LIMITED LIABILITY COMPANY
                               OPERATING AGREEMENT


THIS LIMITED  LIABILITY COMPANY OPERATING  AGREEMENT  ("Agreement"),  is entered
into as of  October  15,  1999,  by and among the  persons  listed on  Exhibit A
hereto, as members ("Members") of Alliance Venture Management, LLC, a California
limited liability company ("Company" or "LLC").

WHEREAS,   the  LLC  proposes  to  act  as  the  general  partner  of  Alliance
Ventures I,  L.P.  and  Alliance  Ventures II,  L.P.  and as such to  receive a
carried interest in the profits of these limited partnerships; and

WHEREAS, the members desire to provide for series of units to be known as Common
Units,  Series A units and  Series B units for the  purpose  of  allocating  the
carried interest in Alliance Ventures I, L.P. and Alliance Ventures II, L.P.

THE PARTIES AGREE AS FOLLOWS:


1.    FORMATION OF LIMITED LIABILITY COMPANY

1.1   FORMATION
      The Members have formed the LLC under the laws of the State of  California
      pursuant to the  Beverly-Killea  Limited  Liability Company Act ("Act") by
      causing  articles of  organization  ("Articles of  Organization")  for the
      Company to be filed in the Office of the Secretary of State of California,
      and by this Agreement intend to establish rules and regulations  governing
      its ownership and control.

1.2   NAME AND PRINCIPAL PLACE OF BUSINESS
      Unless and until  amended in accordance  with this  Agreement and the Act,
      the  name of the LLC  will  be  "Alliance  Venture  Management,  LLC"  The
      principal  place of business of the LLC shall be Santa Clara,  California,
      or such other place or places as the Managers from time to time determine.

1.3   REGISTERED OFFICE AND AGENT FOR SERVICE OF PROCESS
      The Company  shall  maintain a registered  office and agent for service of
      process as required by Section  17061 of the Act.  The  registered  office
      shall be 2575 Augustine Drive, Santa Clara, California,  and the agent for
      service  of  process  shall be Bradley  Perkins,  or such other  place and
      person as the Managers may designate.

1.4   AGREEMENT
      For and in  consideration of the mutual covenants herein contained and for
      other good and  valuable  consideration,  the receipt and  sufficiency  of
      which are hereby acknowledged, the Members executing this Agreement hereby
      agree to the terms and conditions of this  Agreement,  as it may from time
      to time be amended.

1.5   BUSINESS
      The  purpose  of the LLC is to engage in any lawful  act or  activity  for
      which a limited  liability company may be organized under the Act. The LLC
      shall  serve as the  general  partner of the  Partnership,  subject to the
      terms and  conditions  of the  agreement  of  limited  partnership  of the
      Partnership.

1.6   DEFINITIONS
      Terms not otherwise  defined in this Agreement shall have the meanings set
      forth in Section 15.

1.7   TERM
      The term of the Company shall commence upon the later to occur of:

      1.7.1the  filing of  Articles  of  Organization  for the  Company  in the
           office of the Secretary of State of California; or

      1.7.2the execution of this Company Agreement by at least two Members and,

      unless  the term of the LLC is  otherwise  extended  or sooner  terminated
      pursuant to the  provisions of this  Agreement,  shall  continue until ten
      years after the commencement of such term.

      Such term may be amended by amendment of this Agreement.


2.    MEMBERSHIP; UNITS

2.1   MEMBERS
      The Initial  Members of the LLC shall be and  include  each of the persons
      whose  names  are set  forth on  Exhibit  A hereto  as of the date of this
      Agreement.  Exhibit A shall be amended by the Managers as  appropriate  to
      reflect the admission of additional Members or the acquisition by existing
      Members of additional Units in the LLC.

2.2   REPRESENTATIONS AND WARRANTIES
      Each  Member  hereby  represents  and  warrants to the LLC and each of the
      other Members as follows:

      2.2.1PURCHASE ENTIRELY FOR OWN ACCOUNT
           The Member is acquiring  his interest in the LLC for the Member's own
           account for  investment  purposes  only and not with a view to or for
           the resale,  distribution,  subdivision or fractionalization  thereof
           and  has  no  contract,  understanding,  undertaking,  agreement,  or
           arrangement  of any kind with any Person to sell,  transfer or pledge
           to any Person his  interest or any part  thereof nor does such Member
           have any plans to enter into any such agreement;

      2.2.2INVESTMENT EXPERIENCE
           By reason of his business or financial experience, the Member has the
           capacity  to  protect  his  own  interests  in  connection  with  the
           transactions  contemplated hereunder, is able to bear the risks of an
           investment  in the  LLC,  and at the  present  time  could  afford  a
           complete loss of such investment;

      2.2.3DISCLOSURE OF INFORMATION
           The  Member  is aware of the LLC's  business  affairs  and  financial
           condition and has acquired  sufficient  information  about the LLC to
           reach an informed and  knowledgeable  decision to acquire an interest
           in the LLC;

      2.2.4FEDERAL AND STATE SECURITIES LAWS
           The Member  acknowledges  that the interests in the LLC have not been
           registered  under the Securities Act of 1933 or any state  securities
           laws,  inasmuch  as they are  being  acquired  in a  transaction  not
           involving a public  offering,  and under such laws, may not be resold
           or transferred by the Member without appropriate  registration or the
           availability  of  an  exemption  from  such  requirements.   In  this
           connection,  the Member represents that it or he is familiar with SEC
           Rule  144,  as  presently  in  effect,  and  understands  the  resale
           limitations imposed thereby and by the Securities Act of 1933.

2.3   LLC UNITS
      Ownership of the LLC shall be divided into and represented by units of the
      LLC  ("Units").  The LLC shall be  authorized  to issue  three  classes of
      units,  Common Units,  Series A Units and Series B Units. The total number
      of Units  the LLC is  authorized  to issue  shall be  3,000,000,  of which
      1,000,000  shall be Common  Units,  1,000,000  shall be Series A Units and
      1,000,000 shall be Series B Units.



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2.4   VOTING RIGHTS OF LLC UNITS
      Each Common  Unit shall be  entitled  to one vote per Unit,  each Series A
      Unit shall be entitled to 10 votes per Unit,  and each Series B Unit shall
      be entitled to 10 votes per Unit.

2.5   ADDITIONAL MEMBERS, ISSUANCE OF ADDITIONAL UNITS
      Additional  Persons may be issued Units and admitted to the LLC as Members
      upon  compliance with the provisions of this Agreement and upon such terms
      and conditions as the Managers may determine, provided that:

      2.5.1no new  class of Units or  interests  having  rights  or  preferences
           senior  to those of the  existing  Units may be  issued  without  the
           approval  of  Members  holding  a  majority  of  each  class  of such
           outstanding subordinate Units; and

      2.5.2the Managers  may not issue more than the total number of  authorized
           Units, without the approval of the Members.

      Existing Members may be issued  additional Units, upon compliance with the
      provisions  of this  Agreement  and upon such terms and  conditions as the
      Managers may  determine,  provided that no new class of Units or interests
      having rights or preferences  senior to those of the existing Units may be
      issued without the approval of Members holding a majority of each class of
      outstanding  subordinate  Units,  nor may the Managers issue more than the
      total  number of  authorized  Units of the LLC without the approval of the
      Members.

2.6   ADMISSION OF SUBSTITUTE MEMBERS
      Notwithstanding  any other  provision  of this  Agreement,  no Assignee of
      Units of the LLC (including without limitation Permitted Transferees under
      Section 12.4 and purchasers  pursuant to Section 12.5.6) shall be admitted
      as a  Substitute  Member and  admitted to all the rights of the Member who
      assigned the Units, without the approval of the Managers.  If so admitted,
      the  Substitute  Member  shall  have all the rights and powers and will be
      subject  to  all  the  restrictions  and  liabilities  of the  Member  who
      originally  assigned the Units. The admission of a Substitute Member shall
      not release any Member who previously assigned the Units from liability to
      the LLC that may have existed before such substitution.  Consents required
      hereunder may be given in advance of any transfer by any writing signed by
      a Member.

2.7   RESIGNATION OR WITHDRAWAL OF A MEMBER
      Except as specifically  provided below,  and subject to the provisions for
      transfer contained in Section 12, no Member may resign, retire or withdraw
      from  membership in the LLC or withdraw his interest in the capital of the
      LLC.

2.8   DISSOCIATION OF A MEMBER
      The Bankruptcy, death or Dissolution of a Member will:

      2.8.1cause such  Member to be  dissociated  from the LLC (a  "Dissociated
           Member");

      2.8.2terminate the continued membership of such Member in the LLC; and

      2.8.3cause a dissolution  and winding-up of the LLC pursuant to Section 14
           hereof except as expressly provided therein.

      Except  as set  forth  above  or  expressly  provided  elsewhere  in  this
      Agreement, the death, withdrawal,  resignation,  expulsion,  Bankruptcy or
      dissolution of a Member shall not cause a dissolution of the LLC.

2.9   RIGHTS OF DISSOCIATING
      In the event any Member becomes a "Dissociated Member":

      2.9.1if the  dissociation  causes a dissolution  and winding up of the LLC
           under  Section  14,  the  Dissociated  Member  or its  or  his  legal
           representative  shall be entitled to participate in the winding up of
           the LLC to the same extent as any other Member; and

      2.9.2if the  dissociation  does not cause a dissolution  and winding up of
           the LLC under Section 14, the Dissociated  Member or his or its legal
           representative shall be treated as an Assignee unless admitted to the
           LLC as a Substitute Member pursuant to Section 2.7.

2.10  RIGHTS OF MEMBERS TO BIND LLC
      Except as expressly provided herein no Member shall have the right to bind
      the LLC.


3.    CONTRIBUTIONS TO CAPITAL

3.1   INITIAL CONTRIBUTIONS
      Each Member has contributed cash or property having an agreed-upon Initial
      Carrying Value as set forth on Exhibit A hereto,  which Exhibit A shall be
      revised to reflect any additional  contributions  made in accordance  with
      Section 3.3.

3.2   ISSUANCE OF UNITS
      In exchange for the Initial Contribution of the Members, the Members shall
      be issued that number and class of Units set forth opposite their names on
      Exhibit A.

3.3   ADDITIONAL CONTRIBUTIONS
      Except as set forth in Section 2.5 above,  no Member shall be permitted or
      required  to make any  additional  contribution  to the capital of the LLC
      without the consent of the Managers and the Members.

3.4   INTEREST
      No Member  shall be entitled to any  interest  with  respect to its or his
      contributions to or share of the capital of the LLC.


4.    ACTION BY MEMBERS

4.1   MEETINGS OF MEMBERS
      All meetings of the Members for the election of Managers  shall be held in
      the City of Santa  Clara,  State of  California,  at such  place as may be
      fixed from time to time by the Managers, or at such other place within the
      State  of  California  as  shall be  designated  from  time to time by the
      Managers and stated in the notice of the meeting.  Meetings of Members for
      any other  purpose  may be held at such time and place,  within or without
      the State of  California,  as shall be stated in the notice of the meeting
      or in a duly executed waiver of notice thereof. Members may participate in
      a meeting  of the  members  by means of  conference  telephone  or similar
      communications  equipment by means of which all persons  participating  in
      the meeting can hear each other, and such participation in a meeting shall
      constitute presence in person at the meeting.

4.2   ANNUAL MEETINGS

      4.2.1Annual meetings of Members,  commencing with the year 1999,  shall be
           held on such date and at such time as shall be  designated  from time
           to time by the Managers  and stated in the notice of the meeting,  at
           which they shall elect a board of Managers,  and transact  such other
           business as may properly be brought before the meeting.

      4.2.2Written notice of the annual meeting stating the place, date and hour
           of the meeting shall be given to each Member entitled to vote at such
           meeting not less than 10 nor more than 60 days before the date of the
           meeting.



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4.3   SPECIAL MEETINGS

      4.3.1Special meetings of the Members, for any purpose or purposes,  may be
           called by the  Managers and shall be called at the request in writing
           of any Member.  Such  request  shall state the purpose or purposes of
           the proposed meeting.

      4.3.2A special  meeting of the Members for the  election of a new Board of
           Managers may be called by any Member entitled to vote thereon, within
           90 days after the date on which such Member has acquired Units of the
           LLC.

      4.3.3Written notice of a special meeting stating the place,  date and hour
           of the meeting  and the purpose or purposes  for which the meeting is
           called,  shall be given not less than 10 nor more than 60 days before
           the date of the  meeting,  to each  Member  entitled  to vote at such
           meeting.

      4.3.4Business  transacted  at any  special  meeting  of  Members  shall be
           limited to the purposes stated in the notice.

4.4   MEMBERSHIP LIST
      The Person who has charge of the Unit  Register  of the LLC shall  prepare
      and make,  at least ten days before every  meeting of Members,  a complete
      list  of the  Members  entitled  to  vote  at  the  meeting,  arranged  in
      alphabetical  order,  showing the address of each Member and the number of
      Units  registered in the name of each Member.  The list may be examined by
      any  Member,  for any  purpose  germane to the  meeting,  during  ordinary
      business hours, for a period of at least ten days before the meeting.  The
      list shall also be produced  and kept at the time and place of the meeting
      during the whole time  thereof,  and may be inspected by any Member who is
      present.

4.5   QUORUM

      4.5.1The holders of a majority  of the Units  issued and  outstanding  and
           entitled to vote thereat,  present in person or represented by proxy,
           shall  constitute  a quorum at all  meetings  of the  Members for the
           transaction of business except as otherwise provided by statute.  If,
           however, a quorum is not present or represented at any meeting of the
           Members,  the Members entitled to vote thereat,  present in person or
           represented  by proxy,  may adjourn  the  meeting  from time to time,
           without notice other than announcement at the meeting, until a quorum
           is present or represented.  Upon resumption of an adjourned  meeting,
           any business may be transacted that might have been transacted before
           the meeting was  adjourned.  If the  adjournment  is for more than 30
           days, or if after the  adjournment a new record date is fixed for the
           adjourned  meeting,  a notice of the adjourned meeting shall be given
           to each Member entitled to vote at the meeting.

      4.5.2Except as otherwise provided herein,  when a quorum is present at any
           meeting,  the vote of the  Members  holding a  majority  of the Units
           present  in person or by proxy  shall  decide  any  question  brought
           before  the  meeting,  except  that the  Board of  Managers  shall be
           elected as if the LLC were a California  corporation  and the Members
           were shareholders voting for the election of a board of directors and
           except to the extent that the express provision of the statutes,  the
           Articles of Organization, or this Agreement require a different vote.

4.6   VOTING RIGHTS
      Each Member shall at every  meeting of the Members be entitled to one vote
      in person or by proxy for each  Unit,  but no proxy  shall be voted  after
      three  years from its date,  unless  the proxy  expressly  provides  for a
      longer  period.  Members  entitled  to vote shall vote as a single  class.
      Neither the assigning Member nor an Assignee of Units shall have any right
      to a vote with respect to any assigned  Units.  No Member who has assigned
      all of its or his Units  (collectively,  "Former  Members") shall have any
      right to vote on any matter.  A Member who has assigned some, but not all,
      of its or his Units shall be treated as a Member and entitled to a vote on
      all  matters to the extent of its or his  retained  Units.  No Assignee of
      Units  shall have the right to  consent,  approve  or vote on any  matters
      unless such  Assignee has become a Substitute  Member  pursuant to Section
      2.6.

4.7   ACTION WITHOUT MEETING
      Any  action  required  to be taken at any  annual or  special  meeting  of
      Members, or any action which may be taken at any annual or special meeting
      of  Members,  may be taken  without a meeting,  without  prior  notice and
      without a vote,  if a consent  in  writing,  setting  forth the  action so
      taken,  shall be signed by Members  holding  outstanding  Units having not
      less than the minimum number of votes that would be necessary to authorize
      or take  such  action at a meeting  at which  all Units  entitled  to vote
      thereon  were  present  and  voted.  Accordingly,  except  to  the  extent
      expressly  provided  otherwise  in  this  Agreement,  any  action  or item
      requiring  the  approval of the Members,  the consent of the Members,  the
      affirmative  vote of the  Members or the like,  shall in the absence of an
      annual or special meeting of the Members,  require the approval,  consent,
      vote or the like of those  Members that hold at least a majority in number
      of the outstanding Units that are held by all Members at such time. Prompt
      notice  of the  taking  of any  action  without  a  meeting  by less  than
      unanimous  written  consent  shall be given to those  Members who have not
      consented in writing.


5.    MANAGEMENT AND RESTRICTIONS

5.1   MANAGEMENT BY MANAGERS
      Except for  situations in which the approval of the Members is required by
      statute or this Agreement,  the LLC shall be managed and controlled by the
      Managers acting as a Board of Managers. The Board of Managers may exercise
      all powers of the LLC and do all such lawful acts and things as are not by
      statute,  the  Articles of  Organization  or this  Agreement,  directed or
      required to be exercised or done by the Members.  It is intended  that the
      powers and authority of the Board of Managers shall be  substantially  the
      same as the powers and  authority of a board of directors of a corporation
      formed  under the laws of the  State of  California.  Notwithstanding  the
      above,  the Managers may not authorize any investment by the  Partnerships
      in any entity in which Alliance Venture Management has an equity interest,
      and may not permit to be done any of the following without the approval of
      the Members:

      5.1.1Any act or  thing  that  the Act or this  Agreement  requires  to be
           approved, consented to or authorized by the Members;

      5.1.2Voluntarily cause the dissolution of the LLC;

      5.1.3Compromise the liability of any Member for capital  contributions or
           for excessive distributions pursuant to Section 11.5; or

      5.1.4Sell all or a significant  part of the LLC assets,  or engage in any
           material recapitalization or merger.

5.2   NUMBER; VACANCIES
      The Members  shall  determine,  at each annual  meeting and at any special
      meeting  called  for the  purpose  of  electing  Managers,  the  number of
      Managers.  Initially there shall be three Managers. Except for the initial
      Managers,  the Managers  shall be elected by the Members.  Managers  shall
      hold office  until the next  meeting,  whether  annual or special at which
      Managers  are  elected  and such  duly  elected  Managers  are  qualified.
      Managers may but need not be Members.  The Members hereby elect N. Damodar
      Reddy, C.N. Reddy and V.R.  Ranganath as the initial  Managers.  Vacancies
      and  newly  created  Managerships  resulting  from  any  increase  in  the
      authorized  number of Managers may be filled by a majority of the Managers
      then in office, though less than a quorum, or by a sole remaining Manager,
      and the Managers so chosen  shall hold office  until the next  election of
      Managers and until their successors are duly elected and qualified, unless
      sooner  displaced.  If there are no Managers  in office,  then each Member
      shall serve as a Manager until the next election of Managers hereunder.

5.3   MEETINGS OF MANAGERS
      The Board of  Managers  of the LLC may hold  meetings,  both  regular  and
      special,  either  within  or  without  the  State of  California.  Regular
      meetings of the Board of Managers may be held without  notice at times and
      places  determined by the Board.  Special  meetings shall be called by any
      Manager.  Members of the Board of Managers, or any committee designated by
      the  Board of  Managers  may  participate  in a  meeting  of the  Board of
      Managers or any  committee,  by means of  conference  telephone or similar
      communications  equipment by means of which all persons  participating  in
      the meeting can hear each other, and such participation in a meeting shall
      constitute presence in person at the meeting. At all meetings of the Board
      of Managers,  a majority of the Managers shall constitute a quorum for the
      transaction  of business.  Notwithstanding  the presence at a meeting of a
      quorum, all actions of the Board of Managers shall require the approval of
      a  majority  of all  Managers,  except  as may be  otherwise  specifically
      provided by statute or this  Agreement.  If a quorum is not present at any
      meeting of the Board of Managers, the Managers present thereat may adjourn
      the meeting from time to time,  without notice other than  announcement at
      the meeting, until a quorum shall be present.

5.4   ACTION WITHOUT MEETING
      Any action  required or  permitted to be taken at any meeting of the Board
      of Managers or of any committee thereof may be taken without a meeting, if
      all  members of the Board of Managers  or  committee,  as the case may be,
      consent thereto in writing, and the writing or writings are filed with the
      minutes of proceedings of the Board of Managers or committee.

5.5   COMMITTEES
      The Board of Managers may designate one or more committees, each committee
      to consist of one or more of the Managers.  The Board may designate one or
      more Managers as alternate  members of any committee,  who may replace any
      absent or  disqualified  Manager  at any  meeting of the  committee.  Upon
      disqualification  of a Manager of a  committee,  the  Manager or  Managers
      thereof present at any meeting and not disqualified  from voting,  whether
      or not he or they  constitute a quorum,  may  unanimously  appoint another
      Manager  to  act at the  meeting  in the  place  of  any  such  absent  or
      disqualified  Manager.  Any such committee,  to the extent provided in the
      resolution  of the Board of Managers,  shall have and may exercise all the
      powers and  authority  of the Board of Managers in the  management  of the
      business  and  affairs of the LLC;  but no such  committee  shall have the
      power or  authority  to  amend  the  Articles  of  Organization,  adopt an
      agreement of merger or  consolidation,  recommend to the Members the sale,
      lease or exchange of all or  substantially  all of the LLC's  property and
      assets, recommend to the Members dissolution of the LLC or revocation of a
      dissolution,  take any action  requiring a vote of 2/3 of the  Managers or
      amend this Agreement; and, unless the resolution expressly so provides, no
      such committee shall have the power or authority to declare a distribution
      or to authorize the issuance of Units.  Such committee or committees shall
      have  such  name or names as may be  determined  from  time to time by the
      Board of  Managers.  Each  committee  shall  keep  regular  minutes of its
      meetings and report the same to the Board of Managers when required.

5.6   REMOVAL OF MANAGERS
      Any  Manager or the  entire  Board of  Managers  may be  removed,  with or
      without  cause,  by the holders of a majority of Units entitled to vote at
      an election of Managers.

5.7   COMPENSATION OF MANAGERS
      The Managers may be paid their  expenses,  if any, of  attendance  at each
      meeting  of the  Board  of  Managers  and  may be  paid a  fixed  sum  for
      attendance  at each meeting of the Board of Managers or a stated salary as
      Manager.  No such payment shall  preclude any Manager from serving the LLC
      in any other  capacity and  receiving  compensation  therefor.  Members of
      special or  standing  committees  may be  allowed  like  compensation  for
      attending committee meetings.

5.8   AMENDMENT OF ARTICLES OF ORGANIZATION OR AGREEMENT
      The  Managers  shall have the duty and  authority to amend the Articles of
      Organization  or this Agreement as and to the extent  necessary to reflect
      any and all changes or corrections necessary or appropriate as a result of
      any action taken by the Members or Managers in  accordance  with the terms
      of this Agreement.


6.    NOTICES

6.1   NOTICES
      Whenever  notice is  required  to be given to any  Member by the Act,  the
      Articles of Organization or this Agreement,  it shall be given in writing,
      by mail,  addressed  to such  Member at his  address  as it appears on the
      records of the LLC with postage thereon prepaid, and shall be deemed given
      when it is deposited in the United States mail. Notice to Members may also
      be given by telegram or facsimile.

6.2   WAIVER OF NOTICE
      A Member may waive notice,  provided that the waiver is in writing  signed
      by the Member whether before or after the notice is required to be given.


7.    OFFICERS

7.1   OFFICERS
      The Managers may create such offices and elect such  officers as they deem
      appropriate.  Any number of offices  may be held by the same  person.  The
      duties  of such  officers  shall be  established  from time to time by the
      Managers.  Initially,  N. Damodar Reddy is appointed Chairman of the Board
      of Managers, V.R. Ranganath is appointed President, and Bradley Perkins is
      appointed  Secretary,  until  their  resignation  or  replacement  by  the
      Managers.


8.    UNIT CERTIFICATES

8.1   CERTIFICATES
      Every Member of the LLC shall be entitled to have a certificate, signed by
      two officers, certifying the class and number of Units owned by it or him.

8.2   REPLACEMENT CERTIFICATES
      The Managers may direct a new  certificate or certificates to be issued in
      place of any  certificate or  certificates  theretofore  issued by the LLC
      alleged  to have been  lost,  stolen or  destroyed,  upon the making of an
      affidavit of that fact by the person claiming the certificates of stock to
      be  lost,  stolen  or  destroyed.  When  authorizing  issuance  of  a  new
      certificate or certificates,  the Managers may, in their discretion and as
      a condition  precedent to the issuance  thereof,  require the owner of the
      lost,  stolen  or  destroyed  certificate  or  certificates,  or his legal
      representative, to advertise the same in such manner as they shall require
      and/or to give the LLC a bond in such sum as they may direct as  indemnity
      against  any claim that may be made  against  the LLC with  respect to the
      certificates alleged to have been lost, stolen or destroyed.

8.3   TRANSFERS
      Upon  surrender  to the LLC of a  certificate  for Units duly  endorsed or
      accompanied by proper evidence of succession,  assignation or authority to
      transfer,  it shall be the duty of the LLC,  provided that the transfer is
      in compliance with the terms of this Agreement, to issue a new certificate
      to the person entitled thereto,  cancel the old certificate and record the
      transaction upon its books.

8.4   UNIT REGISTER
      In order that the LLC may determine  the Members  entitled to notice of or
      to  consent,  approve or vote on any matter,  or the Members or  Assignees
      entitled  to  receive  payment of any  distribution  or  allotment  of any
      rights,  or  entitled  to  exercise  any rights in respect of any  change,
      conversion  or exchange  of stock or for the  purpose of any other  lawful
      action, the Managers shall fix, in advance, a record date, which shall not
      be more than 60 nor less than ten days  before the date of such  action or
      event.

8.5   RIGHTS OF REGISTERED OWNER
      The LLC shall be entitled to  recognize  the  exclusive  right of a person
      registered  on its books as the owner of Units to  receive  dividends  and
      vote, and to hold liable for calls and assessments a person registered the
      LLC shall not be bound to  recognize  any  equitable  or other claim to or
      interest in such Units on the part of any other person,  whether or not it
      shall have express or other notice thereof,  except as otherwise  provided
      by the laws of California.

8.6   LEGENDS
      Each  certificate  prepared  by the LLC  shall  bear such  legends  as the
      Managers  determine to be necessary to comply with  applicable  securities
      laws or to preserve the  enforceability  of any agreement,  including this
      Agreement, to which the LLC may be a party.


9.    ACCOUNTING AND RECORDS

9.1   FINANCIAL AND TAX REPORTING
      The  LLC  shall  prepare  its  financial  statements  in  accordance  with
      generally  accepted  accounting  principles as from time to time in effect
      and shall prepare its income tax information returns using such methods of
      accounting  and tax year as the Managers  deem  necessary  or  appropriate
      under the Code and Treasury Regulations.

9.2   SUPERVISION; INSPECTION OF BOOKS
      Proper and  complete  books of account and records of the  business of the
      LLC (including those books and records identified in Section 18-305 of the
      Act)  shall be kept under the  supervision  of the  Managers  at the LLC's
      principal  office and at such other place as  designated  by the Managers.
      The  Managers  shall  give  notice  to each  Member  of any  change in the
      location of the books and records.  The books and records shall be open to
      inspection,   audit  and  copying  by  any  Member,   or  his   designated
      representative,  upon reasonable  notice at any time during business hours
      for any purpose  reasonably  related to the Member's  interest in the LLC.
      Any  information  so obtained or copied  shall be kept and  maintained  in
      strictest confidence except as required by law.

9.3   RELIANCE ON RECORDS AND BOOKS OF ACCOUNT
      Any Member or Manager  shall be fully  protected  in relying in good faith
      upon  the  records  and  books  of  account  of  the  LLC  and  upon  such
      information,  opinions,  reports or statements presented to the LLC by its
      Managers, any of its Members, officers, employees or committees, or by any
      other person,  as to matters the Managers or Members  reasonably  believes
      are within such other person's  professional or expert  competence and who
      has  been  selected  with  reasonable  care by or on  behalf  of the  LLC,
      including information, opinions, reports or statements as to the value and
      amount of the  assets,  liabilities,  profits  or losses of the LLC or any
      other facts  pertinent  to the  existence  and amount of assets from which
      distributions to members might properly be paid.

9.4   ANNUAL REPORTS
      The annual  financial  statements of the LLC shall be audited and reported
      on as of the end of each  Fiscal Year by a firm of  independent  certified
      public  accountants  selected by the Managers,  provided that the Managers
      may waive the  requirement  of an audit at any time and for any reason.  A
      copy of the annual report shall be  transmitted  to the Members  within 90
      days after the end of each Fiscal Year.

9.5   TAX RETURNS
      The Managers shall, within 90 days after the end of each Fiscal Year, file
      a Federal  income tax  information  return and  transmit  to each Member a
      schedule  showing such  Member's  distributive  share of the LLC's income,
      deductions  and  credits,  and all other  information  necessary  for such
      Members to timely file their  Federal  income tax  returns.  The  Managers
      similarly  shall file, and provide  information to the Members  regarding,
      all appropriate state and local income tax returns.



<PAGE>


9.6   TAX MATTERS PARTNER
      V.R.  Ranganath  shall  serve as the "Tax  Matters  Partner"  (within the
      meaning of Code  Section  6231) until a successor  is  designated  by the
      Managers.


10.   ALLOCATIONS

10.1  ALLOCATION OF NET INCOME OR NET LOSS
      For each  Accounting  Period,  Net Income or Net Loss of the LLC, or items
      thereof, other than Net Income attributed to or resulting from the Carried
      Interests  from  Alliance  Ventures I and  Alliance  Ventures II, shall be
      allocated to the Members in proportion to their  ownership of  outstanding
      Common Units.  Any Net Income or Net Loss  attributed to or resulting from
      the Carried  Interest from  Alliance  Ventures I shall be allocated to the
      Members in proportion to their  ownership of  outstanding  Series A Units.
      Any Net Income or Net Loss  attributed  to or  resulting  from the Carried
      Interest  from  Alliance  Ventures II shall be allocated to the Members in
      proportion to their ownership of outstanding Series B Units.

10.2  OTHER   ALLOCATIONS;   QUALIFIED   INCOME  OFFSET;   PROPHYLACTIC   OFFSET
      MINIMUM-GAIN  CHARGEBACK  Notwithstanding  the provisions of Section 10.1,
      the following special allocations shall be made in the following order set
      forth below. Terms appearing in quotes in this Section 10.2 are as defined
      in Treasury  Regulations Section 1.704-2, and that regulation shall govern
      determinations required by the rules set forth in this Section 10.2.

      10.2.1 All "nonrecourse  deductions"  shall be allocated among the holders
           of Common  Units in  proportion  to their  ownership  of  outstanding
           Common Units from time to time during such period.

      10.2.2 All "partner  nonrecourse  deductions" shall be specially allocated
           to the Members who bear the economic risk of loss with respect to the
           "partner   nonrecourse  debt"  to  which  such  "partner  nonrecourse
           deductions" are attributable.

      10.2.3 Except  as  otherwise  provided  in  Treasury  Regulations  Section
           1.704-2(f),  if there is a net decrease in "partnership minimum gain"
           during any Fiscal  Year,  each Member  shall be  specially  allocated
           items of LLC income and gain for such Fiscal Year (and, if necessary,
           future Fiscal Years) in an amount equal to such Member's share of the
           net  decrease.  This  Section  10.2.3 is  intended to comply with the
           minimum gain chargeback  requirements of Treasury Regulations Section
           1.704-2 and shall be interpreted accordingly.

      10.2.4 Except  as  otherwise  provided  in  Treasury  Regulations  Section
           1.704-2(i)(4),  if there is a net  decrease in  "partner  nonrecourse
           debt  minimum  gain"  attributable  to a "partner  nonrecourse  debt"
           during any Fiscal Year,  each Member who has a share of such "partner
           nonrecourse debt minimum gain" shall be specially  allocated items of
           LLC  income  and  gain for  such  Fiscal  Year  (and,  if  necessary,
           subsequent  Fiscal  Years) in an  amount  equal to that  share.  This
           Section 10.2.4 is intended to comply with the minimum gain chargeback
           requirements  of Treasury  Regulations  Section  1.704-2 and shall be
           interpreted accordingly.

      10.2.5 If a Member's  capital  account has an Unadjusted  Excess  Negative
           Balance at the end of any Fiscal Year, the Member will be reallocated
           items of LLC income and gain for such Fiscal Year (and, if necessary,
           future  Fiscal  Years) in the  amount  necessary  to  eliminate  such
           Unadjusted Excess Negative Balance as quickly as possible.

      10.2.6 If a Member unexpectedly  receives any adjustments,  allocations or
           distributions    described   in   Treasury    Regulations    Sections
           1.704-1(b)(2)(ii)(d)(4)  through (d)(6), items of LLC income and gain
           shall be specially  allocated  to the Member to eliminate  any Excess
           Negative Balance in such Member's Capital Account  (determined  after
           application  of  Section   10.2.5)  created  thereby  as  quickly  as
           possible.  This Section 10.2.6 is intended to constitute a "qualified
           income  offset"  within the meaning of Treasury  Regulations  Section
           1.704-1(b)(2)(ii)(d) and shall be interpreted accordingly.

      10.2.7 A Member shall not be  allocated  any item of LLC loss or deduction
           to the extent the allocation would cause the Member's capital account
           to have an Excess Negative Balance.

      10.2.8 The  allocations  set  forth in the  preceding  provisions  of this
           Section 10.2 (hereinafter, the "Regulatory Allocations") are intended
           to comply with certain requirements of the Treasury  Regulations.  It
           is the  intent of the  Members  that,  to the  extent  possible,  all
           Regulatory   Allocations   shall  be  offset  with  other  Regulatory
           Allocation or with special  allocations of other items of LLC income,
           gain, loss or deduction pursuant to this Section 10.2(h).  Therefore,
           notwithstanding any other provision of this Agreement (other than the
           provisions  governing  the  Regulatory   Allocations)  the  Board  of
           Managers  shall  make  such  offsetting  special  allocations  of LLC
           income,  gain,  loss or  deduction in whatever  manner it  determines
           appropriate,  to the end that each Member's  Capital  Account balance
           should equal the balance the Member would have had if the  Regulatory
           Allocations  were not part of this  Agreement  and all LLC items were
           allocated  pursuant to Section  10.1. In  exercising  its  discretion
           under this  Section  10.2.8,  the Board of  Managers  shall take into
           account  future  Regulatory  Allocations  under  Sections  10.2.3 and
           10.2.4 above that,  although not yet made, are likely to offset other
           Regulatory  Allocations  previously  made under  Sections  10.2.1 and
           10.2.2 above.

      10.2.9 For purposes of this Section 10.2,  "Excess Negative Balance" shall
           mean the excess of the negative balance in a Member's Capital Account
           (computed  with  any  adjustments  which  are  required  by  Treasury
           Regulations Section  1.704-1(b)(2)(ii)(d)) over the amount the Member
           is obligated to restore to the LLC (computed  under the principles of
           Treasury Regulations Section  1.704-1(b)(2)(ii)(c))  inclusive of any
           addition to such  restoration  obligation  pursuant to application of
           the  provisions  of  Treasury  Regulations  Section  1.704-2  or  any
           successor provisions thereto.

      10.2.10 For purposes of this Section  10.2,  "Unadjusted  Excess  Negative
           Balance"  shall  have the same  meaning as Excess  Negative  Balance,
           except that the Unadjusted  Excess Negative Balance of a Member shall
           be computed without effecting the reductions to such Member's Capital
           Account     described     in     Treasury     Regulations     Section
           1.704-1(b)(2)(ii)(d).

10.3  SPECIAL TAX PROVISIONS

      10.3.1    PARTNERSHIP STATUS
           The  Members  expect  and  intend  that the LLC shall be treated as a
           partnership  for all federal  income tax purposes and each Member and
           the Managers agree that they:

           10.3.1.1 will not on any  federal,  state,  local or other tax return
                take a  position,  and shall not  otherwise  assert a  position,
                inconsistent with such expectation and intent; or

           10.3.1.2 do any act or thing that  could  cause the LLC to be treated
                as other than a partnership for federal income tax purposes.

      10.3.2    TAX ALLOCATIONS
           Except as  otherwise  provided in this  Section 10 or required by the
           Code  and  Treasury  Regulations,  items  of  income,  gain,  loss or
           deduction  recognized  for income tax purposes  shall be allocated in
           the  same  manner  that the  corresponding  items  entering  into the
           calculation of Net Income and Net Loss are allocated pursuant to this
           Agreement.

      10.3.3    SECTION 704(C) ADJUSTMENTS
           In accordance  with Code Section 704(c) and the Treasury  Regulations
           thereunder, items of income, gain, loss and deduction with respect to
           an asset, if any, contributed to the capital of the LLC shall, solely
           for tax  purposes,  be  allocated  among  the  Members  so as to take
           account of any variation  between the adjusted basis of such property
           to the LLC for federal  income tax purposes and its fair market value
           upon contribution to the LLC.

      10.3.4 If the  Carrying  Value of any asset is  adjusted  pursuant  to the
           terms of this Agreement, subsequent allocations of income, gain, loss
           and  deduction  with  respect to such asset shall take account of any
           variation  between  the  adjusted  basis of such asset to the LLC for
           federal income tax purposes and its Carrying Value in the same manner
           as under Code Section 704(c) and the Regulations thereunder.

      10.3.5    SECTION 754 ELECTION
           A Section 754 election may be made for the LLC at the sole discretion
           of the  Managers.  In the event of an  adjustment to the adjusted tax
           basis of any LLC asset  under  Code  Section  734(b) or Code  Section
           743(b) pursuant to a Section 754 election,  subsequent allocations of
           tax items shall reflect such adjustment  consistent with the Treasury
           Regulations promulgated under Sections 704, 734 and 743 of the Code.

      10.3.6 ALLOCATIONS UPON TRANSFERS OF LLC INTERESTS If during an Accounting
           Period, a Member  ("Transferring  Member") transfers Units to another
           person, items of Net Income and Net Loss, together with corresponding
           tax  items,   that  otherwise   would  have  been  allocated  to  the
           Transferring  Member with regard to such  Accounting  Period shall be
           allocated  between  the  Transferring  Member and the  transferee  in
           accordance with their respective  Units during the Accounting  Period
           using any method permitted by Section 706 of the Code and selected by
           the Board of Managers.


11.   DISTRIBUTIONS

11.1  DISTRIBUTIONS TO PREFERRED AND COMMON UNITS
      The  holders  of  the  outstanding   Series  A  Units  shall  receive  all
      distributions  from the LLC  resulting  from  the  Carried  Interest  from
      Alliance  Ventures  I and the  holders of the  outstanding  Series B Units
      shall receive all  distributions  from the LLC resulting  from the Carried
      Interest  from  Alliance  Ventures II and the  holders of the  outstanding
      Common Units shall receive all other distributions from the LLC.

11.2  ALLOCATION OF DISTRIBUTIONS AMONG HOLDERS OF UNITS
      All distributions by the LLC to holders of Series A Units,  Series B Units
      and Common Units shall be made in proportion to the holders'  ownership of
      such outstanding Units at the time of the distribution.

11.3  MANDATORY TAX DISTRIBUTIONS
      In order to permit holders of Units to pay taxes on their  allocable share
      of the  taxable  income of the LLC,  the  Managers  shall cause the LLC to
      distribute,  not later than  February 28 of each year, to each holder of a
      Unit an amount equal to the excess, if any, of:

      11.3.1 the  product  of the  aggregate  net  taxable  income  of  the  LLC
           determined on a cumulative basis for all Accounting  Periods that has
           been allocated to such holder (and any predecessor  holder)  computed
           without regard to any basis  adjustments  under Section 743(b) of the
           Code of such Unit multiplied by 0.45; over

      11.3.2    all  amounts  previously  distributed  to such  holder  and any
           predecessor holder;

      the decimal fraction in these Sections 11.3.1 and 11.3.2 shall be adjusted
      to the extent  necessary (as determined in good faith by the Managers from
      time to time) to reflect any change in the higher of the  maximum  rate of
      tax imposed on individual  taxpayers resident in California under the Code
      or the laws of the State of California and the maximum rate of tax imposed
      on corporate  taxpayers doing business in California under the Code or the
      laws of the State of California.  Any  distributions  made with respect to
      Series A Units and  Series B Units  pursuant  to this  Section  11.3 shall
      reduce  on  a  dollar-for-dollar   basis  the  distributions  required  or
      permitted  to be made with  respect  to such Units  pursuant  to any other
      provision of this Agreement.

11.4  DISCRETIONARY DISTRIBUTIONS
      In addition to the  distributions  provided for in Sections 11.1, 11.2 and
      11.3,  at any time that  there  are no  Series A Units and  Series B Units
      outstanding,  the Managers may, in their sole discretion,  make additional
      distributions  to the holders of outstanding  Common Units in such amounts
      and at such times as they shall from time to time determine.

11.5  RESTRICTION ON DISTRIBUTIONS AND WITHDRAWALS

      11.5.1 The LLC shall not make any  distribution  to the  holders  of Units
           unless  immediately  after  giving  effect to the  distribution,  all
           liabilities of the LLC, other than  liabilities to Members on account
           of their interest in the LLC and  liabilities as to which recourse of
           creditors is limited to specified  property of the LLC, do not exceed
           the fair value of the LLC assets, provided that the fair value of any
           property  that is  subject to a  liability  as to which  recourse  of
           creditors  is so limited  shall be included in the LLC assets only to
           the  extent  that  the  fair  value  of  the  property  exceeds  such
           liability.

      11.5.2 Except as  otherwise  required  by law no holder of Units  shall be
           liable to the LLC for the amount of a distribution  received provided
           that, at the time of the  distribution,  such holder of Units did not
           know that the  distribution  was in  violation of Section  11.5.1.  A
           Member which receives a distribution  in violation of Section 11.5.1,
           and which knows at the time of the distribution that the distribution
           violated such condition, shall be liable to the LLC for the amount of
           the distribution.

11.6  NO OTHER WITHDRAWALS
      Except  as  otherwise   expressly   provided  for  in  this  Agreement  no
      withdrawals or distributions shall be required or permitted.


12.   TRANSFER OF MEMBERSHIP

12.1  TRANSFER
      Any Member or Assignee  may  Transfer any portion of its or his Units only
      if:

      12.1.1    the  transferor  shall  have  complied  with the Right of First
           Refusal imposed by Section 12.5 hereof;

      12.1.2 the  Assignee  shall  have  agreed in  writing to assume all of the
           obligations  of the  assignor  with  respect  to the  Units  assigned
           (including the  obligations  imposed  hereunder as a condition to any
           transfer); and

      12.1.3 the  Managers  in their  sole  discretion  have  consented  to such
           Transfer and shall have concluded (which conclusion may be based upon
           an opinion of counsel  satisfactory  to them) that such assignment or
           disposition will not:

           12.1.3.1  result in a  violation  of the  Securities  Act of 1933 as
                amended, or any other applicable statute of any jurisdiction;

           12.1.3.2  result in a  termination  of the LLC for  Federal  or state
                income tax  purposes or result in (or  materially  increase  the
                risk of) the LLC being treated as a publicly traded  partnership
                or otherwise  taxable as a  corporation  for Federal  income tax
                purposes; or

           12.1.3.3 result in a violation of any law,  rule or regulation by the
                Member, the Assignee, the LLC or the other Members.

      For purposes of this Section 12.1 the phrase "publicly traded partnership"
      shall  have the  meaning  set forth in Section  7704(b)  and 469(k) of the
      Code.

12.2  TRANSFER VOID
      Any purported  Transfer of Units in contravention of this Section 12 shall
      be void and of no effect  to,  on or  against  the LLC,  any  Member,  any
      creditor of the LLC or any claimant against the LLC.

12.3  RIGHTS OF ASSIGNEES
      The  Assignee  of  Units  has no right  to vote or to  participate  in the
      management  of the  business and affairs of the LLC or to become a Member.
      The Assignee is only entitled to receive distributions and to be allocated
      the Net Income and Net Loss (and items thereof)  attributable to the Units
      transferred to the Assignee.

12.4  ADMISSION OF PERMITTED TRANSFEREES
      Notwithstanding  Section  12.5  below,  the Units of any  Member  shall be
      transferable free from any Right of First Refusal if:

      12.4.1    the transfer  occurs by reason of or incident to the death,  or
           divorce, of the transferor Member;

      12.4.2 the  transferee  is a  Permitted  Transferee,  and  such  Permitted
           Transferee  agrees in writing to be bound by the terms and conditions
           of this  Agreement  as  fully  as if it were  an  original  signatory
           hereto.

      A "Permitted  Transferee" is any member of such Member's  immediate family
      including,  in the case of the divorce of a Member from his or her spouse,
      such  spouse.  A Permitted  Transferee  will be  admitted as a  Substitute
      Member only in  accordance  with  Section 2.5  hereof.  Units  transferred
      pursuant to the death of a Member  shall be subject to the  provisions  of
      Section 2.9 (relating to Dissociated  Members)  whether or not transferred
      to a Permitted Transferee.

12.5  RIGHT OF FIRST REFUSAL

      12.5.1    GRANT
           The LLC is hereby granted the right of first refusal  ("First Refusal
           Right"),  exercisable  in  connection  with any proposed  Transfer of
           Units.

      12.5.2    NOTICE OF INTENDED DISPOSITION
           In the event a Member desires to accept a bona-fide third-party offer
           for the Transfer of any or all of the Member's  Units (Units  subject
           to such offer to be hereinafter  called "Target Units"),  such Member
           shall promptly:

           12.5.2.1 deliver to the LLC written notice ("Disposition  Notice") of
                the terms and  conditions  of the offer,  including the purchase
                price and the identity of the third-party offeror; and

           12.5.2.2  Provide  satisfactory  proof  that the  disposition  of the
                Target  Units  to  such  third-party  offeror  would  not  be in
                contravention of the provisions set forth in Section 12.1.

      12.5.3    EXERCISE OF RIGHT
           The LLC (or its assignees)  shall,  for a period of 25 days following
           receipt of the Disposition  Notice, have the right to repurchase all,
           but  not  less  than  all,  of  the  Target  Units  specified  in the
           Disposition  Notice  upon the same  terms  and  conditions  specified
           therein or upon terms and  conditions  which do not  materially  vary
           from those  specified  therein.  Such right shall be  exercisable  by
           delivery of written  notice  ("Exercise  Notice")  to the  transferor
           Member before the end of the 25-day exercise period.

      12.5.4    VALUATION
           If the purchase price specified in the Disposition  Notice is payable
           in property other than cash or evidences of indebtedness, the LLC (or
           its  assignees) may pay the purchase price in cash equal to the value
           of such property. If the Member and the LLC (or its assignees) cannot
           agree on such cash value within ten (10) days after the LLC's receipt
           of  the  Disposition  Notice,  the  valuation  shall  be  made  by an
           appraiser of recognized  standing  selected by the Member and the LLC
           (or its assignees) or, if they cannot agree on an appraiser within 20
           days after the LLC's receipt of the  Disposition  Notice,  each shall
           select an appraiser  of  recognized  standing and the two  appraisers
           shall  designate a third  appraiser  of  recognized  standing,  whose
           appraisal  shall be  determinative  of such  value.  The cost of such
           appraisal  shall be shared  equally by the  Member  and the LLC.  The
           closing shall then be held on the later of:

           12.4.4.1 the fifth  business day following  delivery of the Exercise
                Notice; or

           12.4.4.2 the fifth business day after such cash valuation  shall have
                been made.

      12.5.5    EXERCISE OF RIGHTS
           If the right of the LLC is  exercised  with respect to all the Target
           Units  specified  in  the  Disposition  Notice,  then  the  LLC,  its
           assignees  and/or the Members  (as the case may be) shall  effect the
           purchase  of the Target  Units,  including  payment  of the  purchase
           price, on the same payment terms specified in the Disposition Notice;
           and the  selling  Member  shall  deliver to the LLC the  certificates
           representing the Target Units to be repurchased,  each certificate to
           be properly endorsed for transfer.  The closing shall then be held on
           the later of:

           12.5.5.1  sixty  (60) days  following  delivery  of the  Disposition
                Notice; or

           12.5.5.2 the fifth business day after any necessary  valuation  shall
                have been made.

      12.5.6    NON-EXERCISE OF RIGHT
           In the event the LLC or its assignees do not exercise  their purchase
           rights in accordance with this Section 12.5, the selling Member shall
           have a period  of 30 days  thereafter  in which to sell or  otherwise
           dispose of the Target Units to the third-party  offeror identified in
           the  Disposition  Notice  upon terms and  conditions  (including  the
           purchase  price) no more favorable to such  third-party  offeror than
           those specified in the Disposition Notice;  provided,  however,  that
           any such sale or disposition must not be effected in contravention of
           the  provisions  of Section  12.1. If the Member does not effect such
           sale or disposition  of the Target Units within the specified  30-day
           period,  the LLC's First Refusal Right shall continue to apply to any
           subsequent disposition of the Target Units by Member.

      12.5.7    RECAPITALIZATION/MERGER

           12.5.7.1 In the event of any Unit stock  split,  recapitalization  or
                other transaction  affecting the LLC's outstanding Units without
                receipt  of   consideration,   then  any  new,   substituted  or
                additional  securities or other  property  which is by reason of
                such transaction  distributed with respect to the Units shall be
                immediately  subject to the LLC's First Refusal Right hereunder,
                but only to the extent the Units are at the time covered by such
                right.

           12.5.7.2 In the event of:

                12.5.7.2.1  a merger or  consolidation  in which the LLC is not
                     the surviving entity;

                12.5.7.2.2  a sale,  transfer  or other  disposition  of all or
                     substantially all of the LLC's assets;

                12.5.7.2.3 a reverse  merger  in which the LLC is the  surviving
                     entity but in which the LLC's outstanding voting securities
                     are  transferred in whole or in part to a person or persons
                     other  than  those  who held  such  securities  immediately
                     before the merger; or

                12.5.7.2.4  any  transaction  effected  primarily to change the
                     State  in  which  the LLC is  organized,  or to  create  a
                     holding company structure,

                the LLC's First  Refusal  Right  shall  remain in full force and
                effect  and  shall  apply  to the new  capital  stock  or  other
                property  received  in  exchange  for  the  Purchased  Units  in
                consummation  of the  transaction,  but only to the  extent  the
                Purchased Units are at the time covered by such right.

12.6  MARITAL DISSOLUTION OR LEGAL SEPARATION

      12.6.1    GRANT
           In  connection  with the  dissolution  of the  marriage  or the legal
           separation  of any  Member,  the LLC shall  have the right  ("Special
           Purchase  Right"),  exercisable  at any time during the 30-day period
           following the LLC's receipt of the required  Dissolution Notice under
           Section 12.6.2,  to purchase from the Member's spouse,  in accordance
           with the  provisions of Section  12.6.3 any or all Units which are or
           would otherwise be awarded to such spouse incident to the dissolution
           of  marriage  or legal  separation  in  settlement  of any  community
           property  or other  marital  property  rights such spouse may have or
           obtain in the Units.  The Special  Purchase  Right shall not apply to
           any Units retained by the Member.

      12.6.2    NOTICE OF DECREE OR AGREEMENT
           Each  Member  shall  promptly  provide  the LLC with  written  notice
           ("Dissolution Notice") of:

           12.6.2.1 the  entry of any  judicial  decree or order  resolving  the
                property  rights of the  Optionee and the  Optionee's  spouse in
                connection with their marital  dissolution or legal  separation;
                or

           12.6.2.2 the  execution of any contract or agreement  relating to the
                distribution or division of such property rights.

           The  Dissolution  Notice shall be accompanied by a copy of the actual
           decree of  dissolution or settlement  agreement  between the Optionee
           and the Optionee's  spouse which provides for the award to the spouse
           of Units in  settlement  of any  community  property or other marital
           property rights such spouse may have in such Units.

      12.6.3    EXERCISE OF SPECIAL PURCHASE RIGHT
           The  Special  Purchase  Right  shall be  exercisable  by  delivery of
           written  notice  ("Purchase  Notice") to the Member and the  Member's
           spouse  within 30 days  after the LLC's  receipt  of the  Dissolution
           Notice. The Purchase Notice shall indicate the number of the Units to
           be  purchased  by the LLC,  the date such  purchase is to be effected
           (such date to be not less than five business  days,  nor more than 10
           business days, after the date of the Purchase Notice), and the amount
           which the LLC proposes to pay for such Units.  If the Member's Spouse
           does not agree to the amount proposed to be paid by the LLC, then the
           price  to be  paid  shall  be the  fair  market  value  of the  Units
           determined  as set forth in the  remainder  of this  Section  and the
           purchase  shall occur ten business days  following the  completion of
           such  valuation,  provided  that if the fair market  value is greater
           than 110% of the purchase price set forth in the Purchase Notice, the
           LLC shall have the right to  withdraw  such  Notice.  The fair market
           value of the  Units  shall be the  value  agreed  to by the  Member's
           Spouse or its or his legal representative and the LLC. If such person
           and the LLC are unable to agree to a value,  within 10 days after the
           notice of  election to  purchase  the Units has been given,  the fair
           market  value shall be  established  by an  appraiser  of  recognized
           standing  selected  by the  Member's  Spouse  or  his  or  its  legal
           representative  and the LLC, or, if they cannot agree on an appraiser
           within 20 days after the  expiration  of the  aforementioned  ten-day
           period, each shall select an appraiser of recognized standing and the
           two  appraisers  shall  designate  a third  appraiser  of  recognized
           standing,  whose appraisal shall be  determinative of the fair market
           value. The cost of determining the fair market value shall be paid by
           the LLC.


13.   INDEMNIFICATION AND LIMITATION OF LIABILITY

13.1  INDEMNIFICATION

      13.1.1 To the  fullest  extent  permitted  by the  Act  and  by  law,  the
           Managers,  Members,  the  partners,  members or  shareholders  of any
           Member,  if  such  Member  is  organized  as a  partnership,  limited
           liability  company or  corporation,  respectively,  and the partners,
           shareholders,  controlling persons, officers,  Managers and employees
           of any of the foregoing (herein referred to as "Indemnitees")  shall,
           in accordance with this Section 13.1 be indemnified and held harmless
           by the LLC  from  and  against  any and all  loss,  claims,  damages,
           liabilities   joint  and   several,   expenses,   judgments,   fines,
           settlements  and  other  amounts  arising  from  any and  all  claims
           (including  reasonable legal expenses),  demands,  actions,  suits or
           proceedings  (civil,  criminal,  administrative  or investigative) in
           which they may be  involved,  as a party or  otherwise,  by reason of
           their  management of, or  involvement  in, the affairs of the LLC, or
           rendering of advice or consultation  with respect  thereto,  or which
           relate to the LLC,  its  properties,  business  or  affairs,  if such
           Indemnitee  acted  in good  faith  and in a  manner  such  Indemnitee
           reasonably  believed to be in, or not opposed to, the best  interests
           of the LLC,  and with  respect  to any  criminal  proceeding,  had no
           reasonable  cause to  believe  the  conduct  of such  Indemnitee  was
           unlawful.  The  termination  of  a  proceeding  by  judgment,  order,
           settlement,  conviction  or upon a plea of  nolo  contendere,  or its
           equivalent,  shall not,  of  itself,  create a  presumption  that the
           Indemnitee  did not act in  good  faith  and in a  manner  which  the
           Indemnitee  reasonably believed to be in, or not opposed to, the best
           interests of the LLC or that the Indemnitee  had reasonable  cause to
           believe that the Indemnitee's  conduct was unlawful (unless there has
           been a final  adjudication  in the proceeding that the Indemnitee did
           not act in good faith and in a manner which the Indemnitee reasonably
           believed to be in or not opposed to the best interests of the LLC; or
           that the  Indemnitee  did have  reasonable  cause to believe that the
           Indemnitee's conduct was unlawful).

      13.1.2 The LLC may also  indemnify  any Person who was or is a party or is
           threatened  to be  made  a  party  to  any  threatened,  pending,  or
           completed  action by or in the right of the LLC to procure a judgment
           in its favor by  reason  of the fact  that  such  Person is or was an
           officer,  employee or agent of the LLC, against expenses  actually or
           reasonably  incurred by such Person in connection with the defense or
           settlement of such action,  if such Person acted in good faith and in
           a manner such Person reasonably believed to be in, or not opposed to,
           the best interests of the LLC, except that  indemnification  shall be
           made in respect of any claim, issue or matter as to which such Person
           shall  have  been  adjudged  to  be  liable  for  misconduct  in  the
           performance  of the Person's  duty to the LLC only to the extent that
           the court in which such action or suit was brought,  or another court
           of  appropriate  jurisdiction,   determines  upon  application  that,
           despite  the   adjudication   of  liability,   but  in  view  of  all
           circumstances  of the case,  such  Person is  fairly  and  reasonably
           entitled to indemnity for such  expenses  which such court shall deem
           proper.  To the extent  that the Person  has been  successful  on the
           merits or otherwise in defense of any proceedings referred to herein,
           or in defense of any claim, issue or matter therein, the Person shall
           be  indemnified by the LLC against  expenses  actually and reasonably
           incurred by the Person in connection  therewith.  Notwithstanding the
           foregoing,  no Person shall be entitled to indemnification  hereunder
           for  any  conduct  arising  from  the  gross  negligence  or  willful
           misconduct or reckless  disregard in the  performance of the Person's
           duties under this Agreement.

      13.1.3 Expenses  (including  attorneys'  fees)  incurred in defending  any
           proceeding  under Sections 13.1.1 or 13.1.2 may be paid by the LLC in
           advance of the final  disposition of such  proceeding upon receipt of
           an  undertaking  by or on behalf of the Indemnitee or Person to repay
           such amount if it shall  ultimately be determined that the Indemnitee
           or Person is not entitled to be  indemnified by the LLC as authorized
           hereunder.

      13.1.4 The  indemnification  provided  by this  Section  13.1 shall not be
           deemed to be exclusive of any other rights to which any Person may be
           entitled  under any  agreement,  or as a matter of law, or otherwise,
           both as to action in a Person's  official  capacity  and to action in
           another capacity.

      13.1.5 The Managers shall have power to purchase and maintain insurance on
           behalf of the LLC, the Managers, officers, employees or agents of the
           LLC and any other  Indemnitees at the expense of the LLC, against any
           liability  asserted  against or incurred by them in any such capacity
           whether or not the LLC would have the power to indemnify such Persons
           against such liability under the provisions of this Agreement.

13.2  LIMITATION OF LIABILITY
      Notwithstanding  anything to the  contrary  herein  contained,  the debts,
      obligations  and  liabilities  of the  LLC  shall  be  solely  the  debts,
      obligations  and liabilities of the LLC; and no Manager or Member shall be
      obligated personally for any such debt, obligation or liability of the LLC
      solely by reason of being a Manager or Member of the LLC.


14.   TERMINATION

14.1  TERMINATION
      The LLC shall be dissolved,  its assets  disposed of and its affairs wound
      up upon the first to occur of the following:

      14.1.1    the expiration of its stated term;

      14.1.2    the  affirmative  vote  of  Members  holding  80% of the  Units
           entitled to vote thereon;

      14.1.3 the death,  Bankruptcy  or  Dissolution  of a Member  ("Dissolution
           Event"), unless the holders of Units representing a majority of votes
           (determined  pursuant to Section 2.4)  continues  the business of the
           LLC  within  90 days  following  the  occurrence  of any such  event,
           pursuant to Section 14.2 below; or

      14.1.4    the entry of a decree of judicial dissolution under the Act.

14.2  CONTINUANCE OF THE LLC
      Notwithstanding  the  foregoing  provisions  of  Section  14.1,  upon  the
      occurrence  of a  Dissolution  Event,  if there are at least two remaining
      Members, the holders of Units representing a majority of votes (determined
      pursuant to Section 2.4) may avoid dissolution of the LLC and elect within
      90 days after a  Dissolution  Event to continue the business of the LLC on
      the same terms as this Agreement.  Expenses incurred in the continuance of
      the LLC shall be deemed expenses of the LLC.

14.3  AUTHORITY TO WIND UP
      The Managers  shall have all  necessary  power and  authority  required to
      marshal the assets of the LLC, to pay its creditors,  to distribute assets
      and otherwise  wind up the business and affairs of the LLC. In particular,
      the Managers  shall have the authority to continue to conduct the business
      and  affairs  of the LLC  insofar  as  such  continued  operation  remains
      consistent,  in the judgment of the Managers,  with the orderly winding up
      of the LLC.



<PAGE>


14.4  WINDING UP AND CERTIFICATE OF CANCELLATION
      The winding up of the LLC shall be completed  when all debts,  liabilities
      and  obligations  of the LLC have been paid and  discharged  or reasonably
      adequate  provision  therefor  has  been  made,  and all of the  remaining
      property and assets of the LLC have been distributed to the Members.  Upon
      the  completion  of winding up of the LLC, a Certificate  of  Cancellation
      shall be filed with the Office of the Secretary of State of California.

14.5  DISTRIBUTION OF ASSETS
      Upon  dissolution  and winding up of the LLC, the affairs of the LLC shall
      be wound  up and the LLC  liquidated  by the  Managers.  Pursuant  to such
      liquidation  the assets of the LLC shall be sold unless the Members  shall
      consent to a  distribution  in kind of the  assets.  If the Members do not
      consent  to a  distribution  in kind but the  Managers  determine  that an
      immediate  sale would be financially  inadvisable,  they may defer sale of
      the LLC assets for a reasonable  time.  If any assets are  distributed  in
      kind, then they shall be distributed on the basis of the fair market value
      thereof as determined by appraisal,  and shall be deemed to have been sold
      at such fair market value for purposes of the  allocations  under  Section
      10.  Unless  the  Members  otherwise  agree,  if  any  assets  are  to  be
      distributed  in  kind,  they  shall  be  distributed  to the  Members,  as
      tenants-in-common,  in undivided  interests in proportion to distributions
      to which the Members are entitled  under this Section 14.5.  The assets of
      the LLC,  whether  cash or in kind  shall be  distributed  as  follows  in
      accordance with the Act:

      14.5.1    to  creditors  of the LLC in the order of priority  provided by
           law; and

      14.5.2 the Members and Assignees in accordance with the positive  balances
           in their Capital Accounts, after adjustment for allocations of income
           and loss  realized  during  the year of  dissolution,  and  except as
           specifically  provided  in  Sections 3 and 11, no Member or  Assignee
           shall have any  obligation at any time to repay or restore to the LLC
           all or any  part  of any  distribution  made  to it  from  the LLC in
           accordance  with this Sections  14.5 or 11 or to make any  additional
           contribution of capital to the LLC.

      The  distributions  in this  Section  14.5 shall be made when  dissolution
      occurs,  or, if later,  within 90 days following the event  triggering the
      dissolution. The LLC shall terminate when all of its assets have been sold
      and/or distributed and all of its affairs have been wound up.

14.5  TERMINATION OF A MEMBER'S ASSOCIATION WITH THE LLC
      Should a Member no longer  have an  association  with the LLC (as  defined
      herein),  the LLC  shall  have  the  right,  but not  the  obligation,  to
      repurchase  all shares of the LLC owned by the Member,  upon demand and at
      the price originally paid by the Member for those shares.  An "association
      with the LLC" shall be defined as being an employee or  consultant  of the
      LLC, the Partnerships,  or Alliance  Semiconductor  Corporation (including
      its subsidiaries, and parent, if any).


15.   DEFINITIONS
The  following  terms  shall have the  meanings  set forth for  purposes of this
Agreement:

15.1  ACCOUNTING  PERIOD shall mean for each Fiscal Year the period beginning on
      the 1st of January and ending on the 31st of December;  provided  however,
      that the first  Accounting  Period shall commence on the date of formation
      of the LLC and shall end on December 31, 1999; and provided, further, that
      a new Accounting  Period shall commence on any date on which an Additional
      or  Substituted  Member is admitted to the LLC or a Member  ceases to be a
      Member for any reason.

15.2  ACT shall have the meaning set forth in Section 1.1.

15.3  ADDITIONAL  MEMBER shall mean a Member admitted as a Member after the date
      this Agreement becomes effective.

15.4  CAPITAL ACCOUNT shall mean, with respect to any Member, a separate account
      maintained by the LLC with respect to such Member in  accordance  with the
      following provisions:

      15.4.1    The Capital Account of each Member shall be increased by:

           15.5.1.1 the  amount  of  money  and the  fair  market  value  of any
                property  contributed  to the  LLC by  such  Member  (net of any
                liabilities  secured by such property that the LLC is considered
                to assume or hold  subject to for purposes of Section 752 of the
                Code),

           15.5.1.2 such  Member's  share of Net Income (or items  thereof)  and
                other items of LLC income and gain  allocated  to it pursuant to
                this Agreement, and

           15.5.1.3 the amount of  liabilities of the LLC assumed by such Member
                or (to the extent not taken into account under Section  15.5.1.2
                above) and any other  amounts  required by  Treasury  Regulation
                Section   1.704-1(b),   provided  that  the  Board  of  Managers
                determines  that such increase is  consistent  with the economic
                arrangement  among the Members as expressed  in this  Agreement;
                and

      15.4.2    shall be decreased by:

           15.4.2.1 the amount of money and the agreed fair market  value of any
                property  distributed by the LLC to such Member  pursuant to the
                provisions of this Agreement (net of any liabilities  secured by
                such  property  that such Member is considered to assume or hold
                subject to for purposes of Section 752 of the Code),

           15.4.2.2 such Member's share of Net Loss (or items thereof) and other
                items of LLC loss and deduction allocated to it pursuant to this
                Agreement, and

           15.4.2.3 the amount of  liabilities of such Member assumed by the LLC
                (to the extent not taken into account under 15.4.2.1  above) and
                any  other  amounts  required  by  Treasury  Regulation  Section
                1.704-1(b),  provided that the Board of Managers determines that
                such decrease is consistent with the economic  arrangement among
                the Members as expressed in this Agreement.

15.5  AGREEMENT  shall mean this LLC Agreement as the same shall be amended from
      time to time.

15.6  ARTICLES OF ORGANIZATION shall have the meaning set forth in Section 1.1.

15.7  ASSIGNEE shall mean a transferee or a Permitted  Transferee of a Units who
      has not been admitted as a Substitute Member.

15.8  BOARD OF MANAGERS shall have the meaning set forth in Section 5.1.

15.9  BANKRUPTCY  shall mean with  respect to any Person  that a petition  shall
      have  been  filed  by  or  against  such  Person  as a  "debtor"  and  the
      adjudication  of such  Person as a bankrupt  under the  provisions  of the
      bankruptcy laws of the United States of America shall have  commenced,  or
      that such  Person  shall have made an  assignment  for the  benefit of its
      creditors   generally  or  a  receiver   shall  have  been  appointed  for
      substantially all of the property and assets of such Person.

15.10 CAPITAL  CONTRIBUTION  of a Member  shall  mean  that  amount  of  capital
      actually  contributed  by the  Member  to the LLC  pursuant  to  Section 3
      hereof.

15.11 CARRIED  INTEREST  FROM  ALLIANCE  VENTURES I, L.P.  shall mean the LLC's
      right to receive (as general  partner of Alliance  Ventures I,  L.P.) 15%
      of Net Profits from  Portfolio  Investments  as set forth at Sections 3.2
      and 3.3 of the Alliance Ventures I, L.P. Partnership Agreement.

15.12 CARRIED  INTEREST FROM ALLIANCE  VENTURES II,  L.P.  shall mean the LLC's
      right to receive (as general partner of Alliance  Ventures II,  L.P.) 15%
      of Net Profits from  Portfolio  Investments  as set forth at Sections 3.2
      and 3.3 of Alliance Ventures II, L.P. Partnership Agreement.

15.13 CARRYING VALUE means,  with respect to any LLC asset, the asset's adjusted
      basis for federal income tax purposes, except as follows:

      15.13.1 The initial Carrying Value of any asset contributed by a Member to
           the LLC shall be the agreed-upon  fair market value of the asset upon
           contribution,  as determined by the contributing  Member and the LLC.
           The initial  Carrying Values of the assets  contributed to the LLC as
           Capital Contributions are set forth on Exhibit A hereto.

      15.13.2 In the discretion of the Board of Managers, the Carrying Values of
           all LLC assets may be adjusted to equal their  respective fair market
           values,  as  determined  by the Board of Managers,  and the resulting
           unrecognized  gain or loss  allocated to the Capital  Accounts of the
           Members as though such assets had been sold for their respective fair
           market values as of the following times:

           15.13.2.1 the  acquisition  of an additional  interest in the LLC by
                any new or  existing  Member  in  exchange  for more  than a de
                minimis capital contribution; and

           15.13.2.2 the  distribution  by the LLC to a Member of more than a de
                minimis  amount  of  LLC  assets,  unless  all  Members  receive
                simultaneous  distributions of either undivided interests in the
                distributed  property or identical  LLC assets in  proportion to
                their interests in the LLC.

      15.13.3 The  Carrying  Values of all LLC assets shall be adjusted to equal
           their  respective  fair market values,  as determined by the Board of
           Managers,  and the resulting  unrecognized  gain or loss allocated to
           the  Capital  Accounts  of the Members as though such assets had been
           sold for their  respective  fair  market  values as of the  following
           times:

           15.13.3.1  the date the LLC is  liquidated  within  the  meaning  of
                Treasury Regulation Section 1.704-1 (b)(2)(ii)(g); and

           15.13.3.2 the  termination  of the LLC pursuant to the provisions of
                this Agreement.

      15.13.4 The Carrying  Values of LLC assets shall be increased or decreased
           to  the   extent   required   under   Treasury   Regulation   Section
           1.704-1(b)(2)(iv)(m)  in the event that the adjusted tax basis of LLC
           assets is adjusted pursuant to Code Sections 732, 734 or 743.

      15.13.5 The Carrying Value of a LLC Asset that is distributed  (whether in
           liquidation  of the LLC or otherwise) to one or more Members shall be
           adjusted to equal its fair market  value,  as determined by the Board
           of Managers, and the resulting unrecognized gain or loss allocated to
           the  Capital  Accounts  of the  Members as though such asset had been
           sold for such fair market value.

      15.13.6 The  Carrying  Value  of a LLC  asset  shall  be  adjusted  by the
           depreciation, amortization or other cost recovery deductions, if any,
           taken into account by the LLC with respect to such asset in computing
           Net Income or Net Loss.

15.14 CODE shall mean the Internal Revenue Code of 1986, as amended.

15.15 DISSOCIATED MEMBER shall have the meaning given that term in Section 2.9.

15.16 DISSOLUTION  of a Member that is not a natural person shall mean that such
      Member has  terminated its  existence,  whether  partnership or corporate,
      wound up its affairs and dissolved;  provided,  however,  that a change in
      the  membership  of any  Member  that is a general  partnership  shall not
      constitute  "Dissolution"  hereunder,  whether or not the Member is deemed
      technically  dissolved  for  partnership  law  purposes,  so  long  as the
      business of the Member is continued.

15.17 DISSOLUTION  EVENT shall mean the death or  dissolution  of a Member,  the
      occurrence of which  terminates the Member's  continued  membership in the
      LLC and  results  in the  dissolution  of the LLC under the Act unless the
      holders of Units representing a majority of votes (determined  pursuant to
      Section 2.4) agree otherwise pursuant to Section 14.2.

15.16 FISCAL  YEAR shall mean the period  from  January 1 to December 31 of each
      year, or as otherwise required by law.

15.17 INCOMPETENCY  of a person  shall  mean that such  person  shall  have been
      judged  incompetent  or insane  by a decree  of a court or  administrative
      tribunal of appropriate jurisdiction.

15.18 INITIAL CONTRIBUTION shall have the meaning set forth in Section 3.1.

15.19 MARKETABLE SECURITY shall refer to a security that is (a) registered under
      the  Securities  Act,  (b) traded on a  national  securities  exchange  or
      over-the-counter,  (c) currently the subject of an issuer-filed Securities
      Act registration  statement,  (d) a direct obligation of, or an obligation
      guaranteed  as  to  principal  and  interest  by,  the  United  States,  a
      certificate  of  deposit  maturing  within  one year or less  issued by an
      institution  insured by the Federal Deposit  insurance  Corporation,  or a
      similar security, or (e) transferable pursuant to SEC Rule 144.

15.20 MEMBERS shall mean all Members of the LLC, including  Substitute  Members,
      and Additional Members, but does not include Assignees.

15.21 NET INCOME OR NET LOSS  shall mean the net book  income or loss of the LLC
      for any relevant  period.  The net book income or loss of the LLC shall be
      computed in accordance with Federal income tax principles under the method
      of accounting  elected by the LLC for Federal income tax purposes,  and as
      otherwise adjusted by:

      15.21.1 including as income or deductions, as appropriate,  any tax-exempt
           income and related expenses that are neither properly included in the
           computation of taxable income nor  capitalized for Federal income tax
           purposes;

      15.21.2 including as a deduction  when paid or incurred  (depending on the
           LLC's method of accounting) any amounts  utilized to organize the LLC
           or to promote the sale of (or to sell) an interest in the LLC, except
           that amounts for which an election is properly  made by the LLC under
           Section  709(b)  of the  Code  shall  be  accounted  for as  provided
           therein;

      15.21.3  including  as a  deduction  any  losses  incurred  by the  LLC in
           connection with the sale or exchange of property notwithstanding that
           such  losses  may be  disallowed  to the LLC for  Federal  income tax
           purposes  under the related party rules of the Code  (including  Code
           Sections 267(a)(1) or 707(b));

      15.21.4 calculating  the gain or loss on disposition of LLC assets and the
           depreciation,  amortization  or other cost- recovery  deductions,  if
           any, with respect to LLC assets by reference to their  Carrying Value
           rather than their adjusted tax basis; and

      15.21.5 excluding as an item of income,  gain, loss or deduction any items
           allocated pursuant to Section 10.2 of this Agreement.

15.22 PARTNERSHIPS shall mean Alliance  Ventures I,  L.P., a California limited
      partnership  and  Alliance   Ventures II,   L.P.,  a  California  limited
      partnership.

15.23 PERMITTED  TRANSFER  shall  have the  meaning  set forth in  Section 12.4
      hereof.

15.24 PERSON  shall  mean a natural  person,  partnership  (whether  general  or
      limited and whether domestic or foreign),  LLC, foreign limited  liability
      company, trust, estate, association,  corporation,  custodian,  nominee or
      any other individual or entity in its own or representative capacity.

15.25 SUBSTITUTE  MEMBER shall mean an Assignee who has been admitted to all the
      rights of membership pursuant to this Agreement.

15.26 TRANSFER shall mean any transfer, sale, encumbrance,  mortgage, assignment
      or other disposition.

15.27 TREASURY REGULATIONS shall mean regulations issued pursuant to the Code.

15.28 UNIT REGISTER shall have the meaning set forth in Section 8.4.


16.   MISCELLANEOUS

16.1  AMENDMENT
      This  Agreement  may be  amended  only with the  consent  of the  Members;
      provided  however,  that no amendment that adversely affects the rights of
      one class of Units in a manner  different  than that of  another  class of
      Units shall be  effective  against any holder of such  adversely  affected
      Units who has not consented thereto.

16.2  POWER OF ATTORNEY
      By signing  this  Agreement,  each  Member  designates  and  appoints  the
      Managers as its or his true and lawful  attorney,  in his name,  place and
      stead,  to make,  execute,  sign and file such  instruments,  documents or
      certificates  which may from time to time be  required  by the laws of the
      United  States of America and the State of  California  and any  political
      subdivision  thereof or any other state or political  subdivision in which
      the LLC shall do  business to carry out the  purposes  of this  Agreement,
      except  where such action  requires  the  express  approval of the Members
      hereunder.  Such attorney is not hereby granted any authority on behalf of
      the  undersigned  Members to amend this Agreement  except that as attorney
      for each of the undersigned Members, the Managers shall have the authority
      to amend this Agreement and the LLC's Articles of  Organization  as may be
      required to give effect to the transactions  below following any necessary
      approvals or consents of the Members:

      16.2.1    extensions of the term of the LLC;

      16.2.2    admissions of additional Members;

      16.2.3    transfer of a Member's Units;

      16.2.4    withdrawals or distributions; and

      16.2.5    contributions of additional capital.

      The Managers shall provide to the Members copies of all documents executed
      pursuant to the power of attorney contained in this Section 16.2.

16.3  WITHHOLDING TAXES

      16.3.1 The LLC  shall  at all  times be  entitled  to make  payments  with
           respect to any Member or  Assignee in amounts  required to  discharge
           any  obligation  of the  LLC to  withhold  or  make  payments  to any
           governmental  authority with respect to any federal,  state, local or
           other jurisdictional tax liability of such Member or Assignee arising
           as a result of such Member or Assignee's  interest in the LLC. To the
           extent  each  such  payment  satisfies  an  obligation  of the LLC to
           withhold with respect to any  distribution to a Member or Assignee on
           which the LLC did not  withhold  or with  respect to any  Member's or
           Assignee's  allocable  share  of the  income  of the LLC,  each  such
           payment  shall be  deemed  to be a loan by the LLC to such  Member or
           Assignee  (which  loan  shall be  deemed  to be  immediately  due and
           payable)  and shall not be deemed a  distribution  to such  Member or
           Assignee.  The  amount of such  payments  made with  respect  to such
           Member or Assignee,  plus interest, on each such amount from the date
           of each such  payment  until  such  amount is repaid to the LLC at an
           interest rate per annum equal to the prime rate, from time to time in
           effect, of the Bank of California, San Francisco,  California,  shall
           be repaid to the LLC by:

           16.3.1.1  deduction from any cash  distributions made to such Member
                or Assignee pursuant to this Agreement;

           16.3.1.2  deduction  from any  non-cash  distributions  made to such
                Member or Assignee; or

           16.3.1.3  earlier  payment by such  Member or Assignee to the LLC, in
                each  case  as   determined   by  the  Managers  in  their  sole
                discretion.

           The Managers may, in their discretion,  defer making distributions to
           any Member or  Assignee  owing  amounts to the LLC  pursuant  to this
           Section  16.3  until  such  amounts  are paid to the LLC and shall in
           addition exercise any other rights of a creditor with respect to such
           amounts.

      16.3.2 Each Member or Assignee  agrees to indemnify  and hold harmless the
           LLC and the Managers  and each of the  Members,  from and against any
           liability  for taxes,  interest or penalties  that may be asserted by
           reason  of  the  failure  to  deduct  and  withhold  tax  on  amounts
           distributable  or allocable  to said Member or  Assignee.  Any amount
           payable as indemnity  hereunder by a Member or Assignee shall be paid
           promptly to the LLC upon request for such payment from the  Managers,
           and if not so paid,  the  Managers  and the LLC shall be  entitled to
           claim  against and deduct all such amounts  from the Capital  Account
           of, or from any distribution due to, the affected Member or Assignee.

16.4  FURTHER ASSURANCES
      The  parties  agree to execute and  deliver  any  further  instruments  or
      documents and perform any additional acts that are or may become necessary
      to effectuate and carry on the LLC created by this Agreement.

16.5  BINDING EFFECT
      Subject to the  restrictions  on  transfer  set forth in Section  12, this
      Agreement shall be binding on and inures to the benefit of the Members and
      their   respective    transferees,    successors,    assigns   and   legal
      representatives.

16.6  GOVERNING LAW
      This  Agreement  shall be governed by and construed  under the laws of the
      State of California as applied to agreements  among  California  residents
      entered into and to be performed entirely within California.

16.7  ENTIRE AGREEMENT
      This Agreement  constitutes  the entire  agreement  among the parties with
      respect to the subject matter herein.

16.8  ARBITRATION
      Any controversy or claim arising out of or relating to this Agreement,  or
      the breach thereof,  shall be settled by arbitration in Santa Clara or San
      Mateo County,  California in accordance with the rules then obtaining,  of
      the American Arbitration  Association  regarding  commercial  arbitration.
      Judgment  upon the award  rendered  may be entered  into any court  having
      jurisdiction  thereof.  The losing party shall bear the costs and expenses
      of such arbitration.



<PAGE>


16.9  COUNTERPARTS
      This Agreement may be executed in one or more  counterparts  with the same
      force  and  effect as if each of the  signatories  had  executed  the same
      instrument.

IN WITNESS  WHEREOF,  the parties hereto have caused this Agreement to be signed
as of the date first above written.

Members:

By:  /s/ N.Damodar Reddy              By: /s/ C.N. Reddy
     ----------------------------         ---------------------------
     signature                            signature

N. Damodar Reddy                      C.N. Reddy
---------------------------------     -------------------------------
printed name                          printed name

By:  /s/ V.R. Ranganath               By: /s/ Bradley Perkins
     ----------------------------         ---------------------------
     signature                            signature

V.R. Ranganath                        Bradley Perkins
---------------------------------     -------------------------------
printed name                          printed name

By:  /s/ David Eichler
     ----------------------------
     signature

David Eichler
---------------------------------
printed name

Alliance Semiconductor
Corporation

By:  /s/ N.Damodar Reddy
     ----------------------------
     signature of authorized
     representative

N. Damodar Reddy
---------------------------------
printed name

President and CEO
---------------------------------
title


<PAGE>

                                   Exhibit A
                            Members and Unit Holdings
<TABLE>
<CAPTION>



Member                           Number of Units    Initial Carrying Value
-------------------------------------------------------------------------------

<S>                          <C>                      <C>
Alliance Semiconductor       10,000 Common Units      $2,500.00
Corporation

N. Damodar Reddy             10,000 Series A Units    $2,500.00
                             10,000 Series B Units    $2,500.00

C.N. Reddy                   10,000 Series A Units    $2,500.00
                             10,000 Series B Units    $2,500.00

V.R. Ranganath               10,000 Series A Units    $2,500.00
                             10,000 Series B Units    $2,500.00

Bradley Perkins                 632 Series A Units      $158.00
                               1000 Series B Units      $250.00

David Eichler                   421 Series A Units      $105.25
                                764 Series B Units      $191.00

</TABLE>