SUN TECHNOLOGY ENTERPRISES, INC.
                       DEVELOPMENT AND PURCHASE AGREEMENT

This Agreement is made and entered into by and between Sun Microsystems, Inc., a
Delaware  corporation  having its  principal  place of  business  at 2550 Garcia
Avenue, Mountain View, California 94043 and acting by and through the SunConnect
unit of its subsidiary  Sun Technology  Enterprises,  Inc.  ("SunConnect"),  and
Network Peripherals Inc., a California corporation having its principal place of
business at 1371 McCarthy Boulevard, Milpitas, CA 95035 ("NP").

1.0           DEFINITIONS

              1.1 "Administrator(s)"  means the individuals listed in Section 28
below, or an individual designated by such Administrator.

              1.2 "BOM" means the Bill of Materials  describing the OEM Products
as they are to be delivered to SunConnect set forth in Exhibit A-4, which may be
modified with the mutual written agreement of each party's Administrator.

              1.3  "Development  Deliverable"  means each  deliverable  required
pursuant to the Development Schedule and Deliverables.

              1.4 "Development  Schedule and Deliverables" means the schedule of
tasks, deliverables and completion dates set forth in Exhibit B.

              1.5  "Documentation"  means  the user  manual  and  other  written
materials related to the OEM Products as described in the Product  Specification
and Development Deliverables.

              1.6 "NP  Products"  means the OEM  Products  minus the  Sun-Unique
Elements.

              1.7 "OEM  Products"  means the FDDI Adapter for the  SBbus/Solaris
systems  product line  described in the Product  Specification  (SunLink  FDDI/S
3.x), and any additional  products the parties add by mutual  consent.  The term
"OEM  Products"  shall  include  Documentation  except  with  respect  to  those
instances where this Agreement separately refers to Documentation.

              1.8  "Proprietary   Information"   means  that  information  which
SunConnect  and  NP  desire  to  protect  against  unrestricted   disclosure  or
competitive  use and which,  if disclosed in writing,  is  designated as such in
writing  by the  disclosing  party or, if  disclosed  orally,  is  announced  as
confidential  at the time of its disclosure by the  disclosing  party and within
thirty  (30) days  thereafter  is  summarized  in  writing  and such  summary is
provided to the receiving party.

              1.9  "Product  Specification"  means  the  description  of the OEM
Products set forth in Exhibits A, A-1 and A-2.

              1.10   "SunConnect    Modification"    means   any   modification,
enhancement,  extension  or  addition  of or to the OEM  Products,  in source or
object  code  form,  developed  by or on behalf  of  SunConnect  (but  excluding
modifications developed by NP pursuant to this Agreement).

              1.11  "Sun-Unique  Elements"  means  those  elements  of  the  OEM
Products listed in Exhibit C attached hereto.

              1.12  "Service  Provider"  means an entity  which  SunConnect  has
authorized  to  provide  product   support  to  customers,   which  may  include
distributors, resellers and support partners.

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2.0           DEVELOPMENT OF OEM PRODUCTS

              2.1  Development of OEM Products.  NP and SunConnect  will develop
and test the OEM Products in accordance with the milestones,  delivery dates and
testing  requirements  set forth in the  Development  Schedule  and the  pre-FCS
"SunLink  FDDI/S 3.x Quality  Assurance  Plan  attached  hereto as Exhibit  A-3.
Changes to the Development Schedule and/or the Product Specification may be made
with the mutual written consent of the Administrators of both parties.

              2.2 * "Confidential  portion has been omitted and filed separately
with the Commission."

              2.3 Acceptance of Deliverables.  SunConnect  shall  acknowledge in
writing  or by  electronic  mail its  receipt of each  Development  Deliverable.
SunConnect  will  notify  NP  as  soon  as  possible   whether  the  Development
Deliverable is accepted or rejected,  provided that each Development Deliverable
will be deemed  automatically  accepted if SunConnect's  Administrator  fails to
notify NP in writing that SunConnect  accepts or rejects such deliverable within
thirty (30) days from the date of its delivery.

              2.4  Correction of Errors in  Deliverables.  If, within the thirty
(30)  day  acceptance  period,   SunConnect  notifies  NP  in  writing  that  an
Development  Deliverable  fails  to  satisfy  the  criteria  set  forth  in  the
Development  Schedule or Product  Specification  and  provides NP with a written
explanation  thereof,  NP will have five (5) days to provide  SunConnect  with a
revised schedule for correcting the defect(s) in the non-conforming  Development
Deliverable   and  shall  promptly   institute  and   diligently   execute  such
corrections.

              2.5 FCS Decision. Pursuant to the Development Schedule, SunConnect
is  responsible  for making a "Go/ No Go" decision  regarding the first customer
ship of the OEM Products.  SunConnect will notify NP in writing of the result of
the Go/ No Go  decision  within  two days  after the  decision  is made.  If the
decision is a "go," then this decision will authorize NP to begin the production
phase for the OEM Products and to ship the OEM Products to SunConnect  under the
terms set forth below.

3.0           DOCUMENTATION

              3.1 Documentation  Deliverables.  Development Deliverables related
to Documentation are set forth in Exhibit B.

              3.2 Post-FCS  Documentation.  The parties  will  negotiate in good
faith  to  determine  who  will be  responsible  for  writing  and  implementing
revisions to the  Documentation,  and how related costs shall be  allocated.  NP
will not  distribute  any  modified  Documentation  without  the  prior  written
approval of the SunConnect Administrator.

              3.3  Quality  of  Documentation  Shipped  by NP.  The  quality  of
Documentation  for the OEM  Products  shipped  by NP at and  after  FCS  must be
comparable  with the  quality  of the  current  SunLink  FDDI/S  2.0  documents.
(Notwithstanding  the foregoing  sentence,  the  documentation to be provided to
beta sites by NP may be xeroxed copies of the beta-stage documentation delivered
by  SunConnect  to NP.)  Promptly  after the  Effective  Date. NP will develop a
quality plan to ensure that the Documentation meets the Quality requirements for
post FCS  documentation,  and shall  submit such  quality  plan to  SunConnect's
Administrator for approval.  After such approval the documentation  quality plan
shall be attached as part of the Quality Assurance Plan described in Section 8.1
below.  SunConnect  shall  also have the right to  approve  the  quality  of the
completed Documentation prior to shipment.

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4.0.           OWNERSHIP

              4.1 * "Confidential  portion has been omitted and filed separately
with the Commission."


              4.2 * "Confidential  portion has been omitted and filed separately
with the Commission."

5.0           MAINTENANCE, SUPPORT AND TRAINING.

              5.1  Support to  Customers.  Customer  support  for OEM  Products,
SunLink  FDDI/S 1.0 and  SunLink  FDDI/S 2.0  products  shall be provided as set
forth in Exhibit E.

              5.2 OEM  Product  Repair and  Replacements  Under  Warranty.  If a
SunConnect  Service  Provider  receives  an OEM Product  which is  eligible  for
warranty  service by NP under NP's warranty set forth in Section 23 below,  then
the  Service  Provider  will  return  such  OEM  Product  to NP  for  repair  or
replacement,  and NP shall repair or replace such OEM Product in accordance with
the warranty provided under Section 23.

              5.3 OEM Product Repair and  Replacements  Out of Warranty.  Repair
and Replacement Prices for OEM Products which are not eligible for service under
NP's warranty  ("Out of Warranty OEM  Products")  are set forth in Exhibit F. NP
will  replace Out of Warranty  OEM  Products  for  SunConnect  and  SunConnect's
Service Providers,  and will repair Out of Warranty OEM Products for SunConnect,
SunConnect's  Service  Providers,  customers,   distributors  and  resellers  in
accordance with the procedures and prices in Exhibit F.

              5.4 TOI. NP will provide SunConnect with the information described
in the "Transfer of Information" attached as Exhibit E, and will comply with the
procedures  set forth  therein.  NP hereby grants  SunConnect  an  unrestricted,
fully-paid  license to use,  duplicate,  and  distribute  any TOI  materials  in
whatever  fashion  SunConnect  or its Service  Providers  deem useful to provide
traning in the use of the OEM Products.

6.0           * "Confidential portion has been omitted and filed separately with
the Commission."

7.0           DISTRIBUTION OF NP PRODUCTS

              7.1 No  Distribution  of OEM  Products  by NP.  NP may not sell or
distribute   the  OEM   Products,   or  any  other   products   containing   any
SunConnect-Unique  Element without the express written consent of the SunConnect
Administrator.

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8.0           PRODUCTION OF OEM PRODUCTS

              8.1  Quality  Assurance.  Attached  hereto  as  Exhibit  J is NP's
Quality  Systems  Manual for FCS and subsequent  shipments for ensuring  quality
standards of the OEM Products.

              8.2 NP  Responsibilities.  Except as set for in Section 8.3 below,
NP will be responsible for all aspects of  manufacturing,  assembling,  testing,
packaging  and  delivery  of  the  OEM  Products  to  the  SunConnect-designated
location(s). Each OEM Product delivered to SunConnect will meet the requirements
set forth in Exhibits A (Product  Specifications),  B (Development  Schedule and
Deliverables),  A-4 (BOM), J (Quality  Systems  Manual),  K-1  (Inbound)Outbound
Packaging Requirements),  K-2 (Engineering Specification for Part Identification
Label), K-3 (Corporate  Shipping Container  Graphics  Guideline),  K-4 (Shipping
Carton Color Standard),  K-5 (Specification  for A SunConnect Color:  SunConnect
Medium  Purple),  K-6  (Routing  Guide)  and  Section  15  (Trademark  License).
SunConnect  shall have the right, on reasonable  notice,  to audit NP's premises
and records to verify compliance with these  requirements.  At least thirty (30)
days prior to NP's distribution of the first copy of each commercial  release of
an OEM Product bearing the Sun Trademarks and Trade Dress (as defined in Section
15  below),   NP  shall   provide   SunConnect's   Administrator   with  written
certification  that NP has  adequately  reviewed and tested such OEM Product and
that it conforms to the  requirements of this Section 8.2. NP shall keep written
records of such testing and make them  available  to  SunConnect  promptly  upon
written request.

              8.3      Other Responsibilities.

                       a.   Compact   Disks.   SunConnect   will   initially  be
responsible  for the  mastering  of the  compact  disk to be included in the OEM
Products.  NP will  purchase  the  compact  disks  from  SunConnect's  vendor in
accordance  with  Section  8.11.  (Nothing  herein  shall  be  deemed  to  limit
SunConnect's  right to continue to order and purchase  products from the vendors
fisted in Exhibit  M.) After the FCS of the OEM  Products,  NP will use its best
efforts to identify and reach terms with a compact disk manufacturer within nine
(9) months of the  Effective  Date,  pursuant to which NP would  master  compact
disks without  SunConnect's  assistance.  NP will promptly provide  SunConnect's
Administrator  with the details of such agreement,  including without limitation
all pricing  terms.  SunConnect  may, at its option and in its sole  discretion,
authorize NP to master compact disks directly,  subject to SunConnect's approval
of content and quality.

                       b. Packaging Artwork. SunConnect shall design the artwork
for the OEM Product packaging. The completed artwork is a SunConnect Deliverable
to NP.

              8.4 Copyright  Notices.  The Documentation  shall bear a copyright
notice in the form (C)Sun  Microsystems 19__. NP shall put a copyright notice on
the software  components of the OEM Products and NP Products  incorporating  the
SunLink  Source  Code  stating  (C)Network  Peripherals  19__,  portions  (C)Sun
Microsystems  19__. NP may put an NP copyright  notice on the board component of
the OEM Products.

              8.5 NP Improvements.  NP agrees to keep SunConnect informed of any
improvements to of replacements for existing NP Products or OEM Products planned
to be made  available  during  the term of this  Agreement.  NP agrees to notify
SunConnect's Administrator of such improvements in writing not less than 90 days
prior to  shipment  of NP  Products  incorporating  such  improvements  to third
parties or customers and shall make available such improvements for OEM Products
at no charge to SunConnect, provided that such improvements do not significantly
affect the form,  fit and  function  of the OEM Product in ways that differ from
any  change  in the form,  fit or  function  of the  corresponding  NP  Product.
SunConnect may elect to incorporate such  improvements  into the OEM Products by
notifying NP in

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writing within 30 days after notification of such improvements. If SunConnect so
notifies  NP  within  the 30  day  period,  then  NP  will  ensure  that  any NP
Improvements  are  incorporated  into OEM  Products at least as early as they am
incorporated into NP Products. The terms of Section 10.2 * "Confidential portion
has been omitted and filed  separately  with the  Commission."  will continue to
apply to any improved OEM Products.

              8.6 NP Modifications.  NP will not implement any changes in design
or  manufacture  that might  affect form,  fit or function of the OEM  Products,
including without limitation,  changes in performance,  maintenance  procedures,
interchangeability,  interconnectability,  reliability or  compatibility  of OEM
Products,  without the prior written consent of a SunConnect  Administrator  and
such consent shall not be unreasonably withheld.

              8.7       Mandatory Changes.

                       a.  "Mandatory  Changes," as used herein means any change
necessary to ensure that OEM Products  comply with the following  standards,  as
such  standards  are  constituted  on the  date of  shipment:  (1)  the  Product
Specification;  (2)  applicable  laws  or  regulations;  or (3)  recognized  and
accepted  commercial safety standards for similar products.  NP will. at its own
expense,  supply  SunConnect or SunConnect's  Service  Providers (as directed by
SunConnect)  parts kits and detailed  rework  instructions  for all OEM Products
purchased by SunConnect affected by any Mandatory Change,  regardless of whether
such OEM Products have been delivered to SunConnect, its customers, resellers or
distributors.

                       b. If a Mandatory Change requires replacement of products
already delivered to SunConnect's  customers,  resellers and distributors,  then
SunConnect or SunConnect's Service Provider(s) shall implement such replacements
in  accordance  with the  reasonable  instructions  provided  by NP. NP shall be
responsible for all necessary and reasonable costs incurred by SunConnect or its
Service  Provider(s) in any  replacement of products  delivered to  SunConnect's
customers, distributors and resellers which is required by Section 8.7(a).

              8.8       O/S and Platform Changes.

                       (a)  "Systems  Changes,"  as used herein means any change
necessary to ensure that NP Products remain  compatible with new versions of the
Sun Operating System and new versions of the Sun platform.  NP will use its best
commercial  efforts to develop Systems Changes.  NP agrees to notify  SunConnect
within a reasonable period of time after the release of a new version of the Sun
Operating  System or Sun Platform of Systems Changes planned for the NP Products
and shall make  available  such System  Changes for OEM Products at no charge to
SunConnect.  SunConnect  may elect to  incorporate  System  Changes into the OEM
Products by notifying NP in writing  within 30 days after  notification  of such
System Changes.  If SunConnect so notifies NP within the 30 day period,  than NP
will ensure that any System Changes are available incorporated into OEM Products
at  least  as early as they are  incorporated  into NP  Products.  The  terms of
Section 10.2 * "Confidential  portion has been omitted and filed separately with
the Commission." will continue to apply to any revised OEM Products.

                       (b)  When  Systems  Changes  am not  planned  for  the NP
Products,  then  SunConnect may request such changes in accordance  with Section
8.9 and the parties will mutually develop a development schedule.

                       (c) NP will  perform all required  compatibility  testing
for all new Sun  Operating  Systems  and  new  Sun  platforms  at NP's  expense.
SunConnect  will provide NP with the necessary  equipment  and operating  system
software to perform such testing.

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               8.9     SunConnect Requested and Required Changes.

                       a.  SunConnect  may,  at any  time,  require  changes  in
writing  to any of the  following:  method  of  shipment  or  packing;  place of
delivery,  or the Exhibits marked with an * in Section 29.8 ("Required Change").
In  addition,  SunConnect  may,  at any  time,  request  changes  to  applicable
drawings,  designs or specifications,  or to ensure compatibility with other new
or modified SunConnect products ("Requested Change").

                       b. If a Required or Requested  Change  causes an increase
in the cost or the time  required by NP for  performance  of any purchase  order
issued under this  Agreement and NP so notifies  SunConnect in writing,  then if
SunConnect  wishes such  Requested or Required  Change to be made,  an equitable
adjustment  will be made in the  price  or  delivery  schedule  or both  and the
Agreement and/or any applicable  purchase order will be modified  accordingly in
writing.  Claims by NP for adjustment due to a SunConnect  Requested or Required
Change order must be made within fifteen (15) days from the date of NP's receipt
of the change order;  provided,  however,  that such period may be extended upon
the written approval of SunConnect.

                       c.  If  any  SunConnect   Requested  or  Required  Change
requires reworking of any OEM Product already delivered to SunConnect,  NP will,
at SunConnect's  expense,  supply  components for all OEM Products  purchased by
SunConnect affected thereby.

              8.10  NP  Purchase  from  SunConnect  Suppliers.  NP may  purchase
specific components for the OEM Products from specified  SunConnect suppliers as
SunConnect's  authorized  sub-contractor  as set  forth on  Exhibit  M. NP shall
comply with all  applicable  provisions  of the  SunConnect  contract  with such
suppliers.  SunConnect  agrees  to  provide  NP  with  the  text  of  applicable
provisions.  All items so purchased must be used in OEM Products, and may not be
used in NP Products or other  products  without the express  written  consent of
SunConnect.

              8.11 NP  Sub-Contractors.  NP may  subcontract  the  production of
components  of the OEM Products to  suppliers,  provided that each such supplier
agrees to and fulfills all quality and compliance requirements set forth in this
Agreement and its Exhibits.

              8.12 Future  Cooperation.  The parties  agree to work  together to
evaluate and develop new  technologies  and products for FDDI network  interface
cards as mutually  agreed to. If new  products are  developed,  the parties will
negotiate  an  agreement  with terms as similar as possible  to this  Agreement,
except that product  specifications,  pricing and leadtimes may be different for
such new products.

9.0           PURCHASE OF OEM PRODUCTS

              9.1 Orders.  SunConnect  shall order OEM  Products by  telecopier,
telephone,  electronic  data  interchange  ("EDI") as specified in Section 16.3,
and/or in writing on SunConnect's  standard  purchase order form. Each telephone
order shall be  confirmed  by a hard-copy  purchase  order  within five (5) days
after the placement of such telephone order. All orders for OEM Products will be
governed  by  this  Agreement  and  shall  not  be  governed  by  the  terms  of
SunConnect's  or NP's purchase order,  acceptance or other form documents.  This
Agreement does not constitute a purchase order  SunConnect shall be liable under
this  Agreement  only for those OEM Products  covered by a  SunConnect  purchase
order.

              9.2 Sale to SunConnect  Subcontractors.  NP shall sell and license
OEM  Products  under  the  pricing  and terms  set  forth in this  Agreement  to
SunConnect-designated  subcontractors  ("Subcontractors")  upon express  written
authorization  by  SunConnect.  SunConnect  shall be  liable to pay only for OEM
Products  ordered by and invoiced  directly to SunConect and shall not be liable
to pay for

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any OEM Products ordered by Subcontractors. All purchases made by Subcontractors
shall be added to SunConnect's cumulative volume of OEM Products purchased.

              9.3  Forecasts.  SunConnect  shall  supply  a  six  month  rolling
forecast by the 10th day of each month,  with the first two months broken out by
week.  The  first  two  months  shall be backed  by a  purchase  order  which is
non-cancelable.  The third month of the forecast is a firm commitment, which may
be rescheduled as specified in Section 14.1.

              9.4 SoftwarelFirmware  License. With respect to OEM Products which
contain NP software and/or firmware (Software').  NP hereby grants to SunConnect
a perpetual,  nontransferable,  nonexclusive license to use, market,  distribute
and  sublicense  the use of the  Software  in  object  code  form  only,  and to
authorize  others  to do the  foregoing,  solely in  conjunction  with the sale,
license, loan of distribution of the OEM Products.

              9.5 * "Confidential  portion has been omitted and filed separately
with the Commission."

10.0          PRICE OF OEM PRODUCT(S).

              10.1  Pricing.  The prices and  applicable  discounts  for the OEM
Products  are  specified  in Exhibit N. The prices set forth in Exhibit N do not
include freight or taxes, and all applicable  federal,  state and local sales or
use taxes shall be separately stated on NP's invoice. SunConnect shall be liable
to NP for the payments of such sales or use taxes only if SunConnect  has failed
to comply with the statutory resale tax certificate requirements of states where
appropriate.

              10.2 * "Confidential portion has been omitted and filed separately
with the Commission."

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              10.3 * "Confidential portion has been omitted and filed separately
with the Commission."

              10.4 Price  Notification.  During the tenth week of each  calendar
quarter, NP will provide to a SunConnect Administrator a written confirmation of
the price of each OEM  Product  and  component  thereof,  as such price has been
determined  in  accordance  with  Sections 10.1 10.3. NP will provide such price
confirmation whether or not any price has changed from the previous quarter. The
prices set forth in such  notification  will be deemed  accepted  if  SunConnect
fails to notify NP in writing of any  disagreement  within 10 days after receipt
of the notification by the SunConnect Administrator.

              10.5 Special Requests. If SunConnect requests NP to manufacture or
deliver OEM Products to SunConnect on special terms which will cause an increase
in  the  manufacturing   cost  to  NP,  then  NP  shall  notify  the  SunConnect
Administrator in writing, specifying the additional costs and available options.
SunConnect shall have 10 day to accept or reject such additional costs.  Failure
to respond shall be deemed a rejection of such additional costs and such special
terms.

11.0          SHIPMENT AND DELIVERY

              11.1 Leadtimes and Delivery Dates.  Leadtimes for OEM Products are
set forth in Exhibit N. NP agrees to accept and deliver the full quantity of OEM
Products  ordered on the delivery dates  requested by SunConnect,  to the extent
that such dates are in  conformance  with  leadtimes  set forth in Exhibit N, or
otherwise  mutually-agreed  to  delivery  dates  ("Agreed  Delivery  Date").  If
SunConnect  requests  delivery  dates  earlier than the  leadtimes  set forth in
Exhibit  N, NP  agrees  to use  commercially  reasonable  efforts  to meet  such
requested  delivery dates or to propose the earliest possible alternate delivery
dates.

              11.2  Delayed  Delivery  Dates.  If NP is  unable to  deliver  OEM
Product on the Agreed  Delivery Date, NP shall promptly  notify the  appropriate
SunConnect  materials  management  personnel (as  identified  by the  SunConnect
Administrator),  giving  SunConnect a new delivery date.  SunConnect may, at its
option, (1) accept the new delivery date, (2) reschedule the purchase order, (3)
require NP, at NP's expense,  to use any expedited  transportation  methods that
are available to deliver the OEM Products to SunConnect or a designated customer
via Drop Ship as quickly  as  possible,  or, if new date is greater  than 5 days
after Agreed Delivery Date, (4) cancel the purchase order without liability.  In
all cases,  NP agrees to respond to  SunConnect's  purchase orders within 3 days
after receipt. Time is of the essence with respect to this agreement.

              11.3  Overshipments.  SunConnect  will  pay  only  for  quantities
ordered.  At SunConnect's  option,  overshipments will be returned to NP at NP's
risk freight  collect.  NP shall credit  SunConnect  with the amount of outbound
freight attributable to such returned overshipments.

              11.4 Early  Shipments.  For OEM Products  delivered more than five
(5) days in advance of the Agreed  Delivery  Date(s),  SunConnect may (i) return
such OEM Products to NP freight

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collect,  or (ii) accept such OEM Products  with  payment  based upon the Agreed
Delivery Date(s) and not the date of receipt by SunConnect.

              11.5  Partial  Deliveries.  NP shall  use  reasonable  efforts  to
deliver  the full number of OEM  Products  ordered by  SunConnect  on the Agreed
Delivery  Date(s).  If NP is unable to deliver the full  number of OEM  Products
ordered,  NP shall notify SunConnect  promptly,  and SunConnect shall consent to
such partial  delivery  provided  that the Agreed  Delivery  Date is met for the
deliverable  portion.  Partial deliveries shall be separately invoiced by NP and
paid for by SunConnect without regard to subsequent deliveries.  The undelivered
portion of the order shall be subject to the terms of Section 11.2.

              11.6 * "Confidential portion has been omitted and filed separately
with the Commission."

               11.7     Shipping Documents and Markings.

                       a. Shipping  labels and  containers  must comply with the
requirements set forth in Section 8.2 above.

                       b. Shipping  documentation must be complete and accurate.
This  documentation  must include the SunConnect part number, the manufacturer's
part number, the total quantity shipped,  the SunConnect  purchase order number,
the number of shipping  containers  in the  delivery,  the quantity per shipping
container,  indication  of  partial/complete  shipment and the  waybill/Bill  of
Lading number.

              11.8  Shipping  Reports.  NP will deliver to  SunConnect  shipping
reports specified in Exhibit O.

              11.9 * "Confidential portion has been omitted and filed separately
with the Commission."

              11.10  *   "Confidential   portion  has  been  omitted  and  filed
separately with the Commission."

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              11.11 Import and Export Licenses. NP shall provide all information
under its control  which is  necessary  or useful for  SunConnect  to obtain any
export or  import  licenses  required  for  SunConnect  to ship or  receive  OEM
Products,  including, but not limited to, U.S. customs certificates of delivery,
affidavits of origin, and U.S. Federal Communications Commissions identifier, if
applicable.  The  parties  agree  not to  export  or  re-export,  or cause to be
exported  or  re-exported,  the OEM  Product,  any  technical  data of any  kind
received  hereunder,  or the direct  product  of such  technical  data,  without
complying with the laws of the United States, regulating the same.

              11.12 End of Term Orders.  Purchase  orders  placed by  SunConnect
prior to the end of the Term for which the Agreed Delivery Date(s) are after the
end of the Term shall  continue to be governed  by the terms and  conditions  of
this Agreement.

12.0          PAYMENT

              12.1 Invoice Contents.  Upon shipment of OEM Products ordered,  NP
will submit an invoice  showing invoice number and date,  remit to address,  the
purchase order number, SunConnect part number,  description of each OEM Product,
quantity of each OEM Product,  unit  prices,  each  applicable  tax and extended
totals.

              12.2  Payment  of  Invoice.  SunConnect  shall  be  invoiced  upon
shipment of OEM Product and shall pay each invoice when due. Payment terms are *
"Confidential   portion  has  been  omitted  and  filed   separately   with  the
Commission."  days after shipment to SunConnect's  "Ship to" location of the OEM
Product  covered by the  invoice,  unless  SunConnect  notifies  NP prior to the
payment due date that such OEM  Products am defective  or  nonconforming  in any
manner.

              12.3 Payment Not  Acceptance.  SunConnect's  payment of an invoice
does not  constitute  acceptance  of OEM  Products.  Invoices will be subject to
adjustment for errors, shortages, defects in OEM Products or other failure of NP
to meet the requirements of this Agreement.

13.0          ACCEPTANCE AND QUALITY

              13.1  Compliance  with  Standards.  Each OEM Product  delivered to
SunConnect  shall meet all  requirements  set forth in Section  8.2.  SunConnect
shall not be required  to accept any such OEM  Product  which does not meet such
standards.

              13.2 Audits. SunConnect or its agent may perform reasonable source
inspection and quality assurance audits at NP's facility. SunConnect retains the
right to  periodically  audit NP's  facilities and records to validate  incoming
quality data, test yield data and manufacturing yield data.

              13.3 Quality  Reports.  Within 7 days after the end of each month,
NP shall provide to a SunConnect  Administrator  a written  quality  report in a
form approved by a SunConnect Administrator for the immediately preceding month.

              13.4 Effect of Defects.  If any of the OEM Products are  defective
in  material  or  workmanship  or are  otherwise  not  in  conformity  with  the
requirements of this Agreement,  NP and SunConnect will work together to develop
a plan to correct such defects or nonconformities. If a plan has not been agreed
to within five (5) business days, then SunConnect may either:

                       a. Reject and return an entire lot(s) for  replacement in
which event NP shall,  at NP's expense,  replace  Product(s)  within twenty (20)
working days;

                       b. Perform  one-hundred  percent (100%) testing,  at NP's
expense, retain all conforming Product and reject all nonconforming Product. Any
Product that has been rejected or

                                       10

<PAGE>


required to be corrected  must be replaced or corrected by and at the expense of
NP promptly after notice; or

                       c. Accept it with a mutually  agreed-upon  adjustment  in
price.

              13.5  Returns.  NP  shall  issue a Return  Material  Authorization
("RMA")  within  two (2)  business  days  after  SunConnect's  request to return
defective OEM Products  pursuant to the product warranty  procedure as described
under Section 23. Any  additional  terms of the RMA procedure  shal1 be mutually
agreed to between the parties.  SunConnect shall include the RMA number with all
returns.

14.0          RESCHEDULING AND CANCELLATION.

<TABLE>
              14.1  Rescheduling.  SunConnect  may reschedule all or any part of
any purchase  order or forecast  under this Agreement for a new delivery date up
to ninety (90) days after the Agreed Delivery Date in accordance with the limits
as follows:

<CAPTION>
------------------------------------- ---------------------------------- -----------------------------------
Number  of  Days   Prior  to  Agreed  Maximum  Dollar Value of Purchase  Date  on  Which  Delivery  Must Be
Delivery Date  Reschedule  Notice is  Order Which May Be Rescheduled     Accepted
Received
------------------------------------- ---------------------------------- -----------------------------------
<S>                                   <C>
            61 - 90 Days              * "Confidential portion has been omitted and filed separately with
                                      the Commission."

------------------------------------- ----------------------------------------------------------------------
            0 - 60 Days               * "Confidential portion has been omitted and filed separately with
                                      the Commission."

------------------------------------- ----------------------------------------------------------------------
</TABLE>


Purchase orders may not be rescheduled more than twice.

                       14.2 *  "Confidential  portion has been omitted and filed
separately with the Commission."

                       14.3 *  "Confidential  portion has been omitted and filed
separately with the Commission."

                       14.4 *  "Confidential  portion has been omitted and filed
separately with the Commission."

15.0          TRADEMARK LICENSE

              15.1   Trademarks  And  Trade  Dress.   The  packaging,   artwork.
documentation  and other  materials  provided to NP by SunConnect  hereunder may
contain  Sun   Microsystems,   Inc.  ("Sun")   trademarks  and  or  trade  dress
requirements ("Sun Trademarks and Trade Dress").

              15.2 Grant Of License.  SunConnect  grants to NP a  non-exclusive,
royalty-free,  nontransferable  license  for  the  term  of  this  Agreement  to
reproduce  the  Sun  Trademarks  and  Trade  Dress  in the  United  States  (the
"territory")  solely for the purpose of producing  the OEM Products for delivery
to

                                       11

<PAGE>


SunConnect  hereunder.  NP is  granted  no other  right,  title or  license.  In
particular, NP shall not use the Sun Trademarks or Trade Dress on any item other
than the OEM Products; shall not deliver any item marked with the Sun Trademarks
or Trade Dress to any entity other than  SunConnect or its affiliated  companies
unless specifically directed in writing by SunConnect's Administrator; and shall
have no right to sublicense the Sun Trademarks or Trade Dress.

              15.3 Territory. NP shall not use the Sun Trademarks or Trade Dress
outside the United States (the "Territory") without the prior written consent of
Sun's  Administrator.  SunConnect may refuse to extend the Territory in its sole
discretion.

              15.4 Quality Standards.  NP shall use the Sun Trademarks and Trade
Dress only on  Software  Products  that  conform to the  standards  set forth in
Section 8.2, including the certification requirement therein.

              15.5  Trademark  Usage.  NP shall not modify the Sun Trademarks or
Trade Dress in any fashion  whatsoever  without written  instructions from Sun's
Administrator.  NP will not place any NP or third party  trademark,  trade name,
logo or other  identifying  material  on the OEM  Products  without  the written
consent of SunConnect's Administrator.

              15.6  Protection Of The Sun  Trademarks.  Sun is the sole owner of
the Sun Trademarks and Trade Dress and all goodwill associated  therewith.  NP's
use of the Sun  Trademarks  and Trade Dress inures solely to the benefit of Sun.
NP shall not do anything  that might harm the  reputation or goodwill of the Sun
Trademarks or Trade Dress.  NP shall not challenge Sun's rights in or attempt to
register the Sun  Trademarks or Trade Dress,  or any other name or mark owned by
Sun or substantially  similar thereto. NP shall take no action inconsistent with
Sun's  ownership of the Sun  Trademarks  and Trade  Dress.  if it at any time NP
acquires any rights in, or registration  or application  for, the Sun Trademarks
or Trade  Dress by  operation  of law or  otherwise,  it will  immediately  upon
request by Sun or SunConnect and at no expense to Sun or SunConnect, assign such
rights,  registrations,  or applications to Sun, along with any and all goodwill
associated  with the Sun  Trademarks  and Trade  Dress.  The  parties  agree and
acknowledge  that Sun remains  responsible for the protection and maintenance of
the Sun Trademarks and Trade Dress. NP will, if requested by SunConnect, provide
assistance  in matters  relating to this  Trademark  License,  including but not
limited to (a) giving prompt written notice to SunConnect's Administrator of any
known or potential  infringement  of the Sun Trademarks or Trade Dress,  and (b)
cooperating  with  SunConnect in the  preparation and execution of any documents
necessary  to record  this  Trademark  License  with the  appropriate  trademark
authorities.  SunConnect  shall reimburse NP for the reasonable costs associated
with providing such assistance,  except to the extent that any such costs result
from a  breach  of this  Agreement  by NP,  NP shall  not  commence  any  action
regarding the Sun Trademarks or Trade Dress without  SunConnect's  prior written
consent.

              15.7 Disclaimer Of Warranties By SunConnect.  SUNCONNECT  MAKES NO
WARRANTIES OF ANY KIND  RESPECTING THE SUN TRADEMARKS OR TRADE DRESS,  INCLUDING
THE  VALIDITY  OF SUN'S  RIGHTS  IN THE SUN  TRADEMARKS  OR  TRADE  DRESS IN ANY
COUNTRY, AND DISCLAIMS ANY AND ALL WARRANTIES RELATING TO THE SUN TRADEMARKS AND
TRADE DRESS THAT MIGHT OTHERWISE BE IMPLIED BY APPLICABLE LAW

              15.8 * "Confidential portion has been omitted and filed separately
with the Commission."

                                       12

<PAGE>


16.0          PROGRAMS AND SERVICES

              16.1 POU/DTS Program.  The parties will negotiate in good faith to
develop  with NP a POU/DTS  Program.  Such  program  shall be designed to supply
SunConnect  with OEM  Product(s)  that  meets  established  quality  levels  and
eliminate incoming inspection.

              16.2 Just In Time Delivery Program.  The parties will negotiate in
good faith to develop with NP a Just In Tune delivery program ("JIT").  Such JIT
shall be designed to supply  SunConnect  with the OEM  Product(s) at the time at
which  SunConnect  requires  such OEM  Product(s)  so as to reduce the inventory
which SunConnect is required to retain in order to meet its production needs.

              16.3 Electronic Data Interchange (EDI) Program.  Should SunConnect
and NP enter into an EDI Program which is designed to allow SunConnect and NP to
transmit  electronically all data and information  necessary to conduct business
between the two companies,  it shall be pursuant to the terms and conditions set
forth in Exhibit P.

              16.4 Score Card  Criteria.  The Score Card is a  measurement  tool
used to rate NP's overall performance,  including,  but not limited to, quality,
delivery,  technology,  price and service. NP acknowledges that, at SunConnect's
option, NP may be evaluated in accordance therewith and agrees to cooperate with
SunConnect in this  process.  A copy of  SunConnect's  Score Card criteria and a
sample of the ScoreCard has been provided to NP.

              16.5 Co-Marketing. The parties may enter into agreements regarding
co-marketing of the OEM Products.

17.0          SAFETY COMPLIANCE AND STANDARDS

              17.1 Specification. NP warrants that each OEM Product delivered to
SunConnect will meet the requirements of Section 1.4 (Compliance with standards)
of Exhibit A-1 throughout the Term.  Design changes on OEM Products which affect
compliance  status,  and design changes which may be required due to a change in
the compliance standards,  shall be submitted by NP for reapproval at NP's cost.
NP shall provide confirmation of such approvals to SunConnect's Administrator or
Administrator's  designee  within  thirty  (30)  days  after  execution  of this
Agreement  or  receipt  of  approval,   as   applicable.   Such  approvals  must
specifically identify the OEM products as SunConnect products.

              17.2  Applicable Law. NP warrants and represents that OEM Products
comply with all  applicable  federal,  state,  administrative  and foreign laws,
statutes and regulations for all countries to which NP distributes its products.
NP agrees to notify SunConnect of any post-sale  warnings,  retrofits or recalls
which NP implements with respect to any of the OEM Products.

              17.3 ISO Certification. NP will use its best efforts to become ISO
9001 certified  within 18 months from the Effective Date of this Agreement,  and
to remain ISO - certified throughout the term of this Agreement.

                                       13

<PAGE>


18.0         DISCONTINUED PRODUCTS

              18.1 Product  Discontinuance by NP. NP will not discontinue any of
the OEM  Products  during the Initial Term of this  Agreement  without the prior
written consent of SunConnect's  Administrator.  During any renewal term, NP may
discontinue  the  manufacture  and sale of an OEM  Product  upon six (6) month's
prior written notice to SunConnect, so long as NP does not sell such OEM Product
to any  other of its  customers  after  it stops  selling  such OEM  Product  to
SunConnect. Within sixty (60) days after receipt by SunConnect of written notice
of such discontinuance ("Notice Date"), SunConnect may place and NP shall accept
a binding.  non-cancelable  written commitment for such discontinued OEM Product
for delivery over a one (1) year period  following the Notice Date. OEM Products
to be delivered  during this one year period may be  rescheduled as specified in
Section 14.1, provided that no OEM Product may be rescheduled for delivery after
the first  anniversary  of the Notice  Date.  Discontinuance  of any OEM Product
shall also be subject to the provisions of Section 19 of this Agreement.

              18.2 Component  Discontinuance by NP's Vendors.  If NP learns that
any of the  components  in an OEM  Product is being  discontinued  and cannot be
replaced with a component with similar functionality at the same or lesser cost,
then NP shall notify the  SunConnect  Administrator.  NP will use all reasonable
commercial efforts to develop an appropriate  solution,  subject to SunConnect's
reasonable approval.

              18.3  Product   Discontinuance   by  SunConnect.   SunConnect  may
discontinue any OEM Product on six (6) months notice to NP.

19.0          * "Confidential portion has been omitted and filed separately with
the Commission."

                                       14

<PAGE>


20.0          PROPRIETARY INFORMATION

              20.1 Duty of Non-Disclosure. Each party shall, at all times during
the term of this Agreement and for five (5) years thereafter, keep in confidence
and trust all of the other's Proprietary  Information  disclosed to it and shall
not use such Proprietary  Information other than as permitted under the terms of
this Agreement,  nor shall either party disclose Proprietary  Information of the
other to any third party except as permitted hereunder without the prior written
consent of the  disclosing  party.  Both parties  acknowledge  that  information
disclosed  orally and announced at the time of such disclosure which is specific
to the design and properties of the SunLink Source Code and the Escrow Materials
(as defined in Section 19.4) shall be considered Proprietary Information without
the need for a subsequent writing summarizing the contents of the disclosure.

              20.2  Standard of Care.  Each party shall use the same standard of
care to prevent  disclosure of the  Proprietary  Information  of the other party
which it uses to safeguard  its own  valuable  confidential  information  and/or
trade  secrets,  and in no event km than a  reasonable  degree  of care for such
information;  provided,  however,  that  neither  party  shall be liable for any
inadvertent or unauthorized  disclosure of Proprietary  Information occurring if
it exercises at least the standard of care set forth above to prevent disclosure
and  takes   reasonable  steps  to  mitigate  any  damage  and  prevent  further
disclosure.  Each party shall promptly notify the other if it becomes aware that
the other party's Proprietary  Information has been or is likely to be disclosed
without authorization under this Agreement.

              20.3  Advising  Employees.  Each party dull  inform its  employees
having access to the Proprietary Information of such party's limitations, duties
and  obligations  regarding   non-disclosure  and  copying  of  the  Proprietary
Information  and shall obtain their  agreement,  whether by means of existing or
new agreements, to comply with those limitations, duties and obligations.

                                       15

<PAGE>


              20.4 Exceptions.  Notwithstanding any provisions herein concerning
non-disclosure and non-use of the Proprietary  Information,  neither party shall
have any  obligations  concerning the disclosure or use of any such  information
which: (a) is already known to receiving party other than by previous disclosure
under an obligation of confidentiality; (b) is or becomes publicly known through
publication,  inspection  of product or otherwise and through no wrongful act of
the  receiving  party,  (c) is  received  from a  third  party  without  similar
restriction and without breach of this  Agreement,  (d) is disclosed or released
for disclosure by the disclosing  party to others  without  restriction,  (e) is
disclosed in accordance  with the specific  written  approval of the  disclosing
party; or (f) has been independently developed by the receiving party.

              20.5  Disclosure  Required by Law.  Either  party may disclose any
Proprietary  Information  to the  extent  necessary  to  comply  with  any  law,
regulation or other governmental requirement provided that such party previously
notifies the other party so that it may take appropriate protective measures.

              20.6 Future Development.  Each party to this Agreement understands
that the party  receiving  Proprietary  Information  may now or in the future be
developing  proprietary   information   internally,   or  receiving  proprietary
information  from third parties in  confidence  that may be similar to disclosed
Proprietary  Information.  Accordingly,  nothing  in  this  Agreement  shall  be
construed as a  representation  or inference  that the receiving  party will not
develop  products,  for  itself  or  others,  that  compete  with the  products,
processes,  systems  or  methods  contemplated  by  the  disclosed  Confidential
Information.

              20.7     Inventions.

                       a. All discoveries. improvements and inventions conceived
or first reduced to practice, as those terms are used before the U.S. Patent and
Trademark  Office,  in the  performance  of  this  Agreement  ("Inventions")  by
SunConnect's  personnel  shall be the sole and exclusive  property of SunConnect
and SunConnect  shall retain any and all rights to file any patent  applications
thereon.  All  Inventions  of NP's  personnel  shall be the  sole and  exclusive
property  of NP and NP  shall  retain  any and all  rights  to file  any  patent
applications thereon.

                       b. *  "Confidential  portion  has been  omitted and filed
separately with the Commission."

                       c. The provisions of this Section 20.7  regarding  rights
of ownership * "Confidential  portion has been omitted and filed separately with
the  Commission.",  sharing of expenses and licenses shall also apply to work of
the parties and results obtained with respect to  copyrightable  subject matter,
mask work rights and trade secrets.

21.0          * "Confidential portion has been omitted and filed separately with
the Commission."

                                       16

<PAGE>


22.0          INSURANCE. During the term of this Agreement, NP, at its sole cost
and expense,  shall carry and maintain  Commercial  General Liability  Insurance
with an "A" rated  company or companies  insuring  NP, its agents,  employees or
associates  covering  all  operations  of NP  including,  but  not  limited  to,
Products/Completed  Operations and Blanket  Contractual  Liability  specifically
covering the  indemnification  provisions  in Section 21.0,  against  claims for
personal and bodily injury and property  damage with a combined  single limit of
$2,000,000.

23.0          WARRANTY.

              23.1 Non-Infringement.  NP hereby warrants that: (i) has the right
and power to enter into this  Agreement  and to grant the  rights  and  licenses
granted to SunConnect hereunder; and (ii) the OEM Products will not infringe any
patent,  copyright,  trade secret or other  intellectual  property  right of any
third party.

              23.2 Product Warranty. NP warrants that all OEM Products delivered
hereunder are new, unused and will perform in accordance with the Documentation,
and will achieve any function  described  therein,  will be free from defects in
design, material and workmanship and will substantially

                                       17

<PAGE>


comply with the  requirements  of this Agreement for a period of * "Confidential
portion has been omitted and filed  separately  with the  Commission."  from the
date of acceptance  by SunConnect of OEM Products.  When any OEM Products do not
meet the foregoing warranty, and SunConnect or its Service Providers so notifies
NP in writing  within the  warranty  period,  NP will  repair or replace the OEM
Product as quickly as  possible,  but in no event  later than  twenty  (20) days
after receipt of notification or as otherwise agreed to between the parties.  NP
shall  have no  obligation  hereunder  to make  repairs  or  cause  replacements
required through normal wear and tear.

              23.3 Disclaimer.  EXCEPT FOR THE EXPRESS WARRANTIES STATED IN THIS
AGREEMENT, NP MAKES NO ADDITIONAL WARRANTIES,  EXPRESS, IMPLIED OR STATUTORY, AS
TO  ANY  MATTER   WHATSOEVER.   IN   PARTICULAR,   ANY  AND  ALL  WARRANTIES  OF
MERCHANTABILITY  AND FITNESS FOR A PARTICULAR PURPOSE ARE EXPRESSLY  DISCLAIMED.
NO PERSON IS AUTHORIZED  TO MAKE ANY OTHER  WARRANTY OR  REPRESENTATION  ON NP'S
BEHALF  CONCERNING THE PERFORMANCE OF THE OEM PRODUCTS OTHER THAN AS PROVIDED IN
THIS AGREEMENT.

24.           TERM AND TERMINATION

              24.1  Term.   Subject   to  the   provisions   of   Section   24.1
("Assignment"),  this  Agreement  shall commence on the Effective Date and shall
continue for * "Confidential  portion has been omitted and filed separately with
the  Commission."  ("Initial  Term"),  and thereafter  this  Agreement  shall be
automatically  renewed for  additional  one (1) year periods unless either party
gives  written  notice  of  termination  at least  sixty  (60) days  before  any
anniversary  of the  execution  date after the end of the Initial Term or unless
sooner terminated in accordance with the provisions hereof (the "Term").

              24.2  Termination  by Either  Party.  Either party may, by written
notice,  and/or  suspend its  performance  under this  Agreement,  or cancel any
purchase hereunder without penalty, if the other party:

                       a.  fails to comply  with any of the  material  terms and
conditions of this Agreement,  the other party may terminate this Agreement upon
thirty (30) days' written  notice to the  defaulting  party  specifying any such
breach,  unless within the period of such notice, all breaches specified therein
shall have been  remedied  or, for breaches  which by their nature  require more
than thirty (30) days to remedy,  the parties  shall have agreed upon a plan for
the defaulting party to remedy such breaches.

                       b.   becomes   bankrupt,   becomes  the  subject  of  any
proceedings  seeking  relief or  reorganization  which are not stayed  within 60
days, or makes an assignment for the benefit of creditors.

              24.3  Negotiation of Disputes.  Both parties agree to negotiate in
good faith the  settlement  of any dispute  that may wise under this  Agreement.
Pending  negotiations toward settlement of any dispute, NP agrees to continue to
develop,  fabricate,  and deliver OEM Products under the terms of this Agreement
and  SunConnect  agrees to make  payments on  invoices  due in  accordance  with
Section 12.

              24.4 Effect of  Termination.  If this  Agreement is terminated for
NP's default,  SunConnect  may, at its sole option  require NP to transfer title
and to deliver to  SunConnect,  in the  manner  and to the  extent  directed  by
SunConnect,  (i) all  completed  OEM  Products  not yet  delivered  and (ii) any
partially  completed OEM Products and materials that NP has produced or acquired
for the  performance  of the  terminated  portion.  Payment for OEM Products and
materials  delivered to and accepted by SunConnect under this Section will be at
a price (not to exceed the contract price) agreed upon by NP and SunConnect.

                                       18

<PAGE>


              24.5 No Damages  for  Termination.  Neither  party  shall have the
right to recover  damages or  indemnification  of any nature,  whether by way of
lost profits, expenditures for promotion, payment for goodwill or otherwise made
in  connection  with the business  contemplated  by this  Agreement,  due to the
expiration  or permitted or lawful  termination  of this  Agreement.  EACH PARTY
WAIVES AND RELEASES THE OTHER FROM ANY CLAIM TO  COMPENSATION  OR INDEMNITY  FOR
TERMINATION OF THE BUSINESS RELATIONSHIP UNLESS SUCH TERMINATION IS IN BREACH OF
THIS AGREEMENT.

25.0          LIMITATION OF LIABILITY.  EXCEPT FOR DAMAGES ARISING UNDER SECTION
21 *  "Confidential  portion  has been  omitted  and filed  separately  with the
Commission.",  IN NO EVENT WILL EITHER  SUNCONNECT  OR NP BE LIABLE TO THE OTHER
FOR THE OTHER'S SPECEAL,  INCIDENTAL,  OR CONSEQUENTIAL  DAMAGES HOWEVER CAUSED,
EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY THEREOF.

26.0          RELATIONSHIP  OF  PARTIES.  Neither  party  shall  have,  or shall
represent that it has, any power, right or authority to bind the other party, or
to assume or create any  obligation or  responsibility,  express or implied,  on
behalf of the other party or in the other party's name.  Nothing  stated in this
Agreement  shall be construed as  constituting  NP and  SunConnect  as partners,
joint  venturers,  or as creating the  relationships  of employer and  employee,
franchiser and franchisee, master and servant, or principal and agent.

27.0          PUBLICITY. Neither party shall publicize or disclose the existence
or terms  and  conditions  of this  Agreement,  or any  transactions  hereunder,
without the express,  prior written consent the other party,  except as required
by applicable law or regulation.

28.0          ADMINISTRATION. SunConnect and NP shall, each assign a primary and
secondary  individual to administer  this Agreement  throughout  its term.  Each
party  shall  inform  the  Administrator  of the other in writing of a change of
Administrator or such Administrator's address or telephone number.  SunConnect's
Administrators shall be:

                       PRIMARY ADMINISTRATOR
                                         Michael Hutchings
                                         SunConnect Technology Enterprises, Inc.
                                         2475 Garcia Avenue, M/S MTV 14-40
                                         Mountain View, CA 94043
                                         Ph: (415) 336-1005
                                         Fax: (415) 336-3156

                       SECONDARY ADMINISTRATOR
                                         Philippe Monot
                                         Sun MicroSystems, Inc.
                                         32, chemin du Vieux Chene
                                         38240 MEYLAN
                                         FRANCE
                                         Ph: (011) 33.76.41.42.43
                                         Fax: (011) 33.76.41.42.41

                       NP's Administrators shall be:
                       PRIMARY ADMINISTRATOR
                                         Mitch Strobin
                                         Network Peripherals, Inc.

                                       19

<PAGE>


                                         Milpitas, Ca. 95035
                                         Ph: (408) 321-7300
                                         Fax: (408) 321-9218

                        SECONDARY ADMENISTRATOR
                                         William F. Kelly
                                         Network Peripherals Inc.
                                         Milpitas, Ca. 9503
                                         Ph: (408) 321-7300
                                         Fax: (408) 321-9218

29.0          GENERAL.

              29.1 Entire  Agreement.  This  Agreement and all of its referenced
Exhibits,  constitutes the entire agreement  between the parties with respect to
the subject matter hereof and supersede all prior  proposals,  negotiations  and
communications, oral or written, between the parties with respect to the subject
matter  hereof.  No deviation from these  provisions  shall be binding unless in
writing and signed by an authorized representative of the party to be charged.

              29.2  Governing  Law.  This  Agreement  shall be  governed  by and
construed in accordance  with the laws of the State of California  applicable to
contracts  made and  wholly  to be  performed  in  California  by  residents  of
California.  The  parties  specifically  agree  that  the  1980  United  Nations
Convention on the International Sale of Goods shall not apply to this Agreement.
The  parties  agree  that the  exclusive  jurisdiction  and venue of any  action
between  the  parties  arising  out of  this  business  relationship,  including
disputes that may arise following  termination of this  Agreement,  shall be the
Superior  Court of California for the County of Santa Clara or the United States
District  Court for the Northern  District of California and each of the parties
hereby submits itself to the exclusive jurisdiction and venue of such courts for
purposes of such action.

              29.3 Assignment.  The rights,  duties and obligations either party
under this Agreement may not be assigned in whole or in part by operation of law
or otherwise without the prior express written consent of the other party, which
consent shall not be unreasonably  withheld, and any attempted assignment of any
rights,  duties or obligations  hereunder without such consent shall be null and
void, except that SunConnect may assign its rights and obligations  without NP's
consent,  to a corporation  or other entity which is controlled by, under common
control with, or controls SunConnect Microsystems,  Inc. This Agreement shall be
binding on the parties and their respective successors and permitted assigns.

              29.4 Notices.  Any notice  required or permitted to be given under
this  Agreement  shall be given  in  writing  and  shall be  deposited,  postage
prepaid,  certified  mail return receipt  requested,  in the United States mail,
addressed to SunConnect or NP as the case may be, at the address set forth above
or at such other address as may be given in writing.

              29.5  Waivers,  Severability.  All rights and  remedies  conferred
under this  Agreement or by any other  instrument or law shall be cumulative and
may be exercised singularly or concurrently.  Failure by either party to enforce
any provision shall not be deemed a waiver of future  enforcement of that or any
other  provision.  In the event that any portion of this Agreement shall be held
to be unenforceable,  the remaining portions of this Agreement shall remain full
force and effect.

              29.6 Force Majeure. Neither party shall be liable for any delay or
failure in performance hereunder caused by acts of God or other cause beyond the
parties  control and without fault or negligence of such party.  In the event NP
fails to deliver OEM Product due to such  causes,  SunConnect  may suspend  this
Agreement  in whole or in part for the duration of the  delaying  cause,  and at
SunConnect's  option,  buy the OEM  Product(s)  elsewhere  and  deduct  from any
milestone  or  commitment  to NP the  quantity  so  purchased.  NP shall  resume
performance  under this  Agreement  immediately  after the delaying

                                       20

<PAGE>


cause ceases and, at  SunConnect's  option,  extend the Initial Term and/or Term
for a period equivalent to the length of time the excised delay endured.

              29.7 Survival.  Notwithstanding  the  termination or expiration of
the term of this Agreement or any renewal period thereof, it is acknowledged and
agreed that those rights and  obligations  which by their nature are intended to
survive such expiration or earlier termination shall survive including,  without
limiting the foregoing, Sections 15.7, 15.8, 20, 21, 23, 25, and 29.

              29.8  Exhibits.  The  following is the list of Exhibits  which are
attached  hereto and  incorporated  herein by this  reference as if set forth in
full:

              Exhibits A, A-1 and A-2: Product Specification

                       A-3    Pre-FCS Quality Assurance Plan
                       A-4    BOM
                       B.     Development Schedule
                       C.     Sun-Unique Elements
                       D.     * "Confidential portion has been omitted and filed
                              separately with the Commission."
                       E.     Support *
                       F.     Procedures  for Board  Replacement  (In and out of
                              warranty)
                       G.     [This Exhibit does not exist]
                       H.     [This Exhibit does not exist]
                       I.     * "Confidential portion has been omitted and filed
                              separately with the Commission."
                       J.     Quality Systems Manual
                       K.-1   Inbound/Outbound Packaging Requirements *
                       K-2    Engineering  Specification for Part Identification
                              Label * -
                       K-3    Corporate Shipping Container Graphics Guideline *
                       K-4    Shipping Carton Color Standard *
                       K-5    Specification  for A SunConnect  Color  SunConnect
                              Medium Purple *
                       K-6    Routing Guide *
                       L.     [This Exhibit does not exist]
                       M.     List  of  SunConnect  Suppliers  from  whom NP can
                              purchase

                                       21

<PAGE>


                       N.     Pricing and Leadtimes
                       0.     Shipping Reports
                       R      EDI *
                       Q.     Information Required for Contingent Manufacturing


IN WITNESS  WHEREOF,  the parties  have caused this  Agreement to be executed by
their duly authorized representatives.

Accepted for SunConnect:                        Accepted for NP:

SUN TECHNOLOGY ENTERPRISES, INC.                NETWORK PERIPHERALS INC.


BY:     ____________________________            BY:     ________________________


NAME:   ____________________________            NAME:   ________________________


TITLE:  ____________________________            TITLE:  ________________________


DATE:   ____________________________            DATE:   ________________________

                                       22

<PAGE>



                          Exhibit A: SunLink FDDI/S3.x
                          Product Specifications

                          ______________________________________________________

                          *  "Confidential  portion  has been  omitted and filed
                          separately with the Commission."



<PAGE>



                          Exhibit A-1: SunLink FDDI/S3.0
                          Product Specifications

                          ______________________________________________________

                          This document  defines the SunLink  FDDI/S 3.0 product
                          line.

                          Please refer to the exhibit A for general  description
                          of the product line.

                          A more detailed specification is given below.


                          *  "Confidential  portion  has been  omitted and filed
                          separately with the Commission."



<PAGE>



                          Exhibit A-2: SunLink FDDI/S3.1
                          Product Specifications

                          ______________________________________________________

                          This document  defines the SunLink  FDDI/S 3.1 product
                          line.

                          Please refer to the exhibit A for general  description
                          of the product line and to the exhibit A-1 for general
                          description of the SunLink FDDI/S 3.0 products.

                          As a general  policy,  the SunLink FDDI/S 3.1 products
                          are a superset of the SunLink FDDI/S 3.0 products. All
                          the  hardware,  driver,  compatibility,   performance,
                          security, compliance, packaging,  documentation, etc.,
                          features   described   in  the   SunLink   FDDI/S  3.0
                          specifications  are  applicable to the SunLink  FDDI/S
                          3.1 products.

                          This document only describes new  additional  features
                          which may not be included  in the  SunLink  FDDI/S 3.1
                          products.

                          All   the    functionalities    described    in   this
                          specification   are  already   described  as  optional
                          features  in the  SunLink  FDDI/S  3.0  specification.
                          Therefore, they may already be included in the SunLink
                          FDDI/S 3.0  products.  Depending on the number and the
                          importance  of the features  which are not included in
                          the  SunLink  FDDI/S  3.0  products  and  remain to be
                          implemented,  SunConnect may decide not to require the
                          release of the SunLink FDDI/S 3.1 product line.


                          *  "Confidential  portion  has been  omitted and filed
                          separately with the Commission."


<PAGE>



                          Exhibit A-3: SunLink FDDI/S3.x
                          Pre-FCS Quality Assurance Plan

                          ______________________________________________________

                          *  "Confidential  portion  has been  omitted and filed
                          separately with the Commission."



<PAGE>


                                   EXHIBIT A-4
                          FDDI/S 3.0 PRODUCT DEFINITION
                 for OEM Products including Derivative Products


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."



<PAGE>



                          Exhibit B: SunLink FDDI/S 3.x
                          Development Schedule and Deliverables

                          ______________________________________________________

                          *  "Confidential  portion  has been  omitted and filed
                          separately with the Commission."



<PAGE>



                          Exhibit C: SunLink FDDI/S3.x
                          Sun Unique Elements

                          ______________________________________________________

                          *  "Confidential  portion  has been  omitted and filed
                          separately with the Commission."



<PAGE>



                                    EXHIBIT D


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."



<PAGE>



                                  SCHEDULE D-1


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."



<PAGE>


                                    EXHIBIT E
                              SUPPORT REQUIREMENTS

1.      DEFINITIONS

         1.1 "Supported  Products" means the SunLink FDDI/S v. 1.0 and 2.0 (both
software and hardware components) and the OEM Products.

         1.2  "Enhancement  Release" means a hardware or software  product which
typically  includes  incremental  improvements to a product's  functionality  or
performance. An Enhancement Release is generally characterized by a single digit
change to the right of the decimal  point  (tenths) of an existing  version of a
software product, i.e., X.(X).X.

         1.3 "Escalation" means a bug, error or other problem with the Supported
Products that is referred by SunConnect to NP.  Escalations  are rated according
to their severity (urgency for response) as follows:

                   o   Meltdown/Priority   1  Escalations   are  problems  which
                       require an  immediate  response,  such as the  customer's
                       system being down.

                   o   Hot/Priority 2 Escalations  are problems  which require a
                       very prompt but not an  immediate  response,  such as the
                       customer's  system being operational but with significant
                       degradation or loss of features.

                   o   Warm/Priority  3  Escalations  are  problem  which do not
                       require   as   immediate   or   prompt  a   response   as
                       Meltdown/Priority 1 or Hot/Priority 2 Escalations because
                       they have a less severe impact on the customer.

         1.4  "Maintenance  Release"  means a release of a  software  product or
component typically to correct errors to enable the product or component to meet
its  published  functionality.  A  Maintenance  Release is usually  developed to
incorporate error corrections and/or patches. A Maintenance Release is typically
characterized by a change in the digit to the extreme right of the decimal point
(hundredths) of an existing version of a software product, i.e., X.X.(X).

         1.5  "Services"  means  the  on-call  support,  escalation  management,
problem determination, maintenance and other software support services.

         1.6 "Workaround"  means a method a customer can use to avoid a problem.
Provides a customer with short term approach to dealing with known problems.

2.      NP SUPPORT OBLIGATIONS

<TABLE>
         2.1 On-Call  Support and  Escalation  Management.  Escalations  will be
referred to NP only by the SunConnect  designated  contact  person(s).  NP shall
provide  engineering  support for  Supported  Products and shall have  available
sufficient  trained and qualified  support  engineers to perform Services within
the response times set forth as follows:

<CAPTION>
-------------------------- -------------------------- ------------------------- ---------------------------
                           SunConnect Callback;
                           NP Engineer Assigned;                                Fix, Workaround, or
                           Initial action Plan to                               Long-Term Action Plan
      Call Priority        SunConnect                      Status Reports       to SunConnect
-------------------------- --------------------------------------------------------------------------------
<S>                        <C>
            1              * "Confidential portion has been omitted and filed separately with the
                           Commission."
-------------------------- --------------------------------------------------------------------------------
            2              * "Confidential portion has been omitted and filed separately with the
                           Commission."
-------------------------- --------------------------------------------------------------------------------
            3              * "Confidential portion has been omitted and filed separately with the
                           Commission."
-------------------------- --------------------------------------------------------------------------------
</TABLE>


Days and hours shall be measured according to continuous business hours. Defined
as:  Monday  through  Friday;  8:00 am to 5:00 pm  Pacific  Time,  excluding  US
nationally  recognized holidays. NP shall meet response time requirements for at
least 90% of calls or reports from SunConnect.



<PAGE>


                                EXHIBIT E (con't)

         2.2 Support  Information  Access: The SunConnect Contact Person will be
responsible  for  assigning   Escalations  to  NP  and  for  providing  NP  with
appropriate background information related to such Escalations. Such information
may include prior analysis or traces performed on the problem,  and any relevant
bug track entries.  All requests by NP for additional  information relating to a
particular  Escalation  shall be addressed to and  responded to by  SunConnect's
Contact Person or such other person as may be designated by SunConnect.

         2.3 Problem  Determination.  NP is responsible  for (i) determining the
nature and cause of an Escalation; and (ii) creating a problem/solution synopsis
for each  Escalation.  The  initial  action plan shall  include the  responsible
engineer assigned, results of the initial investigation,  verifying that it is a
bug and a  fix/workaround  will be provided,  what will be the next steps taken,
when a fix/workaround and update will be provided.

         2.4  Workarounds.  NP shall  attempt  to provide  Workarounds  wherever
appropriate  in response to  Escalations  until a  Modification  can be created.
Appropriate  documentation/integration notes are required. Information regarding
Workarounds shall be submitted by NP to SunConnect.

         2.5 Error  Corrections/Patches.  NP shall  use  reasonable  efforts  to
create Patches to fix Supported  Product defects and test and integrate any such
fix in a format acceptable to SunConnect. NP shall provide Patches to SunConnect
in an object code master copy for duplication and distribution. NP will maintain
a copy of all  Patches  and problem  workarounds  produced  and will make backup
tapes containing all then current source and patch directories for the Supported
Products available for inclusion into the Escrow Account.

         2.6 Transfer of Responsibility.  If ongoing support will be provided by
someone other than NP, NP agrees to make reasonable efforts to notify SunConnect
to  preliminary  details  of the  transition  agreement  a minimum of 90-days in
advance of the  transaction of SunConnect to verify the new owner is prepared to
assume the  responsibility.  NP shall make best  efforts to address  issues that
impact SunConnect's support operations.

         2.7 * "Confidential  portion has been omitted and filed separately with
the Commission."

         2.8 * "Confidential  portion has been omitted and filed separately with
the Commission."

         2.9  Inability  to Support  FDDI 1.0 and 2.0.  If,  after the  diligent
exercise of all reasonable  commercial  efforts NP is unable to provide support,
workarounds;  or spares  for  SunLink  1.0 or 2.0  products,  then NP may notify
SunConnect's  Administrator  and shall provide  SunConnect  with all information
relating to the problem and NP's efforts to resolve such problem. Upon receiving
the  required  notice  and  information   from  NP,   SunConnect   shall  assume
responsibility for developing a solution, with NP's reasonable assistance.



<PAGE>


                                EXHIBIT E (con't)

3.     TRAINING AND CONSULTATION

         3.1 Transfer of Information  (TOI). This Section 3.1 shall not apply to
Maintenance  Releases.  For  each  new  Enhancement  Release,  NP  shall  ensure
SunConnect  receives  Transfer  of  Information  (TOI) ten (10)  weeks  prior to
product release.  The Initial TOI will be completed by FCS Code Freeze. NP shall
offer one train-the-trainer session at a central SunConnect designated facility,
and agrees to videotape the session for SunConnect duplication and distribution.
The Initial TOI will be ready within seven (7) days  following  FCS Code Freeze.
Content of the TOI must include the following to a sufficient level of detail:

                  Product Overview
                           Features
                           Limitations
                           File Descriptions
                           External Specification (Functional Spec)

                  Theory of Operation - detail of installation,  configuration
                           Walk through of product install, config, deinstall

                  Troubleshooting/Diagnostics
                           Known Bugs
                           Common User Errors
                           Troubleshooting tools and Diagnostic techniques
                           Support Center requirements

                  Recommended Support Strategy

         3.2 Customer Training. Upon SunConnect's specific request and with NP's
agreement,  NP shall be available  to  participate  in training of  SunConnect's
distributors  and  resellers in  providing  support  services for the  Supported
Products.  Such  training may include  both  creating  and  conducting  training
programs.

         3.3 Responses to Questions.  NP shall answer technical questions on the
Supported  Products from SunConnect's  "support" alias, or other such restricted
access aliases for support purposes. Until NP is provided access to such aliases
SunConnect  shall monitor such aliases and provide NP the questions that require
answers.  NP agrees to use reasonable  commercial  efforts to meet such response
time guidelines that might exist for such aliases.  Upon  SunConnect's  specific
request,  NP agrees to  assist,  as  appropriate,  in  responding  to  technical
questions from Sunconnect's other aliases for the Supported Products,  including
without  limitation  questions  received  via the "net amb" and  "fddi-interest"
email aliases.

4.      NEW OEM PRODUCT RELEASE SUPPORT DELIVERABLES

         4.1  Support  Deliverables.   This  Section  4.1  shall  not  apply  to
Maintenance  Releases nor to the initial  release of the OEM Products.  For each
new  Enhancement  Release of the OEM  Products,  NP shall  ensure  that  support
deliverables are provided to SunConnect within the time frame required to ensure
support readiness at product introduction:

              Deliverable:                                Weeks Prior to FCS:

              Product/Doc Evaluation Copy                 *  "Confidential
              Product/Structure Information                   portion has been
              Business Information & TOI Information          omitted and filed
              Electronic copy of SW/Docs                      separately with
                                                              the Commission."



<PAGE>


                                EXHIBIT E (con't)

5.          FDDI/S 1.0 and 2.0 Support

         5.1 Level of Support.  NP shall provide  hardware and software  support
for the FDDVS 1.0 and 2.0 products to the extent of  Maintenance  Releases only.
NP shall not be  required  to  manufacture  or make  substantial  changes to the
hardware.  If hardware changes are required and SunConnect requests NP to manage
the change  process  then  SunConnect  will be  responsible  for all  SunConnect
approved expenses incurred by NP.

         5.2  Platforms  Supported.  The  following  system  platforms  shall be
supported:

              * "Confidential portion has been omitted and filed separately with
              the Commission."

         5.3 Operating  Systems  Supported.  The following Sun Operating Systems
shall be supported:

              * "Confidential portion has been omitted and filed separately with
              the Commission."



<PAGE>


         Exhibit F

         _________________________________________________________________

         Network Peripherals
         Out of Warranty Repair Policy 1

                  Hardware Service Details


1        Network  Peripherals  reserves  the right to change any portion of this
         policy in the future.

2        Network  Peripherals  will update  records to reflect the shipment of a
         replacement product. In this case the * "Confidential  portion has been
         omitted and filed separately with the Commission."  warranty will be in
         effect for the replacement product.

3        International  deliveries  will be via the standard  service  available
         through the current carrier.



<PAGE>


                                    EXHIBIT I
                            NETWORK PERIPHERALS INC.
                          SOURCE CODE LICENSE AGREEMENT


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."



<PAGE>



Exhibit N: Pricing and Lead Time    (all prices in US dollars)

________________________________________________________________________________


1.     Standard OEM Products

*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."


2.     Derivative Products

*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."


<PAGE>


Exhibit N: Pricing and Lead Time    (all prices in US dollars)

________________________________________________________________________________


3.     Lead-time for Standard OEM Products will be *  "Confidential  portion has
       been omitted and filed separately with the Commission."


4. Flexibility of increases to Standard OEM Product orders.

                          Table 3  Lead-time vs. % Increase

                            --------------------- ---------------------
                            Lead-time             Max. % Increase
                            --------------------- ---------------------
                            12 weeks +                *  "Confidential
                            8 to 12 weeks         portion   has   been
                            6 to 8 weeks          omitted   and  filed
                            4 to 6 weeks          separately  with the
                            0 to 4 weeks          Commission."
                            --------------------- ---------------------


5.     Support of SunConnect's 1.0 and 2.0 FDDI Sbus product line.

*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."


<PAGE>


                                    EXHIBIT O
                                SHIPPING REPORTS


A. NP shall provide the appropriate  SunConnect  materials  management personnel
(as identified by the SunConnect Administrator) with the following reports.

1. Weekly Performance Against Schedule ("PAS") Reports on the first business day
of each week, even if there has not been any change in the information since the
last PAS Report. The PAS Report shall include the information specified below.

                  A. Product Information. Open purchase orders and line numbers,
SunConnect's  manufacturing part numbers, order date, open quantity, balance due
and order status.

                  B. Shipping  Information.  Agreed Delivery Dates,  actual ship
dates, date of arrival,  shipping method,  and airbill or bill of lading number,
if possible.

2. Outbound  Shipment  Report within  twenty-four  (24) hours of the date of any
shipment of OEM  Products to  SunConnect.  The  Outbound  Shipment  Report shall
include the information specified below.

                  A. Product Information.  Purchase order and line numbers, part
number, quantity

                  B.  Shipping  Information.  Airbill or bill of lading  number,
carrier, expected delivery date, and name of contact person at NP to contact

B. The parties will work together to develop a prototype form of monthly summary
report  prior to shipment of the beta version of the OEM  Products,  and a final
form of monthly summary report prior to FCS of the OEM Products.


<PAGE>


                                    EXHIBIT P
                           ELECTRONIC DATA INTERCHANGE
                                 TRADING PARTNER

1.0      Definitions.

         For the  purposes of this  Exhibit,  the  following  definitions  shall
apply:

         1.1      "EDI" means electronic data interchange.

         1.2      "Transaction  Set" is the collection of data that is exchanged
                  in order to convey meaning between the parties engaged in EDI

         1.3      "Third Party  Network  Service  Provider" or  "Provider"  is a
                  business  entity  that  provides  the  service  of moving  and
                  routing EDI transmissions between trading partners.

         1.4      "Enhanced  Security"  is a process  for  providing  additional
                  security,  beyond  what is offered by the  Provider,  that the
                  trading partners may agree to use.

         1.5      "Transaction Set Control Number" or "Header Control Number" is
                  an  identifying  number in the beginning of a Transaction  Set
                  that can be referenced in exchanging information.

         1.6      "Transaction  Set Control Number" or "Trailer  Control Number"
                  is an identifying  number at the end of a Transaction Set that
                  must have a corresponding Header Control Number.

         1.7      "Functional Group" is a group of similar Transaction Sets that
                  is bounded by a  Functional  Group  header  arid a  Functional
                  Group trailer.

         1.8      `Interchange  Control Number' is an identifying number that is
                  contained  in the  interchange  header and trailer and that is
                  used by the  receiving  party to  acknowledge  receipt of this
                  inter-change header and trailer.

         1.9      "Data  Interchange  Control  Number" is an identifying  number
                  that is contained in the  Functional  Group header segment and
                  Functional  Group trailer segment and is used by the receiving
                  party to  acknowledge  receipt  of a  Functional  Group to the
                  sending  party.  This Data  Element in the header and  trailer
                  segments  provides  the  control  information  needed  by  the
                  trading  partners  associated  with the exchange of Functional
                  Group information.

         1.10     "Data  Element" is the smallest  named unit of  information in
                  the Transaction Set.

         1.11     "Segment"  or  "Data  Segment"  is  an  intermediate  unit  of
                  information in a Transaction Set.  Segments are defined in the
                  segment directory.  The segment directory defines each Segment
                  by its name, purpose and identifier.

         1.12     "Line Item" is a Data Element in the  Transaction  Set that is
                  used to provide a specific type of Hash Total.

         1.13     "Hash Total" is the sum of values of a specific Data Element.

                                       1

<PAGE>


 2.0      Prerequisites.

          2.1     Documents, Standards.

                  Each party may electronically  transmit to or receive from the
                  other party any of the Transaction  Sets listed in Exhibit P-1
                  and Transaction Sets which the parties,  by written agreement,
                  add to said Exhibit. All Transaction Sets shall be transmitted
                  in accordance with the standards set forth in Exhibit P-1. Any
                  transmission of data which is not a Transaction Set shall have
                  no force or effect between the parties.

                  Precise procedures to be used in handling Transaction Sets are
                  incorporated   in  Exhibit  P-1.  These   procedures   include
                  assignment  of  confidential  and unique access codes for each
                  party which will then be used to authenticate each Transaction
                  Set,  along with such other  matters as the  parties  consider
                  appropriate.

         2.2      Third Party Network Service Providers.

                  Transaction  Sets will be transmitted  electronically  to each
                  party  through  any  Provider  with  which  either  party  may
                  contract. The Provider for each party is identified in Exhibit
                  P-1.  Either  party may change its  designated  Provider  upon
                  thirty (30) days prior written notice to the other party.

                  Each party shall be responsible  for the costs of any Provider
                  with which it contracts.

          2.3     System Operations.

                  Each party, at its own expense, shall provide and maintain the
                  equipment,   software,   services  and  testing  necessary  to
                  effectively and reliably transmit and receive documents.

                  If  Provider  is down  and this  prevents  either  party  from
                  meeting the pickup or delivery frequency agreed to, that party
                  must notify the other party the same day.

          2.4     Security Procedures.

                  Each party shall  properly use security  procedures  which are
                  reasonably  anticipated to: (a) ensure that all  transmissions
                  of  Transaction  Sets  are  authorized  and  (b)  protect  its
                  business records and data from improper  access.  Both parties
                  agree to preserve and  safeguard  the  confidentiality  of all
                  data  exchanged via EDI, and will not disclose any data to any
                  third  party,  individual  or  corporation  without the owning
                  party's prior written consent.

          2.5     Electronic Signatures.

                  The  parties  may  agree to apply  special  protection,  where
                  permissible,  by encryption or by other means,  to some or all
                  data  exchanged   between  them.  If  special   protection  is
                  required, it will be identified in Exhibit P-1.

3.0       Transmissions.

          3.1      Proper Receipt.

                  Transaction  Sets  shall not be  deemed to have been  property
                  received,  and no  Transaction  Set  shall  give  rise  to any
                  obligation,  until  accessible to the receiving  party at such
                  party's electronic mailbox.

                                        2

<PAGE>


          3.2      Verification.

                  Upon receipt of any Transaction Set, the receiving party shall
                  promptly and properly transmit a functional  acknowledgment in
                  return  within  one  (1)  business  day  after  receipt  of  a
                  Transaction Set.

          3.3      Acceptance.

                  An electronic  transmission  of data shall be deemed  complete
                  and a  Functional  Group  accepted,  when the  receiver of the
                  transmission verifies by functional acknowledgment that:

                            A.        The standards specified in Exhibit P-1 are
                                      met;

                            B.        The actual quantity of Functional  Groups,
                                      Transaction Sets, Segments, Line Items and
                                      Hash    Totals    received    within   the
                                      transmission equals the quantity the party
                                      has  identified as being  included,  using
                                      the appropriate  control fields  specified
                                      in Exhibit P-1.

          3.4     Garbled Transmissions.

                  If any  Transaction  Set is received in an  unintelligible  or
                  garbled form, the receiving  party shall  promptly  notify the
                  originating   party  (if   identifiable   from  the   received
                  Transaction  Set) in a  reasonable  manner.  In the absence of
                  such notice,  the originating  party's records of the contents
                  of such Transaction Set shall control.

          3.5      Erroneous Transmissions.

                  If either  party  receives  a  Transaction  Set from the other
                  party which differs from the applicable  terms and conditions,
                  (e.g., an Order with a price,  quantity or schedule  different
                  than that  mutually  agreed upon),  the receiving  party shall
                  promptly  contact the sending party to confirm the accuracy of
                  the Transaction Set.

          3.6     Faulty Transmissions.

                  In the event either  party  receives a  Transaction  Set which
                  contains any evidence of faulty  transmission,  the  receiving
                  party shall contact the sending party,  reject the Transaction
                  Set and request that the Transaction Set be re-sent.

4.0      Terms and Conditions.

         4.1      Validity, Enforceability.

                  This  Exhibit  evidences  the mutual  intent of the parties to
                  create a binding purchase and sale obligation  pursuant to the
                  electronic  transmission and receipt of documents,  specifying
                  certain  of the  applicable  terms.  During  the  term  of the
                  Agreement,  all  obligations  concerning  the delivery of such
                  Transaction  Sets  in  written  form  may  be  fulfilled  by a
                  transmission.  pursuant to the terms of this Exhibit. However,
                  either  party shall have the  option,  at its  discretion,  to
                  transmit Transaction Sets in written form to the other party.

                                        3

<PAGE>


                  Any  Transaction  Set  properly  transmitted  pursuant to this
                  Exhibit,  including  without  limitation  Exhibit P-1 ("Signed
                  Documents"),  shall  be  considered.  in  connection  with any
                  transaction,  or this  Exhibit,  to be a "writing" and to have
                  been "signed" and to consume an  "original"  when printed from
                  electronic files or records  established and maintained in the
                  normal course of business.

                  The  parties   agree  that  the   provisions  of  the  Uniform
                  Commercial Code, Section 2-201 ("Formal Requirements:  Statute
                  of Frauds"),  shall not apply to  Transaction  Sets covered by
                  this Exhibit since hard copies of Transaction Sets will not be
                  issued,  and the parties  further agree that said  Transaction
                  Sets  shall  be  deemed  to  satisfy  any  statutory  or legal
                  formalities   requiring   that   agreements   be  in  writing,
                  including, but not limited to the Statute of Frauds.

                  The conduct of the parties pursuant to this Exhibit, including
                  the use of Signed Documents properly  transmitted  pursuant to
                  this Exhibit, shall, for all legal purposes, evidence a course
                  of performance  accepted by the parties in furtherance of this
                  Exhibit.

                  The   parties   agree  not  to   contest   the   validity   or
                  enforceability of Signed Documents under the provisions of any
                  applicable  law relating to whether  certain  agreements be in
                  writing  and signed by the party to be bound  thereby.  Signed
                  Documents, if introduced as evidence on paper in any judicial,
                  arbitration,  mediation or administrative proceedings, will be
                  admissible as between the parties to the same extent and under
                  the same conditions as other business  records  originated and
                  maintained in  documentary  form.  Neither party shall contest
                  the  admissibility  of copies of Signed Documents under either
                  the business records exception to the hearsay rule or the best
                  evidence rule on the basis that the Signed  Documents were not
                  originated or maintained in documentary form.

                                        4

<PAGE>


                                   EXHIBIT P-1

1.0       Transaction Sets.

          All  Transaction   Sets   contemplated  by  this  Agreement  shall  be
          transmitted  and  formatted in accordance  with the American  National
          Standard Institute  Business Data Interchange (ANSI X12) Standard,  as
          reflected  in the  number,  version  and date  column set forth  below
          beside each  Transaction  Set. This also includes the data dictionary,
          segment  directory,   and  transmission   controls  published  as  X12
          standards.

          1.1      Transaction Sets to be transmitted by Seller to Sun.

                   Communication         Number      Version           Date
                   -------------         ------      -------           ----


          1.2     Transaction Sets to be transmitted from Sun to Seller.

                   Communication         Number      Version           Date
                   -------------         ------      -------           ----



2.0       Providers.

          All Transaction Sets  contemplated by this Agreement will be channeled
          through  Providers.  Sun and Seller  shall each  assign a Provider  as
          follows:

          2.1      Sun's Provider.

                   _________________________________
                   _________________________________
                   _________________________________
                   _________________________________

          2.2      Seller's Provider.

                   _________________________________
                   _________________________________
                   _________________________________
                   _________________________________

3.0       Transmission Requirements.

          For each  Transaction Set, the Header Control Number Data Element must
          have an identical  corresponding  value in the Trailer  Control Number
          Data Element for all control Segments as follows:

                                        1

<PAGE>


1        The value for the Interchange  Control Number contained in Data Element
         ISA13 for a  transmission  must equal the value for Data Element  IEA02
         that is contained in the transmission.

2.       The value for the Data  Interchange  Control  Number  contained in Data
         Element  GS06  must  equal  the  value  for Data  Element  GE02 that is
         contained in that Functional Group.

3.       The value for the  Transaction  Set Control  Number  contained  in Data
         Element  ST02 for a  Transaction  Set must  equal  the  value  for Data
         Element SE02 contained in that Transaction set.

In addition, the following requirements must be met:

A.       The  actual   quantity  of  Functional   Groups   received  within  the
         transmission must equal the quantity the trading partner has identified
         as being included, As contained in the IEA01 Data Element;

B.       The actual quantity of Transaction  Sets received with the transmission
         must equal the quantity  the trading  partner has  identified  as being
         included, as contained in the GE01 Data Element;

C.       The actual quantity of Segments  included  within each  Transaction Set
         must equal the quantity  the trading  partner has  identified  as being
         included, as contained in the SE01 field;

D.       The actual quantity of Line Items included within each  Transaction Set
         must equal the quantity  the trading  partner has  identified  as being
         included, as contained in the CTT01 field; and

E.       The Hash  Totals  contained  in the CTT02  field  must equal the sum of
         values as defined in each Transaction Set.

                                       2

<PAGE>


Exhibit Q


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."

<PAGE>


                     AMENDMENT #1 TO SUN MICROSYSTEMS, INC.
                       DEVELOPMENT AND PURCHASE AGREEMENT

Sun Microsystems,  Inc. ("Sun") and Network Peripherals Inc. ("NP") hereby agree
to amend the  Development  and Purchase  Agreement  between  them dated  2/25/94
("Agreement") as follows:

1.     SunSoft,  Inc., a subsidiary of Sun Microsystems,  Inc., hereby transfers
       administration  of the above  referenced  agreement  to Sun  Microsystems
       Computer Company, a division of Sun Microsystems, Inc.

2.     All references to "SunConnect" in the Agreement are replaced by "Sun".

3.     In all  sections,  where  applicable,  reference  to "Sunlink  FDDI/S" is
       changed to "Sun FDDI(TM)".

4.     In the event of a  conflict  between  the terms  and  conditions  of this
       Amendment  No. 1 and the  Agreement  as it  relates  to the OEM  Products
       listed in Exhibit N, this Amendment No. 1 shall take precedence.

5.     Reference   Section  1.4,  2.3  and  2.4.   There  are  no   "Development
       Deliverables" associated with the OEM Products set forth in Exhibit N.

6.     Reference Section 1.11. Sun-unique Elements. Delete reference to "Exhibit
       C" and substitute "Exhibit G".

7.     Reference  Section  1.12.  For the  purpose  of this  Agreement  "Service
       Providers" shall include "Sun-authorized third party maintainers (TPMs)".

8.     In the third  line of  Section  3.3 after  "documents"  add "and Sun FDDI
       documents".

9.     Add at the end of Paragraph 5. 1: "In the event of a conflict between the
       terms and  conditions  of Exhibits E and R,  Exhibit R (Customer  Support
       Provisions)  attached hereto and  incorporated  hereby by this reference.
       Exhibit R shall take precedence."

10.    Delete Paragraph 5.3 in its entirety.

11.    Add at the end of Section 8. 1: "NP agrees to comply with the  provisions
       of Exhibit C, Supplier's  Quality Program,  attached hereto. In the event
       of a conflict between Exhibit C and any other exhibits  regarding quality
       of the OEM Products, Exhibit C shall take precedence."

12.    In the ninth line of Section 8.2 after "(Trademark  License)" insert "and
       Exhibit C".

13.    Delete the 4th and 5th  sentence of Section  8.3.a in their  entirety and
       substitute  the  following:  "By the  release  of Sun FDDI  5.0,  NP will
       identify  and reach  terms  with a compact  disk  manufacturer.  Sun will
       provide the necessary copyright information and product disclaimers to be
       included.  Sun must approve the initial  procedures and file organization
       before CD masters are created.  Sun agrees to reimburse  Supplier for the
       costs of CD mastering which are estimated at $2500 to $3000."

14.    Delete Section 8.4 in its entirety and  substitute  the  following:  "8.4
       Copyright  Notices.  Documentation  shall  bear  copyright  notice(s)  as
       provided by Sun."

15.    In Section 8.6 after "interconnectability" insert "serviceability".

16.    Delete Section 9.3 in its entirety and substitute the following:

        "9.3    Forecast:  Sun shall  provide  Supplier  with a *  "Confidential
                portion  has  been  omitted  and  filed   separately   with  the
                Commission."  rolling forecast of its intended  purchases by the
                first  Monday  of each  month,  with the  first *  "Confidential
                portion  has  been  omitted  and  filed   separately   with  the
                Commission." broken out by week. Such forecast is for Supplier's
                convenience  only and shall in no way  create an  obligation  on
                Sun's part to meet such forecast.

                Sun  acknowledges  that in  order to  support  the  agreed  upon
                leadtime,  Supplier  may be required to acquire  certain  unique
                and/or long lead time materials ("Materials") well in advance of
                receipt of Sun's purchase  orders and to support Sun's forecast.
                The description of Materials and their respective  leadtimes are
                set forth in Exhibit  N-1.  Sun's  liability  for  Materials  is
                limited to those  conforming  materials  ordered in the  minimum
                quantities and leadtimes which were strictly  necessary to build
                Product in order to meet Sun's purchase orders and forecast.

17.    Delete the last sentence of Section 10.4 and  substitute  the  following:
       "Sun  agrees to respond to NP within ten (10) days after  receipt of such
       notification  by Sun's  Administrator  whether Sun accepts or rejects the
       price changes."

January 16, 1996    ff                 1               Network Peripherals, Inc.

<PAGE>


18.    Delete Section 14.1 in its entirety and substitute the following:

       "14.1  Rescheduling:  Sun may  reschedule  delivery of all or part of any
              purchase order, at no charge,  to a date after the agreed delivery
              date as follows:

              Notice        Maximum Reschedule Period        Maximum Reschedules

              0-30 days     *  "Confidential  portion has been omitted and filed
                                separately  with the Commission."

              30+ days      *  "Confidential  portion has been omitted and filed
                                separately with the Commission."

              * "Confidential portion has been omitted and filed separately with
              the Commission."

19.    Delete Section 14.2 in its entirety and substitute the following:

       "14.2  Cancellation:

       *  "Confidential  portion has been omitted and filed  separately with the
       Commission."

20.    Delete  Section  18.3 in its  entirety  and replace  with " 18.3  Product
       Discontinuance by Sun. Sun agrees to give NP * "Confidential  portion has
       been omitted and filed separately with the  Commission."  notice prior to
       discontinuing  an OEM  Product.  NP shall use its best efforts to control
       inventory levels and costs during Product phase-out."

21.    *  "Confidential  portion has been omitted and filed  separately with the
       Commission."

22.    *  "Confidential  portion has been omitted and filed  separately with the
       Commission."

23.    *  "Confidential  portion has been omitted and filed  separately with the
       Commission."

24.    *  "Confidential  portion has been omitted and filed  separately with the
       Commission."

25.    In the sentence of Section 23.2 delete "twenty (20) days after receipt of
       notification  or  as  otherwise   agreed  to  between  the  parties"  and
       substitute "the number of days specified in Exhibit R".

26.    In the first line of  Section 24 delete  "Subject  to the  provisions  of
       Section 24.1 ("Assignment")".

27.    Section 24,  Administration.  Delete  Sun's and NP's  Administrators  and
       replace with.

       "Primary Administrator                     Secondary Administrator

       Yoshikazu (Roy) Hirotsuka                  Flora Ford
       Sun Microsystems Inc.                      Sun Microsystems Inc.
       2550 Garcia Avenue, UMIL01-120             2550 Garcia Avenue, UMIL01-103

January 16, 1996    ff                 2               Network Peripherals, Inc.

<PAGE>

       Mountain View, CA 94041                    Mountain View, CA 94041
       Ph:(408)276-2186                           Ph: (408) 276-3945
       Fax: (408) 263-0807                        Fax: (408) 263-3592

       Meena Bhatia                               Dane Iverson Gegal Department)
       Network Peripherals, Inc.                  Network Peripherals, Inc.
       1371 McCarthy Boulevard                    1371 McCarthy Boulevard
       Milpitas, CA 95035                         Milpitas, CA 95035
       Ph:(408)321-7206                           Ph: (408) 321-7300
       Fax: (408) 321-9218                        Fax: (408) 321-9218"

28.    In Section 29.7 add at the end "and Exhibits C and R".

29.    Add at the end of Section 29.8:

       "C - Supplier's Quality Program*

       G - Sun-Unique Elements

       N-1 - Pricing and Leadtimes for New OEM Products

       R - Customer Support Provisions *

30.    Add a new Section 29.9 as follows: "29.9 Environment. Consistent with the
       U.S. Clean Air Act of 1990, Supplier shall use reasonable efforts to give
       Sun as much notice as is  practicable  in the event  Supplier  uses ozone
       depleting chemicals in the manufacture of the Products.  Sun reserves the
       right to reject any Products  manufactured  utilizing or containing  such
       materials if Sun has not previously been notified of the same."

31.    Exhibit A titled "Sun FDDI SBus  Adapter 4.0 Product  Specifications"  is
       attached hereto and incorporated herein by this reference.

32.    Exhibit C dated  November  27, 1995 is attached  hereto and  incorporated
       herein by this reference. Exhibit C-1 dated November 29. 1995 is attached
       hereto and incorporated herein by this reference.

33.    Exhibit G-1 dated December 20, 1995 is attached  hereto and  incorporated
       herein by this reference.

34.    Exhibit F is deleted in its entirety.

35.    Exhibit N dated  2/24/94 is  deleted  in its  entirety  and  replaced  by
       Exhibit N dated November 27, 1995 attached hereto and incorporated herein
       by this reference.

Except as so amended, the Agreement is confirmed in its entirety.

SUN MICROSYSTEMS, INC.,                     NETWORK PERIPHERALS INC.
acting by and through its division,
Sun Microsystems Computer Company

BY:     __________________________          BY:     ____________________________

NAME:   __________________________          NAME:   ____________________________

TITLE:  __________________________          TITLE:  ____________________________

DATE:   __________________________          DATE:   ____________________________

SUNSOFT, INC.

BY:     __________________________

NAME:   __________________________

TITLE:  __________________________

DATE:   __________________________

January 16, 1996    ff                 3               Network Peripherals, Inc.

<PAGE>



                         Exbihit A: Sun FDDI Sbus Adapter 4.0
                         Product Requirements

                         _______________________________________________________

                         *  "Confidential  portion  has been  omitted  and filed
                         separately with the Commission."



<PAGE>


                                    EXHIBIT C
                           SUPPLIER'S QUALITY PROGRAM


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."



<PAGE>


                                   EXHIBIT C-1
                    ADDITIONAL CUSTOMER SUPPORT REQUIREMENTS


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."



<PAGE>


                            Exhibit G-1: Sun FDDI 4.0
                               SUN UNIQUE ELEMENTS


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."


<PAGE>


                                    EXHIBIT N
                              Pricing and Leadtime


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."


<PAGE>


                                   EXHIBIT N-1
                             Materials and Leadtimes


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."



<PAGE>


                                    Exhibit R
                           Customer Support Provisions


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."


<PAGE>


                                   Exhibit R-1
                             NP's Repair Facilities


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."



<PAGE>


                                   Exhibit R-2
                          Sun's Repair Depots and TPMs


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."



<PAGE>


                                   Exhibit R-3
                             Out of Warranty Repair


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."




<PAGE>


                                   Exhibit R-4
                                   NTF Charges


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."

<PAGE>


                     AMENDMENT #2 TO SUN MICROSYSTEMS, INC.
                       DEVELOPMENT AND PURCHASE AGREEMENT

Sun Microsystems,  Inc. ("Sun") and Network Peripherals Inc. ("NP") hereby agree
to amend the  Development  and Purchase  Agreement  between  them dated  2/25/94
("Agreement") as follows:

1.     In the event of a  conflict  between  the terms  and  conditions  of this
       Amendment  No. 2 and the  Agreement  as it  relates  to the OEM  Products
       listed in Exhibit N-2, this Amendment No. 2 shall take precedence.

2.     Reference   Section  1.4,  2.3  and  2.4.   There  are  no   "Development
       Deliverables" associated with the OEM Products set forth in Exhibit N-2.

3.     Within thirty (30) days after  execution of this Amendment No. 2, NP will
       deliver all  materials  described in 19.2 related to SunFDDI 5.0 to Sun's
       designated Escrow Agent.

4.     In Section 24, Administration, change Sun's primary administrator to:

       "Mayita Sanchz
       Sun Microsystems, Inc.
       2550 Garcia Avenue, UMIL01-118
       Ph: (408) 276-2797
       Fax: (408) 945-6498"

5.     Exhibit A-1 titled "SunFDDI 5.0 Product Specification", Sun Part Number *
       "Confidential  portion  has been  omitted and filed  separately  with the
       Commission.",   is  attached  hereto  and  incorporated  herein  by  this
       reference.

6.     In Exhibit  C,  Section  2.0.  insert the  following  after the  headings
       indicated:

       *  "Confidential  portion has been omitted and filed  separately with the
       Commission."

7.     Exhibit F dated 4/1/93 is deleted in its entirety.

8.     Exhibit  G,  SunFDDI  5.0 Sun  Unique  Elements  is  attached  hereto and
       incorporated herein by this reference.

9.     Exhibit  N-1 dated  January  18,  1996 is  deleted  in its  entirety  and
       replaced by Exhibit N-1 dated September 18, 1996

10.    Exhibit N-2 dated November 11, 1996 is attached  hereto and  incorporated
       herein by this reference.

11.    Exhibit  R-3 dated  December  5, 1995,  is deleted  in its  entirety  and
       replaced by Exhibit R-3 dated October 3, 1996 attached hereto.

Except as so amended, the Agreement is confirmed in its entirety.

SUN MICROSYSTEMS, INC.,                     NETWORK PERIPHERALS INC.

BY:     __________________________          BY:     ____________________________

NAME:   __________________________          NAME:   ____________________________

TITLE:  __________________________          TITLE:  ____________________________

DATE:   __________________________          DATE:   ____________________________

November 11, 1996 ff                   1               Network Peripherals, Inc.

<PAGE>


                       Sun FDDI 5.0 Product Specification
                       Exhibit A-1
                       _________________________________________________________


                                             *  "Confidential  portion  has been
                                             omitted and filed  separately  with
                                             the Commission."


<PAGE>


                      Sun FDDI Sbus Adapter 5.0
                      Product Requirements
                      __________________________________________________________


                      *  "Confidential   portion  has  been  omitted  and  filed
                      separately with the Commission."



<PAGE>


                      Exhibit G: Sun FDDI 5.0
                      Sun Unique Elements
                      __________________________________________________________


                      *  "Confidential   portion  has  been  omitted  and  filed
                      separately with the Commission."



<PAGE>


                                   EXHIBIT N-1
                             Materials and Leadtimes


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."



<PAGE>


                                   EXHIBIT N-2
                              Pricing and Leadtime


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."



<PAGE>



                                   Exhibit R-3
                             Out of Warranty Repair


*  "Confidential  portion  has  been  omitted  and  filed  separately  with  the
Commission."