AMENDED AND RESTATED EMPLOYMENT AGREEMENT

THIS AGREEMENT, made this 21 day of July, 1997, by and between C-COR
ELECTRONICS,  INC., a Pennsylvania Business Corporation with its principal place
of  business  at 60 Decibel  Road,  State  College,  Pennsylvania  (hereinafter,
"Corporation"),

                                      -AND-

                   RICHARD E. PERRY (hereinafter, "Employee").

                                   BACKGROUND

A. Corporation has employed Employee since July 17, 1985, first as President and
Chief  Executive  Officer and then as Chairman,  President  and Chief  Executive
Officer and then as Chairman.

B.  Corporation  and Employee  entered  into an Amended and Restated  Employment
Agreement,  dated April 1, 1988 for the period  commencing  on July 17, 1985 and
ending on June 30, 1990.

C.  Corporation  and Employee  entered  into an Amended and Restated  Employment
Agreement dated October 27, 1989 for the period  commencing on July 17, 1985 and
ending on June 30, 1993.

D.      Corporation and Employee entered into an Amended and Restated Employment
Agreement dated September 4, 1990 to amend the section entitled, Bonus.

E.  Corporation  and Employee  entered  into an Amended and Restated  Employment
Agreement dated April 23, 1991 to further amend the section entitled,  Bonus and
to extend the term hereof.

F.  Corporation  and Employee  entered  into an Amended and Restated  Employment
Agreement  dated April 19, 1994 for the period  commencing  on July 17, 1985 and
ending on October 31, 1997.

G. Corporation and Employee are also parties to a "Change of Control" Employment
Agreement dated April 30, 1986 and an Amendment to such Agreement dated June 13,
1986 (together referred to herein as the "Change of Control Agreement"),  and an
Indemnification   Agreement   dated  October  23,  1986  (the   "Indemnification
Agreement").

H.  Corporation  and Employee  entered  into an Amended and Restated  Employment
Agreement  dated  October 16, 1995 for the purpose of modifying the terms of the
retirement annuity provided for in Section 2.05 hereof and incorporating  herein
and   amending   the  terms  of  the  Change  of  Control   Agreement   and  the
Indemnification Agreement.

I. On August 13, 1996,  in  accordance  with  Section  1.02 hereof,  Corporation
notified Employee that Employee would,  effective  September 13, 1996, no longer
serve Corporation as Chief Executive Officer.

J.  Corporation  and Employee  entered  into an Amended and Restated  Employment
Agreement  dated  November  24, 1996 for the purpose of  amending  Section  2.01
hereof,   concerning   salary,   Section  2.03  hereof,   concerning   incentive
compensation, and Section 2.04 hereof, concerning stock options.

K. On  March  3,  1997,  Employee  notified  Corporation  that  Employee  would,
effective  immediately,  voluntarily reduce his salary under Section 2.01 hereof
from $150,000 to $125,000.

L.  Corporation  and Employee desire to further amend and restate the Employment
Agreement  between  Corporation and Employee for the purpose of amending Section
1.01 hereof,  concerning  employment  and term,  amending  Section 2. 01 hereof,
concerning  salary,   deleting  Section  2.07  hereof,   concerning   automobile
allowance, and deleting Section 2.11 hereof concerning club membership.

NOW,  THEREFORE,  in consideration of the mutual promises  contained herein, and
intending to be legally bound thereby, the parties hereto agree as follows:

                                   SECTION I.

                            Description of Employment

1.01. Employment and Term.  Corporation agrees to employ Employee and Employee 
agrees to be so employed for a term which initially commenced on July 17, 1985 
and which will end on October 31, 2000.

1.02.  Capacity.  For the period  commencing on September 13, 1997 and ending on
October 31, 2000,  Employee shall serve in the capacity of Chairman of the Board
of Directors (if elected to the Board of Directors) and shall perform such other
duties  as  Employee  and the  Board  of  Directors  shall  mutually  determine;
provided,  however, that upon thirty (30) days advance written notice,  Employee
may,  at his  option,  elect to resign  and retire as  Chairman  of the Board of
Directors.

1.03.  Time and Efforts.  For the period  commencing  on September  13, 1997 and
ending on October 31, 2000,  as provided  for in Section  1.02 hereof,  Employee
shall diligently and  conscientiously  devote his best efforts and such time and
attention as may be necessary to the  discharge of his duties as Chairman of the
Board and of such other duties as may be determined by mutual agreement.

                                   SECTION II.

                                  Compensation

2.01. Salary.  During the period of Employee's employment hereunder beginning on
September 13, 1997, the Corporation  shall pay to Employee a salary at an annual
rate of One  Hundred  Thousand  ($100,000.00)  Dollars,  payable  bi-weekly  for
services rendered.

2.02.  Business  Expenses.  Employee shall be reimbursed by Corporation  for all
reasonable  expenses  incurred  in  carrying  out his  employment  duties  or in
otherwise  promoting the business of Corporation by presenting to the designated
officer  of  Corporation  an  itemized  expense  account  report  with  receipts
attached.

2.03.   Incentive   Compensation.   Corporation  shall  include  Employee  as  a
participant at the officer level under  Corporation's  "Profit  Incentive Plan".
Employee  will be entitled to such awards as are  declared  from time to time by
the Board of Directors under the terms of the "Profit Incentive Plan".

2.04. Stock options.  As of April 19, 1994, Employee was granted Incentive Stock
Options  for 25,000 shares of C-COR common stock.  Further,  on August 13, 1996,
Employee was granted  Incentive  Stock Options for 25,000 shares of C-COR common
stock.  All such  Incentive  Stock Options are  exercisable  at any time (not to
exceed  ten years  after the date of grant),  during  Employee's  employment  by
Corporation and, following termination of employment,  for a period equal to the
lesser of five (5) years or the period of time  remaining  for  exercise  of the
respective options (not to exceed ten years after the date of grant).

2.05 (a) Retirement  Annuity.  Upon  Employee's  retirement on October 31, 2000,
Corporation  shall pay to Employee a  retirement  annuity in the amount of Fifty
Thousand  and No/100  ($50,000.00)  Dollars per year,  payable on July 1 of each
year,  for the life of  Employee.  In the event  that  Employee  dies  following
retirement and is survived by his spouse,  Betty Perry, annuity payments in like
amount  shall  continue to be paid each July 1,  following  Employee's  death to
Betty Perry for her  lifetime.  All such  annuity  payments  will cease on Betty
Perry's death.

        (b) Pre-retirement  Survivor's Annuity. In the event Employee dies prior
to his retirement from  Corporation and is survived by his spouse,  Betty Perry,
Corporation  shall pay Betty Perry a  survivor's  annuity in the amount of Fifty
Thousand  and No/100  ($50,000.00)  Dollars per year,  payable on July 1 of each
year, for Betty Perry's lifetime.  All such annuity payments will cease on Betty
Perry's death.

        (c)  Conditions.  Nothing  contained in this Section 2.05 and no actions
taken pursuant to this Agreement  shall create or be construed to create a trust
of any kind, or a fiduciary  relationship  between Corporation and Employee,  or
his  spouse.  Any funds  which may be  reserved  by  Corporation  to pay for the
retirement and survivor's  annuity  payments  provided for herein shall continue
for all purposes to be a part of the general funds of Corporation  and no person
other than  Corporation  shall by virtue of this  Agreement have any right to or
interest in such funds. Any bookkeeping  reserve accounts for such payments will
be maintained by Corporation  solely as a convenience in the  administration  of
this  Agreement.  To the  extent  that any  person  acquires  a right to receive
payments from  Corporation  under this  Section,  such right shall be no greater
than the rights of any unsecured  general creditor of the  Corporation.  Neither
Employee nor his representative  shall have any right to commute,  sell, assign,
transfer,  encumber  or  otherwise  dispose  of the  right to  receive  payments
hereunder,  which  payments and the right thereto are  expressly  declared to be
nonassignable and  nontransferable  and any attempted  assignment or transfer by
Employee, or his spouse, shall be void and of no effect. Title to and beneficial
ownership of any assets, whether cash,  investments,  life insurance policies or
other assets which Corporation may use to fund its obligation hereunder shall at
all times remain in Corporation.

        (d) Insurance Policies.  Employee  understands that Corporation may make
application to purchase a life  insurance  policy or policies on his life, or on
the lives of Employee and his spouse in order to fund its obligations under this
section,  which policy or policies will be owned by Corporation  and under which
Corporation will be the sole beneficiary. Employee agrees to provide Corporation
with such information as it may require in order to make such application and to
cooperate fully with Corporation in respect of such  application,  including the
taking of a physical examination if requested to do so. Further,  Employee shall
use his best  efforts  to cause his  spouse  to  provide  Corporation  with such
information as it may require in order to make such application and to cooperate
fully with Corporation in respect of such application, including the taking of a
physical  examination if requested to do so. In the event the insurance  company
to which  application  is made  declines to issue a policy at  standard  premium
rates,  Corporation's  obligations  under this  section 2.05 will be void unless
Corporation decides otherwise. Similarly, upon Employee's death, if the proceeds
of the  policy  on  Employee's  life are not  paid to  Corporation  because  the
information Employee furnished in connection with the application was materially
false or Employee's or any other insured's death is caused by suicide within two
(2) years of the date on which any policy on Employee's  or Employee's  spouse's
life was  issued,  Corporation  will be under no  obligation  to pay the annuity
provided for in this Section 2.05.

2.06. Life Insurance  Coverage.  Corporation will provide to Employee group term
life  insurance  in a face amount  equal to three times the  Employee's  salary.
Increases in life insurance  coverage will occur at the same time the Employee's
salary is increased pursuant to Section 2.01 hereof.

2.07. Financial and Tax Planning Reimbursement.  Corporation agrees to reimburse
Employee for expenses incurred in his personal  financial and tax planning up to
an amount not exceeding One Thousand Five Hundred  ($1,500.00)  Dollars per year
during the term of this Agreement.

2.08.  Other Benefit  Plans.  Employee  shall also be eligible to participate in
Corporation's  other fringe benefit plans,  including both those plans presently
existing and those which may in the future be adopted,  in  accordance  with the
terms and provisions of such plans.

2.09. Vacation.  Employee shall be entitled to a reasonable amount of vacation.

2.10.  Physical  Examination.  Corporation  agrees to reimburse Employee for the
expense of an annual physical examination by a physician selected by Employee.

                                  SECTION III.

                              Intellectual Property

3.01. Disclosure.  Employee agrees to promptly and fully disclose to Corporation
all inventions, improvements, original works of authorship, formulas, processes,
computer  programs,  techniques,  know-how  and data  (hereinafter  collectively
referred to as "Inventions"),  whether or not patentable or copyrightable,  made
or conceived or first reduced to practice or learned by Employee either alone or
jointly  with  others,  whether  or  not  during  Employee's  regular  hours  of
employment  and directly or indirectly  relating to or capable of being used for
the benefit of Corporation's  business.  Employee agrees,  without  compensation
additional to that provided for in Section II of this  Agreement,  to assign all
rights in and to such inventions to Corporation and to execute, at Corporation's
request, appropriate documents effectuating such assignments.

3.02.  Maintenance of Records.  Employee agrees to maintain accurate and current
written  records  of all  such  Inventions,  in the  form  of  notes,  sketches,
drawings,  or  reports  which  shall  be and will  remain  the  property  of and
available to Corporation at all times.

3.03.  Provision of Assistance.  Employee agrees,  upon  Corporation's  request,
during and after the term of employment set forth herein, to assist Corporation,
its attorneys, and nominees at its or their expense in preparing and prosecuting
applications for letters patent on Inventions created by him and applications to
register copyrights on inventions created by him providing,  however,  that time
actually  spent by  Employee at such work after  termination  of  employment  at
Corporation's  request,  shall be paid for by Corporation at a reasonable  rate,
and that necessary  expenses  incurred by Employee in connection with Employee's
duties under this paragraph shall be paid by Corporation.

3.04. Previous  Inventions.  Employee expressly retains an interest in and title
to Inventions  patented or unpatented which Employee conceived prior to his term
of employment with Corporation.

3.05. Term of Obligations.  Employee's  termination of employment by Corporation
under this  Agreement  shall not affect the  obligations  imposed on Employee by
Paragraphs  3.01,  3.02  and  3.03 and such  obligations  shall  be  binding  on
Employee's heirs, executors and administrators.

                                   SECTION IV.

                       Confidentiality and Noncompetition

4.01. Confidentiality.  Employee agrees, during and after his term of employment
hereunder,  without the prior written consent of Corporation, not to disclose to
any person other than Corporation,  by publication or otherwise,  or use for his
own benefit,  any  confidential  information of  Corporation or any  Inventions,
whether conceived in whole or in part by Employee or by others.  Employee's duty
under this paragraph  includes but is not limited to the  nondisclosure of trade
secrets or confidential  information,  knowledge or data of Corporation which he
may  obtain  during  the  course of his  employment  relating  to  Corporation's
business,  technical or otherwise,  including  but not limited to  manufacturing
methods,  processes,  techniques,  products,  engineering  development products,
computer programs, customer lists, machines, research, compositions,  inventions
or discoveries.  Employee agrees that upon leaving the employ of Corporation, he
will not take with him any original or copy of documents, or records relating to
the foregoing matters, without the written consent of Corporation.  This Section
does not apply to any Inventions described in Section 3.04 above.

4.02. Noncompetition.  In consideration of Corporation's agreement to extend the
term  of  Employee's   employment,   for  the  duration  of  his  employment  by
Corporation,  and for a period of two (2) years after the  termination  thereof,
Employee agrees:

        (a) Not to, on behalf of  himself  or any other  entity or  corporation,
directly or indirectly,  as an employee,  agent, independent contractor,  owner,
stockholder,  partner, officer, director or otherwise, engage in the business of
the manufacture or sale of electronic  equipment for use in cable  television or
broadband data transmission systems in North America,  Central America and South
America, Europe, the Middle East and the Far East, including the Pacific Rim.

        (b) Not to call on or solicit,  on behalf of himself or on behalf of any
other entity or corporation, any of the customers of Corporation for the purpose
of selling  or  distributing  to any of said  customers  any  product or service
comparable to or competitive  with products or services  developed,  sold and/or
distributed by Corporation  or products or services which  Corporation  may have
under development during the period of time Employee was employed by Corporation
("Corporation's   Products");   nor  will  Employee  in  any  way,  directly  or
indirectly,  for  himself  or on  behalf of any  other  entity  or  corporation,
solicit,  divert or take away any customer of Corporation.  For purposes of this
Agreement,  "customer"  shall mean any person,  entity or corporation  which has
purchased  Corporation's  Products,  or has  received  a  price  quotation  from
Corporation for  Corporation's  Products,  at any time within the three (3) year
period prior to the date of termination of Employee's employment.

        (c) Not to enter  or  attempt  to enter  into an  employment  or  agency
relationship  with any  person  who,  at the time of such  entry  (or  attempted
entry),  or at the time of termination of Employee's  service with  Corporation,
was an officer,  director,  employee,  principal or agent of Corporation if, but
only if, such employment or agency relationship is with respect to a business in
competition with Corporation.

        (d)  Not to  induce  or  attempt  to  induce  any  person  described  in
subparagraph (c) to leave his or her employment,  agency, directorship or office
with Corporation to enter into a business in competition with Corporation.

It is understood by and between the parties to this Agreement that the aforesaid
covenants  set  forth  in this  Section  4.02  are  essential  elements  of this
Agreement,  and that,  but for the  agreement  of  Employee  to comply with such
covenants,  Corporation  would not have  agreed to the terms of  employment  set
forth in this  Agreement.  Such  covenants  by Employee  shall be  construed  as
agreements  independent of any other provision in this Agreement.  The existence
of any  claim  or cause of  action  of  Employee  against  Corporation,  whether
predicated on this Agreement or otherwise, shall not constitute a defense to the
enforcement by Corporation of such covenants.

In addition to all other legal remedies available to Corporation for enforcement
of the covenants of this Section 4.02, the parties agree that Corporation  shall
be entitled to an injunction by any court of competent  jurisdiction  to prevent
or restrain any breach or threatened breach thereof.

The parties to this Agreement agree that, if any court of competent jurisdiction
determines  the  specified  time period or the  specified  geographical  area of
application, or the definition of Corporation's Products in such covenants to be
unreasonable,  arbitrary  or against  public  policy,  then a lesser time period
and/or a smaller  geographical  area and/or a less  encompassing  definition  of
Corporation's  Products which are determined to be reasonable,  nonarbitrary and
not against public policy may be enforced against Employee.  The parties to this
Agreement  agree and  acknowledge  that they are  familiar  with the present and
proposed  operations of Corporation and believe that the  restrictions set forth
in this Section 4.02 are reasonable with respect to its subject matter, duration
and geographical application.

The provisions of this Section 4.02 may be waived,  in part or fully, in writing
by Corporation at its option.

These restrictive covenants shall survive the termination of this Agreement.

                                   SECTION V.

                                Change of Control

5.01.  Change of  Control.  The  provisions  of  Sections  5.02 and 5.03 of this
Agreement  shall become  operative upon a change of control of  Corporation,  as
hereinafter defined. For purposes of this Agreement, a "change of control" shall
be deemed to have occurred if and when:

        (a)  Subsequent  to the date of this  Agreement,  any person or group of
persons acting in concert shall have acquired  ownership of or the right to vote
or to direct the voting of shares of capital stock of  Corporation  representing
thirty (30%) percent or more of the total voting power of Corporation, or

        (b)  Corporation  shall have merged into or  consolidated  with  another
corporation,  or merged another corporation into Corporation, on a basis whereby
less than  fifty  (50%)  percent  of the  total  voting  power of the  surviving
corporation is represented by shares held by former  shareholders of Corporation
prior to such merger or consolidation, or

        (c)     Corporation shall have sold more than fifty (50%) percent of its
assets to another corporation or other entity or person, or

        (d) As the result of, or in connection with, any cash tender or exchange
offer,  merger  or other  business  combination,  sale of  assets  or  contested
election,  the persons who were directors of Corporation before such transaction
cease to constitute a majority of directors of Corporation.

5.02.  Termination Within Eighteen (18) Months. In the event that the employment
of Employee with  Corporation is terminated  involuntarily  within eighteen (18)
months after a change of control occurs:

        (a)     Employee shall be entitled to receive an amount of cash equal to
the sum of the following amounts:

                 (i) two (2) times his annual  salary as provided for in Section
2.01 hereof at his rate on the date of termination  of employment  (but not less
than two times Employee's annual salary prior to the Change of Control); and

                 (ii) two (2) times Corporation's  annual 401(k) retirement plan
contribution  at the  Employee's  contribution  rate on the  termination  of his
employment  (but not less than the amount the  Corporation was matching prior to
Change of  Control)  (and  subject to  applicable  limitations  of the  Internal
Revenue  Code,  which may  dictate  that such  amount  shall not be added to the
retirement plan but shall be paid in cash).

The sum of these  amounts  shall be paid in equal  monthly  installments  over a
period of twenty-four (24) months,  the first such installment to be paid within
ten (10) days after Employee's termination of employment.

        (b) Employee shall be entitled to receive an amount of cash equal to two
times the amount that would have been awarded to him under the Profit  Incentive
Plan of the Company, pursuant to the terms of such plan as in effect immediately
prior to such change in control  and  regardless  of whether  such plan may have
been changed thereafter,  for the then-current  calendar year if such award were
based on 100% of his share under said plan for such calendar  year.  Such amount
shall be paid at the same time as awards are paid to other  participants in said
plan if such plan shall have been  continued  but in no event later than July 31
of the year  following  that year in respect of which the award was to have been
paid.  If no plan is in effect at the time of change of control,  a cash payment
of $40,200  will be paid to the Employee  within 10 days after  dismissal by the
Company.

        (c) Employee shall continue for a period of twenty-four (24) months from
the date of his  termination  to be covered at the expense of Corporation by the
same or equivalent  health,  dental,  accident,  life and  disability  insurance
coverages  as he  was  enrolled  in  immediately  prior  to  termination  of his
employment;  provided,  however,  that the Employee may elect to be paid in cash
within thirty (30) days after  termination  of his employment an amount equal to
Corporation's cost of providing such coverages during such period.

        (d) If on the date of termination  of employment,  Employee was eligible
for a  retirement  annuity,  Employee  shall  become  eligible  for the benefits
payable  under such annuity and such annuity  shall be paid to Employee,  or, if
applicable,  Employee's spouse, in the same manner,  amounts and intervals as if
Employee had, on the date of his termination of employment following a change of
control, retired from employment with Corporation.

        (e) All  outstanding  options held by  Employee,  both  exercisable  and
nonexercisable,  shall be  immediately  exercisable  regardless  of the time the
option  has been held by  Employee  and shall  remain  exercisable  until  their
original  expiration  date,  subject to applicable  requirements of the Internal
Revenue Code.

        (f) Corporation  shall continue for a period of twenty-four  (24) months
to pay Employee's monthly dues and special  assessments,  if any, of any club of
which Employee was a member at the time of termination and of which  Corporation
was paying  such dues and shall  permit the  Employee  to  continue  to use such
membership thereafter, without reimbursement to Corporation of any membership or
initiation fees or assessments, so long as Employee wishes to do so on the basis
that monthly fees and special assessments will thereafter be paid by him.

        (g) Corporation  shall for a period of twenty-four  (24) months continue
to pay Employee Six Hundred and 00/100 ($600.00)  Dollars per month for expenses
of operating an automobile owned by Employee.

        (h) Within thirty (30) days after  Employee's  termination of employment
as a result of a change of control,  Corporation shall pay to Employee in a lump
sum an amount of cash, net of all federal,  state and local income taxes,  which
shall be sufficient to enable Employee to purchase a paid-up annuity issuable by
a  financially  sound and  reputable  insurance  company  providing  for payment
beginning at age sixty-two  (62) of a monthly  benefit equal to One Thousand and
no/100 ($ 1,000.00) Dollars per month for the life of Employee.

5.03 Resignation Within Two Years. In the event the Employee should determine in
good faith  that his status or  responsibilities  with  Corporation  has or have
diminished  subsequent to a change of control,  and shall for that reason resign
from his employment with  Corporation  within two (2) years after such change of
control, Employee shall be entitled to receive all of the payments and enjoy all
of the benefits specified in Section 5.02 hereof as if Employee's  employment by
Corporation had terminated on the date of Employee's resignation.

5.04  Agreements  Not  Exclusive.  The specific  agreements  referred to in this
Section V are not intended to exclude Employee's participation in other benefits
available to executive  personnel generally or to preclude other compensation or
benefits as may be  authorized by the Board of Directors of  Corporation  at any
time.

5.05  Enforcement  Costs.  Corporation  is aware that upon the  occurrence  of a
change of control the Board of Directors or a  shareholder  of  Corporation  may
then  cause or  attempt  to cause  corporation  to  refuse  to  comply  with its
obligations  under this Section V, or may cause or attempt to cause  corporation
to  institute,  or may  institute,  litigation  seeking  to have this  Section V
declared  unenforceable,  or may take, or attempt to take,  other action to deny
Employee the benefits intended under this Section V. In these circumstances, the
purpose of this Section V could be  frustrated.  It is the intent of Corporation
that  Employee  not be  required  to  incur  the  expenses  associated  with the
enforcement  of his rights  under this  Section V by  litigation  or other legal
action because the cost and expense thereof would substantially detract from the
benefits  extended  to  Employee  hereunder,  nor  be  bound  to  negotiate  any
settlement  of his rights  hereunder  under threat of incurring  such  expenses.
Accordingly, if following a change of control, it should appear to Employee that
Corporation has failed to comply with any of its obligations  under this Section
V or in the event  that  Corporation  or any other  person  takes any  action to
declare this Section V void or  unenforceable,  or institute  any  litigation or
other legal action  designed to deny,  diminish or to recover from  Employee the
benefits  intended to be provided to Employee  hereunder  and that  Employee has
complied with all reasonable  obligations  related to Employees  employment with
Corporation,  Corporation  irrevocably  authorizes Employee from time to time to
retain  counsel of his choice at the direct expense and liability of Corporation
as provided in this Section 5.05 to represent  Employee in  connection  with the
initiation or defense of any  litigation  or other legal  action,  whether by or
against  Corporation  or any  director,  officer,  shareholder  or other  person
affiliated with Corporation, in any jurisdiction.  Not withstanding any existing
or prior  attorney-client  relationship  between  Corporation  and such counsel,
Corporation  irrevocably  consents to Employee entering into an  attorney-client
relationship with such counsel, and in that connection  Corporation and Employee
agree that a  confidential  relationship  shall exist between  Employee and such
counsel.  The reasonable fees and expenses of counsel selected from time to time
by Employee as  hereinabove  provided shall be paid or reimbursed to Employee by
Corporation  on a regular,  periodic  basis upon  presentation  by Employee of a
statement  or  statements  prepared  by such  counsel  in  accordance  with  its
customary practices up to a maximum aggregate amount of $500,000, said amount to
be "grossed up" to cover federal and state income taxes. The amount of the gross
up shall be  calculated in accordance  with the following  formula:  A /(1 - R),
where A is the amount of legal fees and R is the combined  highest  marginal tax
rate applicable to Employee in the tax year that the payment is made.

5.06.  No Set-Off,  Corporation  shall not be  entitled  to set-off  against the
amount  payable to Employee any amounts  earned by Employee in other  employment
after termination of his employment with Corporation, or any amounts which might
have been earned by Employee in other employment had he sought other employment.
The  amounts  payable to Employee  under this  Section V shall not be treated as
damages but as severance compensation to which Employee is entitled by reason of
termination of his employment in the circumstances  contemplated by this Section
V. However, a set-off may be taken by Corporation against the amounts payable to
Employee  for  expenses  covering  the  same or  equivalent  hospital,  medical,
accident, and disability insurance coverages as set forth in Section 5.02(c); or
for expenses covering monthly dues and special  assessments of any club of which
Employee was a member at the time of termination  and of which  Corporation  was
paying dues as set forth in Section  5.02(f); or for expenses related to monthly
automobile  allowance as set forth in Section  5.02(g) if such benefits are paid
for the Employee by a new employer after Employee's termination of employment by
Corporation  under  Section 5.02 hereof or after  Employee's  resignation  under
Section 5.03 hereof.

5.07.  Termination.  The provisions of this Section V shall continue  during the
Term hereof but shall terminate when the employment of Employee with Corporation
shall  terminate,  so long as such  termination  was not in  anticipation  of or
related to a change of control.

                                   SECTION VI

                     Indemnification for Service as Director

6.01.  Indemnity  of  Employee.   In  consideration  of  Employee's  service  to
Corporation  as a director of  Corporation  since October 23, 1986,  Corporation
hereby agrees to hold harmless and indemnify  Employee as a director to the full
extent  authorized or permitted by the provisions of the  Pennsylvania  Business
Corporation  Law (the "State  Statute"),  or by any  amendment  thereof or other
statutory  provisions  authorizing or permitting such  indemnification  which is
adopted after the date hereof.

6.02. Maintenance of Insurance and Self-Insurance.

        (a)  Corporation  represents  that it presently  has in force and effect
policies of Directors and Officers  Liability  Insurance  ("D&O  Insurance")  in
insurance companies and amounts as follows (the "Insurance Policies"):
<TABLE>
<S>                                   <C>                     <C>
Insurer                               Policy No.              Amount

Federal Insurance Co.                 8133-97-22              $10,000,000

Lexington Insurance Co.               F0089OD95               $ 5,000,000 in
                                                              excess of the
                                                              above $10,000,000

Stonewall Insurance Co.               TDX9823904              $ 5,000,000 in
                                                              excess of the
                                                              above $15,000,000
</TABLE>

Subject only to the provisions of Section  6.02(b)  hereof,  Corporation  hereby
agrees  that,  so long as  Employee  shall  continue  to serve as a director  of
Corporation  (or shall  continue  at the  request of  Corporation  to serve as a
director, officer, employee or agent of another corporation,  partnership, joint
venture,  trust or other enterprise) and thereafter so long as Employee shall be
subject to any possible claim or threatened,  pending or completed action,  suit
or proceeding,  whether civil,  criminal or  investigative by reason of the fact
that  Employee  was a director  of  Corporation  (or served in any of said other
capacities), Corporation will purchase and maintain in effect for the benefit of
Employee one or more valid,  binding and  enforceable  policy or policies of D&O
Insurance  providing,  in all  respects,  coverage at least  comparable  to that
presently provided pursuant to the Insurance Policies.

        (b) Corporation  shall not be required to maintain said policy or of D&O
Insurance in effect if said insurance is not reasonably  available or if, in the
reasonable  business  judgment of the then directors of Corporation,  either (i)
the premium cost for such  insurance is  substantially  disproportionate  to the
amount of coverage or (ii) the coverage provided by such insurance is so limited
by exclusions that there is insufficient benefit from such insurance.

        (c) In the event  Corporation  does not  purchase and maintain in effect
said policy or policies of D&O Insurance  pursuant to the  provisions of Section
6.02(a) hereof,  Corporation  agrees to hold harmless and indemnify  Employee to
the full extent of the coverage which would otherwise have been provided for the
benefit of Employee pursuant to the Insurance Policies.

6.03. Additional Indemnity.  Subject only to the exclusions set forth in Section
6.04 hereof,  Corporation  hereby  further agrees to hold harmless and indemnify
Employee:

        (a) Against any and all expenses (including attorneys' fees), judgments,
fines and  amounts  paid in  settlement  actually  and  reasonably  incurred  by
Employee in connection with any threatened, pending or completed action, suit or
proceeding, whether civil, criminal,  administrative or investigative (including
an action by or in the right of the Corporation) to which Employee is, was or at
any time becomes a party,  or is threatened to be made a party, by reason of the
fact that Employee is, was or at any time becomes a director,  officer, employee
or agent of  Corporation,  or is or was  serving  or at any time  serves  at the
request of  Corporation  as a  director,  officer,  employee or agent of another
corporation, partnership, joint venture, trust or other enterprise; and

        (b)  Otherwise  to the fullest  extent as may be provided to Employee by
Corporation under the  non-exclusivity  provisions of Section 7-1 of the By-laws
of Corporation and the State Statute.

6.04.  Limitations  additional Indemnity.  No indemnity pursuant to Section 6.03
hereof shall be paid by Corporation:

        (a)  except to the  extent  the  aggregate  of losses to be  indemnified
thereunder  exceeds  the sum of $ 1,000 plus the amount of such losses for which
Employee is  indemnified  either  pursuant  to  Sections  6.01 or 6.02 hereof or
pursuant to any D&O Insurance purchased and maintained by the Corporation;

        (b)     in respect to remuneration paid to Employee if it shall be 
determined by a final judgment or other final adjudication that such 
remuneration was in violation of law;

        (c) on  account  of any  suit in  which  judgment  is  rendered  against
Employee for an accounting of profits made from the purchase or sale by Employee
of securities of Corporation  pursuant to the provisions of Section 16(b) of the
Securities  Exchange Act of 1934 and amendments thereto or similar provisions of
any federal, state or local statutory law;

        (d) on account of  Employee's  conduct  which is finally  adjudged  by a
court  of  competent   jurisdiction   to  have  been  knowingly   fraudulent  or
deliberately   dishonest  or  to  have   constituted   willful   misconduct   or
recklessness;

        (e)     if a final decision by a court of competent jurisdiction shall 
determine that such indemnification is not lawful.

6.05.  Continuation of Indemnity.  All agreements and obligations of Corporation
contained  herein  shall  continue  during the period  Employee  is a  director,
officer,  employee or agent of Corporation  (or is or was serving at the request
of Corporation as a director, officer, employee or agent of another corporation,
partnership,  joint  venture,  trust or other  enterprise)  and  shall  continue
thereafter  so long as  Employee  shall  be  subject  to any  possible  claim or
threatened,  pending or completed  action,  suit or  proceeding,  whether civil,
criminal or investigative, by reason of the fact that Employee was a director of
Corporation or serving in any other capacity referred to herein.

6.06.  Notification and Defense of Claim.  Promptly after receipt by Employee of
notice of the commencement of any action, suit or proceeding,  Employee will, if
a claim in respect thereof is to be made against  Corporation under this Section
VI,  notify  Corporation  of the  commencement  thereof;  but the omission so to
notify  Corporation  will not relieve it from any liability which it may have to
Employee  otherwise than under this Section VI. With respect to any such action,
suit or proceeding as to which Employee notifies Corporation of the commencement
thereof:

        (a)     Corporation will be entitled to participate therein at its own 
expense;

                          and

        (b) Except as otherwise  provided below, to the extent that it may wish,
Corporation jointly with any other indemnifying party similarly notified will be
entitled to assume the defense thereof,  with counsel  satisfactory to Employee.
After  notice from  Corporation  to  Employee  of its  election so to assume the
defense  thereof,  Corporation will not be liable to Employee under this Section
VI for any  legal  or  other  expenses  subsequently  incurred  by  Employee  in
connection with the defense thereof other than reasonable costs of investigation
or as  otherwise  provided  below.  Employee  shall  have the  right  to  employ
Corporation's  counsel  in such  action,  suit or  proceeding  but the  fees and
expenses  of  such  counsel  incurred  after  notice  from  Corporation  of  its
assumption of the defense thereof shall be at the expense of Employee unless (i)
the employment of counsel by Employee has been authorized by  Corporation,  (ii)
Employee  shall  have  reasonably  concluded  that  there may be a  conflict  of
interest between  Corporation and Employee in the conduct of the defense of such
action or (iii)  Corporation  shall not in fact have employed  counsel to assume
the  defense of such  action,  in each of which  cases the fees and  expenses of
counsel  shall  be at the  expense  of  Corporation.  Corporation  shall  not be
entitled to assume the defense of any action,  suit or proceeding  brought by or
on behalf of  Corporation or as to which Employee shall have made the conclusion
provided for in (ii) above.

        (c)  Corporation  shall not be liable to indemnify  Employee  under this
Section VI for any amounts paid in  settlement  of any action or claim  effected
without its written consent. Corporation shall not settle any action or claim in
any manner  which  would  impose any  penalty or  limitation  on  Employee  with
Employee's written consent.  Neither  Corporation nor Employee will unreasonably
withhold its or his consent to any proposed settlement.

6.07.  Repayment  @f  Expenses.  Employee  will  reimburse  Corporation  for all
reasonable  expenses  paid by  Corporation  in  defending  any civil or criminal
action,  suit or proceeding against Employee in the event and only to the extent
that it shall be  ultimately  determined  that  Employee  is not  entitled to be
indemnified by  Corporation  for such expenses under the provisions of the State
Statute, the By-laws of Corporation, this Section VI or otherwise.

6.08. Enforcement.

        (a) Corporation  expressly  confirms and agrees that it has entered into
this Section VI and assumed the  obligations  imposed on  Corporation  hereby in
order  to  induce  Employee  to  continue  as a  director  of  Corporation,  and
acknowledges that Employee is relying upon this Section VI in continuing in such
capacity.

        (b) In the event  Employee  is  required  to bring any action to enforce
rights or to collect  moneys due under this  Agreement and is successful in such
action,  Corporation shall reimburse  Employee for all of Employee's  reasonable
fees and expenses in bringing and pursuing such action.

                                  SECTION VII.

                                  Miscellaneous

7.01.  Use of Name.  Employee  agrees to allow  Corporation  to have his name or
picture used by Corporation for advertising or trade purposes during the term of
this Agreement.

7.02.  Binding  Effect.  This  Agreement  shall  inure to the  benefit of and be
binding  upon  Employee  and upon  Corporation,  their  successors  and assigns,
including,  without limitation, any person, partnership,  company or corporation
which may acquire  substantially all of Corporation's assets or business or into
which Corporation may be consolidated, merged or otherwise combined.

7.03.  Governing  Law.  This  Agreement  shall  be  construed  and  enforced  in
accordance with the laws of the Commonwealth of Pennsylvania.

7.04.  Legal  Construction.  In the  event  any one or  more  of the  provisions
contained in this  Agreement  shall for any reason be held  invalid,  illegal or
unenforceable in any respect,  such invalidity,  illegality or  unenforceability
shall not  effect  any  other  provision  thereof  and this  Agreement  shall be
construed as if such invalid,  illegal or unenforceable provision had never been
contained herein.

7.05.  Amendment.  No amendment,  modification  or alteration of the term hereof
shall be binding  unless the same be in writing,  dated  subsequent  to the date
hereof and duly executed by the parties hereto.

7.06.  Integration.  This Agreement  constitutes  the entire  understanding  and
agreement  between C-COR and Employee  with regard to the subject  matter hereof
and supersedes all other agreements and understandings  between  Corporation and
Employee.

IN WITNESS  WHEREOF,  the parties  hereto have executed this  Agreement with the
intent to be legally bound thereby on the day and year first above written.