SEPARATION AGREEMENT


     THIS AGREEMENT, effective as of April 30, 2000 (the "Effective Date"), is
by and between COYOTE NETWORK SYSTEMS, INC., a Delaware corporation ("Coyote"),
and BRIAN A. ROBSON.

                                    RECITALS

     A. Mr. Robson has been employed by Coyote since 1996 and has served as
Executive Vice President, Chief Financial Officer and Secretary since December
1998.

     B. Pursuant to the terms and conditions hereof, Mr. Robson is hereby
retiring as Coyote's Executive Vice President, Chief Financial Officer and
Secretary.

     C. In recognition of his many years of leadership and service, it is the
desire of Coyote to provide to Mr. Robson certain severance and other benefits,
on the terms and conditions as set out herein.

     D. It is the desire of the parties to resolve any and all issues between
them with respect to Mr. Robson's employment and retirement.

                                   AGREEMENTS

     In consideration of the mutual covenants set forth herein, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:

     1. Mr. Robson's employment as Coyote's Executive Vice President, Chief
Financial Officer and Secretary shall terminate effective April 30, 2000.

     2. Coyote shall pay to Mr. Robson severance pay from May 1, 2000 through
October 31, 2000 at a rate equal to $15,000 per month. In addition, Coyote will
immediately accelerate the vesting of all non-vested stock options for the
purchase of Coyote common stock previously granted to Mr. Robson and grant to
Mr. Robson an additional 50,000 immediately vested options to purchase Coyote
common stock for $5.00/share. All such severance payments shall be subject to
all applicable deductions and withholdings. In connection with the stock options
discussed above, Mr. Robson acknowledges that they will not be available for
exercise until such time as the Company's shareholders approve and authorize the
issuance of a sufficient number of shares of common stock to permit exercise of
such options and an increase in the number of shares in the Company's

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Nonqualified Employee Stock Option Plan (the "Plan") sufficient to cover all
such options under the Plan. The Company agrees to use all commercially
reasonable efforts to obtain such authorizations from the Company's
shareholders. Following those acts, the Company will use all commercially
reasonable efforts to register such shares added to the Plan.

     3. Coyote shall continue to provide medical/dental and life insurance
benefits to Mr. Robson through August 31, 2001 consistent with and at the same
level of benefits as provided by Coyote to Mr. Robson as of the date hereof.
After such date, Coyote shall make available to Mr. Robson standard COBRA
coverage.

     4. Upon submission of appropriate documentation, Coyote shall continue to
reimburse Mr. Robson for his relocation expenses pursuant to the original
agreement between Mr. Robson and Coyote, of which the primary remaining expense
is the payment of Mr. Robson's real estate agent's fees relating to the sale of
his home in New Jersey.

     5. In support of the services to be provided pursuant to paragraph 9 below,
Coyote shall continue to provide to Mr. Robson the laptop computer currently
provided by Coyote and Coyote agrees to reimburse Mr. Robson for all reasonable
out-of-pocket expenses incurred in connection with Mr. Robson's consulting
services performed pursuant to paragraph 9 below.

     6. Mr. Robson shall be subject to the normal non-employee black-out
provisions with respect to all Coyote options held by Mr. Robson.

     7. As a former officer of Coyote, Mr. Robson shall continue to be
indemnified by Coyote, to the fullest extent permitted under the General
Corporation Laws of Delaware and covered under any director and officer's
liability insurance coverage of Coyote in place from time to time.

     8. Coyote and Mr. Robson agree that neither party shall make any
disparaging statements concerning the other or his or its business activities.

     9. Mr. Robson shall, upon reasonable request by Coyote, make himself
reasonably available and otherwise fully cooperate with Coyote regarding
questions or information which is known or may be known by Mr. Robson. In
addition, in consideration of the severance payments and other benefits to be
provided by Coyote to Mr. Robson hereunder, Mr. Robson hereby agrees to perform
consulting services as Coyote may reasonably request from time to time, and to
undertake to confer with representatives of Coyote at Coyote's offices in
Westlake Village, California, as Coyote may reasonably request from time to
time, from the date hereof through August 31, 2000 relating to assisting Coyote
in the

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<PAGE>

preparation and submission of financial reporting and SEC filings under
the direction of Coyote's General Counsel.

     10. Mr. Robson acknowledges that in the course of his employment with
Coyote he received confidential information concerning Coyote and its business.
Mr. Robson shall keep such information confidential and further agrees not to
disclose such information to third parties without the prior written consent of
Coyote. Mr. Robson represents that has returned to Coyote all such information
in his possession of which he has knowledge and he has not taken or retained any
such information in any form other than any such information directly related to
the activities he has agreed to perform under paragraph 9 above. Mr. Robson
further represents that he has returned all other Coyote property in his
possession. Mr. Robson also agrees not to contact or solicit any information
regarding Coyote's business from employees, customers or suppliers other than in
relation to the activities described in paragraph 9 above.

     11. This Agreement shall bind and benefit the heirs, personal
representatives, administrators, successors, and assigns of the parties hereto.

     12. This Agreement shall constitute the entire agreement between the
parties and supersedes all prior representations, understandings, and agreements
of the parties with respect thereto. Any waiver or amendment of any provision of
this Agreement shall be effective only if in writing and signed by the parties
hereto.

     13. Except for the payments and obligations expressed or adopted in this
Agreement, each party waives and fully releases the other from any claims,
demands, or causes of action, known or unknown, arising prior to the date
hereof.

     14. This Agreement shall be governed by the laws of the State of
California.

                                   COYOTE NETWORK SYSTEMS, INC.

                                   BY     /s/ Daniel W. Latham
                                          ----------------------------------
                                          Its  President
                                               -----------------------------


                                          /s/ Brian A. Robson
                                          ----------------------------------
                                                Brian A. Robson

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