C-COR ELECTRONICS, INC.
                           PROFIT INCENTIVE PLAN (PIP)
                                FISCAL YEAR 1999


1.    Conceptual Basis of the Plan

The PIP plan is based on achieving and improving on the Company's pre-incentive,
pre-tax earnings  relative to the Annual Financial Plan endorsed by the Board of
Directors  at the  beginning of each fiscal year.  The plan  initiates  payments
based on the achievement of 90% of the pre-incentive, pre-tax earnings reflected
in the Annual Financial Plan. The basic payment formula is as follows:

Pre-PIP, Pre-tax earnings  X  PIP % (see Item 3. below) = Total PIP Payment Pool

PIP Payment Pool  X  Sub-pool Apportionment % (see Item 5. Below) = Sub-pool
Payment Pool

Sub-pool Payment Pool X (base wages / total base wages paid to sub-pool members)
= Payment


2.    Participant Eligibility

- Full-time, active employees of C-COR Electronics, Inc. and C-COR Electronics
  Canada are eligible.
- Employees of C-COR Europe, B.V. are not eligible.
- Employees of C-COR de Mexico, S.A. de C.V. are not eligible.
- Employees on Sales or Marketing Commission or Incentive Plans are not
  eligible.
- Employees who are provided a specifically  identified,  alternative  incentive
  bonus program are not eligible.
- Temporary Agency Employees, Independent Contractors, Co-op and Intern
  (part-time) Employees are not eligible.

New Hires within the Fiscal Year and / or Terminated Employees -

An employee is eligible for a quarterly PIP payment only if they have worked the
full fiscal quarter.

An  employee  is  eligible  to receive a year-end  PIP payment if they worked at
least one full fiscal quarter during the 12-month period and were on the payroll
at the end of the fiscal year.

Note:  The  formula  for  calculating  a PIP  payment  takes  into  account  the
pro-rationing of the payment amount to reflect the amount of time the individual
was actively employed during the payment period.

Employees on Leave (Disability; Workers' Compensation; FMLA; Military Leave) -

An employee  must be active and full-time in order to be eligible for a payment.
The  individual  would be  eligible  for a payment on a  pro-rata  basis for the
portion of FY 1999 in which they were an active, full-time employee.

3.    Calculation of Total PIP Payment Pool

Pre-incentive,  pre-tax  profits must be at least 90% of those  reflected in the
Company's  Annual  Financial  Plan in  order to  generate  a PIP  payment  pool.
Achievement  of the following  percentages  of  pre-incentive,  pre-tax  profits
relative to the Annual  Financial  Plan generates the following PIP payment pool
percentages:

     Less  than 90% of Plan 0% PIP  payment  pool 90% to < 100% of Plan 7.5% PIP
     payment pool 100% of Plan 10.0% PIP payment pool More than 100% of Plan (a)

(a) All earnings up to 100% of Plan would generate a PIP payment pool percentage
of 10%. All incremental  earnings, in excess of the 100% level, would generate a
PIP payment pool percentage of 20%.

The PIP payment pool is calculated  by taking the  appropriate  percentage  from
above and multiplying it times the actual  pre-incentive,  pre-tax income of the
Company.


4.    Frequency and Timing of Payments

After the  completion of each fiscal  quarter,  a PIP payment will be calculated
based on the actual  pre-incentive,  pre-tax profitability of the fiscal quarter
(assumes that the figure exceeds 90% of the pre-incentive, pre-tax profitability
reflected in the quarterly Financial Plan). Each quarter is independent from the
standpoint  of the  quarterly  PIP payment  calculation.  The PIP  payment  pool
percentage  will be derived from the above table and will be based on the actual
pre-incentive, pre-tax earnings for the quarter as a percentage of the Financial
Plan pre-incentive,  pre-tax earnings projected for the quarter. C-COR's rolling
financial   forecast   will  be  consulted   with   respect  to  the   projected
pre-incentive,  pre-tax  earnings  for the entire  fiscal  year.  If the rolling
forecast  reflects a lower PIP payment pool  percentage for the year relative to
the actual results for the quarter,  the lower  percentage  corresponding to the
rolling  forecast results will be used to calculate the PIP payment pool. If the
rolling  forecast  reflects a higher PIP payment  pool  percentage  for the year
relative to the actual results for the quarter, the lower percentage dictated by
the actual quarterly results will be used to calculate the PIP payment pool.

If sufficient  pre-incentive,  pre-tax earnings have been generated to warrant a
quarterly PIP payment,  each eligible  employee will be paid one-half of the PIP
payment calculated for them for the fiscal quarter.  The payment will be made as
soon as practically possible, immediately after the Company's Board of Directors
reviews the  quarterly  financial  results and agrees to the payment.  The Board
generally reviews the financial  results at mid-month  following the end of each
fiscal quarter,  except at fiscal year-end. Note that the Board of Directors has
complete discretion in administering and interpreting the PIP Plan.

The remaining one-half payment from each of the first three fiscal quarters will
be accrued (held back)  through the end of the fiscal year.  After the financial
audit has been  completed  for the fiscal  year and the Board of  Directors  has
reviewed the annual  financial  results  (mid-August),  a payment  (assuming the
financial  results  support one) will be disbursed to all eligible  employees as
soon as practically possible. The payment will consist of the following:


   a.    The remaining 1/2 payment "held back" from the first quarter of the
         fiscal year
   b.    The remaining 1/2 payment "held back" from the second quarter of the
         fiscal year
   c.    The remaining 1/2 payment "held back" from the third quarter of the
         fiscal year
   d.    The fourth quarter  payment as well as the amounts "held back" over the
         first three quarters.

Note that  improvement  or  deterioration  of  financial  results in  subsequent
quarters can either  positively or negatively  impact the year-end  payment with
respect to the amount(s) "held back" from earlier quarters.

5.    Apportionment of total PIP Payment Pool Between Sub-pools

The total PIP payment pool is allocated  between two sub-pools for  distribution
as follows:


                                           PIP Pool Apportionment %
                                    -------------------------------------------
Officers                            2.0%  per Officer
Non-officers                        Total Pool less Officer apportionment above

6.    Apportionment of Sub-pool Amounts to Individuals

In general,  the apportionment of the PIP sub-pool to the individuals within the
sub-pool is based on the following: (base wages of employee paid during period /
(total base wages paid to all employees in the sub-pool  during  period)).  This
percentage  is  multiplied  by  the  sub-pool  apportionment  total.  Note  that
non-exempt  base  wages  exclude   overtime.   They  do  however  include  shift
differential.

The apportionment of the Officer sub-pool is based on equal shares. An exception
is  made  for  the  President  and  CEO,  who  receives  the   equivalent  of  a
triple-share.  As an example, assume that the Company has 10 officers, including
the  President  and CEO. In essence,  the PIP sub-pool  would be divided into 12
equal shares with each officer receiving one share, except for the President and
CEO, who would receive  three  shares.  If an Officer is hired during the fiscal
year,  their total share payment amount is pro-rated  based on the time actually
employed as a percentage of the total time during the fiscal  period.  The equal
share portion, not paid to the partial-year Officer, would be distributed to the
Officers who were employed a full-year  consistent with the share  apportionment
described  above.  The President and CEO will review each Officer's  performance
before awarding the shares.

Officer  PIP  payments  are  capped  at 60% of  their  base  salary.  All  other
employees' PIP payments are capped at 40% of their base salary or if non-exempt,
40% of their hourly base pay rate X 2080 hours.