $2,000,000 of additional equity.

     9. EXCLUSIVITY. Neither the Seller nor its board of directors or
     shareholders shall solicit, discuss, negotiate or provide information to
     any party in connection with, or consider ay other proposal for, the
     purchase or sale of any capital stock or assets of Seller. This
     restriction shall remain in effect for a period commencing on the date of
     execution hereof and shall continue until such time as (i) the Definitive
     Agreement is signed by the parties, or (ii) sixty days from the date of
     execution hereof.

     10. EXPENSES. Each of the Buyer and Seller shall pay all of its own
     expenses incidental to the negotiation and preparation of this document
     and of all other documentation, including financial statements relating
     to the acquisition, regardless of whether the acquisition is consummated.

     11. CONFIDENTIALITY. In order to provide for the confidentiality and
     non-disclosure of information exchanged by the parties in connection with
     the negotiation and closing of the acquisition, the parties shall execute
     a mutually-binding confidentiality agreement.

     12. CONDITIONS PRECEDENT TO CLOSING. The consummation of the acquisition
     of the Purchased Interests is subject to the following conditions:

          a.   The execution by the parties, on or before August 22, 1999, of
               the Definitive Agreement containing customary terms and
               provisions applicable to transaction similar to that discussed
               herein, unless such terms and provisions are limited herein.

          b.   The entering into of the non-competition agreements described
               in Section 5 hereto.

          c.   The Buyer shall have raised the Two Million Dollars ($2,000,000)
               of equity referred to in Section 2 hereof.

          d.   The Seller shall have received an opinion from Union Atlantic LC
               that the transactions referred to herein are fair, from a
               financial point of review, to the Seller and its shareholders.

          e.   The Closing shall have taken place on or before August 22, 1999.
               If the closing has not occurred by such date, the Seller shall
               have the right to pursue alternative transactions with other
               parties and shall have no further obligations to the Buyer,
               except for the

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               obligations in the confidentiality agreement referred to in
               paragraph 11 hereof.

     If the proposal described in this Letter is acceptable, please indicate by
signing and dating the duplicate copies in the space provided below and return
all but two (2) originally executed copies to the undersigned. Closing will be
held as soon as possible after execution of the Definitive Agreement and the
fulfillment of the other conditions precedent, but in no event later than
August 22, 1999.

Sincerely,,

NCT Hearing Products, Inc.

/s/ Irene Lebovics
-----------------------------------
Irene Lebovics
President

Agreed and accepted this 22nd day of June, 1999

Pro Tech Communications, Inc.

By: Richard Hennessey
-----------------------------------
Richard Hennessey, President

                                       3<PAGE>   1

                                                                   EXHIBIT 10.24

                             MANUFACTURING AGREEMENT

Solectron California Corporation ("Solectron") whose principle place of business
is located at 847 Gibraltar Drive, Milpitas, California 95035 and Brocade
Communications Systems, Inc. ("Brocade") whose principle place of business is
located at 1901 Guadalupe Parkway, San Jose, California 95131 in their desire to
formulate a strategic business relationship and to define their expectations
regarding this relationship, hereby agree as follows:

1.0     PRECEDENCE:

1.1     This Standard Manufacturing Agreement (the "Agreement") is intended by
        Solectron and Brocade to operate as a basic set of operating conditions
        regarding their respective business relationship whereby Solectron would
        manufacture certain models of Brocade's products as described in more
        particularity in the addenda to this Agreement (the "Products").
        Product-specific requirements along with specific business terms and
        conditions with respect to each Product will be mutually agreed to and
        documented by an executed addendum to this Agreement.

1.2     It is the intent of the parties that this Agreement and its addenda
        shall prevail over the terms and conditions of any purchase order,
        acknowledgment form or other instrument. In the event of a conflict
        between the terms of this Agreement and the terms contained in any
        addenda to this Agreement, the terms of the addenda shall be
        controlling. Addenda shall not be binding until executed by authorized
        representatives of each party.

1.3     This Agreement may be executed in one or more counterparts, each of
        which will be deemed the original, but all of which will constitute but
        one and the same document. The parties agree this Agreement and its
        addenda may not be modified except in writing signed by both parties.

1.4     Nothing in this Agreement shall be construed or deemed to prevent or
        otherwise inhibit Brocade's ability or right to manufacture, at
        Brocade's facility or at a third party facility of Brocade's choice, the
        Products. Further, nothing in this Agreement shall be construed or
        deemed to (i) require Brocade to order any units of the Products to be
        manufactured by Solectron, or (ii) prevent or otherwise inhibit
        Brocade's ability or right to design, develop, manufacture, have
        manufactured, market, use, sell, and or distribute any follow-on
        products or derivatives of the Products.

2.0     TERM

2.1     The effective date of this Agreement shall be 7/30/, 1999 ("Effective
        Date"). This Agreement shall commence on the Effective Date, and shall
        continue for an initial term of three (3) years. Thereafter, this
        Agreement shall automatically be renewed for successive one (1) year
        renewal terms unless either party requests in writing, at least one
        hundred twenty (120) days prior to the anniversary date of the
        then-current term, that this Agreement not be so renewed.

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3.0     PRODUCT FORECAST

3.1     It is agreed that Brocade will provide Solectron, on a monthly basis, a
        non-binding rolling twelve (12) month Product forecast. This section, as
        appropriate, may be modified in an addendum to reflect specific Product
        requirements. Solectron shall view all such forecasts as Confidential
        Information as provided in Section 11.

4.0     MATERIAL PROCUREMENT

4.1     Solectron is authorized to purchase materials using standard purchasing
        practices including, but not limited to, acquisition of material
        recognizing Economic Order Quantities, ABC buy policy and long lead time
        component management in order to meet the PO and long lead time
        requirements of Brocade, solely in accordance with the authorization
        procedures set forth in Section 4.2. Brocade recognizes its financial
        responsibility for the material purchased by Solectron on behalf of
        Brocade.

4.2     Solectron will purchase specified quantities of long lead time material
        and Brocade unique material as authorized by Brocade in advance and in
        writing. Solectron will compile and maintain (and provide an updated
        version to Brocade on a monthly basis that reflects Brocade's current
        requirements) a report concerning this long lead time material which
        will contain:

                *       Brocade part number

                *       Solectron part number

                *       Manufacturer name

                *       Manufacturer part number

                *       Manufacturer description

                *       Lead time

                *       Where used

                *       Quantity per unit of Product

                *       Purchase quantity authorized by Brocade

                *       Purchase price authorized by Brocade

                *       Extended price

        It is understood and agreed that if Brocade orders Solectron to stop
        production of Products for Brocade's convenience, prior to the
        consumption of all material authorized for purchase by Brocade pursuant
        to this Section 4.2, Brocade will purchase all material as provided in
        Section 4.3. It is the intention of both parties that Solectron
        effectively manages the long lead time and Brocade unique material
        inventory such that the inventory will be completely consumed by the
        end-of-support of the Products, and Brocade will consequently not have
        any such material inventory liability.

4.3.    In the event of a termination or a cancellation of a purchase order or a
        material release, Solectron shall provide to Brocade within ten (10)
        business days the cost of material inventory and value-add, whether in
        raw form, work in process, or finished goods, and not returnable to the
        vendor or usable for other customers, the cost of material on order
        which cannot be canceled, and any vendor cancellation charges incurred
        with respect to material canceled or returned to the vendor.

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4.4.    Solectron shall undertake reasonable efforts to cancel all applicable
        component purchase orders and reduce component inventory through return
        for credit programs or allocate components for alternate programs if
        applicable. Charges will be finalized within thirty (30) business days.

4.5.    Solectron shall define manufacturing capacity for each major step in the
        manufacturing process and total manufacturing capacity for each Product
        and/or family of Products. Solectron will also provide component
        supplier supply capacity information with the exception of Brocade
        Managed Components, as defined below in Section 7.3 (collectively
        "Capacity Information"). Capacity Information along with up-to-date
        information on Solectron's manufacturing capacity model and cycle time
        plan will be provided to Brocade on the first day of each month in a
        monthly report or as requested by Brocade. Component supplier capacity
        information will be provided on an as-needed basis.

4.6.    During the term of this Agreement, Solectron agrees to aggressively
        monitor lead times and cycle times for the various Products as broken
        down into the following major categories:

                *       Order processing cycle time

                *       Material lead time

                *       Manufacturing cycle time

                *       Pack out and shipping cycle time

        This information will be reported to Brocade on a monthly basis, or as
        otherwise requested by Brocade ("Lead time Reports"). Solectron agrees
        to aggressively work with Brocade to develop strategies which will lead
        to ongoing reductions in lead times and cycle times for the various
        categories. The Lead time Reports will include the details and results
        of the implementation of such strategies.

4.7.    Solectron will perform a preferred supplier comparison on an ongoing
        basis to ensure optimal use of Solectron's preferred supply base.

4.8.    Upon written request by Brocade, Solectron agrees to increase or
        decrease the quantity of Products scheduled to be delivered to Brocade
        as follows:

        [*]

        Solectron agrees to use commercially reasonable efforts to meet the [*]
        in the table above. The above flexibility percentages are the limit for
        the sum of requested changes during any rolling [*] day planning cycle.
        [*]. The maximum cumulative reschedule delay is sixty (60) days.

5.0     PURCHASE ORDERS AND PRICE REVIEWS

5.1     Brocade agrees to provide Solectron Purchase Orders or Material Releases
        [*] calendar days in advance of the scheduled delivery date (or
        as otherwise provided by an

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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        addendum) and shall become effective upon acceptance of the order by
        Solectron. Solectron shall accept or reject all Purchase Orders within
        two (2) business days of receipt or such Purchase Orders shall be deemed
        accepted by Solectron. Such confirmation must include acceptance of
        requested delivery dates. If Solectron is unable to accept Brocade's
        requested delivery dates, Solectron must immediately advise Brocade of
        the reason such delivery dates cannot be met. Change orders shall be
        provided by written or electronically dispatched notice from Brocade.
        Solectron shall notify Brocade of acceptance of a change order within
        two (2) business days after receipt of Brocade's change order.

5.2     In the event of termination or cancellation of a purchase order, the
        terms of Section 4.3 shall apply.

5.3     Solectron and Brocade will meet every [*] months, or more frequently
        upon the request of either party, during the term of this Agreement to
        review pricing and determine whether any price increase or decrease is
        required. Any price change shall apply only to purchase orders or
        material releases issued after the effective date of such price change,
        unless otherwise agreed to by Solectron and Brocade.

6.0     DELIVERY

6.1     Solectron acknowledges and agrees that Solectron shall make commercially
        reasonable efforts to meet the target goal of 100% on-time delivery to
        Brocade's customer, defined as the shipment of Product by Solectron
        within a maximum window of 0 days early and 0 days late based on the
        acknowledged delivery due date. This section, as appropriate, may be
        modified by an addendum to reflect specific Product requirements.

6.2     All shipments shall be F.O.B. origin (Solectron's dock). Title and risk
        of loss shall pass to Brocade upon Solectron's tendered delivery to the
        common carrier or Brocade's designee.

6.3     Upon learning of any potential delivery delays, Solectron will notify
        Brocade within one (1) business hour as to the cause and extent of such
        delay.

6.4     If Solectron fails to make deliveries at the specified time and such
        failure is caused by Solectron, Solectron will, at no additional cost to
        Brocade, employ accelerated measures such as material expediting fees,
        premium transportation costs, or labor overtime required to meet the
        specified delivery schedule or minimize the lateness of deliveries;
        however, [*].

6.5     Should Brocade require Solectron to undertake export activity on behalf
        of Brocade, Brocade agrees to submit requested export information to
        Solectron pursuant to Solectron Guidelines for Brocade-Driven Export
        Shipments as provided in the addenda.

6.6     All Products shall be packaged and prepared for shipment in a manner
        which (i) follows the requirements set forth in Brocade's Purchase
        Order, (ii) follows good commercial practice, (iii) is acceptable to
        common carriers for shipment, and (iv) is adequate to ensure safe
        arrival. Each shipment shall be accompanied by a packing slip that
        includes Brocade's part numbers, purchase order number and the quantity
        shipped.

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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7.0     PAYMENT TERMS

7.1     Solectron and Brocade agree to payment terms of [*] after the date of
        shipment of Product or Solectron's invoice, whichever is later.

7.2     Currency will be in U.S. Dollars unless specifically negotiated and
        reflected in the addenda.

7.3     Solectron and Brocade agree that the prices for each unit of Product
        manufactured by Solectron for Brocade pursuant to the Agreement shall be
        set forth in the applicable addenda, and further agree that such prices
        shall be generally based upon a formula of different percentage mark-ups
        or margins contained in such applicable addenda for the different
        components, depending upon whether the various components are either (i)
        components for which Solectron is responsible for all aspects of the
        management of the relationship with the supplier ("Solectron Managed
        Components"), or (ii) components for which Brocade is responsible for
        all aspects of the management of the relationship with the supplier
        ("Brocade Managed Components"). The applicable addenda for the products
        manufactured by Brocade as of the Effective Date shall be Exhibit 1
        attached hereto.

8.0     QUALITY

8.1     Solectron shall manufacture the Products in accordance with the process
        quality requirements, standards, specifications and expectations as set
        forth in Exhibit 2 ("Quality System and Product Quality Requirements").

8.2     Solectron will use best industry standards in manufacturing, assembly
        and test, consistent with meeting Brocade's product specifications. As
        far as practical, Solectron will use documented industry standards
        (ASME, IPC, SPI, etc.).

8.3     Workmanship standards for the PCBA are IPC 610b Class II and IPC-R-700C
        Class II. Workmanship standards for the system level are Cosmetic
        Specifications of Molded Parts: SPI 1994 edition. As needed, Solectron
        and Brocade can mutually agree to add industry or product-specific
        standards.

9.0     ENGINEERING CHANGES

9.1     Brocade may, upon advance written notice to Solectron, submit
        engineering changes (ECOs) for incorporation into the Product. It is
        important that this notification include documentation of the change to
        effectively support an investigation of the impact of the engineering
        change. Solectron will use all reasonable efforts to review the
        engineering change and report to Brocade within two (2) business days).
        If any such change affects the price, delivery, or quality performance
        of said Product, an equitable adjustment will be negotiated between
        Solectron and Brocade prior to implementation of the change.

9.2     The parties agree that five (5) business days is a reasonable time
        period to permit Solectron to evaluate ECO impact regarding potential
        excess material liability, price, and delivery.

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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9.3     Solectron agrees not to undertake significant process changes, design
        changes, or process step discontinuance affecting electrical performance
        and/or mechanical form and fit without prior written notification and
        concurrence of Brocade.

9.4     Brocade shall pay Solectron for their costs of implementing ECOs at the
        rate of [*] each. [*] per sustaining product per month will not be
        charged to Brocade. ECOs that are just for AVL changes will not be
        charged to Brocade. ECOs before a product reaches General Availability
        (GA) maturity will not be charged to Brocade.

10.0    INVENTORY MANAGEMENT

10.1    Solectron agrees to purchase components according to Brocade approved
        vendor list (AVL)

10.2    All tools, tooling equipment, test equipment and other related items
        furnished to Solectron by Brocade (See Attachment 1 for list effective
        at contract signing date) or paid for by Brocade ("Brocade Property") in
        connection with this Agreement will be clearly identified by Solectron
        and will remain the property of Brocade and shall:

                *       Be clearly marked and remain the personal property of
                        Brocade.

                *       Be kept free of liens and encumbrances.

                *       Be certified by Brocade to be in compliance with the
                        GAO's Y2K guidelines.

10.3.   Unless otherwise agreed, Brocade is responsible for the general
        maintenance of Brocade tooling/equipment. Solectron will maintain
        burn-in ovens, hi-pot tester and test fixtures at no labor cost to
        Brocade, but will charge Brocade for parts and supplies.

10.4.   Brocade hereby appoints Solectron its bailee and assigns to Solectron
        the Brocade Property, and Solectron accepts such appointment and agrees
        that it will not issue any negotiable bills or receipts on the Brocade
        Property and shall neither file nor permit any lien or other claim to be
        filed against any of the Brocade Property. In the event that such a lien
        or claim is filed, Solectron shall promptly notify Brocade and shall
        take all action necessary to cause such lien or claim against the
        Brocade Property to be released or otherwise removed within forty-five
        (45) days. If such lien or claim is not released within such forty-five
        (45) days, then Solectron shall be deemed to have purchased the Brocade
        Property at the then current replacement costs for such Brocade Property
        and such amount shall be immediately payable to Brocade.

10.5.   Solectron shall hold Brocade Property at its own risk and shall not
        modify the property without the written permission of Brocade. Brocade
        property will be used by Solectron only for purposes of this Agreement.
        Upon Brocade's request, Solectron shall redeliver the property to
        Brocade in the same condition as originally received by Solectron with
        the exception of reasonable wear and tear. In the event the property is
        lost, damaged or destroyed, Solectron's liability for the property is
        limited to the book value of the property.

11.0    CONFIDENTIAL INFORMATION AND PROPRIETARY RIGHTS

11.1    Solectron and Brocade have executed as of April 21, 1998, as part of
        this Agreement, a Nondisclosure Agreement for the reciprocal protection
        of confidential information (the

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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<PAGE>   7

        "NDA Agreement"), as attached hereto as Attachment 2 and incorporated
        herein by reference.

11.2    Subject to the terms of the NDA Agreement and the proprietary rights of
        the parties, Solectron and Brocade agree to exchange, at least
        semi-annually, relevant process development information and business
        plans to include market trends, process technologies, product
        requirements, new product developments, available capacity and other
        information to support technology advancements by both Solectron and
        Brocade.

11.3    Solectron acknowledges and agrees that all right, title and interest in
        and to the Products manufactured by Solectron for Brocade pursuant to
        this Agreement shall remain with Brocade (and/or its suppliers, as
        applicable).

12.0    WARRANTY

12.1.   Solectron warrants for a period of [*] from the date of completion of
        the manufacture of the Product, that (i) the Product will conform to the
        specifications applicable to such Product at the time of its
        manufacture, which are furnished in writing by Brocade and accepted by
        Solectron; (ii) such product will be of good material (except for
        material supplied by Brocade) and workmanship and free from defects for
        which Solectron is responsible in the manufacture; (iii) such Product
        will be free and clear of all liens and encumbrances and that Solectron
        will convey good and marketable title to such Product.

12.2.   All Products are subject to Brocade's inspection and acceptance at
        Brocade's facility or facility of the purchasers of the Products before
        final acceptance. If any Product delivered hereunder fails to conform to
        the specifications provided by Brocade and accepted by Solectron, then
        Brocade shall notify Solectron of such failure and Solectron will have
        up to five (5) business days after receipt of defective Product, to
        either repair or replace the Product at Solectron's option and cost for
        Solectron-caused problems. If Solectron fails to repair or replace such
        Product within such five (5) business day period, then Brocade shall
        have the right, without liability, to require expedited shipping of the
        conforming Product at Solectron's sole cost.

12.3.   In the event that any Product manufactured shall not be in conformity
        with the foregoing warranties, Solectron shall, at Solectron's sole
        expense, replace, repair or correct such Product within [*] of receipt
        of such defective Product. Solectron shall waive any charges to Brocade
        in order to effect the replacement of such defective Products to
        Brocade. Solectron agrees to maintain a repair capability for products
        under warranty. If Solectron is unable to repair, replace or correct
        such product, then Solectron shall credit Brocade for the purchase price
        paid by Brocade for such Product.

12.4.   The foregoing constitutes Brocade's sole remedies against Solectron for
        breach of warranty claims.

12.5.   Solectron shall have no responsibility or obligation to Brocade under
        warranty claims with respect to Products that have been subjected to
        abuse, misuse, accident, alteration, neglect or unauthorized repair.

12.6.   Solectron shall have no liability or responsibility for any losses,
        damages, or failures to the extent that any such claims are a result of
        (i) Solectron's compliance with Brocade's supplied specifications, (ii)
        the negligence of Brocade in supplying the goods, services, or

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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        information in connection with the design, development, distribution,
        and configuration of the product, (iii) modification or alteration of
        product by a party other than Solectron, (iv) incorrect installation or
        incorporation of product by either Brocade or Brocade's authorized field
        representative, (v) inherent design flaws the product which may induce
        intermittent failures, (vi) and transportation damage from approved
        freight carriers.

12.7    THE WARRANTIES CONTAINED IN THIS SECTION ARE IN LIEU OF, AND SOLECTRON
        EXPRESSLY DISCLAIMS AND BROCADE WAIVES ALL OTHER REPRESENTATIONS AND
        WARRANTIES, EXPRESS, IMPLIED, STATUTORY OR ARISING BY COURSE OF DEALING
        OR PERFORMANCE, CUSTOM, USAGE IN THE TRADE OR OTHERWISE, INCLUDING
        WITHOUT LIMITATION THE IMPLIED WARRANTIES OF MERCHANTABILITY, TITLE AND
        FITNESS FOR A PARTICULAR USE.

13.0    TERMINATION

13.1.   If either party fails to meet any one or more of the terms and
        conditions as stated in either this Agreement or the addenda, Solectron
        and Brocade agree to negotiate in good faith to resolve such default.
        Notwithstanding the foregoing, if the defaulting party fails to cure
        such default or submit an acceptable written plan (as determined by the
        non-defaulting party in its sole discretion) to resolve such default
        within thirty (30) days following the date of written notice of default,
        the nondefaulting party shall have the right to terminate this Agreement
        by furnishing the defaulting party with thirty (30) days written notice
        of termination.

13.2.   Each party shall have the right to terminate this Agreement by giving
        termination notice, which termination shall become effective ten (10)
        days after mailing, if the other party:

        13.2.a. files an application for or consents to or directs the
                appointment of, or takes of possession by, a receiver, a
                custodian, trustee or liquidator of all or substantially all of
                such other party's property, whether tangible or intangible,
                wherever located;

        13.2.b. makes a general assignment for the benefit of creditors;

        13.2.c. commences or has the intention of commencing a voluntary case
                under the federal bankruptcy laws (as now or hereinafter may be
                in effect);

        13.2.d. is part of an adjudication that such other party is bankrupt or
                insolvent;

        13.2.e. files or has the intent to file a petition seeking to take
                advantage of any other law providing for the relief of debtors;

        13.2.f. acquiesces to or fails to have dismissed within ninety (90)
                days, any petition filed against such other party in any
                involuntary case under such bankruptcy law; or

        13.2.g. terminates, dissolves, or ceases to continue all or
                substantially all of its business affairs or distributes a
                substantial portion of its assets.

                                     8 of 12

<PAGE>   9

13.3    Either Solectron or Brocade may terminate this Agreement without cause
        by giving one hundred twenty (120) days advance written notice to the
        other party.

13.4    The following Sections shall survive the expiration or earlier
        termination of this Agreement: sections 4.2, 4.3, 8, 11, 12, 13, 14, 15,
        16, and 17.

14.0    DISPUTE RESOLUTION

14.1    In the spirit of continued cooperation, the parties intend to and hereby
        establish the following dispute resolution procedure to be utilized in
        the unlikely event any controversy should arise out of or concerning the
        performance of this Agreement.

14.2.   In the event of a dispute or claim arising between the parties on any
        matter relating to this Agreement, either party may initiate negotiation
        proceedings by written notice to the other party setting forth the
        particulars of the dispute. Upon receipt of such notice, the parties
        agree to meet in good faith within two (2) weeks of the date of such
        notice, to jointly define the scope of and a method to remedy the
        dispute. If such meeting does not resolve the dispute, then senior
        management of Solectron and Brocade are authorized to and will meet
        personally within ten (10) days to confer in a bona fide attempt to
        resolve the matter. The parties will use diligent efforts to arrange
        meetings or telephone conferences as needed to facilitate these
        negotiations.

14.3.   Should any disputes remain existent between the parties at the
        conclusion of the time periods set forth above, then the parties shall
        promptly submit any dispute to mediation with an independent mediator.
        In the event mediation is not successful in resolving the dispute within
        sixty (60) days of the beginning of the two-step resolution process set
        forth above, the parties agree to submit the dispute to binding
        arbitration in accordance with the rules of the Judicial Arbitration and
        Mediation Services/Endispute in San Jose, California (hereinafter
        "JAMS"), and judgment upon the award may be entered in any court having
        jurisdiction. A single arbitrator shall be selected according to JAMS
        rules within thirty (30) days of submission of the dispute to the JAMS.
        The arbitrator shall conduct the arbitration in accordance with the
        California Evidence Code. Except as expressly provided above, no
        discovery of any kind shall be taken by either party without the written
        consent of the other party, provided, however, that either party may
        seek the arbitrator's permission to take any deposition which is
        necessary to preserve the testimony of a witness who either is, or may
        become, outside the subpoena power of the arbitrator or otherwise
        unavailable to testify at the arbitration. The arbitrator shall have the
        power to enter any award that could be entered by a Judge of the
        Superior Court of the State of California sitting without a jury, and
        only such power, except that the arbitrator shall not have the power to
        award punitive damages, treble damages, or any other damages which are
        not compensatory, even if permitted under the laws of the State of
        California or any other applicable law. The arbitration award may be
        enforced in any court having jurisdiction over the parties and the
        subject matter of the arbitration. Notwithstanding the forgoing, the
        parties irrevocably submit to the non-exclusive jurisdiction of the
        Superior Court of the State of California, Santa Clara County, and the
        United States District Court for the Northern District of California,
        San Jose Branch, in any action to enforce an arbitration award.

                                    9 of 12

<PAGE>   10

15.0    LIMITATION OF LIABILITY

        IN NO EVENT, WHETHER AS A RESULT OF BREACH OF CONTRACT, WARRANTY, OR
        TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY, PRODUCT LIABILITY, OR
        OTHERWISE, SHALL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY SPECIAL,
        INCIDENTAL, CONSEQUENTIAL, EXEMPLARY DAMAGES OF ANY KIND WHETHER OR NOT
        EITHER PARTY WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGE.

16.0    PATENT, COPYRIGHT AND TRADEMARK INDEMNITY

        Each party (the "Indemnifying Party") shall defend, indemnify, and hold
        harmless the other party from any claims by a third party of
        infringement of intellectual properties resulting from the acts of the
        Indemnifying Party pursuant to this Agreement, provided that the other
        party (i) gives the Indemnifying Party prompt notice of any such claims,
        (ii) renders reasonable assistance to the Indemnifying Party thereon,
        and (iii) permits the Indemnifying Party to direct the defense of the
        settlement of such claims.

17.0    GENERAL

17.1.   Each of the parties shall at all times during the term of this Agreement
        act as, and shall represent itself to be, an independent contractor, and
        not an agent or employee of the other.

17.2.   Each party to this Agreement will maintain insurance to protect itself
        from claims (i) by the party's employees, agents and subcontractors
        under Worker's Compensation and Disability Acts, (ii) for damages
        because of injury to or destruction of tangible property resulting out
        of any negligent act, omission or willful misconduct of the party or the
        party's employees or subcontractors, (iii) for damages because of bodily
        injury, sickness, disease or death of its employees or any other person
        arising out of any negligent act, omission, or willful misconduct of the
        party or the party's employees, agents or subcontractors.

17.3.   Neither party shall delegate, assign or transfer its rights or
        obligations under this Agreement, whether in whole or part, without the
        written consent of the other party, except that Brocade may assign this
        Agreement to a successor in interest in the event of a merger,
        acquisition or purchase of all or substantially all of the stock or
        assets of Brocade. A waiver of any default hereunder or of any of the
        terms and conditions of this Agreement shall not be deemed to be a
        continuing waiver or a waiver of any other default or of any other term
        or condition, but shall apply solely to the instance to which such
        waiver is directed. The exercise of any right or remedy provided in this
        Agreement shall be without prejudice to the right to exercise any other
        right or remedy provided by law or equity, except as expressly limited
        by this Agreement.

17.4.   In the event any provision of this Agreement is found to be invalid,
        illegal or unenforceable, the validity, legality and enforceability of
        any of the remaining provisions shall not in any way be affected or
        impaired.

                                    10 of 12

<PAGE>   11

17.5.   Except for purchase orders which may be sent by normal carrier, all
        notices and communications hereunder are required to be sent to the
        address or telecopier number stated below (or such other address or
        telecopier number as subsequently notified in writing to the other
        party): (i) By facsimile with confirmation of transmission, (ii)
        personal same or next day delivery or (iii) sent by commercial overnight
        courier with written verification of delivery. All notices so given
        shall be deemed given upon the earlier of receipt or one (1) day after
        dispatch.

        Any notices sent to Brocade hereunder should be sent to:

                             Brocade Communications Systems, Inc.
                             1901 Guadalupe Parkway
                             San Jose, CA 95131
                             Attn: Jean Zorzy
                             Fax No. (408) 487-8091

        with a copy to:

                             Maureen S. Dorney, Esq.
                             Gary Cary Ware & Freidenrich
                             400 Hamilton Avenue
                             Palo Alto, CA 94301
                             Fax No. (650) 327-3699

        Any notices sent to Solectron hereunder should be sent to:

                             Solectron Corporation
                             847 Gibraltar Drive, Bldg. #5
                             Milpitas, CA 95035
                             Attn: Jayne Carthy
                             Fax No. 408-956-6056

        with a copy to:

                             Solectron Corporation
                             847 Gibraltar Drive, Bldg. #5
                             Milpitas, CA 95035
                             Attn: Legal Department
                             Fax No. 408-957-2717

17.6.   Neither party shall be liable for any failure or delay in its
        performance under this Agreement due to acts of God, acts of civil or
        military authority, fires, floods, earthquakes, riots, wars or any other
        cause beyond the reasonable control of the delayed party provided that
        the delayed party: (i) gives the other party written notice of such
        cause within fifteen (15) days of the discovery of the event; and (ii)
        uses its reasonable efforts to remedy such delay in its performance. If
        Solectron is unable to deliver in accordance with agreed delivery
        Schedule, the terms of section 6.4 shall apply.

17.7.   This Agreement shall be governed by, and construed in accordance with
        the laws of the State of California, excluding its conflict of laws
        provisions. In any action to enforce this Agreement, the prevailing
        party shall be awarded all court costs and reasonable attorney fees
        incurred.

                                    11 of 12

<PAGE>   12

17.8.   Neither party shall object to the use of a photocopy of the original of
        this Agreement for the purpose of making any required or allowed public
        filings.

17.9.   This Agreement, the NDA Agreement and the Exhibits hereto are intended
        as the complete, final and exclusive statement of the terms of the
        agreement between the parties regarding the subject matter hereof and
        supersedes any and all other prior or contemporaneous agreements or
        understandings, whether written or oral, between them relating to the
        subject matter thereof. This Agreement may not be modified except in
        writing executed by both parties.

Agreed:

Solectron California Corporation        Brocade Communications Systems, Inc.

By: /s/ MICHAEL T. LING                 By: /s/ VICTOR RINKLE
   --------------------------------        -------------------------------------
Name: Michael T. Ling                   Name: Victor Rinkle
Title: VP Ops                           Title: VP Ops
Date: 7-30-99                           Date: 7-30-99

                                    12 of 12

<PAGE>   13

                 Amendment No. 1 To The Manufacturing Agreement

        This Amendment No. 1 ("Amendment") to the Standard Manufacturing
Agreement (the "Agreement") which was entered into effective 7/30, 1999, is by
and between Brocade Communication Systems, Inc., with a place of business at
1901 Guadalupe Parkway, San Jose, California 95131 ("Brocade") and Solectron
California Corporation, with its place of business at 847 Gibraltar Drive,
Milpitas, California 95035 ("Solectron").

                                    RECITALS

        WHEREAS, the parties have entered into an agreement whereby Solectron
acts as a contract manufacturer for Brocade; and

        WHEREAS, under limited circumstances, Brocade desires to grant [*] with
a place of business at [*] with a limited right to purchase products direct from
Solectron.

        NOW THEREFORE, in consideration of the premises and mutual covenants
contained in this Agreement, the parties hereby agree as follows:

                                    AGREEMENT

        1.      All capitalized terms not defined herein shall have the meaning
set forth in the Agreement.

        2.      A new Section 18 is hereby added to this Agreement, as follows:

                18.1    In the event Brocade provides written notice to
                        Solectron, [*] shall be entitled to purchase products
                        directly from Solectron pursuant to the terms and
                        conditions of this Agreement and at the same prices at
                        which [*] could otherwise purchase such products from
                        Brocade.

                18.2    Brocade shall provide Solectron with a list of products
                        which Solectron may offer to [*] and the associated
                        prices at which said products shall be offered. Such
                        list shall be deemed confidential and subject to the
                        non-disclosure agreement executed between Solectron and
                        Brocade.

                18.3    Solectron shall remit to Brocade, in accordance with
                        procedures to be mutually agreed upon, the difference in
                        the price paid by [*] and the price which Brocade is
                        charged under this Agreement for each product.

                18.4    Solectron acknowledges that in the event Brocade fails
                        to notify Solectron that [*] right to buy products
                        directly from Solectron has arisen, [*] may provide a
                        copy of the agreement between [*] and Brocade as
                        evidence to exercise such right. Prior to allowing [*]
                        to buy directly,

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

                                        1

<PAGE>   14

                        Solectron shall notify Brocade of the request from [*]
                        to exercise this provision.

        3.      Except as amended by the terms of this Amendment, all other
terms and conditions of the Agreement, shall remain in full force and effect.

        IN WITNESS WHEREOF, the parties, through their duly authorized officers,
have executed this Amendment.

Brocade:                                Solectron:

Brocade Communication Systems, Inc.     Solectron California Corporation

By: /s/ VICTOR RINKLE                   By: /s/ MICHAEL T. LING
-----------------------------------     --------------------------------
Print Name: VICTOR RINKLE               Print Name: Michael T. Ling

Title: VP Ops                           Title: VP Ops

Date: 7-30-99                           Date: 7-30-99

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

                                        2

<PAGE>   15

                                    EXHIBIT 1

                                     PRICING

BROCADE COMMUNICATIONS MANUFACTURING AGREEMENT -- 7/20/98

ASSUMPTIONS:

1.)     [*]

2.)     [*]

3.)     [*]

4.)     [*]

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

<PAGE>   16

<TABLE>
<CAPTION>
BROCADE COMMUNICATION              SOLECTRON(R)            SLR QUOTE # R05036-98

UNIT PRICING

ASSEMBLY # 40-0000220-02 REV. E                            SILKWORM II CPU
RECURRING EXPENSE (NRE)
<S>                                   <C>               <C>             <C>
        VOLUME/Quarter                [*]               [*]             [*]

        Material Cost                 [*]               [*]             [*]

        Material Margin               [*]               [*]             [*]

        Material Price                [*]               [*]             [*]

        Assembly Labor                [*]               [*]             [*]

        ICT Labor                     [*]               [*]             [*]

        TOTAL UNIT PRICE              [*]               [*]             [*]
</TABLE>

MATERIAL LEAD TIME   [*]

NONRECURRING EXPENSE (NRE)

<TABLE>
<CAPTION>
        Manufacturing Tooling (taxable)
          <S>                                  <C>
          Stencil                              [*]

          Wave Fixture                         [*]

          TOTAL Taxable Mfg

          Mfg. Engineering (nontaxable)

          Programming/Engineering              [*]

          TOTAL Non-Taxable Mfg                [*]

          Test Tooling (taxable)

          ICT Fixture                          [*]

          TOTAL Taxable Test                   [*]

          Test Engineering (nontaxable)

          ICT Program                          [*]

          TOTAL Non-Taxable Test               [*]

          TOTAL Assembly NRE                   [*]
</TABLE>

        ICT ATE: HP307X UNIQUE TO 40-0000220-02

        A.      Basic test program to cover:

                -       this device will use TestJet only: U16, U31, U19, U22,
                        U17, U20

                -       this device will use TestJet + Library Test: U4, U5, U9,
                        U10

        B.      This test is based on the following assumptions:

                -       based on (estimated) node count: 625

LEAD TIME 3-4 weeks (upon receipt of all necessary documentation and P.O. #)

Solectron Confidential      SLS-10-021924 Rev: -       Page 2 of 8 June 16, 1998

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
<PAGE>   17

BROCADE COMMUNICATION              SOLECTRON(R)            SLR QUOTE # R05036-98

UNIT PRICING

ASSEMBLY # 40-0000273-01 REV.K                     G PORT

<TABLE>
<CAPTION>
RECURRING EXPENSE (NRE)
<S>                             <C>               <C>               <C>
        VOLUME/Quarter           [*]               [*]               [*]

        Material Cost           $[*]              $[*]              $[*]

        Material Margin          [*]               [*]               [*]

        Material Price          $[*]              $[*]              $[*]

        Assembly Labor           [*]               [*]               [*]

        ICT Labor                [*]               [*]               [*]

        TOTAL UNIT PRICE        $[*]              $[*]              $[*]
</TABLE>

MATERIAL LEAD TIME    [*]

NONRECURRING EXPENSE (NRE)

<TABLE>
<CAPTION>
        MANUFACTURING TOOLING (TAXABLE)
<S>                                                <C>
        Stencil                                    $[*]

        Pick & Place Fixture                       $[*]

        Wave Fixture                               $[*]

        TOTAL Taxable Mfg.                         $[*]

        Mfg. Engineering (nontaxable)

        Programming/Engineering                    $[*]

        TOTAL Non-Taxable Mfg.                     $[*]

        Test Tooling (taxable)

        ICT Fixture                                $[*]

        TOTAL Taxable Test                         $[*]

        Test Engineering (nontaxable)

        ICT Program                                $[*]

        TOTAL Non-Taxable Test                     $[*]

        TOTAL ASSEMBLY NRE                         $[*]
</TABLE>

ICT ATE: HP307X UNIQUE TO 40-0000273-01

        A.      Basic test program to cover:

                -       this device will use TestJet only: U1, U2, U3

        B.      This test is based on the following assumptions:

                -       based on (estimated) node count: 200

LEAD TIME 3 weeks (upon receipt of all necessary documentation and P.O. #)

Solectron Confidential          SLS-10-021924 Rev:     Page 3 of 8 June 16, 1998

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
<PAGE>   18

BROCADE COMMUNICATION             SOLECTRON(R)              SLR QUOTE# R05036*98

UNIT PRICING

ASSEMBLY# 40-0000623-01 REV. 15                 FLANNEL PORT BOARD

<TABLE>
<CAPTION>
RECURRING EXPENSE (NRE)
<S>                             <C>             <C>               <C>
        VOLUME/Quarter           [*]               [*]               [*]

        Material Cost           $[*]              $[*]              $[*]

        Material Margin          [*]               [*]               [*]

        Material Price          $[*]              $[*]              $[*]

        Assembly Labor           [*]               [*]               [*]

        ICT Labor                [*]               [*]               [*]

        TOTAL UNIT PRICE        $[*]              $[*]              $[*]
</TABLE>

MATERIAL LEAD TIME    [*]

NONRECURRING EXPENSE (NRE)

<TABLE>
<CAPTION>
        Manufacturing Tooling (taxable)
<S>                                         <C>
        Stencil                                    $[*]

        Pick & Place Fixture                       $[*]

        Wave Fixture                               $[*]

        TOTAL Taxable Mfg.                         $[*]

        Mfg. Engineering (nontaxable)

        Programming/Engineering                    $[*]

        TOTAL Non-Taxable Mfg.                     $[*]

        Test Tooling (taxable)

        ICT Fixture                                $[*]

        TOTAL Taxable Test                         $[*]

        Test Engineering (nontaxable)

        ICT Program                                $[*]

        TOTAL Non-Taxable Test                     $[*]

        TOTAL ASSEMBLY NRE                         $[*]
</TABLE>

ICT ATE: HP307X UNIQUE TO 40-0000623-01

        A.      Basic test program to cover:

                -       this device will use TestJet only: U8, U9, U10, U11

        B.      This test is based on the following assumptions:

                -       based on (estimated) node count: 235

LEAD TIME 3 weeks (upon receipt of all necessary documentation and P.O. #)

Solectron Confidential          SLS-10-021924 Rev: -   Page 4 of 8 June 16, 1998

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
<PAGE>   19

BROCADE COMMUNICATION SOLECTRON (R) SLR QUOTE # R05036*98

UNIT PRICING

ASSEMBLY # 40-0000749-01 REV. A             SILKWORM II MOTHER BOARD

<TABLE>
<CAPTION>
RECURRING EXPENSE (NRE)
<S>                             <C>             <C>               <C>
        VOLUME/Quarter           [*]               [*]               [*]

        Material Cost           $[*]              $[*]              $[*]

        Material Margin          [*]               [*]               [*]

        Material Price          $[*]              $[*]              $[*]

        Assembly Labor           [*]               [*]               [*]

        ICT Labor                [*]               [*]               [*]

        TOTAL UNIT PRICE        $[*]              $[*]              $[*]
</TABLE>

MATERIAL LEAD TIME    [*]

NONRECURRING EXPENSE (NRE)

<TABLE>
<CAPTION>
        Manufacturing Tooling (taxable)
<S>                                         <C>
        Stencil                                    $[*]

        Pick & Place Fixture                       $[*]

        Wave Fixture                               $[*]

        TOTAL Taxable Mfg.                         $[*]

        Mfg. Engineering (nontaxable)

        Programming/Engineering                    $[*]

        TOTAL Non-Taxable Mfg.                     $[*]

        Test Tooling (taxable)

        ICT Fixture                                $[*]

        TOTAL Taxable Test                         $[*]

        Test Engineering (nontaxable)

        ICT Program                                $[*]

        TOTAL Non-Taxable Test                     $[*]

        TOTAL ASSEMBLY NRE                         $[*]
</TABLE>

ICT ATE: HP307X UNIQUE TO 40-0000749-01

        A.      Basic test program to cover:

                -       this device will use TestJet only: U1, U2, U3, U27, U28,
                        U29, U30, U31, U32, U33, U34, U35

                -       this device will use TestJet + Library Test: U8-25

        B.      This test is based on the following assumptions:

                -       based on (estimated) node count: 1275

LEAD TIME     4-5 weeks (upon receipt of all necessary documentation and P.O. #)

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
<PAGE>   20

Solectron Confidential          SLS-10-021924 Rev: -   Page 5 of 8 June 16, 1998

<PAGE>   21

BROCADE COMMUNICATION             SOLECTRON(R)              SLR QUOTE #R05036-98

UNIT PRICING

ASSEMBLY# 70-0000370-03 REV. 1                     SILKWORM II

<TABLE>
<CAPTION>
RECURRING EXPENSE (NRE)
<S>                             <C>             <C>               <C>
        VOLUME/Quarter           [*]             [*]               [*]

        Material Cost           $[*]            $[*]              $[*]

        Material Margin          [*]             [*]               [*]

        Material Price          $[*]            $[*]              $[*]

        Assembly Labor           [*]             [*]               [*]

        System Test              [*]             [*]               [*]

        Haas Test                [*]             [*]               [*]

        TOTAL UNIT PRICE        $[*]            $[*]              $[*]
</TABLE>

Solectron Confidential       SLS-10-021924 Rev:        Page 6 of 8 June 16, 1998

* Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.
<PAGE>   22

                                    EXHIBIT 2

                  QUALITY SYSTEM & PRODUCT QUALITY REQUIREMENTS

1       PURPOSE

1.1     This document outlines the Quality System and Product Quality
        Requirements to Solectron. While this document defines quality
        requirements that are the responsibility of Solectron, it is important
        to note that it is Brocade's intention to establish an open quality
        management relationship with Solectron.

2       SCOPE

2.1     The Quality System and Product Quality Requirements called out in this
        document are for the Fibre Channel Switches and associated printed
        circuit boards manufactured by Solectron.

2.2     Where the requirements called out in this document conflict with
        requirements called out elsewhere, the order of precedence is as
        follows:

2.2.1   Contractual agreements

2.2.2   Brocade Communications Purchase Order, Brocade Communications
        Engineering drawing or specification noted in the Purchase Order

2.2.3   This document

3       DEFINITIONS

3.1     Unless otherwise specified the terms used in this document are defined
        in:

3.1.1   ISO 8402-1986, Quality Vocabulary

3.1.2   ANSI/ASQC A3-1987, Quality Systems Terminology

3.2     Unit: In this document a unit is considered to be an assembled printed
        circuit board (e.g. a CPU board), a subassembly (e.g., power supply), a
        chassis, or a fully assembled switch made up of printed circuit boards,
        subassemblies, displays, and chassis.

4       RESPONSIBILITY

4.1     The Supply Base Engineer reporting to the Manager, Product and Process
        Quality in the Brocade Communications-Operations function is responsible
        for implementing the requirements of this document.

5       REFERENCE DOCUMENTS

5.1     ISO STANDARD 840        Quality Vocabulary

5.2     ISO 9000:1994           Quality management and quality assurance
                                standards -Guide lines for selection and use

5.3     ISO 9002:1994           Quality Systems- Model for quality assurance in
                                design/development, production, installation and
                                servicing.

5.4     ANSI/ASQC A3- 1987      Quality Systems Terminology

5.5     ANSI/ASQC Q1 1986       Guide Lines for Quality System Audits

5.6     MIL STD 105E            Sampling procedures and Tables for inspection
                                by Attributes

6       EQUIPMENT REQUIRED (HARDWARE AND SOFTWARE) (NONE REQUIRED)

7       QUALITY SYSTEM REQUIREMENTS

7.1     Quality System Requirements:

        Brocade Communications' Quality System requirements are defined in the
        document ISO 9002:1994. Solectron's conformance to these requirements
        will be determined by a Quality Assessment organized by the Supply Base
        Engineer and carried out with the

<PAGE>   23

        assistance of other Brocade Communication groups.

<PAGE>   24

7.1.1           Brocade Communications reserves the right to conduct, with
                proper notification, periodic reviews of Solectron's Process and
                Quality Control system. These reviews can include all aspects of
                materials management, manufacturing, test, and quality records
                associated with products and services sold or provided to
                Brocade Communications by Solectron.

7.2     If the Quality Assessment shows that Solectron is does not meet the ISO
        9002 requirements, the deficiencies will be noted and corrective action
        may be required. (See the ANSI/ASQC Q1 1986: Guide Lines for Quality
        System Audits).

7.3     Process Definition:

        Prior to the start of production, Brocade Communications' Supply Base
        Engineer (SBE) and Solectron's representative will determine the key
        steps of the process flow. The key steps of the process flow will be
        documented using either Brocade's or Solectron's documentation.

7.4     Process Changes:

        Once the key process steps are defined, they can not be changed without
        written notification and approval from the Brocade Communications'
        Quality Engineer prior to the implementation of the changes. Examples of
        process changes are: using parts not called out on the Approved Vendor
        List (AVL), alterations to the agreed on process flow, changing
        pass/fail parameters, increasing or decreasing test times, changes in
        test equipment, relocation of the process to a different location, etc.

7.5     Process Reporting:

        Prior to the start of volume production Brocade Communications' Quality
        Engineer and Solectron's representative will agree on the content,
        format, and frequency of the Process Reports.

7.5.1           The Process Reports will include, at a minimum, yields at each
                operation, defect paretos at each operation, and corrective
                actions to address the significant defects. The reports will
                include data from the On-Going Reliability Test and the Out-Of
                the Box Audit (OOBA).

7.5.2           Brocade will, as far as practical, use Solectron's data
                collection process and reports, provided they meet Brocade's
                requirements. The data will be sent electronically.

7.6     Process Qualification and Improvement

7.7     Prior to the start of volume shipments the Brocade and Solectron will
        conduct a Product Verification Test (PVT). The PVT is a controlled build
        of a predetermined number of units with the purpose of demonstrating the
        capability of the process to produce defect free product in a cost
        efficient way.

7.7.1           The Brocade Quality Engineer and Solectron's representative will
                determine prior to the start of the volume production the target
                yield for the PVT build.

7.7.1.1         If the target yield is reached, the process is considered
                capable and ready for volume production.

7.7.1.2         If the target yield is not met, the Brocade Supply Base Engineer
                and Solectron's representative will jointly develop a corrective
                action plan to improve the process yield. When the corrective
                actions have been implemented, a second PVT build will be done.
                If this build meets the predetermined goals, the volume
                production can begin. If the yield is not met, the corrective
                action process will be duplicated until the predetermined yield
                criterion is reached.

7.7.2           Once volume production starts, the Brocade Supply Base Engineer
                and Solectron's representative will agree on a yield improvement
                plan. The Yield Improvement Plan (YIP) will set targets for
                quarterly yield or process improvements. If the quarterly goals
                are not reached, the Brocade and Solectron will determine what
                corrective actions are necessary to reach the quarterly goals.

7.8     On-Going Reliability Test

        Brocade Communications uses an On-going Reliability Test (ORT) as a
        measure of the production process performance. Prior to the start of
        volume production Brocade's Supply Base Engineer and Solectron's
        representative will agree on the how the

<PAGE>   25

        On-going Reliability test will be implemented. The implementation will
        follow the guidelines called out in the Brocade Communications' Process
        number 99-0000401-01

June 18, 1999                     Page 3 of 4             Quality System
                                                                and
                                                    Product Quality Requirements

<PAGE>   26

7.8.1           If there is a failure in the ORT, Solectron will immediately
                notify Brocade's Supply Base Engineer. Solectron's
                representative and Brocade's SBE will immediately start the
                failure analysis process and take any corrective action
                necessary. When the failure analysis is completed, the Brocade
                SBE will inform Brocade's Manager of Process and Product Quality
                of the findings and the status of the corrective action.

7.9     Failure Analysis:

        Solectron is required to do failure analysis on all in-warranty units
        returned from Brocade's customers. At Brocade's request Solectron is
        required to perform the first level failure analysis (determine the
        failed component) within one working day after receiving the failed
        unit. The root-cause analysis (analysis of the defective component) must
        be done within ten working days after the receipt of the failed unit.

7.10    Epidemic Failure:

        Epidemic failures are unit failures that are the result of defects in
        material, workmanship, and/or other deficiencies attributable to or
        within the control of Solectron, including but not limited to, incorrect
        use of components with inherent or latent defects, or consistent
        maladjustments during manufacture. The Epidemic Failure rate is defined
        as three times the Normal Annualized Failure rate specified in the
        Product Specification.

7.10.1          If the unit manufactured by Solectron for Brocade Communications
                is found to fail at an Epidemic rate, Solectron and Brocade
                Communications will mutually agree on a corrective action plan
                to be carried out by Solectron, at Solectron's expense to repair
                and replace the defective units.

7.11    Field Failure Rates as a Measure of Solectron Performance:

        Solectron's performance in delivering a quality product is determined by
        the Field Failure Rate and is measured as the Annualized Field Failure
        Rate. This is rate is calculated as the average number of returns over
        the last three months divided by the installed base, then multiplied by
        twelve to give an annualized rate.

7.11.1          If the Field Failure Rate of the unit manufactured by Solectron
                for Brocade Communications exceeds the Normal Annualized Failure
                Rate called out in the Product specification, Solectron and
                Brocade Communications will mutually implement a program to
                determine the root causes of the Field Failure Rate and
                implement corrective actions.

June 18, 1999                     Page 4 of 4             Quality System
                                                                and
                                                    Product Quality Requirements

<PAGE>   27

ATTACHMENT 1 BRC CONSIGNED EQUIPMENT LIST

<TABLE>
<CAPTION>
Item    Equip. Description                 Serial Number    BRC Asset No.   SLR ID #      Comments
<S>     <C>                                <C>              <C>             <C>           <C>
1       Dell Monitor 17"                   7117360          100018

2       Dell Monitor 17"                   04036a606p       100007

3       PC CPU DELL Dimension              88jpx            100013
        xps 166

4       Dell Monitor 17", lab              04036a7fiv       102079

5       PC CPU HP Vectra XA                us74152334       107074

6       HP Vectra- PC                      us75150685       107159

7       Sony Monitor 200ES                 4036166          100302

8       Sony Monitor 200ES                 4034244          100306

9       HP Vectra- CPU                     75150693         100307

10      HP- CPU                            us75150707       100345

11      Ascend P50 - SLR -GW               7196010          106349

12      Dell Laptop Latitude               7147346byk8642   106365

13      Dell XPS CPU                       88jq8            102064

14      LinkSys 16 port 10bT Hub           N/A              107401

15      LinkSys 16 port 10bT Hub           N/A              107402

16      Bur-In Oven #1                     N/A              N/A             BRCOVEN1

17      Bur-In Oven #2                     N/A              N/A             BRCOVEN2

18      Bur-In Oven #3                     N/A              N/A             BRCOVEN3

19      Bur-In Oven #4                     N/A              N/A             BRCOVEN4

20      Bur-In Oven #5                     N/A              N/A             BRCOVEN5

21      Bur-In Oven #6                     N/A              N/A             BRCOVEN6

22      Bur-In Oven #7                     N/A              N/A             BRCOVEN7

23      Run-In Oven #1                     N/A              N/A             BRCOVEN8

24      Run-In Oven #2                     N/A              N/A             BRCOVEN9

25      Run-In Oven #3                     N/A              N/A             BRCOVEN10

26      ICT Fixture 40-0000749-01          N/A              N/A                           Located on C4 shelf

27      ICT Fixture 40-0000623-01          N/A              N/A                           Located on C1 shelf

28      ICT Fixture 40-0000220-01          N/A              N/A                           Located on C1 shelf

29      ICT Fixture 40-0000004-01          N/A              N/A                           Located on C1 shelf

30      ICT Fixture 40-0000273-01          N/A              N/A                           Located on C1 shelf

31      ICT Fixture 40-0000003-01          N/A              N/A                           Located on C1 shelf

32      SMT Stencil 40-0000623-04 Top      N/A             N/A                            Located on F01
                                                                                          Shelf SMT

33      SMT Stencil 40-0000623-04 Bot      N/A             N/A                            Located on F02
                                                                                          Shelf SMT

34      SMT Stencil 40-0000749-01 Top      N/A             N/A                            Located on F03
                                                                                          Shelf SMT

35      SMT Stencil 40-0000749-01 Bot      N/A             N/A                            Located on F04
                                                                                          Shelf SMT

36      SMT Stencil 40-0000220-03 T & B    N/A             N/A                            Located on F05
                                                                                          Shelf SMT

37      SMT Stencil 40-0000273-03 Top      N/A             N/A                            Located on F06
                                                                                          Shelf SMT

38      SMT Stencil 40-0000273-03 Bot      N/A             N/A                            Located on F07
                                                                                          Shelf SMT

39      SMT Stencil 40-0200003-03 Top      N/A             N/A                            Located on F09
                                                                                          Shelf SMT

40      SMT Stencil 40-0200003-03 Bot      N/A             N/A                            Located on F08
                                                                                          Shelf SMT

41      SMT Stencil 40-0000001-01 T & B    N/A             N/A                            Located on F10
                                                                                          Shelf used on
                                                                                          proto run SMT

42      SMT Stencil 40-0000727-05 Top      N/A             N/A                            Located on F11
                                                                                          Shelf SMT
</TABLE>

<PAGE>   28

<TABLE>
Item    Equip. Description                  Serial Number    BRC Asset No.     SLR ID #        Comments
<S>     <C>                                 <C>              <C>             <C>               <C>
43      SMT Stencil 40-0000727-05 Bot            N/A             N/A                           Located on F12
                                                                                               Shelf SMT

44      SMT Stencil 40-0000004-03 Top            N/A             N/A                           Located on F13
                                                                                               Shelf SMT

45      SMT Stencil 40-0000004-03 Bot            N/A             N/A                           Located on F14
                                                                                               Shelf SMT

46      SMT Stencil 40-0000003-01 Top            N/A             N/A                           Located on F15
                                                                                               Shelf SMT

47      SMT Stencil 40-0000003-01 Bot            N/A             N/A                           Located on F16
                                                                                               Shelf SMT

48      Functional Test Fixture 2400                                         BRC2400 F/T 1

49      Functional Test Fixture 2400                                         BRC2400 F/T 2

50      Functional Test Fixture 2800                                         BRC2800 F/T 1

51      Functional Test Fixture 2400                                         BRC2800 F/T 2

52      Functional Test Debug Fixt. 2400                                     BRC2400 F/T DBG 1

53      Functional Test Debug Fixt. 2800                                     BRC2800 F/T DBG 1

54      Dell Optiplex PC                     UN6JL                                             Used On ESS Chamber

55      Dell Monitor                         84779-DVYN-29                                     Used On ESS Chamber

56      6681A Power Supply                   US36400338                                        Used On ESS Chamber

57      6681A Power Supply                   US36400327                                        Used On ESS Chamber

58      6680A Power Supply                   US36480139                                        Used On ESS Chamber

59      6680A Power Supply                   US36480130                                        Used On ESS Chamber

60

61

62

63
</TABLE>

<PAGE>   29

ATTACHMENT 2             MUTUAL NONDISCLOSURE AGREEMENT

All parties below acknowledge that, by reason of their relationship, they may
have access to certain information and materials concerning the other's
business, plans, products and technical data which are confidential and of
substantial value which would be impaired if such information were disclosed to
third parties. Accordingly, for the purposes of protecting and preserving the
confidential and/or proprietary nature of information to be disclosed or made
available by each party to the others under this Mutual Nondisclosure Agreement
("Agreement"), the parties hereto agree as follows:

1.      Confidential Information. For the purposes of this Agreement,
Confidential Information means any technical, business, financial, contractual
terms and conditions or other information or data furnished by one party to the
other: (i) in written or other tangible form marked with a proprietary legend,
or (ii) in oral or visual form, identified as being confidential at the time of
the disclosure and thereafter summarized in a writing which identifies the
Confidential Information and is transmitted to the receiving party within thirty
(30) days after such oral or visual disclosure.

2.      Period of Protection. The period of protection during which Confidential
Information received pursuant to this Agreement shall be subject to an
obligation of confidentiality and protection is five (5) years from the date of
first receipt of the Confidential Information.

3.      Standard of Care. The standard of care which each party shall be
required to employ in protecting and handling a Confidential Information
received pursuant to this Agreement is the same degree of care which the
receiving party uses to protect and safeguard its own Confidential Information
of the kind, but not less than a reasonable degree of care.

4.      Restrictions on Use. Confidential Information shall be used solely for
internal evaluation and use pertaining to the purpose of this Agreement and
shall not otherwise be used for the benefit of the receiving party or others.
Confidential Information shall be disclosed only to the employees of the
receiving party who have a "need to know" and executed an internal nondisclosure
agreement.

5.      Information Not Subject to Confidentiality. The Confidential Information
of a party shall not include and the foregoing obligations shall not apply to
information or data which: (i) was generally available to the public at the time
of receipt from the disclosing party, or thereafter to have become generally
available to the public; (ii) is known to the receiving party on a
non-confidential basis prior to its receipt from the disclosing party; (iii)
disclosed with the prior written consent of the disclosing party; (iv) becomes
known to the receiving party from a source other than the disclosing party
without breach of this Agreement by the receiving party; (v) was required to be
disclosed pursuant to law; (vi) developed independently by personnel of the
receiving party who had no substantive knowledge of the disclosing party's
Confidential Information at the time of such independent development.

6.      No License. The disclosure of Confidential Information shall not be
construed as granting either a license under any patent, patent application or
any right of ownership in said Confidential Information.

7.      Equitable Relief. The receiving party acknowledges and agrees that in
the event of a breach or threatened breach of any provision of this Agreement,
the disclosing party shall have no adequate remedy at law and shall therefore be
entitled to enforce any such provision by temporary or permanent injunctive or
mandatory relief obtained in any court without the necessity of proving damages,
posting any bond or other security, and without prejudice or diminution of any
other rights or remedies which may be available at law or in equity. This
Agreement shall be construed in accordance with the laws of the State of
California.

8.      Termination. This Agreement may be terminated by either party giving the
other parties a thirty (30) day termination notice in writing. Upon expiration
or termination of this Agreement, each party shall cease all use of the other
party's Confidential Information and return to the other party all tangible
copies of the other party's Confidential Information.

<PAGE>   30

<TABLE>
<CAPTION>
AGREED:

<S>                                          <C>                                          <C>
SOLECTRON                                    Brocade Communications Systems, Inc.
-------------------------------------        -------------------------------------        -------------------------------------
                                             Name of Other Party                          Name of Other Party

/s/ Kelly Priest                             /s/ Jean Zanzy
                                                                                          -------------------------------------
Authorized Representative's Signature        Authorized Representative's Signature        Authorized Representative's Signature

KELLY PRIEST                                 Jean Zanzy
---------------------------------------     ---------------------------------------
Name                                         Name                                         -------------------------------------
                                                                                          Name

DIRECTOR OF SALES                            DIRECTOR, SUPPLIER MGMT

-------------------------------------        -------------------------------------        -------------------------------------
Title                                        Title                                        Title

4-15-98                                      4/21/98
---------------------------------------     ---------------------------------------
Date                                         Date                                         -------------------------------------
                                                                                           Date

                                             1901 Guadalupe Pkwy                          -------------------------------------
MILPITAS, CA                                 San Jose, CA 95131
---------------------------------------     --------------------------------------        -------------------------------------
Address                                      Address                                      Address
SLRNDA3P doc (Date 11/22/95)                                                                             Confidential

</TABLE>

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