Document:

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                                 CONFIDENTIAL

THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE BEEN ACQUIRED FOR INVESTMENT
AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. SUCH
SECURITIES MAY NOT BE SOLD, TRANSFERRED OR PLEDGED IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL (WHICH MAY BE
COUNSEL FOR THE COMPANY) REASONABLY ACCEPTABLE TO IT STATING THAT SUCH SALE OR
TRANSFER IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF
SAID ACT.

 THE SECURITIES EVIDENCED HEREBY ARE SUBJECT TO THE RESTRICTIONS SET FORTH IN AN
AMENDED AND RESTATED RIGHTS AGREEMENT BY AND AMONG THE COMPANY AND CERTAIN
SECURITYHOLDERS OF THE COMPANY (A COPY OF WHICH MAY BE OBTAINED FROM THE
COMPANY), AND BY ACCEPTING ANY INTEREST IN SUCH SECURITIES THE PERSON ACCEPTING
SUCH INTEREST SHALL BE DEEMED TO AGREE TO AND SHALL BECOME BOUND BY ALL THE
PROVISIONS OF SAID AGREEMENT.

Warrant No. 4                                       Number of Shares: 6,000,000
                                                    (subject to adjustment)

Date of Issuance: February 24, 2000

                                 SONOMA SYSTEMS

                          COMMON STOCK PURCHASE WARRANT

                         (Void after February 24, 2005)

         Sonoma Systems, a California corporation (the "Company"), for value
received, hereby certifies that Nortel Networks Inc., or its registered assigns
(the "Registered Holder"), is entitled, subject to the terms and conditions set
forth below, to purchase from the Company, at any time or from time to time on
or after the date of issuance and on or before 5:00 p.m. (San Francisco time) on
February 24, 2005, up to 6,000,000 shares of Common Stock, $.01 par value per
share, of the Company, at a purchase price of $4.00 per share. The shares
purchasable upon exercise of this Warrant, and the purchase price per share,
each as adjusted from time to time pursuant to the provisions of this Warrant,
are hereinafter referred to as the "Warrant Shares" and the "Purchase Price,"
respectively.

         1. EXERCISE.

                  (a) This Warrant may be exercised by the Registered Holder, in
whole or in part and at any time or from time to time (in each case subject to
provisions of subsections 1(e) through 1(h) below), by surrendering this
Warrant, with the purchase form appended hereto as EXHIBIT I duly executed by
the Registered Holder or by the Registered Holder's duly authorized attorney, at
the principal office of the Company, accompanied by payment in full, in lawful

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                                 CONFIDENTIAL

money of the United States, of the Purchase Price payable in respect of the
number of Warrant Shares purchased upon such exercise.

                  (b) The Registered Holder may, at its option, elect to pay
some or all of the Purchase Price payable upon an exercise of this Warrant by
canceling a portion of this Warrant exercisable for such number of Warrant
Shares as is determined by dividing (i) the total Purchase Price so payable in
respect of the number of Warrant Shares being purchased upon such exercise by
(ii) the excess of the Fair Market Value per share of Common Stock (as defined
below) as of the Exercise Date (as defined in subsection 1(c) below) over the
Purchase Price per share. If the Registered Holder wishes to exercise this
Warrant pursuant to this method of payment with respect to the maximum number of
Warrant Shares for which this Warrant is then exercisable that are purchasable
pursuant to this method, then the number of such Warrant Shares so purchasable
shall be equal to the total number of Warrant Shares for which this Warrant is
exercisable as of the Exercise Date, minus the product obtained by multiplying
(x) the total number of Warrant Shares for which this Warrant is exercisable as
of such date by (y) a fraction, the numerator of which shall be the Purchase
Price per share and the denominator of which shall be the Fair Market Value per
share of Common Stock as of the Exercise Date. The Fair Market Value per share
of Common Stock shall be determined as follows:

                           (i) If the Common Stock is listed on a national
securities exchange, the Nasdaq National Market or another nationally recognized
trading system as of the Exercise Date, the Fair Market Value per share of
Common Stock shall be deemed to be the average of the high and low reported sale
prices per share of Common Stock thereon on the trading day immediately
preceding the Exercise Date (provided that if no such price is reported on such
day, the Fair Market Value per share of Common Stock shall be determined
pursuant to clause (ii) of this subsection 1(b)).

                           (ii) If the Common Stock is not listed on a national
securities exchange, the Nasdaq National Market or another nationally recognized
trading system as of the Exercise Date, the Fair Market Value per share of
Common Stock shall be deemed to be the amount most recently determined by the
Board of Directors to represent the fair market value per share of the Common
Stock (including without limitation a determination for purposes of granting
Common Stock options or issuing Common Stock under an employee benefit plan of
the Company); and, upon request of the Registered Holder, the Board of Directors
(or a representative thereof) shall promptly notify the Registered Holder of the
Fair Market Value per share of Common Stock. Notwithstanding the foregoing, if
the Board of Directors has not made such a determination within the three-month
period prior to the Exercise Date, then (A) the Board of Directors shall make a
determination of the Fair Market Value per share of the Common Stock within 15
days of a request by the Registered Holder that it do so, and (B) the exercise
of this Warrant pursuant to this subsection 1(b) shall be delayed until such
determination is made.

                  (c) Each exercise of this Warrant shall be deemed to have been
effected immediately prior to the close of business on the day on which this
Warrant shall have been surrendered to the Company as provided in subsection
1(a) above (the "Exercise Date"). At such time, the person or persons in whose
name or names any certificates for Warrant Shares shall be

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                                 CONFIDENTIAL

issuable upon such exercise as provided in subsection 1(d) below shall be
deemed to have become the holder or holders of record of the Warrant Shares
represented by such certificates.

                  (d) As soon as practicable after the exercise of this Warrant
in whole or in part, and in any event within 10 days (or, if a determination by
the Company's independent auditors is necessary in connection with such exercise
pursuant to clause (ii) of subsection 1(g) below, then 20 days) thereafter (or,
if any determination by the Company's independent auditors made pursuant to
subsection 1(g) below is challenged by the Registered Holder in accordance with
the provisions of subsection 1(h) below, then within 10 days after conclusion of
the procedures specified in such subsection 1(h)), the Company, at its expense,
will cause to be issued in the name of, and delivered to, the Registered Holder,
or as such Registered Holder may direct:

                           (i) a certificate or certificates for the number of
full Warrant Shares to which the Registered Holder shall be entitled upon such
exercise plus, in lieu of any fractional share to which the Registered Holder
would otherwise be entitled, cash in an amount determined pursuant to Section 3
hereof; and

                           (ii) in case such exercise is in part only, a new
warrant or warrants (dated the date hereof) of like tenor, calling in the
aggregate on the face or faces thereof for the number of Warrant Shares equal
(without giving effect to any adjustment therein) to the number of such shares
called for on the face of this Warrant minus the sum of (a) the number of such
shares purchased by the Registered Holder upon such exercise plus (b) the number
of Warrant Shares (if any) covered by the portion of this Warrant cancelled in
payment of the Purchase Price payable upon such exercise pursuant to subsection
1(b) above.

                  (e) Notwithstanding the foregoing, this Warrant shall become
exercisable as follows:

                           (i) with respect to 1,500,000 Warrant Shares (the
"First Tranche Warrant Shares"), on the Original Issue Date (as defined in
subsection 2(a) below); and

                           (ii) with respect to the remaining 4,500,000 Warrant
Shares, on the fifth (5th) anniversary of the Original Issue Date, unless the
exercisability of such remaining Warrant Shares is accelerated pursuant to
subsection 1(f) below.

                  (f) Exercisability of the remaining Warrant Shares referenced
in clause (ii) of subsection 1(e) above shall be accelerated as follows:

                           (i) if the Company recognizes (such recognition, the
"Second Tranche Acceleration Event"), with respect to any period commencing on
January 1, 2000 and ending on or prior to December 31, 2000, revenues of
$28,000,000 or more, an additional 2,000,000 Warrant Shares (the "Second Tranche
Warrant Shares") shall become exercisable as of the date of occurrence of the
Second Tranche Acceleration Event (subject to the provisions of subsections 1(g)
through 1(i) below);

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                           (ii) if the Company receives (such receipt, the
"Third Tranche Acceleration Event"), during any period commencing on January 1,
2000 and ending on or prior to December 31, 2000, purchase orders for the
Company's products and/or services in the aggregate amount of $35,000,000 or
more, an additional 1,000,000 Warrant Shares (the "Third Tranche Warrant
Shares") shall become exercisable as of the date of occurrence of the Third
Tranche Acceleration Event (subject to the provisions of subsections 1(g)
through 1(i) below);

                           (iii) if the Company recognizes, with respect to any
period commencing on January 1, 2000 and ending on or prior to December 31,
2000, revenues of $35,000,000 or more, one (1) additional Warrant Share shall
become exercisable, as of the date of recognition by the Company of such
revenues, for each $10.00 of such revenues in excess of $35,000,000 so
recognized by the Company (subject to the provisions of subsections 1(g) through
1(i) below), provided that exercisability of not more than 1,500,000 Warrant
Shares (the "Fourth Tranche Warrant Shares") may be accelerated pursuant to this
clause (iii); and

                           (iv) notwithstanding the foregoing provisions of
subsection 1(e) and this subsection 1(f), if a Change in Control Event (as
defined below) occurs with respect to the Company prior to the earlier of (A)
the date of termination of the OEM Purchase and Sale Agreement, dated as of
February 10, 2000, between the Company and Nortel Networks Inc. (the "OEM
Agreement") or (B) the date (the "IPO Date") of the closing of the Company's
first underwritten firm commitment public offering of the Company's Common Stock
for sale to the public pursuant to a registration statement under the Securities
Act of 1933, as amended (the "Securities Act"), then, effective as of the date
of such Change in Control Event, (x) all of the Third Tranche Warrant Shares and
the Fourth Tranche Warrant Shares shall, to the extent they have not become
exercisable hereunder prior to such date, become exercisable in full regardless
of the satisfaction (or lack thereof) of the conditions set forth in clauses
(ii) and (iii), respectively, of this subsection 1(f), and (y) if such Change in
Control Event is a Special Change in Control Event, then, in addition to the
acceleration of exercisability of the Third Tranche Warrant Shares and the
Second Tranche Warrant Shares pursuant to clause (iv)(x) of this subsection
1(f), 500,000 of the Second Tranche Warrant Shares shall, to the extent they
have not become exercisable hereunder prior to such date, become exercisable
regardless of the satisfaction (or lack thereof) of the conditions set forth in
clause (i) of this subsection 1(f), and the number of Second Tranche Warrant
Shares the acceleration of exercisability of which remains subject to the
satisfaction of the conditions set forth in clause (i) of this subsection 1(f)
shall be reduced to 1,500,000.

                  (g) Any determination of whether the Second Tranche
Acceleration Event or the Third Tranche Acceleration Event has occurred, and any
determination of whether (and to what extent) exercisability of the Fourth
Tranche Warrant Shares has been accelerated hereunder shall, subject to the
provisions of subsection 1(h) below, be made by the Company's independent
auditors (and the Company shall cause such auditors to make such determination
at the Company's expense), (i) as promptly as reasonably practicable upon a
request for such determination by the Registered Holder, (ii) not later than 10
days after any Exercise Date in the event that the corresponding exercise of
this Warrant purports to exercise the same with respect to any Second Tranche
Warrant Shares, Third Tranche Warrant Shares or Fourth Tranche

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                                 CONFIDENTIAL

Warrant Shares which have not been determined to have become exercisable in
accordance with this subsection 1(g) or by operation of clause (iv) of
subsection 1(f) above, and (iii) in any event, not later than 10 days after
the audited annual financial statements of the Company for the year ended
December 31, 2000 are made available by the Company's auditors, in final
form, to the Company and/or any of the Company's stockholders. To the extent
relevant to the determination of whether exercisability of any of the Warrant
Shares has been accelerated pursuant to subsection 1(f) above, all
determinations of "revenue" shall be made in accordance with generally
accepted accounting principles consistently applied.

                  (h) In the event that the Registered Holder disagrees with any
determination made by the Company's auditors pursuant to subsection 1(g) above,
the Registered Holder may, by written notice to the Company given not later than
15 days after the date on which such determination of the Company's auditors was
furnished in writing to the Registered Holder, require that such determination
be audited by an independent accounting firm of national reputation mutually
acceptable to the Company and the Registered Holder (or, if the Company and the
Registered Holder are unable to agree on the identity of such accounting firm
within 10 days, then such firm shall be selected jointly, within another 10 days
thereafter, by the individuals then serving as primary client contacts for the
Company and the Registered Holder at the independent accounting firm or firms
then serving as the auditors for the Company and the Registered Holder,
respectively). Each of the Company and the Registered Holder shall cooperate in
full with such audit and shall use their respective commercially reasonable
efforts to cause such audit to be completed as promptly as practicable. The cost
of such audit shall be borne by the Company unless such audit does not result in
a determination that exercisability of any of the Warrant Shares shall be
accelerated under subsection 1(f) above (in which case the cost of such audit
shall be borne by the Registered Holder), and the conclusions of such audit
shall be final and binding on all parties absent manifest error.

                  (i) For the purposes of this Warrant:

                           (i) "Change in Control Event" with respect to the
Company means:

                                    (A) the acquisition by an individual, entity
or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) (a "Person") of
beneficial ownership of any capital stock of the Company if, after such
acquisition, such Person beneficially owns (within the meaning of Rule 13d-3
promulgated under the Exchange Act) more than 50% of either (x) the
then-outstanding shares of Common Stock of the Company (the "Outstanding Company
Common Stock") or (y) the combined voting power of the then-outstanding
securities of the Company generally entitled to vote (the "Outstanding Company
Voting Securities"); provided, however, that for purposes of this paragraph (A),
no acquisition by any corporation or other entity pursuant to a Business
Combination (as defined below) which complies with clauses (x) and (y) of
paragraph (B) of this definition shall constitute a Change in Control Event; or

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                                    (B) the consummation of a merger,
consolidation, reorganization, recapitalization or statutory share exchange
involving the Company or a sale or other disposition of all or substantially all
of the assets of the Company (a "Business Combination"), unless, immediately
following such Business Combination, each of the following two conditions is
satisfied: (x) all or substantially all of the individuals and entities who were
the beneficial owners of the Outstanding Company Common Stock and Outstanding
Company Voting Securities immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 50% of the then-outstanding
shares of common stock and the combined voting power of the then-outstanding
securities generally entitled to vote, respectively, of the resulting or
acquiring corporation in such Business Combination (which shall include, without
limitation, a corporation which as a result of such transaction owns the Company
or substantially all of the Company's assets either directly or through one or
more subsidiaries) (such resulting or acquiring corporation is referred to
herein as the "Acquiring Corporation") in substantially the same proportions as
their ownership of the Outstanding Company Common Stock and Outstanding Company
Voting Securities, respectively, immediately prior to such Business Combination
(it being understood that for purposes of the determination of whether or not
such voting power of the then-outstanding securities are owned, directly or
indirectly, in substantially the same proportions as the ownership of
Outstanding Company Common Stock and Outstanding Company Voting Securities,
respectively, any securities transferred pursuant to transfers by a security
holder which is a corporation to a wholly-owned subsidiary of such corporation
or by a security holder which is a closely-held partnership pro rata to the
partners of such partnership or the retired partners of such partnership or to
the estates of any such partners or retired partners or by a security holder
which is a closely-held limited liability company pro rata to the members of
such limited liability company or the retired members of such limited liability
company or to the estates of any such members or retired members, shall be
deemed to be owned in the same proportion as such securities were owned by the
transferring security holder in each such case), and (y) no Person (excluding
the Acquiring Corporation or any employee benefit plan (or related trust)
maintained or sponsored by the Company or by the Acquiring Corporation)
beneficially owns, directly or indirectly, more than 50% of the then-outstanding
shares of common stock of the Acquiring Corporation, or of the combined voting
power of the then-outstanding securities of such corporation generally entitled
to vote (except to the extent that such ownership existed prior to the Business
Combination);

                           (ii) "Special Change in Control Event" means any
Change in Control Event as a result of which (or in connection with which)
any Person that is a direct competitor of Nortel Networks Inc. or any of its
subsidiaries or Affiliates (as defined below) (including, without limitation,
[*], [*] (including [*]), [*] (including [*], [*], and [*]), [*], [*], [*],
[*] and [*], and their respective subsidiaries, Affiliates and successor
entities (and the subsidiaries and Affiliates of any such successor
entities)), acquires beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of more than 50% of any of (A) the
Outstanding Company Common Stock, (B) the Outstanding Company Voting
Securities, or (C) with respect to any Change in Control Event described in
clause (B) of the definition of "Change in Control Event" above, the then-

* CERTAIN CONFIDENTIAL INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
  SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

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                                 CONFIDENTIAL

outstanding shares of common stock or the combined voting power of the
then-outstanding securities generally entitled to vote, respectively, of the
Acquiring Corporation; and

                           (iii) "Affiliate" means, with respect to any
specified Person, (A) any Person that directly or indirectly controls, is
controlled by, or is under common control with such specified Person, or (B) any
Person that is a member of the immediate family of the specified Person.

         2. ADJUSTMENTS.

                  (a)   DILUTING ISSUANCES.

                        (i)   DEFINITIONS. For purposes of this Section 2, the
following definitions shall apply:

                              (A) "OPTION" shall mean rights, options or
warrants to subscribe for, purchase or otherwise acquire Common Stock or
Convertible Securities.

                              (B) "ORIGINAL ISSUE DATE" shall mean the
date on which this Warrant (or any predecessor warrant) was first issued.

                              (C) "CONVERTIBLE SECURITIES" shall mean any
evidences of indebtedness, shares or other securities directly or indirectly
convertible into or exchangeable for Common Stock, but excluding Options.

                              (D) "ADDITIONAL SHARES OF COMMON STOCK"
shall mean all shares of Common Stock issued (or, pursuant to subsection
2(a)(iii) below, deemed to be issued) by the Company after the Original Issue
Date, other than:

                              (I)      shares of Common Stock issued upon
                                       conversion of shares of Series B
                                       Preferred Stock, Series C Preferred
                                       Stock, Series D Preferred Stock or
                                       Series E Preferred Stock (as such terms
                                       are defined in the Amended and Restated
                                       Articles of Incorporation of the Company
                                       as in effect as of the Original Issue
                                       Date (the "Restated Articles"))
                                       (including Series B Preferred Stock,
                                       Series C Preferred Stock, Series D
                                       Preferred Stock and Series E Preferred
                                       Stock issued upon exercise of warrants
                                       then outstanding);

                              (II)    shares of Common Stock issued or issuable
                                      by reason of a dividend, stock split,
                                      split-up or other distribution on shares
                                      of Common Stock that are covered by
                                      subsections 2(b) or 2(c) below;

                              (III)   shares of Common Stock issued or issuable
                                      to officers or employees of, or
                                      consultants to, the Company pursuant

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                                      to a stock grant, option plan or purchase
                                      plan or other employee stock incentive
                                      program approved by the Board of Directors
                                      of the Company;

                              (IV)    shares of Common Stock issued or issuable
                                      upon conversion of Convertible Securities
                                      outstanding prior to the Original Issue
                                      Date; or

                              (V)     up to 2,335,194 shares of the Company's
                                      Series E Preferred Stock.

                           (ii) NO ADJUSTMENT OF PURCHASE PRICE. No adjustments
to the Purchase Price shall be made unless the consideration per share
(determined pursuant to subsection 2(a)(v)) for an Additional Share of Common
Stock issued or deemed to be issued by the Company is less than the lesser of
(i) the Purchase Price on the Original Issue Date or (ii) the Purchase Price in
effect immediately prior to the issue of such Additional Shares.

                           (iii) ISSUE OF SECURITIES DEEMED ISSUE OF ADDITIONAL
SHARES OF COMMON STOCK. If the Company at any time or from time to time after
the Original Issue Date shall issue any Options (excluding Options covered by
subsection 2(a)(i)(D)(III) above) or Convertible Securities or shall fix a
record date for the determination of holders of any class of securities entitled
to receive any such Options or Convertible Securities, then the maximum number
of shares of Common Stock (as set forth in the instrument relating thereto
without regard to any provision contained therein for a subsequent adjustment of
such number) issuable upon the exercise of such Options or, in the case of
Convertible Securities and Options therefor, the conversion or exchange of such
Convertible Securities, shall be deemed to be Additional Shares of Common Stock
issued as of the time of such issue or, in case such a record date shall have
been fixed, as of the close of business on such record date, provided that
Additional Shares of Common Stock shall not be deemed to have been issued unless
the consideration per share (determined pursuant to subsection 2(a)(v) hereof)
of such Additional Shares of Common Stock would be less than the Purchase Price
in effect on the date of and immediately prior to such issue, or such record
date, as the case may be, and provided further that in any such case in which
Additional Shares of Common Stock are deemed to be issued:

                                    (A) No further adjustment in the Purchase
Price shall be made upon the subsequent issue of Convertible Securities or
shares of Common Stock upon the exercise of such Options or conversion or
exchange of such Convertible Securities;

                                    (B) If such Options or Convertible
Securities by their terms provide, with the passage of time or otherwise, for
any increase or decrease in the consideration payable to the Company, then upon
the exercise, conversion or exchange thereof, the Purchase Price computed upon
the original issue thereof (or upon the occurrence of a record date with respect
thereto), and any subsequent adjustments based thereon, shall, upon any such
increase or decrease becoming effective, be recomputed to reflect such increase
or decrease insofar as it affects such Options or the rights of conversion or
exchange under such Convertible Securities;

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                                    (C) Upon the expiration or termination of
any such unexercised Option, the Purchase Price shall be readjusted, and the
Additional Shares of Common Stock deemed issued as the result of the original
issue of such Option shall not be deemed issued for the purposes of any
subsequent adjustment of the Purchase Price;

                                    (D) In the event of any change in the number
of shares of Common Stock issuable upon the exercise, conversion or exchange of
any such Option or Convertible Security, including, but not limited to, a change
resulting from the anti-dilution provisions thereof, the Purchase Price then in
effect shall forthwith be readjusted to such Purchase Price as would have
obtained had the adjustment which was made upon the issuance of such Option or
Convertible Security not exercised, converted or exchanged prior to such change
been made upon the basis of such change; and

                                    (E) No readjustment pursuant to clause (B)
or (D) above shall have the effect of increasing the Purchase Price to an amount
which exceeds the lower of (i) the Purchase Price on the original adjustment
date, or (ii) the Purchase Price that would have resulted from any issuances of
Additional Shares of Common Stock between the original adjustment date and such
readjustment date.

         In the event the Company, after the Original Issue Date, amends the
terms or reduces the exercise prices of any such Options or Convertible
Securities (whether such Options or Convertible Securities were outstanding on
the Original Issue Date or were issued after the Original Issue Date), then such
Options or Convertible Securities, as so amended, shall be deemed to have been
issued after the Original Issue Date and the provisions of this subsection
2(a)(iii) shall apply.

                           (iv) ADJUSTMENT OF PURCHASE PRICE UPON ISSUANCE OF
ADDITIONAL SHARES OF COMMON STOCK. In the event the Company shall, at any time
after the Original Issue Date, issue Additional Shares of Common Stock
(including Additional Shares of Common Stock deemed to be issued pursuant to
subsection 2(a)(iii)), without consideration or for a consideration per share
less than the Purchase Price in effect immediately prior to such issue, then and
in such event, such Purchase Price shall be reduced, concurrently with such
issue, to a price (calculated to the nearest cent) determined by multiplying
such Purchase Price by a fraction, (A) the numerator of which shall be (1) the
number of shares of Common Stock outstanding immediately prior to such issue
plus (2) the number of shares of Common Stock which the aggregate consideration
received or to be received by the Company for the total number of Additional
Shares of Common Stock so issued would purchase at such Purchase Price; and (B)
the denominator of which shall be the number of shares of Common Stock
outstanding immediately prior to such issue plus the number of such Additional
Shares of Common Stock so issued.

                           (v) DETERMINATION OF CONSIDERATION. For purposes of
this subsection 2(a), the consideration received by the Company for the issue of
any Additional Shares of Common Stock shall be computed as follows:

                               (A) CASH AND PROPERTY: Such consideration shall:

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                                    (I)     insofar as it consists of cash, be
                                            computed at the aggregate of cash
                                            received by the Company, excluding
                                            amounts paid or payable for accrued
                                            interest;

                                    (II)    insofar as it consists of property
                                            other than cash, be computed at the
                                            fair market value thereof at the
                                            time of such issue, as determined in
                                            good faith by the Board of
                                            Directors; and

                                    (III)   in the event Additional Shares of
                                            Common Stock are issued together
                                            with other shares or securities or
                                            other assets of the Company for
                                            consideration which covers both, be
                                            the proportion of such consideration
                                            so received, computed as provided in
                                            clauses (I) and (II) above, as
                                            determined in good faith by the
                                            Board of Directors.

                                    (B) OPTIONS AND CONVERTIBLE SECURITIES. The
consideration per share received by the Company for Additional Shares of Common
Stock deemed to have been issued pursuant to subsection 2(a)(iii), relating to
Options and Convertible Securities, shall be determined by dividing

                                            (x) the total amount, if any,
received or receivable by the Company as consideration for the issue of such
Options or Convertible Securities, plus the minimum aggregate amount of
additional consideration (as set forth in the instruments relating thereto,
without regard to any provision contained therein for a subsequent adjustment of
such consideration) payable to the Company upon the exercise of such Options or
the conversion or exchange of such Convertible Securities, or in the case of
Options for Convertible Securities, the exercise of such Options for Convertible
Securities and the conversion or exchange of such Convertible Securities, by

                                            (y) the maximum number of shares of
Common Stock (as set forth in the instruments relating thereto, without regard
to any provision contained therein for a subsequent adjustment of such number)
issuable upon the exercise of such Options or the conversion or exchange of such
Convertible Securities.

                           (vi) MULTIPLE CLOSING DATES. In the event the Company
shall issue on more than one date Additional Shares of Common Stock which are
comprised of shares of the same series or class of Preferred Stock (excluding
shares of Series E Preferred Stock), and such issuance dates occur within a
period of no more than 120 days, then, upon the final such issuance, the
Purchase Price shall be readjusted to give effect to all such issuances as if
they occurred on the date of the final such issuance (and without giving effect
to any adjustments as a result of such prior issuances within such period).

                  (b) ADJUSTMENT FOR STOCK SPLITS AND COMBINATIONS. If the
Company shall at any time or from time to time after the Original Issue Date
effect a subdivision of the outstanding Common Stock, the Purchase Price then in
effect immediately before that subdivision shall be proportionately decreased.
If the Company shall at any time or from time to time after the

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Original Issue Date combine the outstanding shares of Common Stock, the
Purchase Price then in effect immediately before the combination shall be
proportionately increased. Any adjustment under this paragraph shall become
effective at the close of business on the date the subdivision or combination
becomes effective.

                  (c) ADJUSTMENT FOR CERTAIN DIVIDENDS AND DISTRIBUTIONS. In the
event the Company at any time, or from time to time after the Original Issue
Date shall make or issue, or fix a record date for the determination of holders
of Common Stock entitled to receive, a dividend or other distribution payable in
additional shares of Common Stock, then and in each such event the Purchase
Price then in effect immediately before such event shall be decreased as of the
time of such issuance or, in the event such a record date shall have been fixed,
as of the close of business on such record date, by multiplying the Purchase
Price then in effect by a fraction:

                           (1) the numerator of which shall be the total number
                  of shares of Common Stock issued and outstanding immediately
                  prior to the time of such issuance or the close of business on
                  such record date, and

                           (2) the denominator of which shall be the total
                  number of shares of Common Stock issued and outstanding
                  immediately prior to the time of such issuance or the close of
                  business on such record date plus the number of shares of
                  Common Stock issuable in payment of such dividend or
                  distribution;

provided, however, if such record date shall have been fixed and such dividend
is not fully paid or if such distribution is not fully made on the date fixed
therefor, the Purchase Price shall be recomputed accordingly as of the close of
business on such record date and thereafter the Purchase Price shall be adjusted
pursuant to this paragraph as of the time of actual payment of such dividends or
distributions.

                  (d) ADJUSTMENT IN NUMBER OF WARRANT SHARES. When any
adjustment is required to be made in the Purchase Price pursuant to subsections
2(a), 2(b) or 2(c), the number of Warrant Shares purchasable upon the exercise
of this Warrant shall be changed to the number determined by dividing (i) an
amount equal to the number of shares issuable upon the exercise of this Warrant
immediately prior to such adjustment, multiplied by the Purchase Price in effect
immediately prior to such adjustment, by (ii) the Purchase Price in effect
immediately after such adjustment (and, without limiting generality of the
foregoing, the number of the First Tranche Warrant Shares, the Second Tranche
Warrant Shares, the Third Tranche Warrant Shares and the Fourth Tranche Warrant
Shares, as well as the number of Warrant Shares subject to the accelerated
exercisability provisions of clause (iv) of subsection 1(f) above, shall be
similarly adjusted).

                  (e) ADJUSTMENTS FOR OTHER DIVIDENDS AND DISTRIBUTIONS. In the
event the Company at any time or from time to time after the Original Issue Date
shall make or issue, or fix a record date for the determination of holders of
Common Stock entitled to receive, a dividend or other distribution payable in
securities of the Company (other than shares of Common Stock) or in cash or
other property (other than cash out of earnings or earned surplus, determined in
accordance with generally accepted accounting principles), then and in each such

                                    -11-

<PAGE>

                                 CONFIDENTIAL

event provision shall be made so that the Registered Holder shall receive upon
exercise hereof, in addition to the number of shares of Common Stock issuable
hereunder, the kind and amount of securities of the Company and/or cash and
other property which the Registered Holder would have been entitled to receive
had this Warrant been exercised into Common Stock on the date of such event and
had the Registered Holder thereafter, during the period from the date of such
event to and including the Exercise Date, retained any such securities
receivable, giving application to all adjustments called for during such period
under this Section 2 with respect to the rights of the Registered Holder.

                  (f) ADJUSTMENT FOR MERGERS OR REORGANIZATIONS, ETC. If there
shall occur any reorganization, recapitalization, consolidation or merger
involving the Company in which the Common Stock is converted into or exchanged
for securities, cash or other property (other than a transaction covered by
subsections 2(b), 2(c) or 2(e)), then, following any such reorganization,
recapitalization, consolidation or merger, the Registered Holder shall receive
upon exercise hereof the kind and amount of securities, cash or other property
which the Registered Holder would have been entitled to receive if, immediately
prior to such reorganization, recapitalization, consolidation or merger, the
Registered Holder had held the number of shares of Common Stock subject to this
Warrant. Notwithstanding the foregoing sentence, if (x) there shall occur any
reorganization, recapitalization, consolidation or merger involving the Company
in which the Common Stock is converted into or exchanged for anything other than
solely equity securities, and (y) the common stock of the acquiring or surviving
company is publicly traded, then, as part of any such reorganization,
recapitalization, consolidation or merger, (i) the Registered Holder shall have
the right thereafter to receive upon the exercise hereof such number of shares
of common stock of the acquiring or surviving company as is determined by
multiplying (A) the number of shares of Common Stock then subject to this
Warrant by (B) a fraction, the numerator of which is the Fair Market Value per
share of Common Stock as of the effective date of such transaction, as
determined pursuant to subsection 1(b), and the denominator of which is the fair
market value per share of common stock of the acquiring or surviving company as
of the effective date of such transaction, as determined in good faith by the
Board of Directors of the Company (using the principles set forth in subsection
1(b) to the extent applicable), and (ii) the exercise price per share of common
stock of the acquiring or surviving company shall be the Purchase Price divided
by the fraction referred to in clause (B) above. In any such case, appropriate
adjustment (as determined in good faith by the Board of Directors of the
Company) shall be made in the application of the provisions set forth herein
with respect to the rights and interests thereafter of the Registered Holder, to
the end that the provisions set forth in this Section 2 (including provisions
with respect to changes in and other adjustments of the Purchase Price) shall
thereafter be applicable, as nearly as reasonably may be, in relation to any
securities, cash or other property thereafter deliverable upon the exercise of
this Warrant.

                  (g) CERTIFICATE AS TO ADJUSTMENTS. Upon the occurrence of each
adjustment or readjustment of the Purchase Price pursuant to this Section 2, the
Company at its expense shall promptly compute such adjustment or readjustment in
accordance with the terms hereof and furnish to the Registered Holder a
certificate setting forth such adjustment or readjustment (including the kind
and amount of securities, cash or other property for which this Warrant shall be
exercisable and the Purchase Price) and showing in detail the facts upon which
such adjustment or readjustment is based. The Company shall, upon the written
request at any time of

                                    -12-

<PAGE>

                                 CONFIDENTIAL

the Registered Holder, furnish or cause to be furnished to the Registered
Holder a certificate setting forth (i) the Purchase Price then in effect and
(ii) the number of shares of Common Stock and the amount, if any, of other
securities, cash or property which then would be received upon the exercise
of this Warrant.

         3. FRACTIONAL SHARES. The Company shall not be required upon the
exercise of this Warrant to issue any fractional shares, but shall make an
adjustment therefor in cash on the basis of the Fair Market Value per share of
Common Stock, as determined pursuant to subsection 1(b) above.

         4. REQUIREMENTS FOR TRANSFER.

            Subject to the provisions of any other written agreement to which
the Company and the Registered Holder are parties or by which they are bound,
this Warrant and the Registered Holder's rights hereunder may be sold,
exchanged, pledged or otherwise transferred in whole (but not in part), and
the Warrant Shares may be sold, exchanged, pledged or otherwise transferred
in whole or in part, in each case to any person or entity.

         5. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY. The
Company hereby represents and warrants to, and covenants with, the Registered
Holder that, as of the Original Issue Date:

            (a) ORGANIZATION, GOOD STANDING AND QUALIFICATION. The Company is
a corporation duly organized, validly existing and in good standing under the
laws of the State of California and has all requisite corporate power and
authority to carry on its business. The Company is duly qualified to transact
business and is in good standing in each jurisdiction in which the failure so
to qualify would have a material adverse effect on the Company's business or
properties.

            (b) CAPITALIZATION. As of immediately prior to the initial
issuance of this Warrant on the Original Issue Date (the "Closing"), the
authorized capital of the Company consists of:

                     (i) 32,562,731 shares of Preferred Stock, 2,363,636
shares of which have been designated Series A Preferred Stock, all of which will
be issued and outstanding immediately prior to the Closing, 1,691,123 shares of
which have been designated Series B Preferred Stock, all of which will be issued
and outstanding immediately prior to the Closing, 17,808,877 shares of which
have been designated Series C Preferred Stock, all of which will be issued and
outstanding immediately prior to the Closing, 6,199,095 shares of which have
been designated Series D Preferred Stock, all of which will be issued and
outstanding immediately prior to Closing, and 4,500,000 shares of which have
been designated Series E Preferred Stock, 2,067,248 of which are issued and
outstanding immediately prior to the Closing. The rights, privileges and
preferences of the Preferred Stock are as stated in the Restated Articles. All
of the outstanding shares of Preferred Stock have been duly authorized, fully
paid and nonassessable and issued in compliance with all applicable federal and
state securities laws.

                                     -13-

<PAGE>

                                 CONFIDENTIAL

                           (ii) 55,000,000 shares of Common Stock, 499,491
shares of which will be issued and outstanding immediately prior to the Closing.
All of the outstanding shares of Common Stock have been duly authorized, fully
paid and are nonassessable and issued in compliance with all applicable federal
and state securities laws.

                           (iii) The Company has reserved 7,825,000 shares of
Common Stock for issuance to officers, directors, employees and consultants of
the Company pursuant to its 1996 Stock Option Plan duly adopted by the Board of
Directors and approved by the Company shareholders (the "1996 STOCK PLAN"). Of
such reserved shares of Common Stock, 466,493 shares have been issued upon
exercise of options previously granted, options to purchase 7,259,500 shares
have been granted and are currently outstanding, and 99,007 shares of Common
Stock remain available for issuance to officers, directors, employees and
consultants pursuant to the 1996 Stock Plan.

                           (iv) The Company has reserved 1,500,000 shares of
Common Stock for issuance to officers, directors, employees and consultants
of the Company pursuant to its 1999 Stock Option Plan duly adopted by the
Board of Directors and approved by the Company shareholders (the "1999 STOCK
PLAN"). Of such reserved shares of Common Stock, no shares have been issued
upon exercise of options previously granted, options to purchase 1,473,400
shares have been granted and are currently outstanding, and 26,600 shares of
Common Stock remain available for issuance to officers, directors, employees
and consultants pursuant to the 1999 Stock Plan.

                           (v) Except for outstanding options issued pursuant to
the 1996 Stock Plan and the 1999 Stock Plan, and except for outstanding warrants
to acquire up to 178,962 shares of Common Stock, there are no outstanding
options, warrants, rights (including conversion or preemptive rights and rights
of first refusal or similar rights) or agreements, orally or in writing, for the
purchase or acquisition from the Company, either directly or indirectly, of any
shares of its capital stock. Except as set forth in the Amended and Restated
Rights Agreement, dated as of the Original Issue Date, among the Company and the
investors set forth on EXHIBIT A attached thereto (the "Rights Agreement"), the
Company has not granted any registration rights to any Person with respect to
any of the Company's securities.

                  (c) AUTHORIZATION. All corporate action on the part of the
Company, its officers, directors and shareholders necessary for the
authorization, issuance, execution and delivery of this Warrant, the Rights
Agreement and the OEM Agreement (collectively, the "Agreements"), the
performance of all obligations of the Company hereunder and thereunder and the
authorization, issuance (or reservation for issuance), sale and delivery of the
Warrant Shares issuable upon exercise of this Warrant (together, the
"Securities") have been taken or will be taken prior to each Closing, and the
Agreements, when executed and delivered by the Company, shall constitute valid
and legally binding obligations of the Company, enforceable against the Company
in accordance with their terms except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance, and other laws of
general application affecting enforcement of creditors' rights generally, as
limited by laws relating to the availability of specific performance, injunctive
relief, or other equitable remedies, or (ii) to the

                                    -14-

<PAGE>

                                 CONFIDENTIAL

extent the indemnification provisions contained in the Rights Agreement may
be limited by applicable federal or state securities laws.

                  (d) VALID ISSUANCE OF SECURITIES. This Warrant is duly and
validly issued and free of restrictions on transfer other than restrictions on
transfer under this Warrant, the Rights Agreement and applicable state and
federal securities laws. Based in part upon the representations of the
Registered Holder in this Warrant and subject to the provisions of subsection
5(e) below, this Warrant is issued in compliance with all applicable federal and
state securities laws. The Warrant Shares issuable upon exercise of this Warrant
have been duly and validly reserved for issuance, and upon issuance in
accordance with the terms hereof, shall be duly and validly issued, fully paid
and nonassessable and free of restrictions on transfer other than restrictions
on transfer under this Warrant, the Rights Agreement and applicable federal and
state securities laws, and will be issued in compliance with all applicable
federal and state securities laws.

                  (e) GOVERNMENTAL CONSENTS. No consent, approval, order or
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority on the part of
the Company is required in connection with the consummation of the transactions
contemplated by this Warrant, except for filings pursuant to Section 25102(f) of
the California Corporate Securities Law of 1968, as amended, and the rules
thereunder, other applicable state securities laws and Regulation D of the
Securities Act.

                  (f) NONCONTRAVENTION; LITIGATION. The execution, delivery and
performance of the Agreements and the consummation of the transactions
contemplated hereby and thereby will not (i) result in any violation of or
default under, or otherwise conflict with, the Restated Articles or the Bylaws
of the Company (as in effect at the Closing or as of any issuance of Warrant
Shares hereunder) or any instrument, judgment, order, writ, decree or contract
to which the Company is a party or by which it is bound or, to the Company's
knowledge, of any provision of federal, local or foreign statute, rule or
regulation applicable to the Company, or (ii) constitute, with or without
passage of time or giving of notice, either a violation of or default under any
such provision, instrument, judgment, order, writ, decree or contract or an
event which results in the creation of any lien, charge or encumbrance upon any
assets of the Company. There is no action, suit, proceeding or investigation
pending or, to the Company's knowledge, currently threatened against the Company
or with respect to the Company's officers or directors, that questions the
validity of the Agreements or the right of the Company to enter into them, or to
consummate the transactions contemplated hereby or thereby, nor is the Company
aware that there is any basis for the foregoing.

         6. REPRESENTATIONS AND WARRANTIES OF THE REGISTERED HOLDER. The
Registered Holder hereby represents and warrants to the Company that, as of the
Original Issue Date:

                  (a) PURCHASE ENTIRELY FOR OWN ACCOUNT. This Warrant is being
acquired by the Registered Holder for investment for the Registered Holder's own
account, not as a nominee or agent, and not with a view to the resale or
distribution of any part thereof, and the Registered Holder has no present
intention of selling, granting any participation in, or otherwise distributing
the same. The Registered Holder does not presently have any contract,
undertaking, agreement

                                    -15-
<PAGE>

                                 CONFIDENTIAL

or arrangement with any person to sell, transfer or grant participations to
such person or to any third person, with respect to any of the Securities.
The Registered Holder has not been formed for the specific purpose of
acquiring the Securities.

                  (b) DISCLOSURE OF INFORMATION. The Registered Holder has had
the opportunity to perform due diligence and ask questions of the Company's
management in connection with transactions contemplated hereby.

                  (c) RESTRICTED SECURITIES. The Registered Holder understands
that the Securities have not been, and will not be, registered under the
Securities Act, by reason of a specific exemption from the registration
provisions of the Securities Act which depends upon, among other things, the
bona fide nature of the investment intent and the accuracy of the Registered
Holder's representations as expressed herein. The Registered Holder understands
that the Securities are "restricted securities" under applicable U.S. federal
and state securities laws and that, pursuant to these laws, the Registered
Holder must hold the Securities indefinitely unless they are registered with the
Securities and Exchange Commission (the "SEC") and qualified by state
authorities, or an exemption from such registration and qualification
requirements is available. The Registered Holder acknowledges that the Company
has no obligation to register or qualify the Securities for resale except as may
be set forth in a separate written agreement to which the Company and the
Registered Holder are parties or by which they are bound. The Registered Holder
further acknowledges that if an exemption from registration or qualification is
available, it may be conditioned on various requirements including, but not
limited to, the time and manner of sale, the holding period for the Securities,
and requirements relating to the Company which are outside of the Registered
Holder's control and which the Company is under no obligation and may not be
able to satisfy.

                  (d) NO PUBLIC MARKET. The Registered Holder understands that
no public market now exists for any of the securities issued by the Company, and
that the Company has made no assurances that a public market will ever exist for
the Securities.

                  (e) ACCREDITED INVESTOR. The Registered Holder is an
accredited investor as defined in Rule 501(a) of Regulation D promulgated under
the Securities Act.

         7. NO IMPAIRMENT. The Company will not, by amendment of its charter or
through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid or
seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms
and in the taking of all such action as may be necessary or appropriate in order
to protect the rights of the holder of this Warrant against impairment.

         8. NOTICES OF RECORD DATE, ETC. In the event:

                  (a) the Company shall take a record of the holders of its
Common Stock (or other stock or securities at the time deliverable upon the
exercise of this Warrant) for the purpose of entitling or enabling them to
receive any dividend or other distribution, or to receive any right to subscribe
for or purchase any shares of stock of any class or any other securities, or to
receive any other right; or

                                     -16-

<PAGE>

                                 CONFIDENTIAL

                  (b) of any capital reorganization of the Company, any
reclassification of the Common Stock of the Company, any consolidation or merger
of the Company with or into another corporation (other than a consolidation or
merger in which the Company is the surviving entity and its Common Stock is not
converted into or exchanged for any other securities or property), or any
transfer of all or substantially all of the assets of the Company; or

                  (c) of the voluntary or involuntary dissolution, liquidation
or winding-up of the Company,

then, and in each such case, the Company will mail or cause to be mailed to
the Registered Holder a notice specifying, as the case may be, (i) the record
date for such dividend, distribution or right, and the amount and character
of such dividend, distribution or right, or (ii) the effective date on which
such reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation or winding-up is to take place, and the time, if any
is to be fixed, as of which the holders of record of Common Stock (or such
other stock or securities at the time deliverable upon the exercise of this
Warrant) shall be entitled to exchange their shares of Common Stock (or such
other stock or securities) for securities or other property deliverable upon
such reorganization, reclassification, consolidation, merger, transfer,
dissolution, liquidation or winding-up. Such notice shall be mailed at least
thirty (30) days prior to the record date or effective date for the event
specified in such notice.

         9. RESERVATION OF STOCK. The Company will at all times reserve and keep
available, solely for issuance and delivery upon the exercise of this Warrant,
such number of Warrant Shares and other securities, cash and/or property, as
from time to time shall be issuable upon the exercise of this Warrant.

         10. EXCHANGE OF WARRANTS. Upon the surrender by the Registered Holder,
properly endorsed, to the Company at the principal office of the Company, the
Company will, subject to the provisions of Section 4 hereof, issue and deliver
to or upon the order of such Holder, at the Company's expense, a new Warrant or
Warrants of like tenor, in the name of the Registered Holder or as the
Registered Holder (upon payment by the Registered Holder of any applicable
transfer taxes) may direct, calling in the aggregate on the face or faces
thereof for the number of shares of Common Stock (or other securities, cash
and/or property) then issuable upon exercise of this Warrant.

         11. REPLACEMENT OF WARRANTS. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant, the Company will issue, in lieu thereof, a new Warrant of like
tenor.

         12. TRANSFERS, ETC.

                  (a) The Company will maintain a register containing the name
and address of the Registered Holder of this Warrant. The Registered Holder may
change its or his address as shown on the warrant register by written notice to
the Company requesting such change.

                                    -17-

<PAGE>

                                 CONFIDENTIAL

                  (b) Subject to the provisions of Section 4 hereof, this
Warrant and all rights hereunder are transferable, in whole or in part, upon
surrender of this Warrant with a properly executed assignment (in the form of
EXHIBIT II hereto) at the principal office of the Company.

                  (c) Until any transfer of this Warrant is made in the warrant
register, the Company may treat the Registered Holder as the absolute owner
hereof for all purposes.

         13. MAILING OF NOTICES, ETC. All notices and other communications from
the Company to the Registered Holder shall be mailed by first-class certified or
registered mail, postage prepaid, to the address last furnished to the Company
in writing by the Registered Holder. All notices and other communications from
the Registered Holder or in connection herewith to the Company shall be mailed
by first-class certified or registered mail, postage prepaid, to the Company at
its principal office set forth below. If the Company should at any time change
the location of its principal office to a place other than as set forth below,
it shall give prompt written notice to the Registered Holder and thereafter all
references in this Warrant to the location of its principal office at the
particular time shall be as so specified in such notice.

         14. NO RIGHTS AS STOCKHOLDER. Until the exercise of this Warrant, the
Registered Holder shall not have or exercise any rights by virtue hereof as a
stockholder of the Company. Notwithstanding the foregoing, in the event (i) the
Company effects a split of the Common Stock by means of a stock dividend and the
Purchase Price of and the number of Warrant Shares are adjusted as of the date
of the distribution of the dividend (rather than as of the record date for such
dividend), and (ii) the Registered Holder exercises this Warrant between the
record date and the distribution date for such stock dividend, the Registered
Holder shall be entitled to receive, on the distribution date, the stock
dividend with respect to the shares of Common Stock acquired upon such exercise,
notwithstanding the fact that such shares were not outstanding as of the close
of business on the record date for such stock dividend.

         15. CHANGE OR WAIVER. Any term of this Warrant may be changed or waived
only by an instrument in writing signed by the party against which enforcement
of the change or waiver is sought.

         16. SECTION HEADINGS. The section headings in this Warrant are for the
convenience of the parties and in no way alter, modify, amend, limit or restrict
the contractual obligations of the parties.

         17. GOVERNING LAW. This Warrant will be governed by and construed in
accordance with the internal laws of the State of California (without reference
to the conflicts of law provisions thereof).

                                    -18-

<PAGE>

                                 CONFIDENTIAL

         EXECUTED as of the Date of Issuance indicated above.

                                         SONOMA SYSTEMS

                                         By:     /s/  Steven M. Waszak
                                             ---------------------------------
[CORPORATE SEAL]                         Title:   Chief Financial Officer
                                                ------------------------------
                                         Address (Principal Office):

                                                 4640 Admiralty Way, Suite 600

                                                 Marina del Rey, CA 90292

ATTEST:

_________________________

                                       -19-

<PAGE>

                                 CONFIDENTIAL

                                                                       EXHIBIT I

                                  PURCHASE FORM

To:_________________                                         Dated:____________

         The undersigned, pursuant to the provisions set forth in the attached
Warrant (No. ___), hereby irrevocably elects to purchase (CHECK APPLICABLE BOX):

         / /   _____ shares of the Common Stock covered by such Warrant; or

         / /   the maximum number of shares of Common Stock for which such
               Warrant is presently exercisable pursuant to the cashless
               exercise procedure set forth in Section 1(b).

         The undersigned herewith makes payment of the full purchase price for
such shares at the price per share provided for in such Warrant, which is
$________. Such payment takes the form of (CHECK APPLICABLE BOX OR BOXES):

         / /   $______ in lawful money of the United States; and/or

         / /   the cancellation of such portion of the attached Warrant as
               is exercisable for a total of _____ Warrant Shares (using a
               Fair Market Value of $_____ per share for purposes of this
               calculation); and/or

         / /   the cancellation of such number of Warrant Shares as is
               necessary, in accordance with the formula set forth in Section
               1(b), to exercise such Warrant with respect to the maximum
               number of Warrant Shares for which such Warrant is presently
               exercisable that are purchasable pursuant to the cashless
               exercise procedure set forth in Section 1(b).

                                 Signature: ________________________

                                 Address: __________________________

                                          __________________________

                                     -20-

<PAGE>

                                 CONFIDENTIAL

                                                                      EXHIBIT II

                                 ASSIGNMENT FORM

         FOR VALUE RECEIVED, ________________________________________ hereby
sells, assigns and transfers all of the rights of the undersigned under the
attached Warrant (No. ____) with respect to the number of shares of Common Stock
covered thereby set forth below, unto:

Name of Assignee            Address                     No. of Shares
----------------            -------                     -------------

Dated:________________                Signature:________________________________

                                    -21-<PAGE>

                                 CONFIDENTIAL

--------------------------------------------------------------------------------

                             OEM PURCHASE AGREEMENT

                                    between

                                  SONOMA [LOGO]
                                 SYSTEMS

                                       &

                                    SIEMENS

--------------------------------------------------------------------------------

<PAGE>

                                 CONFIDENTIAL

                             OEM PURCHASE AGREEMENT

                                    between

                         Sonoma Systems Europe Limited
                        51 Eastcheap, London EC3M 1JP,
                                 United Kingdom

                     - hereinafter referred to as "Sonoma" -

                                      and

         Siemens Aktiengesellschaft, Berlin and Munchen, Hofmannstrasse 51,
                                  81359 Munchen,
                           Federal Republic of Germany

                     - hereinafter referred to as "Siemens" -

                  Sonoma and Siemens being the "Parties" hereto.

<PAGE>

                                       -2-

                                 CONFIDENTIAL

TABLE OF CONTENTS

Article 1     Definitions
Article 2     Scope of this Agreement
Article 3     Grant of Rights
Article 4     Documentation
Article 5     Indication of Source
Article 6     Purchase Orders
Article 7     Cancellation
Article 8     Forecast
Article 9     Delivery Times/Emergency Orders
Article 10    Delivery of Contractual Products/Late Deliveries
Article 11    Changes to Contractual Products
Article 12    New Products
Article 13    Prices and Terms of Payment
Article 14    Quality Assurance
Article 15    Testing
Article 16    Warranty
Article 17    Technical Approval by Authorities
Article 18    Software Maintenance
Article 19    Spare parts
Article 20    Technical Cooperation
Article 21    Product Planning
Article 22    Patents and Copyrights
Article 23    Product Liability
Article 24    Limitation of Liability
Article 25    Consequential Damages
Article 26    Confidentiality
Article 27    Force Majeure
Article 28    Emergency Manfacturing Rights
Article 29    Term and Termination
Article 30    Provisions after Termination of the Agreement
Article 31    Arbitration
Article 32    Substantive Law
Article 33    Export Regulations
Article 34    Assignment
Article 35    Miscellaneous

Annex 1       Description of Contractual Products
Annex 2       Specifications of Contractual Products
Annex 3       Description of Documentation
Annex 4       Pricing and Discounts
Annex 5       Software Correction Procedure
Annex 6       Maintenance
Annex 7       Intentionally left blank
Annex 8       Emergency Stock

<PAGE>

                                      -3-

                                 CONFIDENTIAL

WHEREAS Sonoma is a manufacturer of hardware and software products.

WHEREAS Siemens desires to market certain products of Sonoma as part of
Siemens' own product range.

WHEREAS the parties have agreed that they shall, as soon as possible
following the date of this Agreement, negotiate the basis on which Sonoma may
develop and license Network Management Integration Software for the
Contractual Products, subject to Siemens supplying to Sonoma such technical
and other proprietary information as Sonoma shall require for this purpose.
Once the parties agree said terms the Network Management Integration Software
shall constitute a part of the Contractual Products and shall be supplied as
provided for under this Agreement.

NOW THEREFORE the Parties hereto agree as follows:

ARTICLE 1 - DEFINITIONS

1.1      "Contractual Products" means the hardware and software products
         (including components or portions thereof) listed in Annex 1 as
         modified or upgraded from time to time by Sonoma. The specifications
         of the Contractual Products are set forth in Annex 2.

1.2      "Documentation" means the complete documentation related to the
         Contractual Products, as set forth in more detail in Annex 3 as
         modified or amended from time to time by Sonoma. Said Documentation,
         shall be provided, if available, in electronic media (e.g. CD-ROM)

1.3      "Emergency Orders" shall have the meaning as per Article 9.1 and 9.3.

1.4      "End User License" means the terms and conditions on which the
         Software is to be licensed by Siemens or its Subsidiary Companies to
         its customers in compliance with the provisions of this Agreement.

1.5      "Software" means the software programs listed in Annex 1 in machine
         readable format which run on the hardware of the Contractual Products.

1.6      "Source Code" means the Software in a human readable, well-known
         commonly used programming language, and shall include flow charts,
         program-

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         mer's notes, information regarding programmer's tools, as well as
         test programs and test documentation.

1.7      "Subsidiary Company" means any company which is owned or controlled
         directly or indirectly by a Party hereto as to fifty percent (50%) or
         more of the issued share capital and/or voting rights.

ARTICLE 2 - SCOPE OF THIS AGREEMENT

This Agreement shall govern the terms and conditions under which Siemens
shall purchase, and Sonoma shall supply Siemens with Contractual Products and
relevant Documentation and provide the services in accordance with the terms
and conditions of this Agreement.

ARTICLE 3 - GRANT OF RIGHTS

3.1      HARDWARE OF CONTRACTUAL PRODUCTS

         Siemens shall have the non-exclusive, non-assignable,
         non-transferable right to market or have marketed through its
         Subsidiary Companies and other sales outlets the hardware of
         Contractual Products under any trade name or trade mark it may choose
         throughout the world, except for trade names or trade marks belonging
         to Sonoma.

         The term "market" shall comprise sale, lease and other forms of
         disposal.

3.2      SOFTWARE

3.2.1    Sonoma hereby grants to Siemens the following non-exclusive,
         non-assignable, non-transferable, worldwide (and perpetual) licenses:

         (a)   a license to use the Software in connection with the
               installation, commissioning, testing and operation of such
               quantities of Contractual Products; as Siemens purchases from
               Sonoma.

         (b)   a license to sublicense the Software to its Subsidiary
               Companies and other sales outlets and to the end-user-customers
               of Contractual Products

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               only in such quantity as purchased from Sonoma.

         (c)   a license to allow Siemens' Subsidiary Companies and other
               sales outlets the right to sublicense the Software to their
               end-user customers of Contractual Products only in such
               quantity as purchased from Sonoma.

         (d)   a license to copy, or have copied, the Software for
               incorporation into the hardware of Contractual Products
               marketed in accordance with Section 3.1 above;

         (e)   In the event Siemens customers require a deposit of the
               Source Code in Escrow pursuant to a license agreement between
               Siemens and the customer, Sonoma shall provide a copy of the
               Source Code to the Escrow Agent to comply with Siemens
               customer's requirements.

3.2.2    In addition to the rights granted under Section 3.2.1 above Siemens
         and its Subsidiary Companies and other sales outlets shall have the
         right to entitle the end-user customers to transfer the Software
         licenses granted to them in connection with a transfer of the
         Hardware subject to the terms of the End User Licence.

3.2.3    Siemens acknowledges that the Software, the Documentation and the
         Source Code contain valuable confidential and proprietary information
         and trade secrets of Sonoma or its licensors which have not been
         published or otherwise placed in the public domain.

3.2.4    The ownership in the Software shall remain with Sonoma or its
         licensors.

3.2.5    When copying Software, Siemens shall reproduce all alphanumeric
         identification characters and copyright legends of Sonoma or its
         licensors.

3.2.6    The End user Licences shall provide adequate protection for Sonoma's
         intellectual property rights in the Contractual Products and shall
         otherwise be in accordance with this Agreement.

3.3      Siemens agrees that it shall:

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         (a)   not and shall procure that any Subsidiary Companies shall not
            separate the hardware and software elements of the Contractual
            Products; and

         (b)   Provide in its contracts with its customers a provision to the
            effect that its customers shall not separate the hardware and
            software elements of the Contractual Products.

3.4      The CSI Client Software for the Contractual Products, when
         developed, shall be supplied directly to Siemens by Sonoma. The
         parties shall negotiate in good faith the terms on which Sonoma shall
         licence the CSI Client Software to Siemens. Once the parties agree
         said terms the CSI Client Software shall constitute a part of the
         Contractual Products and shall be supplied as provided for under this
         Agreement.

ARTICLE 4 - DOCUMENTATION

4.1      Sonoma shall, upon execution of this Agreement, provide to Siemens a
         complete set of Documentation free of charge.

4.2      All Documentation shall comply with the latest technical standards
         of the Contractual Product in question and shall be updated
         accordingly in case of modifications. Sonoma shall provide Siemens
         without delay and free of charge all updates regarding the
         Documentation. This obligation shall apply for such time as Sonoma
         is providing support to Siemens in accordance with Annex 6.

4.3      Siemens shall be entitled to copy, modify, translate and use
         Sonoma's Documentation. Siemens may attach to such Documentation
         its own copyright notices and supply any copied, modified or
         translated Documentation to end-users, Subsidiary Companies and other
         resellers. Where Siemens is entitled to allow sublicensing, it may
         sublicense the rights set forth in this paragraph to its resellers
         and sublicensees.

ARTICLE 5 - INDICATION OF SOURCE

Notwithstanding Sonoma's right to include its own copyright notices in the
Software, the Contractual Products and/or the Documentation shall not bear
any trademark or other identifying name or symbol pertaining to Sonoma.
Siemens shall have the right, to affix, or demand Sonoma subject to Siemens'
agreement to pay Sonoma's full costs

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and expenses in doing so (such costs to be agreed in advance by Siemens), to
affix to the Contractual Products and/or the Documentation, any trademarks,
symbols or part numbers as Siemens may direct.

ARTICLE 6 - PURCHASE ORDERS

6.1      The scope of Sonoma's supply and Siemens' purchase obligation shall
         depend on the Purchase Orders placed by Siemens in writing and
         accepted by Sonoma.

6.2      Siemens' Purchase Orders shall include the following:

         -  date of issuance,
         -  purchase order number
         -  description of specific Contractual Products (including Siemens'
            part numbers) and/or Documentation
         -  quantity of Contractual Products to be delivered
         -  price
         -  requested date(s) of delivery
         -  delivery address, including any customer delivery address, where
            relevant
         -  shipping instructions and destination
         -  reference to this Agreement.
         -  Sonoma part number

6.3      Sonoma shall confirm the receipt of a Purchase Order by fax within
         three working days and shall accept the Purchase Order within one
         week after receipt.

6.4      Sonoma may reject a Purchase Order for the latest version of the
         Contractual Products or the preceding version, within one week after
         receipt only to the extent it exceeds the forecasts as per Article 8
         or is otherwise not in conformance with the terms and conditions of
         this Agreement.

6.5      Acceptance or rejection of a Purchase Order must be sent by fax
         followed by letter and must be addressed to: Siemens AG/Public
         Communication

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         Networks Group, BU BN KGC, Mrs. Dudek - Lindner, Fax: +89 722 27027.

6.6      Within one week after receipt of an order Sonoma shall confirm or
         reject the order in accordance with the foregoing.

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ARTICLE 7 - CANCELLATION

7.1      Siemens shall have the right, pursuant to art.9.2, to postpone
         delivery on one occasion per Purchase Order for up to [*] calendar
         days from scheduled delivery thereafter, any further reschedule
         would be deemed a cancellation).

7.2      Orders may not be cancelled within [*] ([*]) days of the original
         scheduled delivery date. Orders may be cancelled at any time prior to
         [*] ([*]) days of the original scheduled date.

7.3      In the event Siemens cancels an order prior to [*] ([*]) days of
         the original scheduled delivery date, Siemens shall agree to
         reimburse Sonoma for demonstrated out of pocket costs, including
         without limitation purchased parts; provided that Sonoma shall in all
         cases look to mitigate these out of pocket expenses e.g. by otherwise
         reselling the purchase parts. This shall be the sole liability for
         Siemens of a cancellation of a purchase order.

7.4      In the event that Siemens cancels an order less than [*] ([*])
         days before the scheduled delivery date or following the events
         describe in Article 7.1, Sonoma shall have the right to invoice
         Siemens for the full value of the cancelled order.

ARTICLE 8 - FORECAST

On a quarterly basis, Siemens shall provide Sonoma with a non-binding
forecast incl. quotation and proposals of its requirements of Contractual
Products for the following twelve months period. These forecasts are intended
for planning purposes only and shall not be considered as firm commitments to
purchase.

ARTICLE 9 - DELIVERY TIMES/EMERGENCY ORDERS

9.1      Delivery times for Contractual Products shall be:

         -  Complete units of Contractual Products:        [*] weeks.
         -  Spare Parts:                                   [*] weeks.
         -  Emergency Orders                               [*] hours

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         after receipt of order by Sonoma except that Sonoma may increase
         such delivery times in the event that any Purchase Order exceeds the
         forecasts to be provided under Article 8, such increases to be agreed
         with Siemens.

         Delivery times for repaired parts of Contractual Products shall be 2
         weeks after receipt of faulty parts.

9.2      Siemens may postpone the agreed delivery dates on one occasion per
         Purchase Order up to [*] calendar days without incurring any
         liability, however, Sonoma shall be notified of such postponement not
         later than [*] calendar days prior to the agreed delivery dates.

9.3      Furthermore, Siemens shall be entitled to place Emergency Orders for
         minor quantities by giving notice per fax.

9.4      Sonoma agrees to maintain an Emergency Stock of product as set out
         in Annex 8 in order to meet its obligations relating to Emergency
         Orders in this Articles 9.

         In the event the Emergency Stock is insufficient to meet the
         required quantities resulting under articles 9, 15 and 16, Sonoma
         shall use its best efforts to expedite the required product.

         This Article however shall not serve to limit Siemens Emergency
         Manufacturing Rights in Article 28.

ARTICLE 10 - DELIVERY OF CONTRACTUAL PRODUCTS/LATE DELIVERIES

10.1     Delivery shall be effected according to FCA Incoterms 1990.

10.2     Sonoma shall place identification numbers on all parts of the
         Contractual Products for inventory record keeping purposes. Sonoma
         shall shall keep records of its shipments and the related
         identification numbers. The identification numbering system shall
         convey to Siemens the parts identification and the functional and
         correction level of the respective part.

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10.3     Each delivery shall be accompanied by appropriate shipping papers.
         All shipping documents and/or invoices must include the Purchase
         Order number and the identification numbers of the shipped Contractual
         Products.

10.4     Sonoma shall make directdeliveries to customers of Siemens only upon
         prior written instruction by Siemens.

10.5     The dispatch data (flight number, airwaybill number) of all
         deliveries shall be notified to Siemens by Sonoma by fax prior to
         shipment.

         By written notice, Siemens may from time to time indicate to Sonoma
         a specific carrier or carriers or means of transportation or routing,
         and Sonoma shall comply with such directions. If Siemens fails to
         indicate a specific carrier, Sonoma shall arrange appropriate
         transportation.

10.6     Risk of loss or damage shall pass according to FCA, Incoterms 1990.
         Title shall pass with handing over the Contractual Products to the
         freight carrier.

10.7     In the event of Sonoma's delay in delivery of Contractual Products,
         more than [*] days beyond the times set forth in Section 9.1 above,
         except by reasons of Force Majeure, Siemens shall be entitled to a
         payment in the amount of [*]% ([*] percent) of the purchase
         price for each calendar day the Contractual Products are delayed up
         to a maximum amount of [*]% ([*] percent).

         In the event the delay exceeds [*], Siemens shall, in addition
         to the aforestated rights, be entitled to cancel the order wholly or
         in part without incurring any liability.

         Article 10.7 sets out Sonoma's entire liability and Siemens' sole
         remedy for delays in delivery of Contractual Products under this
         Agreement.

10.8     Should circumstances arise that may result in a delayed delivery by
         Sonoma, Sonoma shall promptly notify Siemens of such circumstances.

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ARTICLE 11 - CHANGES TO CONTRACTUAL PRODUCTS

11.1     Sonoma is entitled to make non-substantial changes to the
         Contractual Products at any time without notice to Siemens provided
         that any such changes do not affect their compliance with the
         requirements stated in Article 17 and do not affect their form,
         fitness, functions, safety, reliability, performance and/or
         maintainability detailed in the specifications set forth in Annex 2
         of this Agreement.

11.2     To the extent that any changes which Sonoma wishes to make to the
         Contractual Products will substantially affect their form, fitness,
         functions, safety, reliability, performance and/or maintainability,
         Sonoma shall inform Siemens of any such changes in writing as soon as
         possible and at least three (3) months prior to the first delivery of
         modified Contractual Products, provided, however, that unless
         otherwise agreed, Contractual Products must not be changed insofar as
         binding orders are already placed.

11.3     Siemens is entitled to request changes to the Contractual Products,
         e.g., relating to the improvement, reliability or serviceability of
         the Contractual Products. The Parties shall implement the procedure
         set out in Article 11.6 and discuss in good faith and agree in
         writing upon the terms, conditions and costs for such changes.
         Changes of Contractual Products due to customer fault reports showing
         epidemic or systematic failures shall be provided by Sonoma subject
         to the terms of the Contractual Product warranty or the support
         services, as applicable.

11.4     Changes to Contractual Products which are necessary due to customer
         requirements shall be implemented by Sonoma subject to terms and
         conditions to be mutually agreed upon except that Sonoma may refuse
         to make such changes where it has reasonable technical grounds for
         doing so.

11.5     Regarding substantial changes as per this Article 11, Sonoma shall
         at its own expense, and upon Siemens' request, submit to Siemens free
         of charge two (2) samples of the modified Contractual Products. If
         Siemens requests additional samples Sonoma will provide such samples
         at the normal discounted price set out in Annex 4. The costs of
         delivery of the sample Contractual Products shall be borne by Siemens.

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11.6     The Product Change Procedure for changes to be made to the
         Contractual Products under Article 11.3 shall be as follows:

         Siemens may at any time during the term hereof submit to Sonoma a
         change request and Sonoma shall respond in good faith to such request
         within 14 days from receipt of such request setting out the cost and
         time requirements of the implementation of such request or providing
         an explanation of the technical reasons why it is not able to make
         such changes.

11.7     Any implementation work may be performed by Sonoma on account of
         Siemens only after Siemens' acceptance of Sonoma's offer.

ARTICLE 12 - NEW PRODUCTS

12.1     If during the term of this Agreement, Sonoma intends to introduce a
         product replacing Contractual Products or designed or fit to
         supersede the Contractual Products, Sonoma shall inform Siemens
         thereof as soon as possible, but in any event not less than three (3)
         months prior to such introduction, and shall transmit to Siemens the
         specifications of such new products. Upon Siemens request Sonoma
         shall provide test samples of such new products in accordance with
         Article 11.5 above.

12.2     Siemens agrees that it shall implement new releases of the software
         for the Contractual Products within six months of such new releases
         becoming available. Sonoma shall supply the current version of the
         Contractual Products and the version released before the current
         version but shall have no obligation to continue to supply earlier
         versions.

12.3     This Agreement shall not be deemed to grant to Siemens any rights in
         any new or other supplier products unless such products are added to
         Annex 1 by agreement of the parties in writing.

ARTICLE 13 - PRICES AND TERMS OF PAYMENT

13.1     Prices and discounts for the Contractual Products are set out in
         Annex 4 to this Agreement in USD and include appropriate packaging
         suitable for airfreight.

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13.2     The prices for spare parts and support are set out in Annex 4.

13.3     The prices stated in Annex 4 hereto are fixed for a period of six
         months after the effective date of this Agreement. The Parties shall
         thereafter meet every six (6) months to discuss the appropriateness
         of price reductions, whereby due consideration shall be given to
         changes in market conditions, currency fluctuations and/or costs.
         Spare part prices shall reflect the manufacturing costs of the
         respective parts plus reasonable margins.

         Payment of all sums payable by Siemens under this Agreement shall be
         effected in USD and shall be due thirty days after receipt of the
         respective invoice.

13.5     In the event that Siemens does not render undisputed payments for
         any sums due under this Agreement at the due dates thereof, Sonoma
         shall be entitled, upon request to interest on such delayed payments
         at an interest rate of [*]% ([*] per cent) above the discount rate of
         the Deutsche Bundesbank in Frankfurt prevailing at the time of delay.

ARTICLE 14 - QUALITY ASSURANCE

14.1     GENERAL INSPECTION SYSTEM

         If Siemens or any customer so request with reasonable notice they
         shall be entitled from time to time to review, at Sonoma's premises
         in the United States, Sonoma's quality and inspection system.

14.2     FACTORY INSPECTION TEST OF CONTRACTUAL PRODUCTS

         If Siemens or any of its customers request to perform a factory
         inspection, such inspection will be performed as Sonoma's premises in
         the United States prior to delivery of the respective Contractual
         Products. The time, place and procedure of the factory inspections
         will be agreed upon between the Parties reasonably in advance. All
         expenses accruing in connection with the factory inspection shall be
         borne by Sonoma, except for the travel, lodging and living expenses
         incurred by the participants of Siemens or its customers.

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14.3     The parties agree that for the purpose of calculating delivery times
         under this Agreement, any delays caused by any such inspection shall
         not go to calculate such delivery times.

ARTICLE 15 - TESTING

15.1     Siemens may purchase and Sonoma shall provide Siemens with a supply
         of Contractual Products for testing purposes subject to the
         provisions of this Article.

15.2     Contractual Products supplied for testing shall be charged by Sonoma
         at an increased discount rate as set out in Annex 4

15.3     Siemens may order a maximum of 8 Contractual Products per quarter for
         testing purposes as defined above.

15.4     Delivery of Contractual Products for testing purposes shall be
         effected as set out in Article 10.

ARTICLE 16 - WARRANTY

16.1     The warranty period for the hardware elements of the Contractual
         Products shall be [*] ([*]) months from delivery of the Contractual
         Products and the warranty period for the Software shall be [*] from
         delivery.

16.2     HARDWARE

16.2.1   Sonoma warrants, subject to the conditions below, that it will have
         on the date of delivery title to the hardware of the Contractual
         Products free and clear of any security interest, lien or
         encumbrances and that the hardware of the Contractual Products is
         newly manufactured, contains new parts, complies with the
         requirements stated in Article 18, conforms with the specifications
         attached hereto in Annex 2 and is and shall remain for the warranty
         period free from defects inmaterial and workmanship.

16.2.2   If Contractual Products supplied by Sonoma hereunder fail to conform
         with this warranty Siemens may return the respective Contractual
         Products as set out below and Sonoma shall at Siemens' option (1)
         repair or replace any defective Contractual Product at no cost to
         Siemens or (2) refund the purchase price for the defective Contractual
         Product. All replaced spare parts

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         shall become the property of Sonoma.

16.2.3   Warranty repair service may be obtained by delivering the defective
         Contractual Product to Sonoma's designated repair depot within the
         warranty period and providing proof of purchase date and a written
         description of the problem or failure. Siemens agrees to prepay
         shipping charges and assume the risk of loss or damage in transit.
         If the Contractual product is damaged as a result of Siemens' failure
         to package the Contractual Products in the original packaging or its
         equivalent this may void the warranty. If the Contractual Product is
         damaged in transit, Siemens must file a claim with the carrier. Sonoma
         will pay shipping charges for returning the Contractual Product to
         Siemens. Upon return of such repaired Contractual Product, the
         warranty will continue to apply for the remaining unexpired warranty.

16.2.4   To return an item for repair, the Sonoma Customer Support Department
         must be contacted to obtain a return material authorization number
         (RMA) and the Sonoma Customer Support Department shall provide such
         RMA promptly to Siemens and if such number is provided the RMA will
         be used for the return of the Contractual Product.

16.3     SOFTWARE

16.3.1   Furthermore Sonoma warrants that the Software conforms with the
         specifications set forth in Annex 2, that Sonoma is entitled to
         license or sublicense the Software in accordance with the terms of
         this Agreement and that the Software delivered is free and clear of
         any security interest, lien or encumberances.

16.3.2   If any Software including firmware supplied by Sonoma hereunder
         fails to conform to the warranty and such failure is reproducible
         Sonoma shall correct such failure in accordance with the procedures
         in Annex 5.

16.3.3   Sonoma warrants that the contractual products are Year 2000
         compliant. Year 2000 compliant shall mean that neither performance
         nor functionality is affected by dates prior to, during and after the
         Year 2000

16.4     Sonoma shall have no obligation under the warranty provisions where
         damage results from a cause other than defect or malfunction, including

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         where the Contractual Product is not properly installed, or is
         neglected, or where damage is caused by accident, unreasonable use
         or unauthorised servicing, or modification of the Contractual Product
         or any part of it.

16.5     The provisions set out above shall constitute Sonoma's only
         obligation and Siemens' sole remedy for breach of the warranties
         relating to damaged or defective Contractual Products.

16.6     Except as expressly provided in this Agreement, Sonoma gives no
         warranty and hereby excludes any warranty, term or condition of any
         kind, whether express, implied, arising under statute or otherwise.

16.8     DOCUMENTATION

16.8.1   Sonoma warrants that the Documentation provided to Siemens hereunder
         is and always shall be up to date and Sonoma shall exercise its best
         efforts to be complete, and technically correct as possible and can
         be used for the purposes set forth in this Agreement and that Sonoma
         is entitled to grant the rights under Documentation in accordance
         with the terms of this Agreement.

16.8.2   If Documentation supplied by Sonoma hereunder fails to conform with
         this warranty, the faulty Documentation will be corrected promptly by
         Sonoma.

ARTICLE 17 - TECHNICAL APPROVAL BY AUTHORITIES

17.1     For the purposes of this Article 17 the "Approval Authorities" shall
         mean the body or bodies having responsibility for approving the
         Contractual Products for connection to communications networks in any
         country.

17.2     The Contractual Products delivered by Sonoma shall comply with the
         requirements of the Approval Authorities for the following standards:
         N-America (CSA, UL, FCC), Europe (CE).

         On Siemens' request Sonoma shall modify the Contractual Products to
         become compliant also with the requirements of the Approval
         Authorities in other countries identified by Siemens. The details of
         such modifications including but not limited to which party shall
         bear the costs associated will be agreed between the parties on a
         case by case basis.

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ARTICLE 18 - SOFTWARE MAINTENANCE

During the period of the Software warranty, Sonoma shall provide to Siemens
Software maintenance service in accordance with the terms and conditions of
Annex 6 attached hereto. Thereafter, and for a period of not less than two
(2) years after the last delivery of Contractual Products by Siemens to its
customers, Sonoma shall offer to provide to Siemens such Software maintenance
service for the fees set forth in Annex 4. This obligation shall survive
termination of this Agreement.

ARTICLE 19 - SPARE PARTS

19.1     Prior to the first delivery of Contractual Products, Sonoma shall
         make available to Siemens a detailed spare parts list containing the
         spare part numbers, prices, etc. This list will be revised and
         updated by Sonoma in regular time intervals, at least every 6 months.

19.2     In case Sonoma fails without due cause for a period of more than
         [*] ([*]) days after receipt of Siemens' order to provide Siemens
         with spare parts, Sonoma shall grant to Siemens the rights pursuant
         to the terms and conditions of Article 28 (Emergency Manufacturing
         Rights).

ARTICLE 20 - TECHNICAL COOPERATION

20.1     SALES ASSISTANCE

         (a)   Upon Siemens' request Sonoma shall assist Siemens and its
               Subsidiary Companies in its negotiations with their customers.
               Upon Siemens' request and upon reasonable notice technical
               experts of Sonoma shall participate in meetings with their
               actual or potential customers. In its request Siements shall
               explain the nature of the technical questions to be addressed
               and Sonoma shall make available a sufficiently qualified expert.

         (b)   Sonoma shall also assist Siemens and its Subsidiary Companies
               in performing inhouse network integration and system tests for
               Contractual Products. Upon Siemens' request Sonoma shall
               delegate a reasonable number of experts to Siemens' test beds
               who shall assist Siemens in carrying out such tests. Sonoma
               shall provide Siemens with proposals for test procedures and
               shall assist Siemens in analysing all problems

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               occuring during such tests.

         (c)   Furthermore Sonoma shall assist Siemens and its Subsidiary
               Companies in connection with the performance of acceptance
               tests by their customers. Upon Siemens' request Sonoma shall
               provide Siemens with proposals for test procedures, and
               technical experts of Sonoma shall participate in the
               performance of the acceptance tests by these customers and
               shall assist in analysing all problems occuring during such
               tests.

         (d)   All reasonable travel and lodging expenses incurred by Sonoma
               in connection with the assistance provided in accordance with
               (i), (ii) and (iii) above shall be borne by Siemens. If
               assistance as per Section 20.1 exceeds 15 man/days per quarter,
               Siemens shall pay Sonoma a daily fee of [*], - ([*]) per
               additional man/day.

20.2     TRAINING FOR INSTALLATION AND SUPPORT

         (a)   Upon Siemens' request Sonoma shall train experts of Siemens
               and its Subsidiary Companies in the installation, testing,
               commissioning, operation, repairs and maintenance of Contractual
               Products. Such training will be given for each Contractual
               Product. Sonoma's trainers shall provide Siemens' trainees with
               adequate training materials, such materials being part of the
               Documentation. The details of such training, e.g. date, duration,
               number of trainees, etc. will be agreed upon on a case by case
               basis reasonably in advance. In any event the training shall
               commence not later than 3 weeks after Siemens' request.

         (b)   All reasonable travel and lodging expenses incurred by Sonoma
               in connection with the training under (i) above shall be borne
               by Siemens. The training will be supplied at no cost by Sonoma.
               However in the future prices will be negotiated if training
               requirements become excessive.

20.3     TRAINING MATERIALS

         Sonoma shall provide to Siemens a set of reproducible training
         materials, including such materials as usually utilized by Sonoma
         when instructing its own customers (e.g. Video clips). Such training
         materials shall be in English and if available also in German.
         Siemens shall be entitled to copy, modify and translate such training
         materials and to attach to any copy its own copyright

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         notices. Siemens and its Subsidiary Companies and other sales outlets
         may utilize any copy of Sonoma's training materials for performing
         own training courses for their own customers.

ARTICLE 21 - PRODUCT PLANNING

21.1     Product planning meetings will be held if necessary.

21.2     The product planning meeting will discuss all relevant issues
         related to the Contractual Products such as, but not limited to:

(a)      Product availability schedules of new products or modifications of
         Contractual Products required by the market, whereby the Parties
         intent to achieve a product evolution giving due regard to the
         interdependencies of the Contractual Products with the evolution of
         the Siemens products.

(b)      Provide a forum for Siemens to present ideas for product
         enhancements required by the market.

21.3     Each of the parties shall nominate a product manager who shall be
         primarily responsible for monitoring the supply of the Contractual
         Products and who shall act as the first port of call for the other
         party in the event of any problem, query or dispute relating to the
         matters arising under this Agreement.

<PAGE>

                                      -21-

                                 CONFIDENTIAL

ARTICLE 22 - PATENTS AND COPYRIGHTS

22.1     Siemens shall inform Sonoma without undue delay if a third party
         brings a claim regarding the infringement of its protective rights
         (e.g., patent, trademark, copyright, mask work, trade secret or
         other similar rights) in connection with Contractual Products.

22.2     Sonoma shall defend Siemens and hold Siemens harmless against any
         suit, claim, damages, or proceeding brought against it alleging that
         any use of the Contractual Products infringes any Worldwide patent,
         copyright or trade mark or any trade secrets of any third parties
         provided that Siemens:

         (a)   promptly notifies Sonoma in writing of any such suit, claim
               or proceeding;

         (b)   allows Sonoma to defend, settle or otherwise dispose of
               such suit or proceeding and at its expense to direct the defense
               of such suit, claim, or proceeding;

         (c)   gives Sonoma sole authority, full information and
               assistance as Sonoma reasonably requests to defend such suit,
               claim or proceeding; and

         (d)   does not enter into any settlement of any such suit, claim
               or proceeding without Sonoma' prior written consent.

22.3     In the event of any third party claim, Sonoma may, at its cost:

         (a)   acquire from the third party entitled to dispose of the
               respective protective rights, the right of use required for the
               purposes of this Agreement; or

         (b)   replace such infringing Contractual Products or parts thereof
               by non-infringing ones complying with the specifications; or

         (c)   if (a) and (b) are not economically feasible, to take back
               such Contractual Products, the use of which is prevented due to
               the infringement, and to reimburse to Siemens the cost of such
               Contractual Products [less

<PAGE>

                                      -22-

                                 CONFIDENTIAL

               depreciation at 10 per cent of the US list price for each
               year or part year from delivery of the Contractual Products].

22.4     Sonoma will have no liability in case of the infringement of a
         protective right which results from modifications made by Siemens to
         Contractual Products, or from the combination of Contractual Products
         with other products not delivered by Sonoma.

22.5     The provisions set out above state Sonoma's entire liability and
         Siemens' entire remedy for any claim that the Contractual Products
         infringe the intellectual property rights of a third party.

ARTICLE 23 - PRODUCT LIABILITY

Sonoma shall indemnify and hold Siemens or its Subsidiary Companies harmless
against any claims, damages, costs and expenses due to product liability in
connection with, or resulting from, Sonoma's products excluding, however,
liability resulting from changes or modifications of Contractual Products as
carried out by Siemens.

ARTICLE 24 - LIMITATION OF LIABILITY

24.1     Subject to Article 24.2 and except in respect of supplier's
         obligations pursuant to Article 22, in no event whatsoever,
         regardless of the form or cause of action whether in contract or
         tort, (including negligence) or the number of claims asserted, and
         whether in respect of a breach or default in the nature of a breach
         of condition or fundamental term or a fundamental breach or as a
         result of negligence shall either party, its employees, directors,
         officers and/or agents have any liability In excess of $[*] per
         event arising out of or in connection with this Agreement.

24.2     In no event shall a party's total aggregate liability to the other
         party in any consecutive 12 month period commencing on the date of
         this Agreement, (a "Contractual Year") arising out of or in
         connection with this Agreement whether arising in tort (including
         negligence), contract, by statute, regulation or otherwise be
         greater than the greater of $[*] or the total amount paid by Siemens
         to Sonoma in the Contractual Year preceding the Contractual Year in
         which the

* CERTAIN CONFIDENTIAL INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
  SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

<PAGE>

                                      -23-

                                 CONFIDENTIAL

         other party's claim arises.

24.3     Siemens, subject to 24.2, agrees to indemnify and keep Sonoma
         harmless from any claims or damages inclusive of Sonoma's
         professional fees made against Sonoma as a result of negligence or
         misrepresentation of Siemens of any of its subsidiary companies in
         relation to the Contractual Product.

ARTICLE 25 - CONSEQUENTIAL DAMAGES

Except for Siemens obligations to pay Sonoma for the purchase of Contractual
Products ordered by Siemens, as provided within this Agreement, neither
party, its employees, agents, officers or directors shall be liable to the
other in any way whatsoever, whether as a result of a claim or action in
contract or in tort or otherwise for any indirect, special, punitive or
consequential damages, including but not limited to lost profits, lost
business revenues, lost business, failure to realize expected savings or
other commercial or economic loss of any kind whatsoever, whether or not such
damages are foreseeable, and whether or not the party, its employees, agents,
officers or directors have been advised of the possibility of such damages,
except that Sonoma shall be liable for such losses to Siemens in the event
that Siemens is held liable to its customers subject always to the limits set
out in Article 24.

ARTICLE 26 - CONFIDENTIALITY

Both Siemens and Sonoma undertake to keep confidential with respect to third
parties with the same degree of care with which they treat and protect their
own proprietary information (but not less than reasonable care), any
information indicated as confidential (including but not limited to the
Software and Source Code), furnished and transmitted by one Party to the
other under this Agreement. Verbal disclosures shall be deemed confidential
only if summarized in writing and designated as confidential by the
disclosing party within 30 days. Further, the Parties shall not use the
other's information for any purpose other than in furtherance of the purposes
of this Agreement. This applies both during the term of this Agreement and
for a period of five (5) years thereafter, with the exception that both
Siemens and Sonoma may disclose such information to their respective
Subsidiary Companies, agents, consultants and customers, but solely in
furtherance of the purposes of this Agreement, and only if these third
parties agree to substantially similar confidentiality provisions.

<PAGE>

                                      -24-

                                 CONFIDENTIAL

Any information which:

-    is known to or in the possession of the receiving Party prior to
     transmission by the disclosing party;

-    becomes available to the receiving Party from a source other than the
     disclosing Party or is in or passes into the public domain other than by
     breach of this Agreement;

-    is developed independently by the receiving Party;

-    is normally disclosed to customers or disclosure of which is authorized
     by the disclosing Party;

-    is required to be disclosed by a governmental body,

shall not be subject to this confidentiality provision.

ARTICLE 27 - FORCE MAJEURE

Neither Party to this Agreement shall be held responsible for the performance
of any obligations under this Agreement provided such performance is hindered
or prevented by any circumstances of Force Majeure which are deemed to
include war, riot, strike, lock-out, flood, or other natural catastrophes or
national or local Government regulations and provided the Party frustrated
notifies the other Party without delay in writing at the beginning and end of
any such circumstances. The Party frustrated shall use every endeavour to
minimize the hindrance or prevention of such fulfilment. Upon the ending of
such circumstance, the frustrated Party shall without delay resume the
fulfilment of its obligations including any obligations, the performance of
which was interrupted thereby.

ARTICLE 28 - EMERGENCY MANUFACTURING RIGHTS

28.1     If Sonoma:

         (a)   ceases or is unwilling, without a cause attributable to
               wrongfull acts of Siemens under this agreement, to provide
               commercially adequate

<PAGE>

                                      -25-

                                 CONFIDENTIAL

              support or maintenance for the Software in accordance with the
              terms and conditions of this Agreement.

         (b)  is consistently or unreasonably unable or unwilling to
              deliver to Siemens the quantities of Contractual Products and/or
              spare parts forecasted and ordered by Siemens as provided for in
              this Agreement and not rejected by Sonoma as provided for in this
              Agreement subject to the limitations and conditions set out in
              this Agreement within [*] ([*]) days of the delivery dates set
              out in section 9 of this Agreement;

         (c)  ceases doing business as a going concern,

         (d)  has a receiver, administrator or manager of its property,
              assets or undertakings appointed in such circumstances as would
              substantially affect Siemens' continuing use of the Software in
              accordance with this Agreement;

         (e)  takes advantage of the insolvency laws of any jurisdiction;

         (f)  makes an assignment in bankruptcy or is adjudicated a bankrupt;

         (g)  makes a general assignment for the benefits of its creditors;

         (h)  is ordered by any court of competent jurisdiction to be
              wound up; or

         (i)  become insolvent or makes a sale in bulk of a substantial
              portion of its assets;

         (hereinafter "Event of Default" and collectively referred to as
         "Events of Default")

         then Sonoma hereby grants to Siemens the non-exclusive right to
         manufacture or to have manufactured the Contractual Products and
         spare parts (the "Emergency Manufacturing Right").

28.2     Siemens shall enter into confidentiality agreements with any
         subcontractors or

* CERTAIN CONFIDENTIAL INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
  SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

<PAGE>

                                      -26-

                                 CONFIDENTIAL

         other person it engages to manufacture Contractual Products under
         this Article 28 and such agreements shall impose on such
         subcontractors or other persons confidentiality obligations no less
         onerous than those set out in Article 26 of this Agreement.

28.3     In the case of an Event of Default, Siemens shall be entitled to
         carry on Emergency Manufacturing Rights only until the Event of
         Default no longer exists and only to the extent necessary to meet
         Siemens' requirements during the period of the Event of Default.

28.4     To ensure that Siemens will have the ability to manufacture, or have
         manufactured, upon the event of one or more of the aforementioned
         Events of Default, Sonoma shall, within ten (10) days of receipt of
         written notice of the Events of Default and Siemens notice of its'
         intension to proceed with Emergency Manufacturing:

         -   deliver to Siemens a reproducible set of the complete
             manufacturing and testing documentation and the source and object
             code of the Software with respect to the Contractual Products,
             such documentation to be in the English language and thereafter,
             with the first acceptance of each modified Contractual Product,
             deliver to Siemens the updated version thereof;

         -   deliver to Siemens with respect to the Contractual Products
             technical assistance by training Siemens' experts and explaining
             the above mentioned documentation without charge;

         -   identify Sonoma's suppliers of parts and components and
             authorize Siemens to purchase parts and components directly from
             said suppliers;

         -   provide to Siemens information regarding special tools required
             for the manufacture of Contractual Products, and offer to sell
             such tools to Siemens for reasonable compensation and to the
             extent Sonoma is not using or planning to use such tools.

         -   Siemens shall maintain the information at its premises and shall
             make use of such information provided hereunder only if at least
             one of the foregoing preconditions is met. Upon notice to Siemens
             by Sonoma and as soon as Sonoma no longer is default, Siemens
             shall discontinue the

<PAGE>

                                      -27-

                                 CONFIDENTIAL

             manufacture of the Products.

         -   Sonoma shall use reasonable efforts to procure for Siemens, any
             necessary assignment or licence of rights to third party
             technology in the Contractual Products on reasonable terms and
             conditions. Siemens shall be responsible for payment of any
             royalties for use by Siemens of third party technology.

             If Siemens considers invoking Emergency Manufacturing Rights
             under this Agreement information regarding any and all third party
             technologies and their respective royalties will be provided to
             Siemens by Sonoma.

28.5     In the event that Siemens exercises the Emergency Manufacturing
         Right, Siemens shall pay to Sonoma a royalty of [*] per cent of the
         discounted US list price set out in Annex 4 from time to time for
         each Contractual Product which it manufactures.

28.6     The royalty in respect of each Contractual Product shall become due
         and payable upon manufacture of each Contractual Product and shall be
         invoiced and paid no later than the end of each calendar month
         commencing at the end of the month following the last delivery of a
         Contractual Product by Sonoma.

28.7     Siemens shall provide Sonoma with written evidence on a monthly
         basis of the number of Contractual Products it manufactures for the
         period over which it exercises the Emergency Manufacturing Right.

28.8     Siemens shall allow Sonoma or its agents or representatives
         reasonable access during Siemens' normal business hours to and to copy
         relevant records of Siemens to enable Sonoma to ascertain whether the
         royalty payments made are accurate. In the event that such exercise
         discloses a shortfall in royalties due to Sonoma, Siemens shall
         remedy such shortfall forthwith on demand from Sonoma.

28.9     The Emergency Manufacturing Right shall terminate in the event that
         this Agreement terminates for whatever reason except that Siemens
         shall be entitled to continue to exercise the Emergency Manufacturing
         Right for such period as Sonoma would have been obliged under this
         Agreement to provide Contractual Products under Article 30.2.

* CERTAIN CONFIDENTIAL INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
  SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

<PAGE>

                                      -28-

                                 CONFIDENTIAL

ARTICLE 29 - TERM AND TERMINATION

29.1     This Agreement shall enter into force upon being signed by both
         Parties and shall continue in effect for a period of five (5) years
         unless this Agreement is extended by written agreement prior to its
         expiration.

29.2     This Agreement may by written notice be forthwith terminated by a
         Party having such right as herein provided - and save of any other
         rights such Party may have - upon the occurrence of either one or
         more of the following events stated below:

         -   by either Party in the event that the other Party voluntarily
             files a petition in bankruptcy or has such a petition
             involuntarily filed against it (which petition is not discharged
             within thirty (30) days after filing), or is placed in an
             insolvency proceeding, or if an order is issued appointing a
             receiver or trustee or a levy or attachment is made against a
             substantial portion of its assets which order shall not be
             vacated, or set aside within thirty (30) days from date of
             issuance, or if any assignment for the benefit of its creditors
             is made;

         -   by either Party in the event that the other has failed in the
             performance of any material contractual obligation herein
             contained, provided that such default is not remedied to the
             other Party's reasonable satisfaction within [*] ([*]) days
             after written notice to the other Party specifying the nature of
             such default and requiring remedy of the same;

         -   by Sonoma in the event that Siemens fails to make payment of any
             sums which have become due to it under this Agreement within [*]
             days of being required by Sonoma to make such payment;

         -   by Sonoma in the event that Siemens or any of its Subsidiary
             Companies is in breach of the terms on which the Contractual
             Products are licensed.

29.3     In addition to its rights set out above, Sonoma may suspend the
         delivery of Contractual Products in the event that Siemens has failed
         to make payment of any sums due to it under this Agreement.

29.4     This Agreement may be terminated by written mutual consent of the
         parties.

* CERTAIN CONFIDENTIAL INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
  SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

<PAGE>

                                      -29-

                                 CONFIDENTIAL

ARTICLE 30 - PROVISIONS AFTER TERMINATION OF THE AGREEMENT

30.1     Provided the contract was not terminated by Sonoma due to default
         of Siemens, after termination of this Agreement, Sonoma shall
         continue to supply to Siemens Contractual Products according to the
         terms of this Agreement to such extent as required by Siemens to
         fulfill a contractual commitment which Siemens has undertaken prior
         to termination of this Agreement, provided that Siemens notifies
         Sonoma in writing within thirty (30) days of the effective date of
         termination of this Agreement of the complete nature and extent of
         any such contractual commitments.

30.2     Provided the contract was not terminated by Sonoma due to default of
         Siemens, for a period of [*] ([*]) years after termination of this
         Agreement, Sonoma shall supply to Siemens, in accordance with the
         terms and conditions in effect at the time of termination of the
         Agreement, Contractual Products required by Siemens for the expansion
         of the existing systems in which Contractual Products are already
         used. If Sonoma wishes to discontinue the manufacture of Contractual
         Products before the end of said [*]-year-period after termination or
         expiration of this Agreement, Sonoma shall notify Siemens thereof and
         thereafter, Siemens shall be entitled to exercise the Emergency
         Manufacturing Right in accordance with the provisions of Article 28.

30.3     After termination of this Agreement, Sonoma shall be obliged to
         supply spare parts to Siemens for a period of [*] ([*]) years after
         the last delivery by Sonoma to a customer of products identical or
         similar to the Contractual Products. Such supply shall be in
         accordance with the terms and conditions in effect at the time of
         termination of this Agreement.

ARTICLE 31 - ARBITRATION

31.1     All disputes arising out of or in connection with the present
         Agreement, including any question regarding its existence, validity
         or termination, shall be finally settled under the Rules of
         Arbitration of the International Chamber of Commerce, Paris, by
         three arbitrators in accordance with the said Rules.

* CERTAIN CONFIDENTIAL INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
  SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

<PAGE>

                                      -30-

                                 CONFIDENTIAL

31.2     Each party shall nominate one arbitrator for confirmation by the
         competent authority under the applicable Rules (Appointing
         Authority). Both arbitrators shall agree on the third arbitrator
         within 30 days. Should the two arbitrators fail, within the above
         time-limit, to reach agreement on the third arbitrator, such third
         arbitrator shall be appointed by the Appointing Authority. If there
         are two or more defendants, any nomination of an arbitrator by or on
         behalf of such defendants must be by joint agreement between them.
         If such defendants fail, within the time-limit fixed by the
         Appointing Authority, to agree on such joint nomination, the
         proceedings against each of them must be separated.

31.3     The seat of arbitration shall be Zurich. The procedural law of this
         seat shall apply where the Rules are silent.

31.4     The language to be used in the arbitration proceeding shall be
         English.

ARTICLE 32 - SUBSTANTIVE LAW

All disputes shall be settled in accordance with the provisions of this
Agreement and all other agreements regarding its performance, otherwise in
accordance with the substantive law in force in Switzerland without reference
to other laws. The application of the United Nations Convention on Contracts
for the International Sale of Goods of April 11, 1980 shall be excluded.

ARTICLE 33 - EXPORT REGULATIONS

Sonoma shall not be obliged to perform deliveries, orders and other
obligations under this Agreement if that performance is hindered by the
applicable export laws and regulations of the Federal Republic of Germany,
the United States of America or other countries.

With respect to those Contractual Products which include materials or
technology originating from the United States of America, which Sonoma will
identify in the individual delivery documents, Siemens agrees that it will
comply with all export laws and regulations of the United States of America.

<PAGE>

                                      -31-

                                 CONFIDENTIAL

In the event that Siemens intends to export Contractual Products subject to a
export restriction, Siemens will inform Sonoma accordingly and Sonoma will
use its best efforts to obtain any necessary re-export licenses from the
authorities governing Sonoma.

ARTICLE 34 - ASSIGNMENT

This Agreement may not be assigned by Sonoma without the express written
consent of Siemens (which shall not be unreasonably withheld) except that
Sonoma may assign its rights under this Agreement or transfer its obligations
to an affiliate or to a successor of all or substantially all of Sonoma's
business to which this Agreement relates.

ARTICLE 35 - MISCELLANEOUS

35.1     For the orders placed by Siemens under this Agreement, no other
         conditions than those specified herein shall be applicable. All
         changes and amendments to this Agreement must be in a writing
         executed by both parties to be valid. This requirement of written
         form can only be waived by a writing executed by both parties
         specifically stating an intent to amend this Agreement.

35.2     Communications between Sonoma and Siemens shall be given in writing,
         by post or by telefax, to the following addresses of the Parties or
         to such other addresses as communicated by the Party concerned in
         writing to the other Party:

         If to Sonoma, to:

         Sonoma Systems Europe Ltd
         .....................................
         Att.: Managing Director.......................
         60 Priestley Road,......................................
         Guildford...............................
         Surrey
         GU2 5SE
         UK...................................
         Fax: 0/0044 1483 300333
         Tel: 0/0044 1483 300600

<PAGE>

                                  -32-

                              CONFIDENTIAL

         With a copy to:

         Sonoma Systems Inc.
         4640 Admiralty Way
         600 Marina del Rey
         CA USA 90292
         For the attention of: Vice President Finance

         If to Siemens, to:

         Siemens AG
         Att.: Mr. Joachim Meier
         VP, Finance and Business Administration
         Hofmannstrabe 51
         D-81359 Munchen
         Federal Republic of Germany
         Tel.: +49 89 722 48914
         Fax: +49 89 722 35141

35.3     No right or interest in this Agreement shall be assigned or
         transferred to any third party by either Sonoma or Siemens without
         first obtaining written consent from the other Party (such consent
         not to be unreasonably withheld or delayed). This article shall not
         restrict Sonoma's ability to assign its receivables from Siemens to a
         bona fide banking instituion under terms of an operating line of
         credit. However Sonoma shall provide that Siemens' rights to offset
         against any claims of Siemens against Sonoma shall not be affected by
         such assignment.

35.4     If any provision contained in this Agreement is or becomes
         ineffective or is held to be invalid by a competent authority or
         court having final jurisdiction thereover, all other provisions of
         this Agreement shall remain in full force and effect and there shall
         be substituted for the said invalid provision a valid provision
         having an economic effect as similar as possible to the original
         provision.

35.5     This Agreement constitutes the entire understanding and agreement
         between the Parties hereto with respect to the Contractual Products
         and shall super-

<PAGE>

                                     -33-

                                 CONFIDENTIAL

         sede and cancel all previous agreements, negotiations and
         commitments, either oral or written.

35.6     The Annexes which are attached hereto and which constitute a part
         hereof are:

         Annex 1  Description of Contractual Products
         Annex 2  Specifications of Contractual Products
         Annex 3  Description of Documentation
         Annex 4  Prices and Discounts
         Annex 5  Software Correction Procedure
         Annex 6  Maintenance
         Annex 7  Intentionally left blank
         Annex 8  Emergency Stock

<PAGE>

                                     -34-

                                 CONFIDENTIAL

London,   27/5/98                        Munchen,   05/27/98
       ------------------------------            -------------------------

Sonoma Systems Europe Limited            Siemens Aktiengesellschaft

                                                 [ILLEGIBLE]
-------------------------------------    ---------------------------------
        /s/ Steven M. Waszak
-------------------------------------    ---------------------------------
        Steven M. Waszak                         [ILLEGIBLE]
-------------------------------------    ---------------------------------

<PAGE>

                                      -35-

                                  CONFIDENTIAL

                                     ANNEX 1

 DESCRIPTIONS

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------
PRODUCT ID                    DESCRIPTION
<S>                          <C>
-------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------
8000 SA                       SONOMA ACCESS Base Unit, with single AC power supply
                              (Switch-selectable for 115VAC and 230VAC)
-------------------------------------------------------------------------------------------------------
8000 DA                       SONOMA ACCESS Base Unit, with dual AC power supplies
                              (Switch-selectable for 115VAC and 230VAC)
-------------------------------------------------------------------------------------------------------
8000 DD                       SONOMA ACCESS Base Unit, with dual -48VDC power supplies
-------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------
8000 SW-TLX-2.0               SONOMA ACCESS Transparent LAN eXtender-TM- (TLX) software V2.0,
                              SONOMA ACCESS high-performance real-time operating system, SNMP
                              agent, Web DMS, and SLIP management software
-------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------
ATM DS1                       T1 ATM Card, with one RJ-45 connector
-------------------------------------------------------------------------------------------------------
ATM E1                        E1 ATM Card, with one RJ-45 connector
-------------------------------------------------------------------------------------------------------
8000 DS3ATM                   DS3 ATM Card, with two BNC connectors, compliant with DSX-3
                              specifications
-------------------------------------------------------------------------------------------------------
8000 E3ATM                    E3 ATM Card, with two BNC connectors
-------------------------------------------------------------------------------------------------------
8000 OC3ATM-MM                OC-3c/STM-1 ATM Multimode Card, with fiber optic SC connector (0-2Km)
-------------------------------------------------------------------------------------------------------
8000 OC3ATM-SM                OC-3c/STM-1 ATM Single Mode Card, with fiber optic SC connector (0-
                              19Km)
-------------------------------------------------------------------------------------------------------
8000 OC3ATM-LR                OC-3c/STM-1 ATM Long-Reach Single Mode Card, with fiber optic SC
                              connector (12-30Km)
-------------------------------------------------------------------------------------------------------
ENH DS3 ATM                   DS3 GCRA compliant ATM Card, with two BNC connectors, compliant with
                              DSX-3 specifications
-------------------------------------------------------------------------------------------------------
ENH E3 ATM                    E3 GCRA compliant ATM Card, with two BNC connectors
-------------------------------------------------------------------------------------------------------
ENH OC3 ATM MM                OC-3c/STM-1 GCRA compliant ATM Multimode Card, with fiber optic SC
                              connector (0-2Km)
-------------------------------------------------------------------------------------------------------
ENH OC3ATM SM-IR              OC-3c/STM-1 GCRA compliant ATM Single Mode Card, with fiber optic ST
                              connector (0-19Km)
-------------------------------------------------------------------------------------------------------
ENH OC3ATM SM-LR              OC-3c/STM-1 GCRA ATM Long-Reach Single Mode Card, with fiber optic
                              ST connector (12-30Km)
-------------------------------------------------------------------------------------------------------
8000 ENET                     Ethernet Card (10Mbps), with AUI, RJ-45 and BNC connectors
-------------------------------------------------------------------------------------------------------
8000 FAST ENET-1              Fast Ethernet Card (10/100Mbps auto-sensing) with RJ-45 connector
                              (UTP).
-------------------------------------------------------------------------------------------------------
8000 FAST ENET-4              Four-Port Fast Ethernet Card (10/100Mbps auto-sensing), with RJ-45
                              connectors
-------------------------------------------------------------------------------------------------------
8000 TRN                      Token Ring Card (4/16Mbps auto-sensing), with DB-9 and RJ-45
                              connectors
-------------------------------------------------------------------------------------------------------
8000 FDDI-SAS                 FDDI Single-Attach (SAS) Interface Card, with multimode fiber optic SC
                              connector
-------------------------------------------------------------------------------------------------------
8000 FDDI-DAS                 FDDI Dual-Attach (DAS) Interface Card, with two multimode fiber optic SC
                              connectors
-------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------
8000 SBP                      Spare Blanking Plates (package of five)
-------------------------------------------------------------------------------------------------------
8000 RM-19                    Rackmount Kit for 19-inch equipment rack
-------------------------------------------------------------------------------------------------------
8000 RM-23                    Rackmount Kit for 23-inch equipment rack
-------------------------------------------------------------------------------------------------------
8000 SUG V2.0                 SONOMA ACCESS User Guide
-------------------------------------------------------------------------------------------------------
8000 SUG-DISK V2.0            SONOMA ACCESS User Guide and HTML Help Files on 3.5-inch diskettes
-------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------
8000 AC PWR                   Non-Redundant AC Power Supply
-------------------------------------------------------------------------------------------------------
8000 DUAL AC PWR              Redundant AC Power Supply
-------------------------------------------------------------------------------------------------------

<PAGE>

                                       -36-

                                   CONFIDENTIAL

-------------------------------------------------------------------------------------------------------
8000 DUAL DC PWR              Redundant DC Power Supply
-------------------------------------------------------------------------------------------------------
8000 FAN                      System Intake Fan
-------------------------------------------------------------------------------------------------------
8000 CPU FAN                  System Processor Fan
-------------------------------------------------------------------------------------------------------
8000 MB ASSY                  System Motherboard
-------------------------------------------------------------------------------------------------------
32 MEG UPG                    System Memory (32Mb Upgrade)
-------------------------------------------------------------------------------------------------------
SYSTEM STATUS                 System Control Card
CARD
-------------------------------------------------------------------------------------------------------
CABLE/CONNECTOR               Management Cables
ASSEMBLY
-------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------
SS-UK-Support                 Customer Technical Support Centre access Monday to Friday 8 AM
                              to 5 PM UK Local Time.
-------------------------------------------------------------------------------------------------------
SS-UK-Update                  Software Update Support Service - Customer must have a valid
                              Support Contract in place.
-------------------------------------------------------------------------------------------------------
</TABLE>

<PAGE>

                                     -37-

                                 CONFIDENTIAL

                                  ANNEX 2
SONOMA ACCESS SPECIFICATIONS

------------------------------------------------------------------------------
HARDWARE
------------------------------------------------------------------------------
SIZE (H x W x D): 6.5 x 16.4 x 16.7 inches
16.6 x 41.7 x 42.5 cm
WEIGHT: 28 pounds; 12.7 Kg
MOUNTING: Table top or rack-mounted operation
TEMPERATURE: 0 to 50C (32 to 122F) operating,
-25 to 85C (-13 to 185F) storage
HUMIDITY: 10% TO 90%, non-condensing
POWER: 250W (853 BTU/hour). Three power
supply options, including single and
redundant versions for AC input, and
a redundant version for -48VDC input,
with separate power entry
SAFETY: UL1950, EN60950, TUV GS Mark,
C-UL 22.2 No. 950
EMISSIONS: FCC Class A, EN 55022 Class B
COMPATIBILITY: EN 50082-1, CE Mark

SOFTWARE
--------

MANAGEMENT:
/ /  Self diagnostic
/ /  SNMP Agent: Supports RFC 1213 (MIB II), RFC
1286 (Bridge MIB), and Sonoma ACCESS device-specific MIB
extensions.  Supports GET, SET, GET NEXT and TRAP
instructions
/ /  Web DCS (Device Configuration System) supports
summary information and default configuration for
plug-and-play installation and configuration
/ /  DHCP (Dynamic Host Configuration Protocol)
enables Sonoma ACCESS to automatically acquire its IP
management address from a DHCP server
for plug and work operation
/ /  SLIP:  Standard TCP/IP connection via the serial
management port, for out-of-band SNMP or web
DCS access, via a standard async modem
VIRTUAL NETWORKS:
Up to 16 virtual networks, including any combination of
subscriber LAN ports and up to 1024 ATM virtual
circuits
ATM virtual circuits can use one or more virtual paths
RATE QUEUES:
Bandwidth groups for setting maximum throughput on
ATM virtual circuits
ATM INTERFACE:
RFC 1483. AAL 5.  Compatible with all switches
supporting UNI 3.0 or 3.1
ERROR CHECKING:
Detects and blocks all types of errored frames,
on all LAN ports.
FRAME FILTERING:
Full wire-speed filtering of inbound frames. Automatic
forwarding to appropriate port, based on self-learned
destination address.  Inclusive or exclusive filters can be
used for additional levels of security.  Learns and filters
up to 16,535 addresses.  Separate, secure databases
are maintained for each subscriber's virtual network
PROTOCOLS:
All protocols handled transparently
SPANNING TREE:
IEEE 802.1 compliant.  Separate spanning tree domain
for each virtual network

------------------------------------------------------------------------------
ORDERING INFORMATION
------------------------------------------------------------------------------
EACH SONOMA ACCESS BASE UNIT SHIPS WITH THE FOLLOWING:
/ /  Intel 200Mhz Pentium processor, with 16MB DRAM
/ /  Single AC or redundant AC or DC power supplies
/ /  System Status Card
/ /  Pre-loaded software
/ /  Sonoma ACCESS Quick-Start Guide

BASE UNITS:
------------------------------------------------------------------------------
8000 SA Sonoma ACCESS Base Unit, with single AC
power supply (switch-selectable for 115VAC
or 230VAC)
8000 DA Sonoma ACCESS Base Unit, with dual AC
power supplies (auto sense for 115VAC or 230VAC)
8000 DD Sonoma ACCESS Base Unit, with dual -48VDC
power supplies

SOFTWARE:
------------------------------------------------------------------------------
8000 SW-TLX Sonoma Transparent LAN eXtender-TM-
(TLX) software, Sonoma high-performance
real-time operating system, SNMP agent,
and Web DCS

INTERFACE CARDS:
------------------------------------------------------------------------------
8000 DS3ATM DS3 ATM Card, with two BNC connectors,
compliant with DSX-3 specifications
8000 E3ATM E3 ATM Card, with two BNC connectors
8000 OC3ATM-MM OC-3c/STM-1 ATM Multimode Card, with
fiber optic SC connector (0-2Km)
8000 OC3ATM-SM OC-3c/STM-1 ATM Single Mode Card,
with fiber optic SC connector (0-19Km)
8000 OC3ATM-LR OC-3c/STM-1 ATM Long-Reach Single
Mode Card, with fiber optic SC connector
(12-30Km)
8000 ENET Ethernet Card (10Mbps), with AUI, RJ-45,
and BNC connectors
8000 FAST ENET-1 Fast Ethernet Card (10/100Mbps auto-
sensing), with RJ-45 connector (UTP) and
DB-9 connector (STP)
8000 FAST ENET-4 Four-Port
Fast Ethernet Card (10/100Mbps
auto-sensing), with RJ-45 connectors
8000 TRN Token Ring Card (4/16Mbps auto-sensing),
with DB-9 and RJ-45 connectors
8000 FDDI-SAS FDDI Single-Attach (SAS) Interface Card,
with multimode fiber optic SC connector
8000 FDDI-DAS FDDI Dual-Attach (DAS) Interface Card,
with two multimode fiber optic SC connectors

ACCESSORIES:
------------------------------------------------------------------------------
8000 SBP Spare Blanking Plates (package of five)
8000 RM-19 Rackmount Kit for 19-inch equipment rack
8000 RM-23 Rackmount Kit for 23-inch equipment rack
8000 SUG Sonoma ACCESS User Guide
8000 SUG-DISK Sonoma ACCESS User Guide and HTML
Help Files on 3.5-inch diskettes
------------------------------------------------------------------------------
CONTACTS
------------------------------------------------------------------------------
SONOMA SYSTEMS CORPORATE OFFICE
4640 Admiralty Way, Marina del Rey, CA 90292 USA
Telephone: 310-827-8000 Fax: 310-305-2525
Inquiry at http://www.sonoma-systems.com
SONOMA SYSTEMS EUROPEAN OFFICE
60 Priestley Road, The Surrey Research Park,
Guildford GU2 5SE UK
Telephone: +44 1483 300600 Fax: +44 1483 300333

[lOGO]
<PAGE>

                                     -38-

                                 CONFIDENTIAL

                                    ANNEX 3

Description of Documentation

1.   Sales and Technical Presentations and Product Release Bulletins
2.   Sonoma Access
         -          user guide - soft and hard
         -          quickstart guide - hard
         -          DCS help files - soft
         -          MIB files - soft
         -          software release notes - soft and hard

<PAGE>

                                      -39-

                                  CONFIDENTIAL

                                    ANNEX 4

                              PRICING AND DISCOUNTS

<TABLE>
<CAPTION>

-------------------------------------------------------------------------------

PRODUCT ID                                US LIST PRICE               SIEMENS
                                                                     DISCOUNTED
                                                                       PRICE*
-------------------------------------------------------------------------------

-------------------------------------------------------------------------------
<S>                                    <C>                  <C>
8000 SA                                      $4695                       $[*]
-------------------------------------------------------------------------------
8000 DA                                      $5645                       $[*]
-------------------------------------------------------------------------------
8000 DD                                      $5995                       $[*]
-------------------------------------------------------------------------------
8000 SW-TLX-2.0                              $2000                       $[*]
-------------------------------------------------------------------------------
ATM DS1                                      $3000                       $[*]
-------------------------------------------------------------------------------
ATM E1                                       $3000                       $[*]
-------------------------------------------------------------------------------
8000 DS3ATM                                  $3000                       $[*]
-------------------------------------------------------------------------------
8000 E3ATM                                   $3000                       $[*]
-------------------------------------------------------------------------------
8000 OC3ATM-MM                               $4000                       $[*]
-------------------------------------------------------------------------------
8000 OC3ATM-SM                               $6000                       $[*]
-------------------------------------------------------------------------------
8000 OC3ATM-LR                               $8000                       $[*]
-------------------------------------------------------------------------------
ENH DS3 ATM                                  $3000                       $[*]
-------------------------------------------------------------------------------
ENH E3 ATM                                   $3000                       $[*]
-------------------------------------------------------------------------------
ENH OC3 ATM MM                               $4000                       $[*]
-------------------------------------------------------------------------------
ENH OC3ATM SM-IR                             $6000                       $[*]
-------------------------------------------------------------------------------
ENH OC3ATM SM-LR                             $8000                       $[*]
-------------------------------------------------------------------------------
8000 ENET                                     $300                       $[*]
-------------------------------------------------------------------------------
8000 FAST ENET-1                              $750                       $[*]
-------------------------------------------------------------------------------
8000 FAST ENET-4                             $3000                       $[*]
-------------------------------------------------------------------------------
8000 TRN                                     $1000                       $[*]
-------------------------------------------------------------------------------
8000 FDDI-SAS                                $5000                       $[*]
-------------------------------------------------------------------------------
8000 FDDI-DAS                                $8000                       $[*]
-------------------------------------------------------------------------------
8000 SBP                                       $50                       $[*]
-------------------------------------------------------------------------------
8000 RM-19                                    $250                       $[*]
-------------------------------------------------------------------------------
8000 RM-23                                    $250                       $[*]
-------------------------------------------------------------------------------
8000 SUG V2.0                                 $100                       $[*]
-------------------------------------------------------------------------------
8000 SUG-DISK V2.0                             $50                       $[*]
-------------------------------------------------------------------------------
8000 AC PWR                                   $595                       $[*]
-------------------------------------------------------------------------------
8000 DUAL AC PWR                             $3895                       $[*]
-------------------------------------------------------------------------------
8000 DUAL DC PWR                             $4395                       $[*]
-------------------------------------------------------------------------------
8000 FAN                                      $250                       $[*]
-------------------------------------------------------------------------------
8000 CPU FAN                                  $250                       $[*]
-------------------------------------------------------------------------------
8 MEG SIMM                                    $400                       $[*]
-------------------------------------------------------------------------------
32 MEG UPG                                    $400                       $[*]
-------------------------------------------------------------------------------
SYSTEM STATUS CARD                            2595                        [*]
-------------------------------------------------------------------------------
CABLE/CONNECTOR                                120                        [*]
ASSEMBLY
-------------------------------------------------------------------------------
8000 MB ASSY                                  3995                       $[*]
-------------------------------------------------------------------------------
SS-UK-Support                                                        $[*] pa**
-------------------------------------------------------------------------------
SS-UK-Update                                              [*]% Unit List price
                                                                          pa**
-------------------------------------------------------------------------------
Products for Testing Purposes            As above              [*]% off the US
as per article 15                                                  list prices
-------------------------------------------------------------------------------
</TABLE>

*    Significant Orders - In the event of that Siemens receives a customer order

* CERTAIN CONFIDENTIAL INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
  SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

<PAGE>

                                      -40-

                                 CONFIDENTIAL

     which it considers to be significant, Siemens may request that Sonoma
     increases the discounts set out above. Sonoma shall consider whether or
     not to apply additional discounts to such orders and if so, the level of
     any such additional discounts.

**   Support Fees - Support fees shall comprise the following elements:

     (a) USD [*] annual fee payable yearly. The first payment shall become
     due and payable on the date of this Agreement and subsequent payments
     shall become due and payable on each anniversary of this Agreement; and

     (b) [*] per cent of the US list price for each of the Contractual
     Products supplied by Sonoma from time to time. The first payment for UK
     Support & Updates for Contractual Products supplied from the date of
     this Agreement shall become due and payable on 1 January 1999.
     Subsequent payments for all Contractual Products which have been
     supplied under this Agreement from time to time shall become due and
     payable on each anniversary of this date, and shall be invoiced quarterly
     in advance.

     (c) The support fees shall be payable for the period of this Agreement and
     thereafter for so long as Sonoma is obliged under this Agreement to
     continue to provide support.

* CERTAIN CONFIDENTIAL INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
  SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

<PAGE>

                                      -41-

                                  CONFIDENTIAL

                                     ANNEX 5

                         Software Correction Procedures

1.)   Siemens has a priority system which reports priorities from (P1)
      through (P4) where (P1) represents the highest priority, defined as
      follows:

      (a)  A "P1" problem exists if as a result of execution of the Software,
      a user's system is: (i) inoperative; or (ii) experiencing severe
      intermittent problems; or (iii) unsafe; or (iv) experiencing a unique
      problem which is the equivalent of the foregoing.

      (b)  A "P2" problem exists if as a result of execution of the Software,
      a user's system is: (i) experiencing a critical degradation of
      performance or function; or (ii) experiencing significant intermittent
      problems; or (iii) experiencing a unique problem which is the
      equivalent of the foregoing.

      (c)  A "P3" problem exists if, as a result of execution of the Software,
      a user's system is: (i) experiencing a non-critical degradation of
      performance or function; or (ii) experiencing minor intermittent
      problems.

      (d)  A "P4" problem exists if a user's system is operational and: (i)
      is experiencing a problem which has been bypassed and is under evaluation;
      or (ii) if there is a problem with Documentation.

2.)   When Siemens advises Sonoma that a P1-P4 problem exists, Sonoma shall
      use its reasonable endeavours to provide a fix or a workaround for such
      problem within the time periods set forth below:

      P1 - 1      to 3 calendar days;
      P2 - 4      to 6 calendar days;
      P3 and P4 - within the period of the next regularly scheduled Sonoma
                  system maintenance release, not to exceed one hundred and
                  eighty (180) days after notification.

3.)   Together with each Software patch Sonoma shall provide the following
      information:

      -           reference to the fault notification
      -           name of the Software which is corrected
      -           name/number of the patch
      -           procedure for incorporation of the patch into the Software
      -           dependencies (NOT INDEPENDENCIES) of the patch with respect to
                  other software, hardware, firmware, other patches

<PAGE>

                                      -42-

                                 CONFIDENTIAL

      -           reference to successful test of the patch.

4.)   Sonoma's Software patches must be in a form which can be installed
      without interruption of the operation of the Contractual Products. If
      the Contractual Product is operated from a remote operation and
      maintenance facility the patches must be in a form which can be
      installed from the OEM facility.

5.)   Upon Siemens' request Sonoma shall make available a list which shows
      all available patches.

<PAGE>

                                      -43-

                                 CONFIDENTIAL

                                    ANNEX 6

                           SOFTWARE MAINTENANCE SERVICE

In consideration of Siemens payment to Sonoma of the service and support fees
set forth in Annex 4, Sonoma agrees to render support services to Siemens.

1.  SUPPORT HOTLINE

1.1. Telephone consultation

        Sonoma will provide direct support of Siemens' trained and certified
        personnel in the form of phone and related (e-mail, fax, etc.) support
        during Siemens' regular business hours.

1.2.    A technical support hotline to Sonoma's (location) offices support staff
        shall be available during Siemens regular UK business hours (from 08.30
        to 17.30).

2. UPDATES

2.1.    Sonoma will provide maintenance support for Software during the period a
        maintenance agreement is in effect. Sonoma will notify Siemens of, and
        Sonoma will send to Siemens, all available software releases related to
        the Software. These potentially could include, but are not necessarily
        limited to, maintenance releases, corrections, modifications and
        changes or work-arounds.

2.2.    During the period a maintenance and support agreement is in effect,
        support shall be provided for (in addition to the current version of
        the Software) the next previous version of Software for 24 months after
        a subsequent version of the Software is released by Siemens or Siemens'
        Subsidiary Companies to its customers.

4. CODE FIXES

4.1.    Sonoma will deliver solutions for all P1 through P4 code problems in
        accordance with Section 3.0 of this Annex 6.

5. DOCUMENTATION

5.1     Sonoma will provide to Siemens the documentation required to describe
        technical solutions and/or work arounds for P1 through P4 software
        problems at the same time Sonoma provides the software resolving such
        software problems.

<PAGE>

                                      -44-

                                 CONFIDENTIAL

                                    ANNEX 8

                                EMERGENCY STOCK

Subject to payment by Siemens of the carrying charge referred to below, Sonoma
agrees to maintain a complete set of spares of the Sonoma equipment that
Siemens has sold and installed at its customer sites.

The initial stock will consist of one (1) unit of each of the contractual units.

Based on periodic reviews, the quantities of emergency stock will be revised
based on mutual agreement by both parties.

Siemens shall pay to Sonoma a monthly carrying charge of one per cent of the
discounted list price for each of the spares or Contractual Products retained by
Sonoma as emergency stock. Sonoma shall invoice such amount to Siemens in
advance and such payments shall become due 30 days from the date of Sonoma's
invoice.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00002-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00002-of-00352.parquet"}]]