Document:

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                                                                   Exhibit 10.85

                             EMPLOYMENT AGREEMENT
                             --------------------

     This Employment Agreement (this "Agreement") is dated as of May 30, 2001 by
                                      ---------
and between Hai-Perng, aka Alex Kuo ("Officer") and Vertel Corporation, a
                                      -------
California corporation (the "Company").
                             -------

     1.   Term of Agreement.  This Agreement will commence on the date hereof
          -----------------
and continue until the second anniversary of the date hereof (the "Term") unless
                                                                   ----
earlier terminated as provided for in Section 4 below.

     2.   Duties.
          ------

          (a)  Position.  Officer will be employed as Chief Marketing Officer
               --------
and General Manager, Network Management Tools and Solutions Group of the
Company, and as such will report to the Chief Executive Officer.

          (b)  Obligations to the Company.  Officer agrees to the best of his
               --------------------------
ability and experience that he will, to the reasonable satisfaction of the
Company, at all times loyally and conscientiously perform all of the duties and
obligations required of him pursuant to the terms of this Agreement. Officer
will comply with and be bound by the Company's operating policies, procedures
and practices from time to time in effect during the Term.

     3.   Benefits.
          --------

          (a)  Compensation.  Officer shall not receive any guaranteed salary or
               ------------
base compensation. Notwithstanding the foregoing, Officer will be eligible for
commissions based on the revenues of the Company, excluding any revenues
received by the Company from (i) its WebResolve products, (ii) any acquisitions,
joint ventures, mergers other than revenues from Seller (as hereinafter
defined), or (iii) any other material corporate transactions similar to those
stated in Section 3(a)(ii) hereof that add revenue to the Company (together with
(i) and (ii) above, collectively, the "Excluded Revenue Base"). The Company and
Officer may agree from time to time to modify or amend the definition of
Excluded Revenue Base, provided however that any such modification or amendment
shall be invalid and unenforceable unless it is in writing and is signed by both
an authorized executive officer of the Company and Officer.

          (b)  Commissions.  Provided that Officer continues his employment with
               -----------
the Company hereunder, from the date hereof, through the end of fiscal year
2001, Officer shall be eligible to earn commissions based on the following
percentage of the Company's revenue (after deducting the Excluded Revenue Base):

               (1)  one percent (1%) of revenue up to $20,000,000 for fiscal
year 2001; plus

               (2)  one and one-half percent (1 1/2%) of any incremental revenue
between $20,000,001 and $25,000,000 for fiscal year 2001; plus
<PAGE>

               (3)  two percent (2%) of any incremental revenue over $25,000,001
for fiscal year 2001.

          With respect to Officer's commissions for the partial month of the
Company's second fiscal quarter commencing on the date hereof and continuing
through June 30, 2001, Officer shall be entitled to commissions pursuant to the
following formula:  one percent (1%) of the Company's revenue (less the Excluded
Revenue Base) for the entire second fiscal quarter ending June 30, 2001 (the
"Second Quarter"), multiplied by a fraction, the numerator of which is the
number of calendar days elapsed in the second quarter that Officer is employed
by the Company, and the denominator of which is the number of calendar days in
the Second Quarter.

          Prior to the end of fiscal year 2001, the foregoing commission
structure shall be reviewed by the Compensation Committee and the Board of
Directors of the Company with Officer to determine a revised commission
structure based on revenue targets and percentage commission break points
similar to the fiscal year 2001 commission structure for fiscal year 2002.

          Officer shall receive a recapturable draw from the Company in
accordance with the Company's normal payroll practices (including applicable
withholdings and the like), for each fiscal quarter with an appropriate
adjustment (upward or downward) on the last payroll in the month following the
close of the fiscal quarter for which the actual commissions were earned.  From
time to time, the Company shall make a good faith estimate of the recapturable
draw for each fiscal quarter and shall pay Officer the applicable pro-rata
amount for each normal pay period during each such fiscal quarter.

          (c)  Employee Benefits.  While Officer is an employee of the Company,
               -----------------
Officer will be eligible to participate in the Company's employee benefit plans
of general application, including without limitation, those plans covering
medical, disability and life insurance in accordance with the rules established
for individual participation in any such plan and under applicable law.  While
Officer is an employee of the Company, Officer will be eligible for vacation and
sick leave in accordance with the Company's policies in effect from time to time
and will receive such other benefits as the Company generally provides to its
other employees of comparable position and experience.

          (d)  Expense Reimbursement.  The Company will reimburse Officer for
               ---------------------
all reasonable and necessary expenses actually and properly incurred by Officer
in connection with Officer's duties under this Agreement provided that Officer
first furnish receipts, reports, statements and vouchers for all such expenses
to the Company and such expenses are incurred in accordance with the Company's
general policies, procedures and guidelines regarding such expenditures (as such
may be amended from time to time by the Company in its discretion).

     3.   Intentionally Omitted.

     4.   Termination of Employment.
          -------------------------

          (a)  Officer's employment and this Agreement may be terminated upon
the occurrence of any of the following events:

               (i)  The Company's reasonable determination in good faith that it
is terminating Officer for Cause (as defined in Section 5 below)("Termination
                                                                  -----------
for Cause");
---------

                                       2
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               (ii)   The Company's determination that it is terminating Officer
without Cause, which determination may be made by the Company at any time at the
Company's sole discretion, for any or no reason ("Termination Without Cause");
                                                  -------------------------

               (iii)  Officer's voluntary termination of his employment with the
Company ("Voluntary Termination"); or
          ---------------------

               (iv)   As a result of Officer's death or Disability (as defined
in Section 5 below).

          (b)  At-Will Employment.  The Company and Officer acknowledge that
               ------------------
Officer's employment is and will continue to be at-will, as defined under
applicable law, and that Officer's employment with the Company may be terminated
by either party at any time for any or no reason. Officer shall not be entitled
to any payments, benefits, damages, awards or compensation of any nature upon
termination of his employment with the Company.

     5.   Definitions.  For purposes of this Agreement, the following
          -----------
definitions will apply:

          (a)  "Cause" for Officer's termination will exist if the Company
                -----
terminates Officer's employment for any of the following reasons: (i) Officer's
willful failure substantially to perform his duties hereunder (other than any
such failure due to Officer's physical or mental illness), and such willful
failure is not remedied within 10 business days after written notice from the
Chief Executive Officer or President, which written notice shall state that
failure to remedy such conduct may result in Termination for Cause, (ii)
Officer's engaging in willful and serious misconduct that has caused or is
reasonably expected to result in material injury to the Company and its
affiliates, taken as a whole, (iii) Officer's conviction of or entering a plea
of guilty or nolo contendere to a crime that constitutes a felony, or (iv)
Officer's willful breach of any of his material obligations hereunder or under
any other written agreement or covenant with the Company or any of its
affiliates and such willful breach is not remedied within 10 business days after
written notice from the Chief Executive Officer, which written notice shall
state that failure to remedy such conduct may result in Termination for Cause.

          (b)  "Disability" shall mean that Officer has been unable to perform
                ----------
his duties hereunder as the result of his incapacity due to physical or mental
illness, and after its commencement such inability, which continues for at least
120 consecutive calendar days or 150 calendar days during any consecutive
twelve-month period, is determined to be total and permanent by a physician
selected by the Company and its insurers and acceptable to Officer or to
Officer's legal representative (with such agreement on acceptability not to be
unreasonably withheld).

          (c)  "Purchase Agreement" shall mean that certain Agreement and Plan
                ------------------
of Reorganization and Liquidation, dated May ____, 2001, between Trigon
Technology Group, Inc., a Texas corporation ("Seller") and the Company.

     6.   Confidentiality Agreement; Breach of Confidentiality Provisions.
          ---------------------------------------------------------------
Officer will sign, or has signed, a Confidential Information and Invention
Assignment Agreement (the "Confidentiality Agreement") substantially in the form
                           -------------------------
attached hereto as Exhibit A.  Officer hereby represents and warrants to the
                   ---------
Company that he has complied with all obligations under the Confidentiality
Agreement and agrees to continue to abide by the terms of the Confidentiality
Agreement and further agrees that the provisions of the Confidentiality
Agreement will survive

                                       3
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any termination of this Agreement or of Officer's employment relationship with
the Company. Officer acknowledges that upon breach of the confidentiality
provisions contained in this Section 6, the Company would sustain irreparable
harm from such breach, and, therefore, Officer agrees that in addition to any
other remedies which the Company may have under this Agreement, the
Confidentiality Agreement or otherwise, the Company will be entitled to obtain
equitable relief, including specific performance and injunctions, restraining
him from committing or continuing any such violation of this Agreement or the
Confidentiality Agreement.

     7.   Noncompetition and Nonsolicitation Covenants; Breach of Agreement.
          -----------------------------------------------------------------

          (a)  Noncompetition and Nonsolicitation Covenants.  In consideration
              --------------------------------------------
for the Company's entering into this Agreement and for the payment of any
benefits hereunder, Officer hereby agrees that he will not, during the Term, do
any of the following without the prior written consent of the Chief Executive
Officer:

               (i)    Compete.  Carry on any business or activity (whether
                      -------
directly or indirectly, as a partner, stockholder, principal, agent, director,
affiliate, employee or consultant) which is competitive with the business
conducted by the Company (as conducted now or during the Term), nor engage in
any other activities that conflict with Officer's obligations to the Company.

               (ii)   Solicit Business.  Solicit or influence or attempt to
                      ----------------
influence any client, customer or other person either directly or indirectly, to
direct his, her or its purchase of the Company's products and/or services to any
person, firm, corporation, institution or other entity in competition with the
business of the Company.

               (iii)  Solicit Personnel.  Solicit or influence or attempt to
                      -----------------
influence any person or entity employed or engaged as a consultant by the
Company to terminate or otherwise cease his, her or its employment or consulting
relationship with the Company or become an employee or consultant of any
competitor of the Company.  This Section 7(a)(iii) is to be read in conjunction
with Section 6 of the Confidentiality Agreement executed by Officer.

          (b)  Breach of Noncompetition and Nonsolicitation Provisions.  Officer
               -------------------------------------------------------
acknowledges that the Company's entering into this Agreement and committing to
make any payments required hereunder represents consideration for Officer's
agreement to abide by the restrictions set forth in Section 7(a).

     8.   Repurchase Option.  The Company or its assignees shall have the option
          -----------------
to repurchase all or a portion of the Shares (as defined below) on the terms and
conditions set forth in this Section (the "Repurchase Option") if Officer ceases
to be employed by the Company (as defined below) for Cause.

          (a)  Definition of "Employed by the Company"; "Termination Date".  For
               -----------------------------------------------------------
purposes of this Agreement, Officer will be considered to be "employed by the
Company" if the Board of Directors of the Company determines that Officer is
rendering substantial services to the Company or any parent, subsidiary or
affiliate of the Company.  In case of any dispute as to whether Officer is
employed by the Company, the Board of Directors of the Company shall have the
sole discretion to determine whether Officer has ceased to be employed by the
Company or any parent, subsidiary or affiliate of the Company and the effective
date on which Officer's employment terminated (the "Termination Date").

                                       4
<PAGE>

          (b)  Shares.  "Shares" shall mean (i) thirty-five percent (35%) of the
               ------
aggregate shares of common stock of the Company ("Company Common Stock") which
Officer is entitled to receive upon the consummation by Seller of all
distributions to Seller's shareholders required by the Purchase Agreement,
without reduction for any indemnification obligations under the Purchase
Agreement (the "Aggregate Potential Officer Distribution") for the first twelve
(12) months from the date of this Agreement, and (ii) twenty-five percent (25%)
of the Aggregate Potential Officer Distribution for the second twelve (12)
months from the date of this Agreement ("Year Two").  In determining the
aggregate shares of Company Common Stock to which Officer is so entitled to
receive, shares to be distributed directly to Officer and those to be deposited
into the Hold-Back Escrow (as defined in the Purchase Agreement) on his behalf
shall both be taken into consideration.  By way of example only, if, out of a
total of 4,500,000 shares of Company Common Stock payable by the Company to
Seller under the Purchase Agreement (of which, a certain percentage is required
to be deposited into the Hold-Back Escrow), 450,000 shares are to be distributed
by Seller to Officer and 450,000 shares are to be deposited into the Hold-Back
Escrow for the benefit of Officer, then the "Shares" would mean 450,000 shares
of Company Common Stock.  Notwithstanding any of the foregoing, the Repurchase
Option shall lapse as to one quarter of the Shares remaining subject to the
Repurchase Option at the beginning of Year Two after the close of each three (3)
fiscal month period during Year Two.  By way of example only, if, at the
beginning of Year Two, Officer has 1,000,000 Shares that remain subject to the
Repurchase Option, such Repurchase Option shall lapse on 250,000 Shares after
the close of each three (3) fiscal month period during Year Two.  The number of
Shares will be proportionately adjusted to reflect any applicable stock
dividend, stock split, reverse stock split or recapitalization of the common
stock of the Company.

          (c)  Exercise of Repurchase Option at Original Price.  If Officer
               -----------------------------------------------
shall cease to be employed by the Company as a result of a Termination for Cause
or a Voluntary Termination and the Termination Date shall occur prior to the
date which is the second year anniversary of the date hereof (the "Second
Anniversary"), then at any time within 90 days after the Termination Date, the
Company may elect to repurchase any or all of the Shares (the "Repurchase
Option") by giving Officer written notice of such election. The Company and/or
its assignee(s) will then have the option to repurchase from Officer (or
Officer's personal representative as the case may be) any or all of the Shares
at a purchase price per share equal to the Purchaser Share Value (as defined in
the Purchase Agreement), as adjusted to reflect any applicable stock dividend,
stock split, reverse stock split or recapitalization of the common stock of the
Company (the "Repurchase Option Price").

          (d)  Payment of the Repurchase Option Price.  The Repurchase Option
               --------------------------------------
Price will be payable, at the option of the Company or its assignee(s), by check
or by cancellation of all or a portion of any outstanding indebtedness owed by
Officer to the Company (or to such assignee) or by any combination thereof. The
Repurchase Option Price will be paid without interest within ninety (90) days
after the Company gives Officer written notice of the exercise of its Repurchase
Option.

          (e)  Right of Termination Unaffected.  Nothing in this Agreement will
               -------------------------------
be construed to limit or otherwise affect in any manner whatsoever the right or
power of the Company (or any parent, subsidiary or affiliate of the Company) to
terminate Officer's employment with the Company (or any parent, subsidiary or
affiliate of the Company) at any time for any reason or no reason, with or
without Cause.

                                       5
<PAGE>

          (f)  Escrow.  As security for Officer's faithful performance of this
               ------
Agreement, Officer agrees, immediately upon receipt of the stock certificate(s)
evidencing the Shares, to deliver such certificate(s), together with two (2)
copies of a blank Stock Power and Assignment Separate from Stock Certificate in
the form of Exhibit 1 attached hereto ("Stock Powers"), both executed by Officer
            ---------
and by Officer's spouse, if any (with date and number of Shares left blank), to
the Secretary of the Company or other designee of the Company (the "Escrow
Holder"), who is hereby appointed to hold such certificate(s) and Stock Powers
in escrow and to take all such actions and to effectuate all such transfers of
such Shares as are in accordance with the terms of this Agreement.  Escrow
Holder will act solely for the Company as its agent and not as a fiduciary.
Officer and Company agree that Escrow Holder will not be liable to any party to
this Agreement (or to any other party) for any actions or omissions unless
Escrow Holder is grossly negligent or intentionally fraudulent in carrying out
the duties of Escrow Holder under this Agreement.  Escrow Holder may rely upon
any letter, notice or other document executed with any signature purported to be
genuine and may rely on the advice of counsel and obey any order of any court
with respect to the transactions contemplated by this Agreement.  The Shares
will be released from escrow on the Second Anniversary to the extent the Company
has not previously exercised its Repurchase Option.

     9.   Conflicts.  Officer represents that his performance of all the terms
          ---------
of this Agreement will not breach any other agreement to which Officer is a
party.  Officer has not, and will not during the Term, enter into any oral or
written agreement in conflict with any of the provisions of this Agreement.
Officer further represents that he is entering into or has entered into an
employment relationship with the Company of his own free will and that he has
not been solicited as an employee in any way by the Company.

     10.  Release.  In consideration for the Company's entering into this
          -------
Agreement, Officer agrees that upon his termination of employment with the
Company, he will execute an agreement in a form acceptable to the Company
pursuant to which Officer will agree to release the Company and its officers,
agents and successors from claims related to or arising from Officer's
employment relationship with the Company that occurred through and including the
date of termination of employment.

     11.  Successors.  Any successor to the Company (whether direct or indirect
          ----------
and whether by purchase, lease, merger, consolidation, liquidation or otherwise)
or to all or substantially all of the Company's business and/or assets will
assume the obligations under this Agreement and agrees expressly to perform the
obligations under this Agreement in the same manner and to the same extent as
the Company would be required to perform such obligations in the absence of a
succession.  The terms of this Agreement and all of Officer's rights hereunder
will inure to the benefit of, and be enforceable by, Officer's personal or legal
representatives, executors, administrators, successors, heirs, distributees,
devisees and legatees.

     12.  Entire Agreement.  This Agreement, including any Exhibits hereto,
          ----------------
constitutes the sole agreement of the parties and supersedes all oral
negotiations and prior writings with respect to the subject matter hereof.

     13.  Miscellaneous Provisions.
          ------------------------

          (a)  Amendments and Waivers.  Any term of this Agreement may be
               ----------------------
amended or waived only with the written consent of the parties.

                                       6
<PAGE>

          (b)  Notices.  Any notice required or permitted by this Agreement will
               -------
be in writing and will be deemed sufficient upon receipt, when delivered
personally or by a nationally-recognized delivery service (such as Federal
Express or UPS), or 48 hours after being deposited in the U.S. mail as certified
or registered mail with postage prepaid, if such notice is addressed to the
party to be notified at such party's address as set forth below or as
subsequently modified by written notice.

          (c)  Choice of Law.  The validity, interpretation, construction and
               -------------
performance of this Agreement will be governed by the laws of the State of
California, without giving effect to the principles of conflict of laws.

          (d)  Severability.  If one or more provisions of this Agreement are
               ------------
held to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith. In the event that the parties cannot reach a
mutually agreeable and enforceable replacement for such provision, then (i) such
provision will be excluded from this Agreement, (ii) the balance of the
Agreement will be interpreted as if such provision were so excluded and (iii)
the balance of the Agreement will be enforceable in accordance with its terms.

          (e)  Counterparts.  This Agreement may be executed in counterparts,
               ------------
each of which will be deemed an original, but all of which together will
constitute one and the same instrument.

          (f)  Arbitration.  Any dispute or claim arising out of or in
               -----------
connection with this Agreement will be finally settled by binding arbitration in
Los Angeles County, California in accordance with the rules of the American
Arbitration Association by one arbitrator appointed in accordance with said
rules. The arbitrator will apply California law, without reference to rules of
conflicts of law or rules of statutory arbitration, to the resolution of any
dispute. Judgment on the award rendered by the arbitrator may be entered in any
court having jurisdiction thereof. Notwithstanding the foregoing, the parties
may apply to any court of competent jurisdiction for preliminary or interim
equitable relief, or to compel arbitration in accordance with this paragraph,
without breach of this arbitration provision. This Section 13(f) will not apply
to the Confidentiality Agreement.

          (g)  Advice of Counsel.  EACH PARTY TO THIS AGREEMENT ACKNOWLEDGES
               -----------------
THAT, IN EXECUTING THIS AGREEMENT, SUCH PARTY HAS HAD THE OPPORTUNITY TO SEEK
THE ADVICE OF INDEPENDENT LEGAL COUNSEL, AND HAS READ AND UNDERSTOOD ALL OF THE
TERMS AND PROVISIONS OF THIS AGREEMENT. THIS AGREEMENT WILL NOT BE CONSTRUED
AGAINST ANY PARTY BY REASON OF THE DRAFTING OR PREPARATION HEREOF.

                                       7
<PAGE>

     The parties have executed this Agreement the date first written above.

                                  VERTEL CORPORATION

                                  By:  /s/  Craig Scott
                                       -----------------------------------------
                                       Craig Scott, VP Finance & Administration
                                       and Chief Financial Officer

                                  Address:
                                            Vertel Corporation
                                            21300 Victory Boulevard
                                            Suite 700
                                            Woodland Hills, California  91367
                                            Attention: Chief Executive Officer
                                            Fax No.: (818) 598-0104

                                  With a copy to:
                                            David J. Katz, Esq.
                                            Perkins Coie LLP
                                            1620 26/th/ Street
                                            6/th/ Floor
                                            Santa Monica, California  90404
                                            Fax No.: (310) 788-3399

                                  Hai-Perng, aka Alex Kuo

                                  Signature: /s/  Hai-Perng Kuo
                                             -----------------------------------

                                  Address:  ____________________________________

                                            ____________________________________

                   [SIGNATURE PAGE TO EMPLOYMENT AGREEMENT]
<PAGE>

                                   EXHIBIT A
                                   ---------

                         CONFIDENTIAL INFORMATION AND

                        INVENTION ASSIGNMENT AGREEMENT
<PAGE>

                                   EXHIBIT 1
                                   ---------

                          STOCK POWER AND ASSIGNMENT

                        SEPARATE FROM STOCK CERTIFICATE
<PAGE>

                          STOCK POWER AND ASSIGNMENT
                           SEPARATE FROM CERTIFICATE

     FOR VALUE RECEIVED and pursuant to that certain Employment Agreement dated
as of _________________________ (the "Agreement"), the undersigned hereby sells,
assigns and transfers unto ______________________________, __________ shares of
the Common Stock of [__________________________], a California corporation (the
"Company"), standing in the undersigned's name on the books of the Company
represented by Certificate No(s). ____ delivered herewith, and does hereby
irrevocably constitute and appoint the Secretary of the Company as the
undersigned's attorney-in-fact, with full power of substitution, to transfer
said stock on the books of the Company.  THIS ASSIGNMENT MAY ONLY BE USED AS
AUTHORIZED BY THE AGREEMENT AND ANY EXHIBITS THERETO.

     Dated: _________________________

                                       Hai-Perng, aka Alex Kuo

                                       _________________________________________
                                       (Signature)

                                       _________________________________________
                                       (Please Print Name)

                                       _________________________________________
                                       (Spouse's Signature, if any)

                                       _________________________________________
                                       (Please Print Spouse's Name)

Instructions to Officer:  Please do not fill in any blanks other than the
-----------------------             ---
signature line.  The purpose of this Stock Power and Assignment is to enable the
Company and/or its assignee(s) to acquire the shares upon exercise of its
"Repurchase Option" set forth in the Agreement without requiring additional
signatures on the part of the Officer or Officer's Spouse, if any.
<PAGE>

                          STOCK POWER AND ASSIGNMENT

                           SEPARATE FROM CERTIFICATE

     FOR VALUE RECEIVED and pursuant to that certain Employment Agreement dated
as of _________________________ (the "Agreement"), the undersigned hereby sells,
assigns and transfers unto ______________________________, __________ shares of
the Common Stock of [__________________________], a California corporation (the
"Company"), standing in the undersigned's name on the books of the Company
represented by Certificate No(s). ____ delivered herewith, and does hereby
irrevocably constitute and appoint the Secretary of the Company as the
undersigned's attorney-in-fact, with full power of substitution, to transfer
said stock on the books of the Company.  THIS ASSIGNMENT MAY ONLY BE USED AS
AUTHORIZED BY THE AGREEMENT AND ANY EXHIBITS THERETO.

     Dated: _________________________

                                       Hai-Perng, aka Alex Kuo

                                       _________________________________________
                                       (Signature)

                                       _________________________________________
                                       (Please Print Name)

                                       _________________________________________
                                       (Spouse's Signature, if any)

                                       _________________________________________
                                       (Please Print Spouse's Name)

Instructions to Officer:  Please do not fill in any blanks other than the
-----------------------             ---
signature line.  The purpose of this Stock Power and Assignment is to enable the
Company and/or its assignee(s) to acquire the shares upon exercise of its
"Repurchase Option" set forth in the Agreement without requiring additional
signatures on the part of the Officer or Officer's Spouse, if any.
<PAGE>

                                   EXHIBIT 2
                                   ---------

                                SPOUSE CONSENT
<PAGE>

                                SPOUSE CONSENT
                                --------------

     The undersigned spouse of Hai-Perng, aka Alex Kuo (the "Officer") has read,
understands and hereby approves all the terms and conditions of the Employment
Agreement dated _________________________ (the "Agreement"), by and between
Officer and [__________________________], a California corporation (the
"Company"), which Agreement was entered into in connection with the sale of
substantially all of the assets (the "Asset Purchase") of Trigon Technology
Group, Inc., a Texas corporation, of which Officer is a Shareholder.

     In consideration of the Company consummating the Asset Purchase and
employing my spouse under the Agreement, I hereby agree to be irrevocably bound
by all the terms and conditions of the Agreement (including but not limited to
the Company's Repurchase Option) and further agree that any community property
interest I may have in the Shares will be similarly bound by the Agreement.

     I hereby appoint Officer as my attorney-in-fact, to act in my name, place
and stead with respect to any amendment of the Agreement.

     Dated: ______________________________

                                       _________________________________________
                                       Signature of Spouse [Sign Here]

                                       _________________________________________
                                       Name of Spouse [Please Print]

                                       [_] Check this box if you do not
                                           have a spouse.<PAGE>

                                                                   Exhibit 10.86

                       RETENTION AND SEVERANCE AGREEMENT

          This Retention and Severance Agreement ("Agreement") is dated as of
May 30, 2001, and is between Vertel Corporation (the "Company"), a California
corporation, and the undersigned officer of the Company ("Officer").

          Officer and the Company desire to set forth certain of the terms and
conditions governing Officer's employment by the Company following a Change of
Control (as defined below) and other circumstances.  Accordingly, Officer and
the Company hereby agree as follows:

          1.  Definitions.  For purposes of this Agreement, the following terms
shall have the meanings set forth below:

              (a) "Base Salary" shall mean Officer's commission compensation
earned pursuant to Section 3 of Officer's Employment Agreement with the Company
dated of even date herewith ("Officer's Employment Agreement"), for the last
full Company fiscal quarter immediately preceding the date upon which an event
occurs which triggers any severance obligations hereunder multiplied by four.
"Biweekly Base Salary" shall mean one-twenty-sixth (1/26) of the Base Salary at
the time in question.

              (b) "Company" shall mean Vertel Corporation, a California
corporation, and each of its successor enterprises that result from any merger,
consolidation, reorganization, sale of assets or otherwise.

              (c) A "Change of Control" shall have occurred if (i) any person,
corporation, partnership, trust, association, enterprise or group shall become
the beneficial owner, directly or indirectly, of outstanding capital stock of
the Company possessing at least 50% of the voting power of the outstanding
capital stock of the Company, (ii) there shall be a sale of all or substantially
all of the Company's assets or (iii) the Company shall merge or consolidate with
another corporation and the stockholders of the Company immediately prior to
such transaction do not own, immediately after such transaction, stock of the
purchasing or surviving corporation in the transaction (or of the parent
corporation of the purchasing or surviving corporation) possessing more than 50%
of the voting power of the outstanding capital stock of that corporation, which
ownership shall be measured without regard to any stock of the purchasing,
surviving or parent corporation owned by the stockholders of the Company before
the transaction.

              (d) "Control Change Covered Termination" shall mean the cessation
of the Officer's employment by the Company that occurs within one (1) year after
a Change of Control, other than as a result of a Termination for Cause or a
Voluntary Termination.

              (e) "Non-Control Change Covered Termination" shall mean the
cessation of Officer's employment at any time by the Company other than as a
result of a Termination for Cause and other than a Control Change Covered
Termination or a Voluntary Termination.
<PAGE>

          (f) "Termination for Cause" shall have that meaning set forth in
Officer's Employment Agreement.

          (g) "Expiration Date" shall mean the earlier of (i) the date on which
Officer ceases to be employed as an officer of the Company as a result of a
Termination for Cause; or (ii) the date that all obligations of the parties
hereunder have been satisfied.  The expiration of the terms of this Agreement
pursuant to the preceding sentence shall be effective for all purposes.

          (h) "Benefit Period" shall mean, (1) a period of one (1) year
commencing with the day next following the effectiveness of a Control Change
Covered Termination or Non-Control Change Covered Termination, as applicable, if
such termination occurs in the first six months of the Term of the Employment
Agreement, or (2) a period of six (6) months commencing with the day next
following the effectiveness of a Control Change Covered Termination or Non-
Control Change Covered Termination, as applicable, if such termination occurs
after the first six months of the Term of the Employment Agreement.

          (i) "Voluntary Termination" shall have that meaning set forth in
Officer's Employment Agreement.

      2.  Officer's Commitment Upon A Change of Control. Subject to Section 3,
if a Change of Control shall occur on or before the Expiration Date, Officer
agrees to remain in the employ of the Company for a period of 180 days from the
effectiveness of the Change of Control. Subject to the express provisions of
this Agreement, the Company shall have no obligation to retain or continue
Officer as an employee and Officer's employment status as an "at-will" employee
of Company is not affected by this Agreement.

      3.  Control Change Covered Termination. If a Control Change Covered
Termination shall occur on or before the Expiration Date:

          (a) During the Benefit Period, the Company shall pay to Officer, every
two weeks in accordance with Company's standard payroll practices, Officer's
Biweekly Base Salary immediately prior to the effective date of such Control
Change Covered Termination.  In the event that Officer dies during such Benefit
Period, Company agrees that it shall pay any payments remaining unpaid under
this Section 3 as a death benefit to Officer's estate on the same terms; and

          (b) The following modification shall apply to the vesting provisions
of all outstanding options to purchase the Company's Common Stock held by
Officer (the "Outstanding Options") as follows:  1) upon Officer completing one
year of service following a Change of Control, vesting of Outstanding Options
will accelerate by 12 months; and 2) should Officer's employment terminate
pursuant to a Control Change Covered Termination within 12 months following a
Change in Control, vesting of Officer's Outstanding Options will accelerate by
two years from the date of the Change in Control.  Should Officer's employment
voluntarily terminate within one (1) year following a Change in Control, vesting
of Outstanding Options will be subject to no additional acceleration beyond
those terms contained in the Officer's option agreement.  If Officer's
employment terminates by Voluntary Termination (as

                                      -2-
<PAGE>

defined in the Employment Agreement), then Officer will not be entitled to
receive any severance benefits and, if such Voluntary Termination occurs prior
to completing one year of service following a Change of Control, then Officer
will not be entitled to receive any acceleration of vesting of his Outstanding
Options.

      4.  Non-Control Change Covered Termination. If a Non-Control Change
Covered Termination shall occur on or before the Expiration Date, during the
Benefit Period, the Company shall pay to Officer, every two weeks in accordance
with Company's standard payroll practices, Officer's Biweekly Base Salary
immediately prior to the effective date of such Non-Control Change Covered
Termination. In the event that Officer dies during such Benefit Period, Company
agrees that it shall pay any payments remaining unpaid under this Section 3 as a
death benefit to Officer's estate on the same terms. If Officer's employment
terminates by Voluntary Termination, then Officer will not be entitled to
receive any severance benefits.

      5.  Withholding. The Company shall deduct from all payments paid to
Officer under this Agreement any required amounts for social security, federal
and state income tax withholding, federal or state unemployment insurance
contributions and state disability insurance or any other required taxes;
provided, however, that the Company shall reimburse and pay to Officer an amount
equal to any excise taxes required to be paid by Officer under Section 4999 of
the Internal Revenue Code of 1986, as amended on any amounts paid or benefits
provided to Officer hereunder.

      6.  Officer's Obligations. In exchange for the Company providing the
above-described benefits to Officer, Officer agrees to the following:

          (a) During the Benefit Period, Officer will not directly or indirectly
(a) engage in; (b) own or control any debt equity or other interest in (except
as a passive investor of less than 2% of the capital stock or publicly traded
notes or debentures of a publicly held company); or (c) (1) act as director,
officer, manager, employee, participant or consultant to or (2) be obligated to
or connected in any advisory business enterprise or ownership capacity with any
person whose business is competitive with that of the Company.

          (b) During the term of this Agreement, or if longer, the Benefit
Period, Officer will not, on behalf of any business enterprise other than the
Company and its subsidiaries, solicit the employment of any person that is or
was employed by the Company or any of its subsidiaries;

          (c) Within two weeks of the effective date of a Control Change Covered
Termination and prior to receiving any severance compensation from the Company
in respect of such Control Change Covered Termination, whether under this
Agreement or otherwise, Officer will execute and deliver to the Company a
Release and a Confidentiality Agreement, in the form provided to Officer by the
Company; and

          (d) In the event of any breach by Officer of the restrictions
contained in this Agreement, the Company shall have no further obligation to
compensate Officer hereunder and Officer acknowledges that the harm to Company
cannot be reasonably or adequately compensated in damages in any action at law.
Accordingly, Officer agrees that, upon any

                                      -3-
<PAGE>

violation of such restrictions, Company shall be entitled to preliminary and
permanent injunctive relief in addition to any other remedy under applicable
law, without the necessity of proving actual damages.

          7.  Assumption Agreement.  The Company will require any successor
(whether direct or indirect, by purchase, merger consolidation or otherwise) to
all or substantially all of the business and assets of the Company, expressly to
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it whether or not such
succession had taken place.

          8.  Miscellaneous.  This agreement shall be binding upon and inure to
the benefit of Company and Officer; provided that Officer shall not assign any
of Officer's rights or duties under this Agreement without the express prior
written consent of the Company.  This Agreement sets forth the parties' entire
agreement with regard to the subject matter hereof.  No other agreements,
representations or warranties have been made by either party to the other with
respect to the subject matter of this Agreement.  This Agreement may be amended
only by a written Agreement signed by both parties.  This Agreement shall be
governed by and construed in accordance with the laws of the State of
California.  Any waiver by either party of any breach of any provision of this
Agreement shall not operate as or be construed as a waiver of any subsequent
breach.  If any legal action is necessary to enforce the terms of this
Agreement, the prevailing party shall be entitled to reasonable attorney's fees
in addition to any other relief to which that party may be entitled.

          This agreement shall continue in effect until the Expiration Date
provided, however, that if on the Expiration Date monies are then owed by the
Company hereunder, then this Agreement shall continue in effect until the
Benefit Period shall have expired.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                      -4-
<PAGE>

          In witness thereof, the parties hereto have executed this Agreement,
as of the day and year first written above.

VERTEL CORPORATION                         "OFFICER"

By: /s/ Craig Scott                        By: /s/  Hai-Perng Kuo
    ---------------                           -------------------
Its: Chief Financial Officer                  Hai-Perng, aka Alex Kuo

             [SIGNATURE PAGE TO RETENTION AND SEVERANCE AGREEMENT]

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