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                            EIP MICROWAVE, INC.
                                          
                            SECURITY AGREEMENT


       This Security Agreement (the "SECURITY AGREEMENT") is made and entered 
into as of July 20, 1998, by and between EIP MICROWAVE, INC., a Delaware 
corporation ("COMPANY"), and JAMES N. CUTLER, JR. (the "LENDER").

                                  RECITALS

       WHEREAS, the Lender has entered into a Subordinated Loan Agreement (the
"LOAN AGREEMENT"; unless otherwise noted, capitalized terms used herein without
definition have the meanings assigned thereto in the Loan Agreement) dated as of
July 20, 1998 between the Company and the Lender; and

       WHEREAS, the execution, delivery and performance of this Security
Agreement is a condition to the making of advances by the Lender under the Loan
Agreement.

       NOW, THEREFORE, in consideration of the premises and for good and
valuable consideration, the Company and the Lender agree as follows:

       1.  SECURITY INTEREST.  As security for the obligations described in
Section 2 hereof, the Company hereby grants to the Lender, a security interest
in and lien on all of the Company's right, title and interest in and to the
following collateral (the "COLLATERAL"):  (i) all Accounts, Inventory,
Equipment, General Intangibles, fixtures, tax refunds, letters of credit and
documents of title; (ii) all now owned and hereafter acquired real estate and
leasehold and other interests in real property together with all purchase
options and other rights related to such leaseholds or other interests;
(iii) all deposit accounts (general or special and whether collected or
uncollected) with credits and other claims against any financial institutions
with which the Company maintains deposits; (iv) all insurance proceeds of or
relating to any of the foregoing; (v) all of the Company's now owned or
hereafter acquired chattel paper, documents and instruments; (vi) all of the
Company's books and records relating to any of the foregoing; and (vii) all
accessions and additions to, substitutions for, and replacements, products and
proceeds of any of the foregoing.

       "ACCOUNTS" shall mean all now owned or hereafter acquired accounts,
contract rights, chattel paper, instruments, documents, claims to insurance, and
other rights to payment for goods sold or leased by the Company or for services
rendered by the Company.

       "EQUIPMENT" shall mean all of the Company's now owned or hereafter
acquired goods and other tangible property (other than Inventory) used or
useable by the Company  in its business, wherever the same are located,
including, without limitation, fixtures, furniture, machinery, equipment,
computer hardware, vehicles and trade fixtures, together with any and all
accessories, parts, supplies and appurtenances thereto, substitutions, renewals
and improvements therefor and replacements thereof.

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     "GENERAL INTANGIBLES" shall mean all choses in action, general intangibles,
causes of action and all other intangible personal property of the Company of
every kind and nature (other than Accounts) now owned or hereafter acquired by
the Company.  Without in any way limiting the generality of the foregoing,
General Intangibles specifically include contracts and contract rights, all
corporate or other business records, deposits (whether collected or
uncollected), security deposits, inventions, designs, patents, patent
applications, trademarks, trade names, trade secrets, trade styles, service
marks, goodwill, copyrights, registrations, licences, franchises, computer
software and firmware and all licenses therefore, insurance policies and tax
refund claims owned by the Company  and all letters of credit, guarantee claims,
security interests or other security held by or granted to the Company  to
secure payment by an account debtor of any Accounts.

     "INVENTORY" shall mean all goods, inventory, merchandise and other personal
property, including, without limitation, goods in transit, wherever located and
whether now owned or hereafter acquired by the Company which are or may at any
time be held for sale or lease, furnished under or incident to any contract or
held as raw materials, work in progress, finished goods, supplies or materials
used or consumed in the Company's businesses, and all such property the sale or
other disposition of which has given rise to Accounts and which has been
returned to or repossessed or stopped in transit by the Company.

     2.   OBLIGATIONS.  The security interest hereby granted shall secure the
due and punctual payment and performance by the Company of its indebtedness,
liabilities and obligations to the Lender under the Note and any and all other
obligations of the Company under this Security Agreement, including without
limitation: (i) the due and punctual payment in full (and not merely the
collectibility) of the principal and the premium, if any, and the interest on
the Note, in each case when due and payable, according to the terms of the Note,
whether at maturity, by acceleration or otherwise, regardless of the extent
allowed as a claim in any proceeding in respect of the bankruptcy,
reorganization or insolvency of the Company  (a "REORGANIZATION"); and (ii) the
due and punctual payment in full (and not merely the collectibility) of all
other sums and charges which may at any time be due and payable in accordance
with or under the terms of the Note, regardless of the extent allowed as a claim
in any Reorganization.

     3.   SPECIAL WARRANTIES AND COVENANTS OF THE COMPANY.  The Company hereby
represents, warrants and covenants to the Lender that:

          (a)    The address specified in on the signature page hereto is the
chief executive office and the place of business of the Company.

          (b)  The Company is (or with respect to Collateral acquired after the
date hereof, will be) the sole owner of the Collateral; the security interest
hereunder in the Collateral is a valid and enforceable security interest in that
Collateral and, upon the filing of financing statements, will be duly perfected
as to all Collateral in which a security interest can be perfected by the filing
of a financing statement and there are no security interests in, liens or
encumbrances on, adverse claims of title to, or any other interest whatsoever
in, the Collateral or any portion thereof, except the Permitted Liens (as
defined in the Loan Agreement).

          (c)  The Company will defend the Collateral against all claims and
demands of all persons at any time claiming the same or any interest therein.

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          (d)  The Company will promptly execute and deliver to the Lender such
financing statements, certificates and other documents and instruments, and will
give any notices to third parties, as may be necessary to enable the Lender to
perfect or from time to time continue perfection of the security interest
granted herein, or to protect the Collateral against the rights, claims or
interests of third parties, including, without limitation, such financing
statements, certificates, notices and other documents as may be necessary to
perfect a security interest in any additional Collateral hereafter acquired by
the Company or in any replacements or proceeds thereof.

          (e)  The Company will maintain all Collateral only in California or
Oregon.

          (f)  The Company has not, in the conduct of its business, been known
as or used any other corporate or fictitious name.

          (g)  The Company will promptly upon the Lender's request deliver to
the Lender records and schedules that show the status, condition and location of
the Collateral, including accounts receivable aging reports and will promptly
notify the Lender in writing of any event or change of law, regulation, business
practice or business condition that may adversely affect the value of the
Collateral. The Lender shall have the right to review and verify such records,
schedules and notices, including the right to contact account debtors of the
Company to confirm balances owing on and the terms of Accounts, and the Company
will reimburse the Lender for all costs incurred thereby.

          (h)  The Lender shall have the right at any time to make any payments
and do any other acts the Lender may deem necessary to protect its security
interest in the Collateral, including, without limitation, the rights to pay,
purchase, contest or compromise any encumbrance, charge or lien that in the
judgment of the Lender appears to be prior to or superior to the security
interest granted hereunder, and appear in and defend any action or proceeding
purporting to affect its security interest in and/or the value of the
Collateral, and in exercising any such powers or authority, the right to pay all
expenses incurred in connection therewith, including fees and expenses of
counsel for the Lender.  The Company hereby agrees to reimburse the Lender for
all payments made and expenses incurred under this Security Agreement, which
amounts shall be secured under this Security Agreement, and agrees it shall be
bound by any payment made or act taken by the Lender hereunder. The Lender shall
have no obligation to make any of the foregoing payments or perform any of the
foregoing acts.

     4.   RIGHTS OF LENDER.  Upon the occurrence of any Event of Default, the
Lender may declare all of the Obligations to be immediately due and payable and
the Lender shall then have the rights and remedies of a Lender under the Uniform
Commercial Code and under all other applicable laws, including, without
limitation, the right to take possession of the Collateral and, in addition
thereto, the right to enter upon any premises on which the Collateral or any
part thereof may be situated and remove the same therefrom. The Lender may
require the Company to make the Collateral (to the extent the same is movable)
available to the Lender at a place to be designated by the Lender which is
reasonably convenient to the Company and the Lender. Unless the Collateral is
perishable or threatens to decline speedily in value or is of a type customarily
sold on a recognized market, the Lender will give the Company at least ten (10)
days' prior written notice, at the last address for notices to the Company
specified in accordance with Section 10 hereof, of the time and place of any
public sale thereof or of the time after which any private sale or any other
intended disposition thereof 

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is to be made.  Each such notice shall be deemed to meet all requirements 
hereunder and under applicable law (including the Uniform Commercial Code) 
that reasonable notification be given of the time and place of such sale or 
other disposition.  After deducting all costs and expenses of collection, 
storage, custody, sale or other disposition and delivery (including legal 
costs and attorneys' fees) and all other charges against the Collateral, the 
residue of the proceeds of any such sale or disposition shall be applied to 
the payment of the Obligations of the Company; and the surplus, if any, shall 
be paid to whomever may be lawfully entitled to receive the same.

     In the event the proceeds of any sale, lease or other disposition of the
Collateral hereunder are insufficient to pay all of the Obligations in full, the
Company will be liable for the deficiency, together with interest thereon, and
the costs and expenses of collection of such deficiency, including (to the
extent permitted by law), without limitation, reasonable attorneys' fees,
expenses and disbursements.

     5.   RIGHT OF LENDER TO USE AND OPERATE COLLATERAL, ETC.  Upon the
occurrence of any Event of Default and during the continuance of any Event of
Default, but subject to the provisions of the Uniform Commercial Code or other
applicable law, the Lender shall have the right and power to take possession of
all or any part of the Collateral, and to exclude the Company and all persons
claiming under the Company wholly or partly therefrom, and thereafter to hold,
store, and/or use, operate, manage and control the same. Upon any such taking of
possession, the Lender may, from time to time, at the expense of the Company,
make all such repairs, replacements, alterations, additions and improvements to
any of the Collateral as the Lender may deem proper.  In any such case, the
Lender shall have the right to manage and control the Collateral and to carry on
the business and to exercise all rights and powers of the Company, in respect
thereto as the Lender shall deem best, including the right to enter into any and
all such agreements with respect to the operation of the Collateral or any part
thereof as the Lender may see fit; and the Lender shall be entitled to collect
and receive all issues, profits, fees, revenues and other income of the same and
every part thereof.  Such issues, profits, fees, revenues and other income shall
be applied to pay the expenses of the Lender and of operating the Collateral and
of conducting the Company's business, and of all maintenance, repairs,
replacements, alterations, additions and improvements, and to make all payments
which the Lender may be required or may elect to make, if any, for taxes,
assessments, insurance and other charges upon the Collateral or any part
thereof, and all other payments which the Lender may be required or authorized
to make under any provision of this Security Agreement (including legal costs
and attorneys' fees).  The remainder of such issues, profits, fees, revenues and
other income shall be applied to the payment of the Obligations. Without
limiting the generality of the foregoing, the Lender shall have the right to
pply for and have a receiver appointed by a court of competent jurisdiction in
any action taken by Lender to enforce their rights and remedies hereunder in
order to manage, protect and preserve the Collateral and continue the operation
of the business of the Company and to collect all revenues and profits thereof
and apply the same to the payment of all expenses and other charges of such
receivership including the compensation of the receiver and to the payment of
the Obligations as aforesaid until a sale or other disposition of such
Collateral shall be finally made and consummated

     6.   COLLECTION OF ACCOUNTS, ETC.  Upon the occurrence and during the
continuance of any Event of Default, the Lender may notify or may require the
Company to notify account debtors on any or all of the Company's Accounts,
whether now existing or hereafter arising, to make payment directly to the
Lender, and the Lender may take possession of all proceeds of any accounts in
the Company's possession, and may take any other steps which the Lender deems
necessary or advisable 

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to collect any or all such Accounts or other Collateral or proceeds thereof.  
Without limiting the generality of the foregoing, upon the occurrence and 
during the continuance of any Event of Default:  (a) the Lender shall have 
the right to receive, endorse, assign and/or deliver in their name or the 
name of the Company any and all checks, drafts and other instruments for the 
payment of money relating to the Accounts, and the Company hereby waives 
notice of presentment, protest and nonpayment of any instrument so endorsed; 
(b) the Company hereby constitutes the Lender or their designee as its 
attorney-in-fact with power to endorse the Company's name upon any notes, 
acceptances, checks, drafts, money orders or other evidences of payment or 
Collateral that may come into Lender' possession; to sign the Company's name 
on any invoice or bill of lading relating to any of the Company's accounts, 
drafts against customers, assignments and verifications of such accounts and 
notices to customers; to notify the Post Office authorities to change the 
address for delivery of mail addressed to the Company to such address as the 
Lender may designate; and to do all other acts and things necessary to carry 
out this agreement.  All acts of said attorney or designee are hereby 
ratified and approved, and said attorney or designee shall not be liable for 
any acts of omission or commission, nor for any error of judgment or mistake 
of fact or law; this power being coupled with an interest is irrevocable 
until this Security Agreement terminates in accordance with its terms; (c) 
the Lender may, without notice to or consent from the Company, in their 
reasonable business judgment, sue upon or otherwise collect, extend the time 
of payment, or compromise or settle for cash, credit or otherwise upon any 
terms, any of the Company's Accounts or any securities, instruments or 
insurance applicable thereto and/or release the obligor thereon; and (d) the 
Lender are authorized and empowered to accept the return of the goods 
represented by any of the Company's Accounts, without notice to or consent by 
the Company, all without discharging or in any way affecting the Company's 
liability thereunder.

     7.   WAIVERS, ETC.  The Company hereby waives presentment, demand, notice,
protest and, except as otherwise provided herein, all other demands and notices
in connection with this Security Agreement or the enforcement of the Lender'
rights hereunder or in connection with any Obligations or any Collateral; the
Company consents to and waives notice of the granting of renewals, extensions of
time for payment or other indulgence to any account debtor in respect of any
account receivable, the addition or release of persons primarily or secondarily
liable on any account receivable or other Collateral, the acceptance of partial
payments on any obligation or on any account receivable or other Collateral
and/or the settlement or compromise thereof.  No delay on the part of any Lender
in exercising any right hereunder shall operate as a waiver of such right or of
any other right hereunder. Any waiver of any such right on any one occasion
shall not be construed as a bar to or waiver of any such right on any such
future occasion.  The Company further waives any right it may now or hereafter
have to notice (other than any requirement of notice provided herein) or to a
judicial hearing prior to the exercise of any right or remedy provided by this
Security Agreement to the Lender and waives its right, if any, to set aside or
invalidate any sale duly consummated in accordance with the foregoing provisions
hereof on the grounds (if such be the case) that the sale was consummated
without a prior judicial hearing.  The Company hereby waives the right to plead
any statute of limitations as a defense to any indebtedness or obligations
hereunder or secured hereby to the full extent permitted by law.  The Company's
waivers under this section have been made voluntarily, intelligently and
knowingly.

     8.   AUTHORITY OF THE LENDER.  The Lender shall have and be entitled to
exercise all powers hereunder which are specifically granted to the Lender by
the terms hereof together with such powers as are reasonably incident thereto. 
The Lender may perform any of its duties hereunder or in 

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connection with the Collateral by or through agents or employees and shall be 
entitled to retain counsel and to act in reliance upon the advice of counsel 
concerning all such matters. Neither any Lender nor any attorney or agent of 
the Lender shall be liable to the Company for any action taken or omitted to 
be taken by it or them hereunder, except for its or their own gross 
negligence or willful misconduct, nor shall the Lender be responsible for the 
validity, effectiveness or sufficiency hereof or of any document or security 
furnished pursuant hereto. The Lender and its attorneys and agents shall be 
entitled to rely on any communication, instrument or document believed by it 
or them to be genuine and correct and to have been signed or sent by the 
proper person or persons.  The Company agrees to indemnify and hold harmless 
the Lender and any other person from and against any and all costs, expenses 
(including fees and expenses of counsel), claims or liability incurred by the 
Lender or such person hereunder, unless such claim or liability shall be due 
to willful misconduct or gross negligence on the part of the Lender or such 
person.

     9.   TERMINATION, ETC.  This Security Agreement and the security interest
in the Collateral created hereby shall terminate only when all of the
Obligations have been paid, performed and discharged in full.  No waiver by any
Lender or by any other holder of Obligations of any default shall be effective
unless in writing nor operate as a waiver of any other default or of the same
default on a future occasion.

     10.  NOTICES.   All notices, consents and other communications under this
Security Agreement shall be in writing and shall be deemed to have been duly
given when (a) delivered by hand, (b) sent by telecopier (with receipt
confirmed), provided that a copy is mailed by registered mail, return receipt
requested, or (c) when received by the addressee, if sent by Express Mail,
Federal Express or other express delivery service (receipt requested), in each
case to the appropriate addresses and telecopier numbers set forth on the
signature page (or to such other addresses and telecopier numbers as a party may
designate as to itself by notice to the other parties).

     11.    MISCELLANEOUS.  This Security Agreement shall inure to the benefit
of and be binding upon the Lender and the Company and their respective
successors and assigns.  In the event any of the Obligations are transferred,
the Lender may assign its rights and duties hereunder to the transferee or
transferees of the Obligations.  In case any provision of this Security
Agreement shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby. This Security Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts.  Each
counterpart bearing, and each set of counterparts collectively bearing, the
signatures of all parties shall be an original, but all the counterparts
together shall constitute one and the same instrument  The terms of this
Security Agreement may not be altered, modified, amended, supplemented or
terminated in any manner whatsoever except by written instrument signed by the
Company and the Lender.

     12.  GOVERNING LAW; WAIVER OF RIGHTS, REPRESENTATION BY COUNSEL, WAIVER OF
DAMAGES, ETC. 

     (a)  This Agreement and (unless otherwise provided) all amendments hereof
and waivers and consents hereunder shall be governed by the internal law of the
State of Oregon, without regard to the conflicts of law principles thereof.

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     (b)  The Company waives all rights of notice and hearing of any kind prior
to the exercise by the Lender of their rights from and after the occurrence of
an Event of Default to repossess the Collateral with judicial process or to
replevy, attach or levy upon the Collateral or other security for the
Obligations.  The Company waives the posting of any bond otherwise required of
the Lender in connection with any judicial process or proceeding to obtain
possession of, replevy, attach or levy upon the Collateral or other security for
the Obligations to enforce any judgment or other court order entered in favor of
the Lender, or to enforce by specific performance, temporary restraining order,
preliminary or permanent injunction this Security Agreement or any other
agreement or document between the Company and the Lender.

     (c)  Each party hereto acknowledges that it has been represented by counsel
and/or has had an opportunity to seek the advice of counsel in connection with
this Security Agreement and the transactions contemplated by this Security
Agreement.  Accordingly, any rule of law or any legal decision that would
require interpretation of any claimed ambiguities in this Security Agreement
against the party that drafted it has no application and is expressly waived. 
The provisions of this Security Agreement shall be interpreted in a reasonable
manner to effect the intent of the parties hereto.

     (d)  Notwithstanding anything to the contrary elsewhere in this Security
Agreement, no party (or its agents) shall, in any event, be liable to the other
party (or its agents) for any consequential damages, including, but not limited
to, loss of revenue or income, cost of capital, or loss of business reputation
or opportunity relating to the breach or alleged breach of this Security
Agreement.  Each party agrees that it will not seek punitive damages as to any
matter under, relating to or arising out of this Security Agreement.

     IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the date first set forth above.        

                              THE COMPANY
                              
                              EIP MICROWAVE, INC.
                              1745 McCandless Drive
                              Milpitas, CA 95035-8024
                              Fax Number:  (408) 945-6312

                              By:  /s/ J. BRADFORD BISHOP
                                   ----------------------------
                                   J. Bradford Bishop
                                   Chairman and Chief Executive Officer

                              THE LENDER

                              /s/ JAMES N. CUTLER, JR.
                              ------------------------------
                              James N. Cutler, Jr.
                              6950 S.W. Hampton Street
                              Suite 200
                              Portland, OR 97223
                              Fax Number:  (503) 624-0115