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                                                                   Exhibit 10.17


                              EMPLOYMENT AGREEMENT






                  THIS AGREEMENT, dated as of February 21, 1996, is entered into
by and between Tandem Computers Incorporated ("Employer") and John T. Losier
("Executive"), and supersedes and replaces any prior employment agreement
previously entered into between Employer or any subsidiary thereof and
Executive.

                  In consideration of the respective undertakings of Employer
and Executive set forth below, Employer and Executive agree as follows:

                  1. Employment. Employer hereby employs Executive, and
Executive accepts such employment and agrees to perform services for Employer,
for the period and upon the other terms and conditions set forth in this
Agreement.

                  2. Term of Employment.

                     2.01 Period of Employment. The initial term of Executive's
employment pursuant to this Agreement will commence on March 1, 1996 (the
"Commencement Date") and, unless terminated at an earlier date in accordance
with Section 5.01 of this Agreement, shall continue in effect until September
30, 1998 or as extended to a later date under Section 5.03(a) or 5.03(e) of this
Agreement. The term of Executive's employment under the terms of this Agreement
commencing on the Commencement Date and ending pursuant to the terms hereof is
hereinafter referred to as the "Period of Employment." The initial Period of
Employment under this Agreement shall be subject to possible extension in twelve
month increments in the sole discretion of Employer as follows. Prior to
September 1 of each year during the Executive's Period of Employment, Employer
may elect (which election shall be made in writing), in its sole discretion, to
terminate Executive's employment on the third succeeding September 30. If no
such election is made, the term of Executive's employment pursuant to the terms
of this Agreement shall be automatically extended for an additional twelve month
period, under the terms and conditions in effect at the time of such extension,
or with such modifications as Employer and Executive may then agree.

                     2.02 Expiration of Employment. Executive may continue
employment with Employer after the expiration of the Period of Employment in
which case Executive's employment relationship with Employer will be governed by
such other terms as Executive and Employer may agree or as may apply under
applicable law, and Executive's only rights continuing under this Agreement
shall be those rights that have vested during the Period of Employment or
otherwise continue after the Period of Employment under Section 5.03 or other
express terms of this Agreement.


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         3.       Position and Duties.

                  (a)      During the Period of Employment, Executive agrees to
                           perform such duties and executive functions as
                           Employer shall assign to him from time to time and
                           shall have the title of Senior Vice President and
                           General Manager of Worldwide Sales. Executive shall
                           devote his best efforts and (except as provided in
                           Section 5.03(e) hereof) full-time attention to the
                           performance of his duties.

                  (b)      Except upon the prior written consent of Employer,
                           Executive, during the Period of Employment, shall not
                           (i) accept any other employment; or (ii) engage,
                           directly or indirectly, in any other business,
                           commercial or professional activity (whether or not
                           pursued for pecuniary advantage) that is or may be
                           competitive with Employer, that might create a
                           conflict of interest with Employer, or that otherwise
                           might interfere with the business of Employer, or any
                           affiliate of Employer.

         4.       Compensation.

                  4.01 Base Salary. Employer will pay to Executive during the
Period of Employment an annual base salary to be paid in substantially equal
installments in accordance with Employer's standard payroll procedures and
policies. The initial annual base salary will be at the rate currently being
paid to Executive, and the annual base salary may be increased from time to time
in the sole discretion of Employer (and may not be decreased except pursuant to
a reduction comparable to reductions generally applicable to similarly situated
employees of Employer imposed as part of a company wide cost-savings
initiative).

                  4.02 Annual Bonus. During the Period of Employment, Executive
will be entitled to participate in Employer's Targeted Income Plan, or any other
bonus plan or program made generally available to Employer's senior executives
(the "Plan"). The award of an annual bonus shall be subject to the terms and
provisions of the Plan, which may be modified from time to time, and the
Executive's annual incentive target bonus may be increased in the sole
discretion of Employer (and may not be decreased except pursuant to a reduction
comparable to reductions generally applicable to similarly situated employees of
Employer imposed as part of a company wide cost-savings initiative).

                  4.03 Stock Options. During the Period of Employment, Executive
will be eligible to receive grants of Employer's stock options or other stock
incentive awards under programs which are made generally available to Employer's
senior executives from time to time. Such grants are highly discretionary and
will be subject to the terms of the applicable plans and agreements adopted by
Employer from time to time.


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                  4.04 Participation in Other Benefit Plans. During the Period
of Employment, Executive will be entitled to participate in Employer's
retirement plans, medical and dental plans, disability plans, life insurance
plans, and other Employer benefits not described elsewhere in this Section 4
which are made generally available to Employer's senior executives from time to
time to the extent that Executive's age, position and other factors qualify him
for such benefits.

                  4.05 Fringe Benefits and Perquisites: Vacation and Sick Leave.
During the Period of Employment, Employer will provide Executive with such
fringe benefits, perquisites, vacation and sick leave as Employer from time to
time makes generally available to its senior executives.

         5.       Termination and Change in Control.

                  5.01 Grounds for Termination. The Period of Employment will
terminate prior to the expiration of the term set forth in Section 2 of this
Agreement in the event that:

                  (a)      Executive dies.

                  (b)      Executive becomes permanently disabled and qualifies
                           for payments under Employer's disability plans for a
                           period covering 90 consecutive days.

                  (c)      Employer terminates the Period of Employment for
                           Cause. "Cause" means termination upon (i) willful and
                           substantial failure by Executive to perform his
                           duties with Employer (other than due to disability);
                           (ii) willful engaging by Executive in conduct which
                           is demonstrably and materially injurious to Employer
                           or that demonstrates gross unfitness for service;
                           (iii) Executive's conviction of a felony which
                           impairs his ability substantially to perform his
                           duties with Employer or other felony involving
                           dishonesty or breach of trust; or (iv) any material
                           breach by Executive of the terms of this Agreement.
                           Executive will not be subject to termination for
                           "Cause" without (A) reasonable written notice to
                           Executive setting forth the reasons for Employer's
                           intention to terminate Executive and (B) an
                           opportunity for Executive to cure any of the actions
                           or omissions forming the basis for such intended
                           termination, if possible, within 15 days after
                           receipt of such written notice.

                  (d)      Executive terminates the Period of Employment for
                           Good Reason. "Good Reason" means termination by
                           Executive due to (i) a material reduction in
                           Executive's position (status, offices, titles, or
                           reporting requirements) , authorities, duties or
                           responsibilities; (ii) a reduction in Executive's
                           annual base salary or target annual bonus, other than
                           a reduction comparable to 


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                           reductions generally applicable to similarly situated
                           employees of Employer imposed as part of a company
                           wide cost-savings initiative; (iii) a requirement for
                           Executive to move his principal office in excess of
                           30 miles from the present location of Executive's
                           principal office; or (iv) any material breach by
                           Employer of the terms of this Agreement. Executive
                           may not terminate his employment for "Good Reason"
                           without (A) reasonable written notice to Employer
                           setting forth the reasons for Executive's intention
                           to terminate employment and (B) an opportunity for
                           Employer to cure any of the actions or omissions
                           forming the basis for such intended termination, if
                           possible, within 15 days after receipt of such
                           written notice.

                  (e)      Employer terminates the Period of Employment without
                           Cause, other than pursuant to Section 5.01(a) or (b)
                           above.

                  (f)      Executive voluntarily terminates the Period of
                           Employment without Good Reason, other than pursuant
                           to Section 5.01(a) or (b) above.

             5.02 Effect of Termination.

                  (a)      In the event of termination of the Period of
                           Employment pursuant to the provisions of Section
                           5.01(a) above, Executive's estate will be entitled to
                           be paid the annual base salary otherwise payable to
                           Executive pursuant to Section 4.01 of this Agreement
                           only through the date of termination, and Employer
                           will continue to provide Executive with the benefits
                           described in Sections 4.04 and 4.05 above through the
                           date of termination. In addition, Executive's
                           beneficiaries will be entitled to any benefits
                           provided under Employer's life insurance plans.

                  (b)      In the event of termination of the Period of
                           Employment pursuant to the provisions of Section
                           5.01(b) above, Executive will be entitled to be paid
                           the annual base salary otherwise payable to Executive
                           pursuant to Section 4.01 of this Agreement only
                           through the date of termination, and Employer will
                           continue to provide Executive with the benefits
                           described in Sections 4.04 and 4.05 above through the
                           date of termination. Executive will also be entitled
                           to benefits in accordance with the terms and
                           conditions of Employer's disability plans.

                  (c)      In the event of termination of the Period of
                           Employment pursuant to the provisions of Section
                           5.0l(c) or (f) above, Employer will have no further
                           obligations 


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                           hereunder, except that (i) Employer will pay
                           Executive his annual base salary and continue to
                           provide Executive with the benefits described in
                           Sections 4.04 and 4.05 above through the date of
                           termination and shall remain obligated under Sections
                           5.03(h) and the first and third sentences of Section
                           7.06(a), and (ii) in the event of a termination
                           pursuant to Section 5.01(f) because Executive does
                           not accept Employer's offer under clause (A) of
                           Section 5.03(e)(ii), Employer shall remain obligated
                           under Section 5.03(c)(v) and (viii). Executive will
                           not be paid any annual bonus pursuant to Section 4.02
                           of this Agreement for the fiscal year in which the
                           termination occurs or any subsequent fiscal year,
                           unless otherwise provided in section 5.03(e).

                  (d)      In the event of termination of the Period of
                           Employment pursuant to the provisions of Section
                           5.01(d) or (e) above, Employer will (i) pay Executive
                           his annual base salary through the date of
                           termination at the rate in effect at the time notice
                           of termination is given; (ii) pay Executive a
                           pro-rated annual bonus for the fiscal year in which
                           termination occurs for the portion of the fiscal year
                           prior to the date of termination, based on Employer's
                           performance through the end of the fiscal quarter in
                           which the termination occurs; (iii) (except as
                           provided in section 5.03(f)) pay to Executive, not
                           later than 30 days following the date of termination,
                           a lump sum payment equal to three times the sum of
                           (A) Executive's annual base salary at the rate in
                           effect at the time notice of termination is given
                           plus (B) Executive's annual incentive target bonus
                           under the Plan at the time notice of termination is
                           given as if such bonus in paid at 100% of the
                           potential payout under such Plan; (iv) continue to
                           provide for a period of three years from the date of
                           termination the benefits described in Section 4.04
                           (with disability benefits to be calculated as of the
                           date of termination) to which Executive was entitled
                           on the date of termination; (v) continue to provide
                           for a period of three years from the date of
                           termination the fringe benefits and perquisites
                           described in Section 4.05 to which Executive was
                           entitled on the date of termination; (vi) (except as
                           provided in section 5.03(e)) make a lump sum payment
                           to Executive in the amount of $500,000.00 or, in the
                           alternative, if Executive elects in writing within
                           thirty (30) days from commencement of employment, a
                           $500,000.00 one hundred percent (100%) vested
                           Employer contribution to the Tandem Computers
                           Incorporated Deferred Compensation Plan; (vii) pay
                           for individual outplacement counseling services to
                           Executive up to a maximum of $50,000; and 


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                           (viii) extend any Employer loan guarantees and renew
                           any Employer loans to Executive for a period of three
                           years from the date of termination.

                  (e)      Notwithstanding any other provision of this
                           Agreement, Employer shall have the right in its sole
                           discretion at any time, upon notice to Executive, to
                           terminate Executive's employment without Cause as
                           provided in Section 5.01(e). In the event of any such
                           termination, Employer may condition making payment of
                           the amounts contemplated to be paid under this
                           Agreement upon Executive's execution and delivery of
                           a release and settlement agreement in favor of
                           Employer of all claims by Executive for payments
                           under this Agreement or otherwise arising out of
                           Executive's employment with Employer, except for any
                           claims which Executive may have based on race, sex or
                           age discrimination. Any decision of Employer to
                           terminate Executive's employment without Cause shall
                           not be subject to arbitration under this Agreement,
                           nor may a termination without Cause be challenged for
                           any reason in any court of law or before any federal
                           or state administrative agency or in any other legal
                           proceeding; provided that nothing in this paragraph
                           (e) shall preclude arbitration of any claim for
                           failure to pay amounts owed to Executive as expressly
                           provided herein.

             5.03 Provisions For Change In Control. The following special
provisions will apply in connection with a Change in Control which is publicly
announced during the Period of Employment. As used in this Agreement, "Change in
Control" shall have the meaning given to it in Section 7.12. Unless otherwise
expressly provided, the benefits under this Section 5.03 will be in addition to
all other benefits to which Executive may be entitled under other provisions of
this Agreement.

                  (a)      When Employer publicly announces during the Period of
                           Employment execution by Employer of a letter of
                           intent or definitive agreement to consummate a
                           transaction that would constitute a Change in
                           control, Employer will pay to Executive a special
                           incentive bonus in the amount of $300,000.00. The
                           period following such announcement until the Change
                           in Control occurs or the transaction is abandoned
                           shall be included within the period of Employment for
                           all purposes of this Agreement, and the Period of
                           Employment shall thereby be extended to the
                           expiration of such period.

                  (b)      Upon the change in Control contemplated by the
                           announcement described in Section 5.03(a), if
                           Executive has remained in Employer's employment
                           through the Change in Control or Executive's
                           employment is terminated after the announcement
                           described in Section 


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                           5.03(a) either by Employer without Cause or by
                           Executive for Good Reason, Employer will pay to
                           Executive a special extraordinary efforts bonus for
                           special efforts to accomplish the successful
                           consummation of the Change in Control transaction.

                  (c)      Upon the Change in Control aforementioned in Section
                           5.03(b), if Executive has remained in Employer's
                           employment through the Change in Control or
                           Executive's employment is terminated after the
                           announcement described in Section 503(a) either by
                           Employer without Cause or by Executive for Good
                           Reason, Employer shall use its best efforts to cause
                           all stock options then held by Executive which have
                           not yet vested to be assumed by the acquiring
                           company, or to cause stock options with similar terms
                           and conditions in the acquiring company to be
                           substituted therefor, and, in either case, Executive
                           shall continue to vest in such stock options in the
                           acquiring company in accordance with their terms
                           during additional employment and consulting periods
                           described in paragraph (e) below and during such
                           other periods as may apply pursuant to the terms of
                           such stock options. The time to exercise any stock
                           options in the acquiring company shall not terminate
                           before 90 days following the end of the additional
                           employment and consulting periods described in
                           paragraph (e) below.

                  (d)      Upon the Change in Control aforementioned in Section
                           5.03(b), if Executive has remained in Employer's
                           employment through the Change in Control or
                           Executive's employment is terminated after the
                           announcement described in Section 5.03(a) either by
                           Employer without Cause or by Executive for Good
                           Reason, Employer will pay to Executive the full
                           (instead of pro-rated) annual bonus which would be
                           payable to Executive for the entire fiscal year in
                           which the Change in Control occurs, based on the
                           assumption that Employer would have continued to
                           perform for the full fiscal year at the same level of
                           performance which it had achieved through the date of
                           the Change in Control. All special payments which are
                           made and expenses which are incurred on account of
                           the Change in Control will be disregarded in
                           measuring Employer's performance. Upon receipt of
                           such payment, Executive shall not thereafter be
                           entitled to receive any payment pursuant to Section
                           5.02 (d) (ii).

                  (e)      (i)      Employer agrees to employ Executive, and 
                                    Employee hereby accepts employment, as a
                                    full-time employee for the first six months
                                    following the Change in Control
                                    aforementioned in Section 3.03(b) and to 


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                                    pay Executive (I) a monthly base salary at
                                    twice the monthly rate of base salary in
                                    effect immediately prior to the change in
                                    Control and (II) a bonus equal to
                                    Executive's annual incentive target bonus
                                    under the Plan at the time of the Change in
                                    Control (for the entire fiscal year in which
                                    the change in control occurs) as if such
                                    bonus is paid at 100% of the potential
                                    payout under such Plan.

                           (ii)     Employer further agrees to offer to retain
                                    Executive during the second six months
                                    following the Change in Control either:

                                    (A)      as a full-time employee, in which
                                             event Employer will pay Executive
                                             seventy-five percent (75%) of the
                                             monthly base salary and bonus which
                                             is payable to Executive under the
                                             preceding sentence during the first
                                             six months following the Change in
                                             Control, or

                                    (B)      as a part-time consultant or
                                             employee, in which event Employer
                                             will pay Executive fifty percent
                                             (50%) of the monthly base salary
                                             and bonus which is payable to
                                             Executive under the preceding
                                             sentence during the first six
                                             months following the Change in
                                             Control.

                           (iii)    If Employer does not offer to retain
                                    Executive as a full-time employee pursuant
                                    to subparagraph (ii)(A) above, such action
                                    by Employer shall be deemed to be a
                                    termination of Executive's employment by
                                    Employer without Cause for purposes of this
                                    Agreement, including Section 5.03(f) below;
                                    provided, however, that nothing in this
                                    Section 5.03(e) shall affect or interfere
                                    with Employer's right to terminate Executive
                                    for Cause during Executive's full-time
                                    employment in accordance with the provisions
                                    of Section 5.01(c).

                           (iv)     If Employer does offer to retain Executive
                                    as a full-time employee pursuant to
                                    subparagraph (ii)(A) above, and Executive
                                    accepts such offer and is employed as a
                                    full-time employee for such second six-month
                                    period, the Period of Employment will expire
                                    on the first anniversary of the Change in
                                    Control. Executive's employment with
                                    Employer shall continue thereafter at the
                                    level of monthly base salary and bonus which
                                    were in effect immediately prior to the
                                    Change in Control, or upon such other terms
                                    as Employer and Executive may agree, until
                                    terminated for any reason. 


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                           (v)      If Employer does offer to retain Executive
                                    as a full-time employee pursuant to
                                    subparagraph (ii)(A) above, and Executive
                                    does not accept such offer, Executive may
                                    elect to be a part-time employee or
                                    consultant during the second six months
                                    following the Change in Control on the terms
                                    described in subparagraph (ii)(B) above. If
                                    Executive elects such position as a
                                    part-time employee or consultant, his
                                    employment with Employer sha11 terminate
                                    upon the expiration of such second six-month
                                    period. Such election by Executive shall be
                                    deemed to be a voluntary termination of
                                    employment by Executive without good Reason
                                    at the end of such second six month period
                                    for purposes of this Agreement, including
                                    section 5.03(f) below; provided, however,
                                    that nothing in this section 5.03(e) shall
                                    affect or interfere with Executive's right
                                    to terminate employment for Good Reason
                                    during Executive's full-time employment in
                                    accordance with the provisions of Section
                                    5.01(d).

                           (vi)     The Period of Employment shall be extended
                                    to the expiration of both such six month
                                    periods described in subparagraphs (e)(i)
                                    and (ii) above, unless and until Executive
                                    declines Employer's offer of full or
                                    part-time employment or consultancy as
                                    described in subparagraphs (e)(i) and (ii)
                                    above, provided, that the compensation and
                                    bonus payments described in subparagraphs
                                    (e)(i) and (ii) above shall be in lieu of
                                    all amounts otherwise owing pursuant to
                                    Sections 4.01 or 4.02 hereof with respect to
                                    such periods.

                           (vii)    If Executive is employed as a full-time
                                    employee for the first six months and
                                    retained as a full or part-time employee or
                                    consultant for the second six months after
                                    the Change in Control under the terms
                                    described above in this paragraph (e), and
                                    Employer performs its obligations under this
                                    paragraph (e), Executive shall not be
                                    entitled to receive any contribution or
                                    payment pursuant to Section 5.02(d)(vi).

                           (viii)   Upon any breach of Employer's obligations
                                    under this paragraph (e) (which breach
                                    continues following written notice by
                                    Executive and the expiration of a reasonable
                                    opportunity for cure), Executive shall be
                                    entitled to receive the payment or
                                    contribution specified in Section
                                    5.02(d)(vi), in addition to the amounts
                                    provided in section 5.03(f) below to the
                                    extent applicable. 


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                  (f)      In the event of termination of Executive's employment
                           by Employer without Cause (other than due to
                           Executive's death or permanent disability) or by
                           Executive for Good Reason at any time within 36
                           months after the Change in Control aforementioned in
                           Section 5.03(b), Employer will pay to Executive, not
                           later than 30 days following the date of termination,
                           a lump sum Payment equal to two and one-half times
                           the sum of (A) Executive's annual base salary at the
                           rate in effect immediately prior to the Change in
                           Control plus (B) Executive's annual incentive target
                           bonus under the Plan at the time of the Change in
                           Control as if such bonus is paid at 100% of the
                           potential payout under such Plan. Upon receipt of
                           such payment, Executive shall not be entitled to
                           receive any payment pursuant to Section 5.02(d)(iii).

                  (g)      In the event of termination of Executive's employment
                           by Employer without Cause (other than due to
                           Executive's death or permanent disability) or by
                           Executive for Good Reason any time within 36 months
                           after the Change in Control aforementioned in Section
                           5.03(b), Employer will continue to provide the
                           benefits described in Sections 5.02(d)(iv) and (v)
                           for a period of three years from the date of
                           termination and will pay for individual outplacement
                           counseling services described in Section
                           5.02(d)(vii). If Employer is unable for any reason to
                           continue Executive's coverage under its medical
                           benefits plan, Employer shall provide equivalent
                           benefits coverage through insurance.

                  (h)      In the event a Change in Control occurs and Executive
                           becomes entitled to payments under this Agreement,
                           Employer shall cause its independent auditors
                           promptly to review, at Employer's sole expense, the
                           applicability to such payments of Section 4999 of the
                           Internal Revenue Code of 1986, as amended (the
                           "Code"). If such auditors shall determine that any
                           payment or distribution of any type by Employer to
                           Executive or for his benefit, whether paid or payable
                           or distributed or distributable pursuant to the terms
                           of this Agreement or otherwise (the "Total
                           Payments"), would be subject to the excise tax
                           imposed by Section 4999 of the Code, or any interest
                           or penalties with respect to such excise tax (such
                           excise tax, together with any such interest and
                           penalties are collectively referred to as the "Excise
                           Tax"), then Executive shall be entitled to receive an
                           additional cash payment from Employer (a "Gross-Up
                           Payment") within 30 days of such determination equal
                           to an amount such that after payment by Executive of
                           all taxes (including any interest or penalties
                           imposed with respect to such taxes), including any
                           Excise Tax and employment taxes imposed upon the
                           Gross-Up Payment, Executive would retain an amount of
                           the Gross-Up Payment equal to the Excise Tax imposed
                           upon the Total Payments; provided, however, that
                           Executive will 


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                           be entitled to receive a Gross-Up Payment only if the
                           amount of the payment defined in Section 28OG(b)(2)
                           of the Code exceeds the sum of (A) $100,000 plus (B)
                           2.99 times the Executive's "base amount" as defined
                           in Section 28OG(b)(3) of the Code, and provided
                           further, that if Executive is not entitled to receive
                           a Gross-Up payment, Executive will receive only an
                           amount of Total Payments that would not include any
                           payment defined in Section 28OG(b)(1) of the Code.
                           For purposes of the foregoing determination,
                           Executive's income tax rate shall be deemed to be the
                           highest statutory marginal Federal and California
                           income tax rates (on a combined basis) applicable to
                           individuals which are then in effect. Employer's
                           independent auditors shall make their determination
                           based upon a substantial authority standard under
                           Section 6662 of the Code. The intent of the parties
                           is that Employer shall be solely responsible for, and
                           shall pay, any Excise Tax on the Total Payments and
                           Gross-up Payment and any income and employment taxes
                           (including, without limitation, penalties and
                           interest) imposed on any Gross-Up Payment, as well as
                           any loss of tax deduction caused by the Gross-Up
                           Payment. An example of the calculation of the
                           Gross-Up Payment is set forth in Appendix A. If no
                           determination by Employer's auditors is made prior to
                           the time a tax return reflecting any portion of the
                           Total Payments is required to be filed by Executive,
                           Executive will be entitled to receive a Gross-Up
                           Payment calculated on the basis of the Total Payments
                           reported by Executive in such tax return, within 30
                           days of the filing of such tax return. In all events,
                           if any tax authority determines that a greater Excise
                           Tax should be imposed upon the Total Payments than is
                           determined by Employer's independent auditors or
                           reflected in Executive's tax returns, Executive shall
                           be entitled to receive the full Gross-Up Payment
                           calculated on the basis of the amount of Excise Tax
                           determined to be payable by such tax authority from
                           Employer within 30 days of such determination.

         6. Taxes. All payments to be made to Executive under this Agreement
will be net of required withholding of federal, state income and employment
taxes.

         7. Miscellaneous.

            7.01 Governing Law. This Agreement is made under and shall be
governed by and construed in accordance with the laws of the State of
California.

            7.02 Successors. This Agreement shall be binding upon and
inure to the benefit of Executive and Executive's heirs and estate and of
Employer and its successors. Employer will require any successor (whether by
purchase, merger, consolidation, or otherwise) to all or substantially all of
the business and/or assets of Employer to expressly assume this 


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Agreement. Failure of Employer to obtain such assumption of this Agreement prior
to the consummation of any such succession shall be a breach of this Agreement.
In any case where a successor assumes Employer's obligations under this
Agreement by operation of law, the requirements imposed in thus Section 7.02
will be satisfied if the successor acknowledges to Executive in writing that it
shall assume or has assumed Employer's obligations under this Agreement by
operation of law within 30 days of receipt of a written notice from Executive
requesting such acknowledgment.

                  7.03 Amendments. No amendment or modification of this
Agreement will be deemed effective unless made in writing and signed by each
party hereto.

                  7.04 No Waiver. No term or condition of this Agreement will be
deemed to have been waived, nor will there by any estoppel to enforce any
provisions of this Agreement, except by a statement in writing signed by the
party against whom enforcement of the waiver or estoppel is sought. Any written
waiver will not be deemed a continuing waiver unless specifically stated, will
operate only as to the specific term or condition waived and will not constitute
a waiver of such term or condition for the future or as to any act other than
that specifically waived.

                  7.05 Assignment. This Agreement is not assignable, in whole or
in part, by any party without the written consent of the other party.

                  7.06 Legal and Accounting Fees.

                       (a)      Employer will pay legal and accounting fees
                                charged by Munger, Tolles & Olson and Price
                                Waterhouse in connection with entering into
                                this Agreement. In addition, upon
                                Executive's request, Employer will also pay
                                or reimburse Executive for the cost, not to
                                exceed $15,000, of professional accounting
                                and tax services in connection with the
                                receipt of payments under Section 5.03 of
                                this Agreement unless the Period of
                                Employment terminated under Section 5.01(c)
                                or (f). Employer will make a tax gross-up
                                payment to Executive, if necessary, to
                                offset any taxable income which is reported
                                for or realized by Executive with respect to
                                these legal and accounting fees.

                       (b)      Each party will bear its own legal and
                                accounting fees in connection with any claim
                                or dispute arising out of or relating to
                                this Agreement.

                  7.07 Severability. To the extent that any provision of this
Agreement shall be determined to be invalid or unenforceable, the invalid or
unenforceable portion of such provision will be deleted from this Agreement, and
the validity and enforceability of the remainder of such provision and of this
Agreement will not be affected.

                  7.08 Notices. All notices under this Agreement will be in


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<PAGE>   13
writing and will be deemed effective when delivered in person (in Employer's
case, to its Secretary) or twenty four (24) hours after deposit thereof in the
U.S. mails, postage prepaid, for delivery as registered or certified mail --
addressed, in the case of Executive, to him at his last residential address
known by Employer and, in the case of Employer, to its corporate headquarters,
attention to its Secretary, or to such other address as Executive or Employer
may designate in writing at any time or from time to time to the other party. In
lieu of notice by deposit in the U.S. mails, a party may give notice by
telegram, telex or telecopy, in which case such notice will be deemed effective
upon receipt.

                  7.09 Counterparts. This Agreement may be executed by the
parties hereto in counterparts, each of which will be deemed to be an original,
but all such counterparts will together constitute one and the same instrument.

                  7.10 Headings. The headings of sections herein are included
solely for convenience of reference and shall not control the meaning or
interpretation of any of the provisions of this Agreement.

                  7.11 Arbitration.

                       (a)      All disputes between Executive (and his
                                attorneys, successors, and assigns) and
                                Employer (and its employees, agents,
                                successors, attorneys and assigns) of any
                                kind whatsoever, including, without
                                limitation, all disputes relating in any
                                manner to the employment or termination of
                                Executive and all disputes arising under
                                this Agreement, but excluding any claims by
                                Executive based on race, sex or age
                                discrimination ("Arbitrable Claims") shall
                                be resolved by arbitration. All persons and
                                entities specified in the preceding sentence
                                (other than Employer and Executive) shall be
                                considered third party beneficiaries of the
                                rights and obligations created by this
                                Section on Arbitration. Arbitration shall be
                                final and binding upon the parties and shall
                                be the exclusive remedy for all Arbitrable
                                Claims. THE PARTIES HEREBY WAIVE ANY RIGHTS
                                THEY MAY HAVE TO TRIAL BY JURY IN REGARD TO
                                ARBITRABLE CLAIMS.

                       (b)      Arbitration of Arbitrable Claims shall be in
                                accordance with the Employment Dispute
                                Resolution Rules of the American Arbitration
                                Association ("AAA Employment Rules"), except
                                as provided otherwise in this Agreement. The
                                arbitrator shall be selected from a source
                                provided by the Judicial Arbitration and
                                Mediation Service ("J.A.M.S."). In any
                                arbitration, the burden of proof shall be
                                allocated as provided by applicable law.
                                Either party may bring an action in court to
                                compel arbitration under this Agreement and
                                to enforce an arbitration award. Otherwise,
                                neither party shall initiate or prosecute
                                any lawsuit or administrative action in any
                                way related to any 


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<PAGE>   14
         Arbitrable Claim. All arbitration hearings under this Agreement shall
         be conducted in San Francisco, California. The Federal Arbitration Act
         shall govern the interpretation and enforcement of this Section 7.11.
         The fees of the arbitrator shall be split between both parties equally.

              (c)      All proceedings and all documents prepared in
                       connection with any Arbitrable Claim shall be
                       confidential and, unless otherwise required by law,
                       the subject matter thereof shall not be disclosed to
                       any person other than the parties to the proceedings,
                       their counsel, witnesses and experts, the arbitrator,
                       and, if involved, the court and court staff.

              (d)      The rights and obligations of Executive and Employer
                       set forth in this Section 7.11 with respect to
                       arbitration shall survive the termination of
                       Executive's employment and the expiration of this
                       Agreement.

         7.12 Change in Control. A "Change in Control" shall be deemed to have
occurred upon: (i) the acquisition by any Person, other than Employer or one or
more Persons controlling, controlled by or under common control with Employer,
of beneficial ownership (as determined pursuant to Rule 13d-3 under the
Securities Exchange Act of 1934, as amended) of eighty-five percent (85%) or
more of Employer's outstanding voting securities, or (ii) a change in the
composition of the Board of Directors of Employer (the "Board") over any period
of thirty-six (36) consecutive months or less such that a majority of the Board
members (determined by rounding up to the next whole number) cease to be
comprised of individuals who either (A) were Continuing Directors at the start
of such period or (B) were elected or nominated for election as Board members
during such period by at least a majority of the Continuing Directors in office
at the time such election or nomination was approved by the Board.

         The 85% test in subparagraph (i) of the Change in Control definition
shall be measured at the time the transaction resulting in the Change in Control
first commences, and there shall be excluded from such calculation, to the
extent provided pursuant to Section 203 (or any successor provision) of the
Delaware General Corporation Law, shares owned by (i) persons who are both
officers and directors of Employer and (ii) employee stock plans in which
employee participants do not have the right to determine confidentiality whether
shares held subject to the plan are to be tendered in a tender or exchange
offer.

         "Continuing Director" shall mean any member of the Board who has served
continually as such Board member from and before the commencement of the
transaction resulting in the Change of Control.

         "Person" shall mean any individual firm, partnership, corporation or
other entity and shall include any successor of such entity and all 


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<PAGE>   15
Affiliates, Associates and Subsidiaries (as such terms are defined in Rule 12b-2
of the Securities Exchange Act of 1934, as amended) of such entity.

         IN WITNESS WHEREOF, Employer and Executive have executed this Agreement
as of the date set forth in the first paragraph above.


         EMPLOYER:                      TANDEM COMPUTERS INCORPORATED



                                        By /s/ ROEL PIEPER
                                           ---------------------------------
                                        Its Chief Executive Officer
                                           ---------------------------------

         EXECUTIVE:                     /s/ JOHN LOSIER
                                        ------------------------------------
                                        John Losier


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