Document:

Kranem Corporation: Exhibit 10.3 - Filed by newsfilecorp.com

CONSULTING AGREEMENT 

BETWEEN

XALTED INFORMATION SYSTEMS PVT. LTD. 

AND 

AJAY. M. BATHEJA

THIS Consulting Agreement (the “Agreement”) is entered into by and between Ajay Batheja , an individual (the “Consultant”), residing at 71, Sunflower, Cuffe Parade, Mumbai – 400 005, India and Xalted
Information Systems Pvt. Ltd., ., a Company incorporated under the Companies Act, 1956 (the "Company"), having its Registered Office at at 1106/9, A.M.Industrial Estate, Garvebhavi Palya, 7th Mile, Hosur Road, Bangalore 560 068,
India to be effective on October 1, 2005 (the “Effective Date”), for Management Control and operation services relating to the Company (the “Consulting Services”) on the terms and conditions set forth herein. The
Consultant and the Company are hereinafter sometimes referred to collectively as the “Parties” and individually as a “Party.” 

WHEREAS, the Company desires to engage the Consultant to provide the Consulting Services, as defined in subsection 2 below, under the terms and conditions of this Agreement, and 

WHEREAS, the Consultant is willing to provide the Consulting Services, as defined in subsection 2 below, to the Company under the terms and conditions of this Agreement. 

NOW THEREFORE, in consideration of the foregoing recitals and the mutual promises hereinafter set forth, the Parties hereby agree as follows: 

1. Term of Agreement.

This Agreement will become effective on the Effective Date and will continue in effect (the “Initial Term”) of 5 (Five Years) unless earlier terminated as provided in Section 10. This Agreement will automatically be renewed for
additional 5 (Five Years) term (collectively “Subsequent Terms” and individually a “Subsequent Term”) unless terminated in accordance with Section 10. 

2. Services To Be Performed by Consultant: 

2.1 The Consulting Services and the Manner of Performance. Management
control and operations services relating to the Company. The Consultant warrants and represents that he is highly qualified and experienced in the performance of the Consulting Services expected to be performed by him. The Consultant agrees to
perform the Consulting Services (i) in a professional and workmanlike manner, (ii) in a professional manner the most appropriate to achieve the desired result consistent with the corporate objectives of the Company and (iii) at such times and at
such places as the Consultant will determine, consistent with the Consultant’s commitments hereunder. The services described herein shall be referred to as the “Consulting Services.”

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2.2 Conduct. If the Consultant performs any Consulting Services on the Company’s premises, they will be subject to the rules, restrictions, and directives concerning security, conduct and access, which the Company may from
time to time adopt and communicate. Any documents, tools, equipment, or other materials supplied to the Consultant by the Company are for use in performing the Consulting Services for the Company only and must be promptly returned upon completion of
the assignment or earlier termination in the same condition supplied subject to reasonable wear and tear. The Parties acknowledge and agree that the Consultant is an independent consultant and shall not perform work for other conflicting third
parties due to non-disclosure and proprietary information disclosed by the Company.

3. Fee. 

3.1 The Company agrees to pay the Consultant Rs. 25,000/- per month (Rupees
Twenty Five Thousand Only) (the “Fees”) for the Consulting Services. The Company shall pay the Fee on or about the tenth day of each following month by check or direct deposit at the Consultant’s option in a designated bank
account. 

4. Consultant's Tax and Insurance Obligations.

The Consultant will be solely responsible for and will make proper and timely payment of any income or other taxes, including the Consultant’s estimated state and federal income taxes and self-employment tax. The Company shall deduct the Tax at
Source as applicable on the Fees under the Indian Income Tax Act and shall issue the Certificate for Deduction of Tax at Source to the Consultant, as per the Indian Income Tax Act and the Rules framed thereunder. The Consultant acknowledges that it
is solely responsible for securing and maintaining general liability insurance in customary and adequate amounts, and workers' compensation insurance, disability insurance, and unemployment insurance for the Consultant and the Consultant's
employees. The Consultant acknowledges that Company may require the Consultant to provide the Company with proof of the Consultant's coverage. The Consultant hereby agrees to indemnify the Company against any claims, liabilities or expenses the
Company incurs as a result of the Consultant's breach of its obligations under this Section 4. 

5. Independent Consultant Relationship.

The Consultant acknowledges and understands that he is an independent consultant and is responsible for paying all taxes, employee benefit payments, health, life, disability or other insurance premiums and other similar charges for the Consultant
and for all persons engaged by the Consultant to perform the Services. The Consultant agrees to indemnify and hold the Company harmless from any claims asserting such responsibility against the Company. The Consultant understands, acknowledges and
agrees that the Consultant is not an employee or agent of the Company, and no relationship of employment, agency, joint venture or partnership is formed by this Agreement or the performance of the Consulting Services.

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6. Assignment, Delegation.

The Parties agree that the delegation or assignment by the Consultant of any or all of its duties, obligations, or rights hereunder, without the prior written consent of the Company, is void. Unless otherwise specified in the Work Statement, the
Consultant may not use subcontractors to perform any tasks hereunder, without the Company's prior written consent. If individual personnel of the Consultant are identified on any Work Statement, the Consulting Services to be performed by such
persons may not be delegated to others without the Company's prior written consent. The Company may not assign or transfer its obligations hereunder to any third party without the prior written consent of the Consultant but it may assign or transfer
its obligations hereunder to a subsidiary, affiliate, parent, or successor corporation. 

7. Confidentiality of Proprietary Information.

The Consultant acknowledges that the information and documents with which he has access to as a result of this Agreement, is the confidential information of the Company. The Consultant agrees not to disclose any of the information, which he has
access to as result of this Agreement, to any third party without the prior consent of the Company.

9. Termination. 

9.1 For Cause. The Company may, without any liability to the Consultant, terminate
this Agreement upon written 30 calendar days notice to the Consultant on the occurrence of any of the following events: 

9.1.1 Breach by Consultant of any of the terms of this Agreement; or 

9.1.2 Any good faith belief of the Company of the inability of the Consultant to perform its duties hereunder, including, without limitation, financial instability or inability of the Consultant to pay his bills. 

9.2 For Convenience. The Company may terminate this Agreement, with or without cause, by giving 60 calendar days prior written notice to the Consultant. In the event of such termination, the Company shall pay to the Consultant the
amount due for the Consulting Services rendered prior to such agreed-upon termination. In addition, in the event of such termination, the Company shall pay to the Consultant the Consultancy Fees for One Year as per the last drawn Consultancy
Fees.

9.3 Mutual Consent. The Parties may at any time mutually agree to terminate this Agreement by giving 30 calendar days notice on either side or payment in lieu thereof.

9.4 Obligations on Termination. Upon termination, the Consultant shall promptly deliver to the Company all copies of any tools, documents, software, specifications and materials of any sort, which were given to the Consultant by the
Company. The Company may withhold final payment until the Company receives all such materials. If the Consultant breaches this Agreement, the Company will be entitled, in addition to any other remedies at law, to recover the
reasonable cost of completing the Consulting Services, to the extent such cost exceeds the amount to be paid to Consultant for performance of such incomplete Services under this Agreement. 

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10. Survival.

The terms and conditions contained in this Agreement that by their sense and context are intended to survive the performance hereof by either or both Parties hereunder shall so survive the completion of performance, cancellation or termination of
this Agreement.. 

11.  Modifications.

No modification of this Agreement will be valid unless made in writing and signed by all Parties hereto. 

12. Integrated Agreement.

This Agreement supersedes and cancels any and all previous agreements of whatever nature between the Company and the Consultant with respect to the matters covered herein. This Agreement constitutes the full, complete and exclusive agreement between
the Consultant and the Company with respect to the subject matters herein. 

13. Governing Law.

This Agreement will be governed by and construed in accordance with the laws of the India, as applied to contracts entered into and performed wholly within India. The Parties agree that any dispute arising out of this Agreement will be resolved by
the courts located in the City of Mumbai in India. The Parties consent to the exclusive jurisdiction of and venue in such courts. 

14. Notice.

All notices under this Agreement shall be in writing and in English, and shall be deemed given when personally delivered, or three days after being sent by prepaid certified or registered mail to the address of the Party to be noticed as set forth
herein or such other address as such party last provided to the other by written notice. 

15. Facsimile and Counterparts.

The Agreement may be signed by facsimile and may be executed in counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument. 

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16. Dispute Resolution

With respect to any controversy or claim arising out of, or in any way related to this Agreement, the Parties agree in good faith to attempt to resolve such dispute before entering into any formal legal proceeding by providing written notice and
entering into good faith discussions and negotiation with its respective management. If the issue or dispute has not been resolved within ten (10) days of the date of written notice thereof to the other Party of the issue or dispute, (or longer
period as may be agreed to between the parties), then the issue shall be resolved by mediation in accordance with the Arbitration and Conciliation Act, 1996 of India. The Parties will agree on a mediator who has experience in the relevant industry.
If the matter has not been resolved by mediation within twenty (20) days of the initiation of the mediation, the controversy shall be settled by binding arbitration in accordance with the Arbitration and Conciliation Act, 1996 of India. The Parties
will each select an arbitrator, and the arbitrators shall select the third arbitrator. The arbitration proceeding shall take place in Mumbai, India. The arbitration award shall be binding and valid upon the Parties and the judgment thereon may be
entered and enforced as the final judgment in any court of competent jurisdiction. 

17. No Waiver or Modification

No waiver or modification of this Agreement or any part thereof will be valid unless in writing and duly executed by the Party to be charged. The waiver by the Company of a breach of any provision of this Agreement by the Consultant shall not
operate or be construed as a waiver of any other or subsequent breach by the Consultant. 

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.

	
THE COMPANY
		
THE CONSULTANT
	
	
 	
 
	
 
		
 
	
	
Signature: /s/ Pratap. S. Kondamoori
		
Signature: /s/ Ajay. M. Batheja
	
	
Name: Pratap. S. Kondamoori
		
Name: Ajay. M. Batheja
	
	
Title: Chairman
		
 
	

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ADDENDUM TO CONSULTING AGREEMENT BETWEEN XALTED INFORMATION
SYSTEMS PRIVATE LTD AND AJAY. M. BATHEJA. 

Effective August 1, 2006, Clause No. 3 shall stand revised as
under:

3. Fee: 

3.1 The Company agrees to pay the Consultant Rs. 1,50,000/- per
month (Rupees One Lac & Fifty Thousand Only ) (the “Fees”) for the
Consulting Services. The Company shall pay the Fee on or about the tenth day of
each following month by check or direct deposit at the Consultant’s option in a
designated bank account. 

	THE COMPANY	THE CONSULTANT
	 	 
	 	 
	Signature: /s/ Pratap (Bob) Kondamoori
    	Signature: /s/ Ajay. M.
      Batheja 
	Name: Pratap. S. Kondamoori 	Name: Ajay. M. Batheja 
	Title: Chairman	  
	  	  
	  	  
	Date: 	Date: 

6 of 6Xalted Networks, Inc.: Exhibit 10.4 - Filed by newsfilecorp.com

Confidential

	SHARE EXCHANGE 
	AND 
	RESTRICTED STOCK PURCHASE AGREEMENT

     THIS Share Exchange and
Restricted Stock Purchase Agreement (this “Agreement”), dated as of
October 1, 2004 (the “Effective Date”), is made and entered into by and
among Xalted Networks, Inc. (“Xalted America”), a Delaware corporation,
Xalted Information Systems, Pvt., Ltd., (“Xalted India”), an Indian
corporation (the “Company”), Rajendra Manikonda (“Mr. Manikonda”),
an individual, and Pratap (Bob) Kondamoori (“Mr. Kondamoori”), an
individual. Mr. Kondamoori and Mr. Manikonda are hereinafter sometimes referred
to collectively as the “Shareholders” and individually as a
“Shareholder.” Xalted America, Xalted India, and the Shareholders are
hereinafter sometimes referred to collectively as the “Parties” and
individually as a “Party.” Capitalized terms used in this Agreement but
not defined herein shall have the meaning assigned to them in the Xalted SPA, as
defined below.

     WHEREAS, Xalted India has
authorized and issued a total of 1,445,000 shares (“Xalted India Shares”)
of its stock with a par value of Rs.10 (the “Xalted India Stock”);

     WHEREAS, Xalted India was
initially capitalized at 14,450,000 Rs.

     WHEREAS, the Shareholders
currently owns all of the outstanding Xalted India Shares of the Xalted India
Stock;

     WHEREAS, Mr. Kondamoori
currently owns 1,082,500 shares or 74.92% (the “Kondamoori Shares”) and
Mr. Manikonda owns 362,500 shares 25.08% (the “Manikonda Shares”) of the
Xalted India Shares.

     WHEREAS, the Shareholders
have previously signed a side letter, dated December 19, 2003, (the “Side
Letter”), which is attached hereto as Exhibit A, under which they agreed to
transfer all of the Xalted India Shares to Xalted America as soon as Indian law
permitted and appropriate regulatory approvals could be obtained by reimbursing
the Shareholders for certain documented loans made by them to Xalted India and
certain documented out-of-pocket costs incurred by them to organize Xalted India
plus 6% simple interest (the “Total Organizational Expenses”) into Series
CC Preferred Stock of Xalted America at $0.674 per share (the “CC
Stock”);

     WHEREAS, the Parties
hereto desire to have the Shareholders convert their Xalted India Shares into
the CC Stock with the same rights and privileges and under the same terms and
conditions for Series CC Preferred Stock, as set forth in the Series BB and CC
Stock Purchase Agreement executed by the Company and other entities on or about
February 10, 2004, as amended from time to time, (the “Xalted SPA”),
which is incorporated herein as though fully attached herein.

     WHEREAS, the Parties agree
that Mr. Manikonda is an Indian Resident and that Mr. Kondamoori is not an
Indian Resident for the purpose of the Foreign Investment Restriction and the
value of their Xalted India Shares is subject to different valuation
methodologies;

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     WHEREAS, the Parties agree
that the Total Organizational Expenses is currently $347,152.30.

     NOW, THEREFORE, in
consideration of the mutual covenants and agreements set forth in this
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

ARTICLE 1.
EXCHANGE OF SHARES AND CLOSING

     1.1 Transfer of the Kondamoori
and Manikonda Shares. On the basis of the representations, warranties,
covenants and agreements set forth herein, Mr. Kondamoori agrees to and will
convey, transfer, assign and deliver to Xalted America at the Closing, as
hereinafter defined, good and marketable title to, free and clear of all liens
or restrictions of any kind (collectively, “Liens”), and Xalted America
agrees to and will acquire and accept from Mr. Kondamoori the Kondamoori Shares.
On the basis of the representations, warranties, covenants and agreements set
forth herein, Mr. Manikonda agrees to and will convey, transfer, assign and
deliver to Xalted America at the Closing, as hereinafter defined, good and
marketable title to, free and clear of all liens or restrictions of any kind
(collectively, “Liens”), and Xalted America agrees to and will acquire
and accept from Mr. Manikonda the Manikonda Shares. In addition to exchanging
its CC Stock for the Shareholder’s Xalted India Stock, Xalted America agrees to
pay the capital gains up to $50,000.00 (if any) that the Shareholders are
required to pay by the Indian government on the exchange of the stock based on
the applicable valuation required by the Indian government determined by Xalted
America’s financial consultant.

     1.2 Conversion of the
Conversion Amount into CC Shares. The Parties agree that the Total
Organizational Expenses shall be converted into CC Shares at $0.674 per share.
The Shareholders agree and acknowledge and the other Parties agree that Mr.
Kondamoori shall get 74.92% of the CC Shares and Mr. Manikonda shall get 25.08%
of the CC Shares upon conversion of the Total Loan. The Parties agree that
Xalted America shall issue a total of 515,063 shares of CC Shares to the
Shareholders with 385,885 shares of CC Shares to Mr. Kondamoori (the “Mr.
Kondamoori Shares”) and 129,178 shares of CC Shares to Mr. Manikonda (the
“Mr. Manikonda Shares”) at the Closing, as defined below. The Parties
further agree that the number of CC Shares may be adjusted in accordance with
the Adjustment set forth in Section 1.5 below. Notwithstanding anything to the
contrary, at the Company’s option, the Company may require Mr. Kondamoori and
Mr. Manikonda to transfer their Xalted India Shares to a Mauritius corporation,
which is currently being set up and will be wholly owned by the Company, and not
directly to the Company as specified above, at any time after the Effective Date
and prior to the end of the Escrow as defined in Section 2.3 below.

     1.3 Consideration. In
consideration for the transfer of the Kondamoori Shares, described above in
Section 1.1, the Shareholders shall receive at the Closing their Shares as set
forth above in Section 1.2. In consideration for the Xalted India Shares to be
received by Xalted America, Xalted America shall issue the CC Shares to Mr.
Kondamoori and Mr. Manikonda as 

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set forth above in Section 1.2. As further consideration,
Xalted America agrees to pay the capital gains up to $50,000.00 (if any) that
the Shareholders are required to pay by the Indian government on the exchange of
the stock based on the applicable valuation required by the Indian government
determined by Xalted America’s financial consultant.

     1.4 Closing. The closing
will take place on December 1, 2004 (the “Closing”). At the Closing,
Xalted America will issue to the Shareholders the CC Shares described above and
Mr. Kondamoori shall transfer the Kondamoori Shares to Xalted America and Mr.
Manikonda shall transfer the Manikonda Shares to Xalted America. The Parties
agree that the CC Shares, the Kondamoori Shares and the Manikonda Shares shall
be given to and escrowed by Xalted America’s General Counsel and Assistant
Secretary (the “Escrow”) and not given to the respective Parties until
the Valuation, the Tax Calculation and the Documentation, as set forth in
Section 1.5 below, have been completed and certified by the financial consultant
engaged by Xalted India and Xalted America, the Adjustment (if any), as
described in Section 1.5 below, has been made, and the Audit Committee of Xalted
America has authorized the transfer. 

     1.5 Valuation, Certification
and Adjustment. The Parties acknowledge and agree that the Kondamoori Shares
and the Manikonda Shares must be valued in accordance with Indian law and
regulations for the purpose of determining, inter alia, the value of such
stock and the capital gains tax (if any) owed by Mr. Kondamoori and Mr.
Manikonda (the “Tax Calculation”) on the exchange of the stock under the
terms and conditions of this Agreement (the “Valuation”). The Parties
further acknowledge and agree that the Total Organizational Expenses, pursuant
to the Side Letter, must be properly documented and supported by proper receipts
and cancelled checks (the “Documentation”). The Parties have engaged a
financial consultant to do both the Valuation and the Documentation and to
certify the results to the boards of both Xalted India and Xalted America. The
Parties agree that the CC Stock to be exchanged hereunder shall be reduced based
on the Documentation (the “Adjustment”) but in no event shall be
increased above the amounts set forth in Exhibit B. 

     1.6 Further Assurances;
Post-Closing Cooperation. Each Party hereto shall take such further action
and execute and deliver such further documents as may be reasonably requested by
any other Party in order to carry out the provisions and purposes of this
Agreement.

     1.7 The CC Stock. The CC
Stock shall have the same rights, preferences, privileges, and restrictions as
the Series CC Preferred Stock described in the Xalted SPA, the Related
Agreements, all of which are incorporated herein as though fully attached
hereto, as amended from time to time, and the Restated Certificate, which is
incorporated herein as though fully attached hereto. The CC Stock shall be
subject to the restrictions set forth in subsection 1.9 below, which the Parties
hereto believe and intend to be identical to the restrictions on the transfer of
Series CC Preferred Stock set forth in the Xalted SPA and the Related
Agreements. If there is an inconsistency between the restrictions set forth in
the Xalted SPA and this Agreement, the Parties agree that the restrictions in
the Xalted SPA shall prevail and be applicable to the CC Stock.

     1.8 Joinder to the Xalted SPA
and Related Documents. The Shareholders shall become “parties” to the Xalted
SPA and the Related Agreements and shall have the same rights 

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and obligations as the “Purchasers” and the “Investors” have in
the Xalted SPA and the Related Agreements. The Shareholders hereby joins in and
agrees to observe, perform and be bound by all of the provisions of, and the
Company agrees that the Shareholders shall have the rights ascribed to
“Additional Purchasers” and “Purchasers” in the Xalted SPA and to “Investors”
under the Related Agreements, as amended from time to time, including the
Restated Investors Rights Agreement, as amended from time to time, the Restated
Co-Sale Agreement, as amended from time to time, and the Restated Voting
Agreement, as amended from time to time. Without limiting the generality of the
foregoing, each Shareholder (as to itself) expressly joins in the
representations and warranties of the Investors set forth in Section 4 of the
Xalted SPA (collectively, the “Purchaser Representations”) and hereby represents
and warrants (as to itself) that, as of the date hereof, the Purchaser
Representations are, with respect to the Shareholder, true, complete and correct
in all material respects. The Company hereby consents to each of the
Shareholders joining as a party to the Xalted SPA and the Related Documents.
Each of the Shareholders, as to itself, acknowledges that it has been provided
with a copy of the Xalted SPA, the Related Agreements, and the Restated
Certificate.

     1.9    Restricted
Shares

     1.9.1 Securities Laws.
Xalted shall take such steps as are necessary to comply with all applicable
securities laws in connection with the Agreement. Shareholders shall use their
best efforts to assist Xalted as may be necessary to comply with such laws.

     1.9.2 Securities Act
Exemption. The Xalted Shares to be issued pursuant to this Agreement or the
Common Stock, which the Preferred Shares are convertible into, will not be
registered under the Securities Act. The Xalted Shares will be issued pursuant
to an exemption from registration.

     1.9.3 Restrictive Legends.
Each certificate representing the Xalted Shares issued hereunder and any other
securities issued in respect of the Xalted Shares upon any stock split, stock
dividend, recapitalization, merger, or similar event (unless no longer required
in the opinion of counsel for Xalted) shall be stamped or otherwise imprinted
with legends substantially in the following form:

“THE SHARES REPRESENTED BY THIS
CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION
MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR
AN OPINION OF COUNSEL SATISFACTORY IN FORM AND SUBSTANCE TO XALTED THAT SUCH
REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933.”

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Confidential

ARTICLE 2.

REPRESENTATIONS AND WARRANTIES OF Xalted
America 

Except as set forth on the Schedule of Exceptions, Xalted
  America and Xalted India severally, but not jointly hereby represents and
  warrants to the Shareholders (as to itself, but not to the other) as
  follows:

     2.1 Organization. It is a
corporation duly organized and existing under, and by virtue of, the laws of the
State of California (as to SysteamUS) and Delaware (as to Xalted America). It
has the requisite corporate power to own and operate its properties and assets,
and to carry on its business as presently conducted and as proposed to be
conducted.

     2.2 Corporate Power. It
has all requisite legal and corporate power to execute and deliver this
Agreement, to issue and sell its Shares and to carry out and perform its
obligations under the terms of this Agreement.

     2.3 Authorization. All
corporate action on the part of it, its officers, directors and shareholders
necessary for the authorization, execution, delivery and performance by the it
of this Agreement, the authorization, sale, issuance and delivery of its Shares
and the performance of its obligations hereunder has been taken and the sale,
issuance and delivery of the its Shares and the execution, delivery and
performance of this Agreement will not violate the Company’s Bylaws or Articles
of Incorporation (the “Charter Documents”) or any of its material
agreements. This Agreement, when executed and delivered by it, shall constitute
a valid and binding obligation of it enforceable in accordance with its terms,
subject to laws of general application relating to bankruptcy, insolvency and
the relief of debtors (other than usury laws) and rules of law governing
specific performance, injunctive relief or other equitable remedies. Its Shares,
when issued in compliance with the provisions of this Agreement, will be validly
issued, fully paid and nonassessable, and will be free of any consensual liens
or encumbrances created by it , other than liens or encumbrances in connection
with this Agreement and related documents and agreements and the transactions
contemplated hereby; provided, however, that the its Shares may be subject to
restrictions on transfer under state and/or federal securities laws as set forth
herein or as otherwise required at the time a transfer is proposed.

ARTICLE 3.
REPRESENTATIONS AND WARRANTIES OF EACH
SHAREHOLDER

     Each Shareholder severally, but
not jointly, represents and warrants to Xalted America and Xalted India (as to
itself, but not to any other Shareholder) as follows:

     3.1 Ownership of Shares.
The Shareholder owns the Xalted India Shares set forth opposite its name on
Exhibit A free and clear of all Liens.

     3.2 Authorization; No
Violation. The Shareholder has full legal capacity, power and authority to
execute, deliver and perform this Agreement and to consummate the transactions
contemplated hereby. This Agreement has been duly executed and delivered by the
Shareholder and constitutes a legal, valid and binding obligation, enforceable
against the Shareholder in accordance with its terms. Neither the execution,
delivery and performance of this Agreement by the Shareholder nor the
consummation of any of the transactions provided for hereby will result in any
violation or breach of or default (or an event which with notice or the passage
of time or both would constitute a default) under any contract, franchise
or permit to which the Shareholder is a party, or by which the Shareholder is
bound.

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         3.3 Investment
  Representations

          (a) The
Shareholder has substantial experience in evaluating and investing in private
placement transactions of securities in companies similar to Xalted America so
that it is capable of evaluating the merits and risks of his or her investment
in Xalted America and has the capacity to protect its own interests in making
its investment in Xalted America;

          (b) The
Shareholder is an “accredited investor” as that term is defined in Rule 501 of
the Securities Act of 1933, as amended (the “Securities Act”).

          (c) The
Shareholder is acquiring the Xalted America Shares and, upon conversion of any
Preferred Shares, the Xalted America’s Common Stock underlying the Preferred
Shares for investment for its own account, not as a nominee or agent, and not
with the view to, or for resale in connection with, any distribution thereof.
The Shareholder understands that the Xalted America Shares to be acquired
pursuant to this Agreement and the Common Stock underlying the Preferred Shares
have not been, and may not be registered under the Securities Act of 1933, as
amended (the “Securities Act”), by reason of a specific exemption from
the registration provisions of the Securities Act, the availability of which
depends upon, among other things, the bona fide nature of the investment intent
and the accuracy of such Shareholder representations as expressed herein;

          (d) The
Shareholder acknowledges that the Xalted America Shares, the Preferred Shares
and the Common Stock underlying the Preferred Shares must be held indefinitely
unless subsequently registered under the Securities Act or unless an exemption
from such registration is available. The Shareholder is aware of the provisions
of Rule 144 promulgated under the Securities Act which permit limited resale of
shares purchased in a private placement subject to the satisfaction of certain
conditions, including, among other things, the existence of a public market for
the shares, the availability of certain current public information about the
issuer, the resale occurring not less than one year after a party has purchased
and paid for the security to be sold, the sale being effected through a
“broker’s transaction” or in transactions directly with a “market maker” and the
number of shares being sold during any three-month period not exceeding
specified limitations;

          (e) The
Shareholder understands that no public market now exists for any of the
securities issued by Xalted America and that Xalted America has made no
assurances that a public market will ever exist for Xalted America’s
securities;

          (f) The
Shareholder has had an opportunity to discuss Xalted America’s business,
management and financial affairs with its management. The Shareholder has also
had an opportunity to ask questions of officers of Xalted America, which
questions were answered to its satisfaction. The Shareholder understands that
such discussions, as well as any written information issued by Xalted America,
were intended to describe certain aspects of the Xalted America’s business and
prospects but were not an exhaustive description;

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          (g) This
Agreement, when executed and delivered by the Shareholder, will constitute a
valid and legally binding obligation of the Shareholder, enforceable in
accordance with its terms, and subject to laws of general application relating
to bankruptcy, insolvency and the relief of debtors and rules of law governing
specific performance, injunctive relief or other equitable remedies;

          (h)
Xalted America has not, and will not, incur, directly or indirectly, as a result
of any action taken by the Shareholder, any liability for brokerage or finders’
fees or agents’ commissions or any similar charges in connection with this
Agreement; and

          (i) The
Shareholder has reviewed with its own tax advisors the federal, state, local and
foreign tax consequences of this investment and the transactions contemplated by
this Agreement (including any tax consequences resulting from the recently
enacted tax legislation). It relies solely on such advisors and not on any
statements or representations of Xalted America or any of its agents. The
Shareholder understands that it (and not Xalted America) shall be responsible
for its own tax liability that may arise as a result of this investment or the
transactions contemplated by this Agreement.

ARTICLE 4.
CONDITIONS TO CLOSING OF THE
SHAREHOLDERS

Each Shareholder’s obligation to exchange Xalted India Shares
for Xalted America Shares at the Closing, except as specifically indicated
below, is subject to the fulfillment or waiver on or prior to the Closing Date
of the following conditions:

     4.1 Representations and
Warranties Correct. The representations and warranties made by Xalted
America and Xalted India in Article 2 hereof shall be true and correct in all
material respects on the Closing Date with the same force and effect as if they
had been made on and as of said date.

     4.2 Third Party Consents.
All necessary third party consents on the part of Xalted America, if any, and
SysteamUS, if any, shall have been obtained.

     4.3 Compliance with Federal
Securities Laws. The existence of a valid exemption to or compliance with
the registration requirement of the Securities Act.

     4.4 Blue Sky. Xalted
America and SysteamUS, if any, shall have obtained all necessary Blue Sky law
permits and qualifications, or secured an exemption therefrom, required by any
state in which the exchange of securities shall occur, except to the extent that
filings or other action may be taken after the Closing Date without jeopardizing
such exemptions.

     4.5 Xalted America Share
Certificates. The Shareholders shall have received Xalted America Stock
representing their respective shares as provided on Exhibit A hereto.

     4.6 Participation. All
Shareholders shall have executed this Agreement.

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ARTICLE 5.
CONDITIONS TO CLOSING OF COMPANY

     Xalted America’s obligation to
issue the Xalted America Shares at the Closing is subject to the fulfillment of
the following conditions:

     5.1 Xalted India Share
Certificates. Xalted America shall have received stock certificates of
Xalted India representing Xalted India Shares to be transferred at the Closing
pursuant to Exhibit A and such certificates shall have been duly endorsed
and transferred pursuant to and in accordance with all applicable federal and
state laws in favor of Xalted America such that Xalted America shall be the duly
registered owner of such Xalted India Shares.

     5.2 Compliance with Federal
Securities Laws. There is an exemption from or compliance with the
registration requirement of the Securities Act.

     5.3 Blue Sky. Xalted
America and SysteamUS, if any, shall have obtained all necessary Blue Sky law
permits and qualifications, or secured an exemption therefrom, required by any
state in which the exchange of securities shall occur, except to the extent that
filings or other action may be taken after the Closing Date without jeopardizing
such exemptions.

ARTICLE 6.
RESTRICTIONS ON TRANSFERABILITY;
SECURITIES ACT COMPLIANCE

     6.1 Securities Laws.
Xalted America shall take such steps as are necessary to comply with all
applicable securities laws in connection with the Agreement. Shareholders shall
use their best efforts to assist Xalted America as may be necessary to comply
with such laws.

     6.2 Securities Act
Exemption. The Xalted America Shares to be issued pursuant to this Agreement
or the Common Stock, which the Preferred Shares are convertible into, will not
be registered under the Securities Act. The Xalted America Shares will be issued
pursuant to an exemption from registration.

     6.3 Restrictive Legends.
Each certificate representing the Xalted America Shares issued hereunder and any
other securities issued in respect of the Xalted America Shares upon any stock
split, stock dividend, recapitalization, merger, or similar event (unless no
longer required in the opinion of counsel for Xalted America) shall be stamped
or otherwise imprinted with legends substantially in the following form:

“THE SHARES REPRESENTED BY THIS
CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION
MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR
AN OPINION OF COUNSEL SATISFACTORY IN FORM AND SUBSTANCE TO Xalted America THAT
SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933.”

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ARTICLE 7. 
MISCELLANEOUS

     7.1 Governing Law. This
Agreement shall be governed in all respects by the internal substantive laws of
the State of California, of the United States of America.

     7.2 Successors and
Assigns. Except as otherwise provided herein, the provisions hereof shall
inure to the benefit of, and be binding upon, the successors and assigns of the
parties hereto, provided, however, that the rights of the Shareholders to
exchange their Subsidiary Shares for Xalted America Shares shall not be
assignable without the prior written consent of the Company.

     7.3 Entire Agreement;
Amendment. This Agreement and the exhibits hereto constitute the full and
entire understanding and agreement between the parties with regard to the
subjects hereof and thereof. Neither this Agreement nor any term hereof may be
amended, waived, discharged or terminated other than by a written instrument
signed by the party against whom enforcement of any such amendment, waiver,
discharge or termination is sought.

     7.4 Notices, etc. All
notices and other communications required or permitted hereunder shall be in
writing and shall be mailed by registered or certified mail, postage prepaid, or
otherwise delivered by hand or by messenger, addressed 

        
 (a) If to a Shareholder, at such Shareholder’s
address as such Shareholder shall have furnished to Xalted America, or 

          (b)
If to Xalted America as follows:

	 	Xalted America Networks, Inc. 
	 	82 Pioneer Way, Suite 114 
	 	Mountain View, CA 94041 
	 	Attn: Chief Legal Officer 

     7.5 Delays or Omissions.
No delay or omission to exercise any right, power or remedy accruing to the
Shareholders upon any breach or default of Xalted America under this Agreement
shall impair any such right, power or remedy of the Shareholders nor shall it be
construed to be a waiver of any such breach or default, or an acquiescence
therein, or of or in any similar breach or default thereafter occurring; nor
shall any waiver of any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. Any waiver, permit,
consent or approval of any kind or character by any Shareholder of any
provisions or conditions of this Agreement, must be in writing and shall be
effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement, or by law or otherwise afforded to the
Shareholders, shall be cumulative and not alternative.

     7.6 Facsimile and
Counterparts. This Agreement may be signed by facsimile and executed in any
number of counterparts, each of which shall be an original and all of which
shall constitute one instrument.

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     7.7 Severability. In the
event that any provision of this Agreement becomes or is declared by a court of
competent jurisdiction to be illegal, unenforceable or void, this Agreement
shall continue in full force and effect without said provision; provided that no
such severability shall be effective if it materially changes the economic
benefit of this Agreement to any party.

     7.8 Binding Arbitration.
The Parties agree that any and all controversies or claims arising out of or
relating to this Agreement, or any alleged breach hereof, shall be resolved by
binding arbitration as prescribed herein. A single arbitrator shall conduct the
arbitration under the current rules of the American Arbitration Association
(“AAA”) and the provisions set forth herein. The arbitrator shall be
selected in accordance with the AAA procedures from a list of qualified people
maintained by the AAA. The arbitration shall be conducted in the city of San
Jose, California. All expedited procedures prescribed under the AAA rules shall
apply. There shall be no discovery other than the exchange of information, which
is provided to the arbitrators by the Parties. The arbitrator shall only have
authority to award compensatory damages and shall not have authority to award
punitive damages, other non-compensatory damages or any other form of relief.
Each Party shall bear its own costs and attorneys’ fees and disbursements. The
arbitrator’s decision and award shall be final and binding, and judgment upon
the award rendered by the arbitrator may be entered in any court having
jurisdiction thereof. If any Party files a judicial or administrative action
asserting claims subject to arbitration, as prescribed herein, and another Party
successfully stays such action and/or compels arbitration of said claims, the
Party filing said action shall pay the other Party’s costs and expenses incurred
in seeking such stay and/or compelling arbitration, including reasonable
attorneys’ fees and disbursement.

     IN WITNESS WHEREOF, this
Agreement has been duly executed and delivered by the duly authorized officer of
each Party as of the Effective Date.

	Xalted America 	Mr. Kondamoori 
	  	  
	Signature: /s/ Christopher L. Rasmussen 	Signature: /s/ Pratap (Bob) Kondamoori 
	Name: Christopher L. Rasmussen 	Name: Pratap (Bob) Kondamoori 
	Title: VP-Law and General Counsel 	  
	  	  
	  	  
	Mr. Manikonda 	Xalted India 
	  	  
	Signature: /s/ Rajendra Manikonda 	Signature: /s/ Rajendra Manikonda 
	Name: Rajendra Manikonda 	Name: Rajendra Manikonda 
	  	Title: Managing Director 

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EXHIBIT A 
December 19, 1993 Side Letter

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EXHIBIT B 
STOCK OWNERSHIP

	  	  	Before Exchange 	After Exchange 
	  	  	XI1 Common 	XI Common 	XA2 CC 
	  	Shareholder 	  	  	  
	  	  	  	  	  
	1. 	Mr. Kondamoori	1,082,500 	0 	385,885 
	2. 	Mr. Manikonda 	362,500 	0 	129,178 
	3. 	Xalted America	0 	1,445,000 	   

______________________________________
1 XI is
Xalted India.
2 XA is Xalted America.

B-1

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