SEPARATION AGREEMENT


     THIS SEPARATION AGREEMENT is made and entered into by and between 

James W. Checco (hereinafter referred to as "Employee") and Digital Link 

Corporation, a California corporation (hereinafter referred to as the 

"Company").

                         WITNESSETH:

  WHEREAS, Employee and the Company have mutually agreed that Employee will 
separate from the Company; and 
  
  WHEREAS, Employee and the Company desire to settle fully and finally all 
differences between them, including, but in no way limited to, any 
differences that might arise out of Employee's employment with and 
separation from the Company.

  NOW, THEREFORE, the parties agree as follows:

     1.   Employee and Company agree that, subject to Employee's compliance 
with this Agreement:

          (a)  Employee agrees that his active employment with the Company 
will end at the end of the business day on November 19, 1996.  Employee 
will cease being an officer of the Company as of the same date.  Regardless 
of whether employee signs this Agreement or not he will be paid all
accrued salary and paid time off through November 19, 1996, less applicable 
withholding for federal and state income taxes, FICA, SDI and any employee 
contributions for the 401(k) plan.  Thereafter, Employee will be available 
to the Company as a consultant only to answer questions upon reasonable 
notice. Employee agrees that after November 19, 1996, he is no longer 
authorized to incur any expenses, obligations or liabilities on behalf of 
the Company.

          (b)  Employee will remain a consultant of Company until the end 
of business on May 19, 1997, even if he otherwise becomes employed and will 
be paid at his current salary on a bi-weekly basis at the same time as 
Company employees (the "Salary Benefit").  Employee will continue
being provided all current benefits until May 19, 1997 except that (i) no 
car allowance will be paid, (ii) there will be no further participation in 
the 1993 Employee Stock Purchase Plan, (iii) there will be no paid time off,
(iv) no bonus will be paid for Fiscal Year 1997, and (v) an amount
equal to current health insurance benefits will paid toward Employee's 
COBRA costs.  In the event Employee is employed, whether temporarily, 
full-time or as a consultant, prior to May 19, 1997, Employee's benefits 
(other than the Salary Benefit) under this subparagraph (b) will cease 
upon Employee becoming employed.

      (c)  The Company will pay $15,000 to Employee for assistance in 
finding new employment.  The Fiscal Year 1996 bonus will be paid on a 
pro-rated basis to November 19, 1996, per the 1996 Executive Bonus Plan.  
The bonus will be paid at the end of February 1997.

          (d)  Employee has the following outstanding stock option grants 
to purchase the Company's Common Stock, which vest on or prior to May 19, 
1997:
                              
 Grant No.   Grant Date   Vesting from 11-19-96 to 05/19/97
    594       11-03-95                     3,750
    692       04-10-96                    12,188
                   Total Shares           15,938

   These options will continue to vest in accordance with such grants 
through May 19, 1997.  The provisions of Employee's option grants shall 
continue in full force and effect.

          (e)  Employee agrees that on or before November 19, 1996 he will 
return to the Company all files, memoranda, records, credit cards and other 
documents and physical or personal property, which Employee has in his 
possession or control and which are the property of the Company.

     2.   Employee agrees that the payments and provision of benefits under 
this Agreement are in full satisfaction of all obligations of Company to 
Employee arising out of or in connection with his employment including, 
without limitation, all salary, bonuses, accrued vacation, sick pay,
and reimbursement of expenses.  Employee agrees that the additional payment 
constitutes consideration for the consulting services, covenants and 
releases of Employee as set forth herein.

     3.   The Employee, on behalf of himself, his agents, representatives, 
heirs, employees, predecessors, successors, and assigns and any persons 
acting by, through, under or in concert with each of them hereby releases 
and forever discharges each of the Company, its subsidiaries,
affiliates, agents, representatives, directors, officers, employees, 
predecessors, successors and assigns, and any persons acting by, through, 
under or in concert with each of them (the "Releasees"), from any and all 
manner of action or actions, causes of action, in law or in equity, suits,
debts, liens, contracts, agreements, promises, liabilities, claims, 
demands, losses, damages, costs, or expenses (including, without 
limitation, any claim based on Employee's prior employment by Company or 
his separation therefrom, any claims for wages, bonuses, or expense
reimbursement, any claims that any circumstances of Employee's separation 
were wrongful, or in violation of any of his rights, contractual, statutory 
or otherwise), including, but not limited to, the Age Discrimination in
Employment Act, 29 U.S.C. 621 et seq. (as amended by the Older Workers' 
Benefit Protection Act, 29 U.S.C. 626(f)), whether or not now known, 
claimed or suspected, fixed or contingent, which Employee now, has, owns or 
holds, or at any time heretofore had, owned or held or ever claimed to
have had, owned or held or may hereafter have, own or hold against the 
Releasees based upon or arising from any matter, cause, fact, thing, 
act or omission whatsoever occurring or existing at any time to and 
including the date hereof.  This release does not release Company from its 
obligations under this Agreement.  The foregoing release shall remain in
effect in the event of any breach of this Agreement.

     4.   This Agreement shall not in any way be construed as an admission 
by the Releasees that they acted wrongfully with respect to the Employee or 
any other person. Similarly, this Agreement shall not in any way be 
construed as an admission that the Employee has acted wrongfully, or
that the Employee has any rights whatsoever against the Company.  The 
parties have entered into this settlement in  order to purchase peace 
and avoid any possible involvement in protracted litigation.

     5.   At all times after the execution of this Agreement, Employee 
and Company represent and agree that each will keep the terms, (including 
benefits and amounts paid to Employee) of this Agreement confidential, and 
no information concerning this Agreement will be disclosed to
anyone, except (1) in the case of Employee, to his spouse, tax preparer and 
attorney, if any; and (2) in the case of Company, to its attorney, 
accountant, and others as may be required by law, including, but not 
limited to Securities and Exchange Commission requirements.

   6.   Employee and Company agree that neither shall make any statement, 
written or oral, or otherwise engage in any communication, which disparages 
in any way the other or the other party's directors, officers, employees, 
capabilities, products or business practices.

     7.   Employee represents and warrants that no other person had or 
has or claims any interest in the matters referred to in paragraph 3 
hereof; that he has the sole right and exclusive authority to execute 
this Agreement, and that he has not sold, assigned, transferred, conveyed
or otherwise disposed of any claim or demand relating to any
matter covered by this Agreement.

     8.   Employee expressly waives any right or benefit available to him 
in any capacity under the provisions of Section 1542 of the Civil Code of 
California, which provides:

          "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH
          THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN
          HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE,
          WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY
          AFFECTED HIS SETTLEMENT WITH THE DEBTOR."
          
     9.   Employee represents and agrees that he fully understands his 
right to discuss all aspects of this Agreement with his private attorney, 
that to the extent, if any, that he desired, he has availed himself of this 
right, that he has carefully read and fully understands all of the
provisions of this Agreement, and that he is voluntarily entering into 
this Agreement.  Employee understands and agrees that the waiver of
 rights contained in this Agreement is only an exchange for the 
consideration specified herein, and that Employee would not otherwise be 
entitled to such  consideration.  Employee acknowledges that he was 
offered a period of at least twentyone (21) days to consider the terms
of this Agreement.  For a period of seven (7) days following execution of 
this Agreement, Employee may revoke said Agreement, and the Agreement 
shall not become effective until the seven (7) day period has expired.

   10.  Employee represents and agrees that this Agreement is binding upon 
himself, his estate, heirs and assignees. Company represents and agrees 
that this Agreement is binding upon the Company, its successors and 
assigns.  The provisions of this Agreement are severable, and if any part
of it is found to be unenforceable, the other paragraphs shall remain fully 
valid and enforceable.

     11.  Any dispute arising out of or related to this Agreement shall be 
settled in accordance with the Rules of the American Arbitration 
Association.  The arbitration will take place in Sunnyvale, California.  
The award of the arbitrators will be final and binding upon the parties.
Judgment upon the award may be entered in any court having
jurisdiction.

     12.  This Agreement sets forth the entire agreement between the 
parties hereto, and fully supersedes any and all prior agreements or 
understandings between the parties hereto pertaining to the subject 
matter hereof.


     Executed at Sunnyvale, California.


     PLEASE READ CAREFULLY.  THIS SETTLEMENT AGREEMENT AND RELEASE INCLUDES 
A RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS.


Date:   12/12/96                           /s/ James W. Checco
                                               James W. Checco


                                        Digital Link Corporation

Date:   12/12/96                         By:   /s/ Alan Fraser
                                           Chief Executive Officer