Document:

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                                                                    EXHIBIT 10.2

                    INTELLECTUAL PROPERTY SECURITY AGREEMENT
                    [Communications & Power Industries, Inc.]

     This Intellectual Property Security Agreement (the "Agreement"), dated as
of December 15, 2000, is made by COMMUNICATIONS & POWER INDUSTRIES, INC., a
Delaware corporation (together with its successors and assigns, "Grantor"), in
favor of FOOTHILL CAPITAL CORPORATION, a California corporation, as agent for
the Lenders (in such capacity, "Agent" with respect to the following facts:

     A. Grantor has adopted certain trademarks and service marks, as identified
herein and in Schedule A annexed hereto and made a part hereof, and

     B. Grantor is the owner and holder of certain patents, patent applications,
inventions and trade secret information, as identified herein and in Schedule B
annexed hereto and made a part hereof.

     C. Grantor is the owner of the copyrights in certain works of authorship,
as described herein and in Schedule C annexed hereto and made a part hereof.

     D. Grantor, the Obligors named therein, Agent, and the Lenders named
therein have entered into that certain Loan and Security Agreement dated as of
December 15, 2000 (as from time to time amended, modified or supplemented in
accordance with its terms, the "Loan Agreement"). Capitalized terms, which are
used herein but not defined herein, shall have the meanings ascribed to them in
the Loan Agreement. Pursuant to the Loan Agreement the Lender Group has agreed
to extend credit to or for the account of Grantor in the form of a term loan and
revolving credit facility, and Grantor has granted to Agent, for the benefit of
the Lender Group, a security interest in substantially all of Grantor's assets
as security for all Obligations.

     E. To induce the Lender Group to enter into the Loan Agreement and to
accept all of the Loan Documents, and to make advances and otherwise extend
credit to Grantor thereunder, Grantor has agreed to secure the payment and
performance of the Obligations and to accomplish same by executing and
delivering to Agent (i) this Agreement, (ii) a Security Interest in Trademarks
and a Security Interest in Patents, (iii) a Power of Attorney, and (iv) any and
all other documents which Agent reasonably deems necessary to protect the Lender
Group's interests hereunder or with respect to the payment or performance of the
Obligations.

     F. This Agreement is the Intellectual Property Security Agreement as
defined and described in the Loan Agreement.

     NOW, THEREFORE, IT IS AGREED that, for and in consideration of the premises
set forth above, the terms and conditions contained herein, and other good and

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valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and as collateral security for the prompt payment in full when due
(whether at stated maturity, by acceleration or otherwise) of the Obligations,
Grantor hereby pledges and grants to Agent, for the benefit of the Lender Group,
a lien and security interest in all of Grantor's right, title and interest in
and to the following property and interests in property, whether now owned by
Grantor or hereafter acquired and whether now existing or hereafter coming into
existence (all being collectively referred to herein as "IP Collateral"):

          (a) all of Grantor's right, title and interest in and to trademarks,
trade names, trade styles, service marks, logos, emblems, prints and labels, all
elements of package or trade dress of goods, and all general intangibles of like
nature, now existing or hereafter adopted or acquired by Grantor, together with
the goodwill of Grantor's business connected with the use thereof and symbolized
thereby, and all applications, registrations and recordings thereof, including,
without limitation, applications, registrations and recordings in the United
States Patent and Trademark Office or in any similar office or agency of the
United States or in any office of the Secretary of State (or equivalent) of any
state thereof, or in any similar office or agency of any country or political
subdivision thereof throughout the world, whether now owned or hereafter
acquired by Grantor, including, but not limited to, those described in Schedule
A annexed hereto and made a part hereof, together with all extensions, renewals
and corrections thereof and all licenses or other contracts pertaining thereto
and all general intangibles relating thereto (all of the foregoing assets
encompassed by this subparagraph 1(a) being hereinafter collectively referred to
as the "Trademarks");

          (b) all of Grantor's right, title and interest in and to all
inventions and letters patent and applications therefor, and all registrations
and recordings thereof, including, without limitation, applications,
registrations and recordings in the United States Patent and Trademark Office or
in any similar office or agency of the United States or any state thereof, or in
any similar office or agency of any country or political subdivision thereof
throughout the world, whether now owned or hereafter acquired by Grantor,
including, but not limited to, those described in Schedule B annexed hereto and
made a part hereof, together with all re-examinations, reissues, continuations,
continuations-in-part, divisions, improvements and extensions thereof and all
licenses or other contracts pertaining thereto, all rights to file patent
applications, and all licenses of patent rights to Grantor now in effect or
entered into during the term of this Agreement and the rights to make, use and
sell, and all other rights with respect to, the inventions disclosed or claimed
therein, all inventions, designs, proprietary or technical information,
know-how, other data or information, software, databases, all embodiments or
fixations thereof and related documentation, all information having value in
connection with Grantor's business and all other trade secret rights not
described above, and the general intangibles relating to any of the foregoing
(all of the foregoing assets encompassed by this subparagraph 1(b) being
hereinafter collectively referred to as the "Patents");

          (c) all of Grantor's right, title and interest in and to copyrights
in works of authorship of any kind, and all applications, registrations and
recordings thereof in the Office of the United States Register of Copyrights,
Library of Congress, or in any similar office or

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agency of any country or political subdivision thereof throughout the world,
whether now owned or hereafter acquired by Grantor, including, but not limited
to, those described in Schedule C annexed hereto and made a part hereof,
together with all extensions, renewals, reversionary rights, and corrections
thereof and all licenses or other contracts or pertaining thereto, and all
general intangibles relating thereto (all of the foregoing assets encompassed by
this subparagraph 1(c) hereinafter collectively referred to as the
"Copyrights");

          (d) all of Grantor's customer lists and other records of Grantor
relating to the distribution of products bearing, constituting or incorporating
the Trademarks, Patents and Copyrights; and

          (e) any and all proceeds of the foregoing, including, without
limitation, the proceeds from any claims by Grantor against third parties for
past, present or future infringement of the Trademarks, Patents or Copyrights
and any royalties from licenses to third parties of the Trademarks, Patents or
Copyrights.

Notwithstanding any of the foregoing premises to the contrary, the grant of a
security interest as provided herein shall not extend to, and the term "IP
Collateral" shall not include, any property of Grantor (whether owned or held as
licensee or lessee, or otherwise), to the extent that (i) such property is not
assignable or capable of being encumbered as a matter of law or under the terms
of the license or other agreement applicable thereto (but solely to the extent
that any such restriction shall be enforceable under applicable law), without
the consent of the licensor thereof or other applicable party thereto and (ii)
such consent has not been obtained; provided, however, that the foregoing grant
of security interest shall extend to, and the term "IP Collateral" shall
include, any proceeds of any property which is otherwise excluded under phrase
(i) to the extent that assignment or encumbrance of such proceeds is not
restricted.

     1.   Grantor hereby represents, warrants, covenants and agrees as follows:

          (a) Grantor has the sole, full and clear title to the Trademarks for
the goods and services with which the Trademarks are used (except as provided in
paragraph 1(g) below and in Schedules A and A-1 attached hereto). Except for the
Trademarks set forth on Schedule A-1, the registrations of the Trademarks are
valid and subsisting and in full force and effect. Grantor has not granted a
license or otherwise agreed to allow any third party, other than its
Subsidiaries in the ordinary course of their business, to use any Trademark
(except as provided in Schedule A attached hereto). Grantor has used and will
continue to use for the duration of this Agreement standards of quality in the
manufacture of products sold under the Trademarks that are at least equal to
those standards in effect as of the date of this Agreement to the extent that
the failure to do so would cause a Material Adverse Change.

          (b) Grantor (either itself or through its licensees) will continue to
use the Trademarks on each and every trademark class of goods applicable to its
current lines of goods as reflected in its current catalogs, brochures and price
lists in order to maintain the Trademarks in full force and effect, in the
ordinary course of business, free from any claim of

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abandonment for nonuse, and Grantor will not (and will not permit any licensee
thereof to) do any act or knowingly omit to do any act whereby any Trademark may
become invalidated, provided, however, that Grantor may abandon any Trademark if
Grantor believes in its reasonable business judgment that such abandonment is in
the best interest of Grantor's business, provided, further, that (i) Grantor
gives Agent prompt written notice of Grantor's intent to abandon any Trademark
at least 30 days prior to abandonment, and (ii) such abandonment will not,
itself or in conjunction with any other event, materially decrease the value of
the IP Collateral. Grantor hereby informs Agent that Grantor may have heretofore
abandoned the Trademarks listed on Schedule A-1.

          (c) Grantor has the sole, full and clear title to the Patents shown on
Schedule B hereto and such patents are valid and subsisting and in full force
and effect and have not been adjudged or, to Grantor's knowledge, claimed
invalid or unenforceable in whole or in part (except as provided in paragraph
l(g) below and in Schedules B and B-1 attached hereto). Grantor has not granted
a license or otherwise agreed to allow any third party, other than its
Subsidiaries in the ordinary course of their business, to use any Patent (except
as provided in Schedule B attached hereto). Grantor (either itself or through
its licensees) shall mark products made and sold under the Patents in accordance
with the U.S. Patent Act and other applicable laws. Grantor shall diligently
prosecute any patent application now pending or acquired or made by it during
the term of this Agreement, shall make applications on unpatented but patentable
inventions, and shall preserve and maintain all rights of any kind in the
Patents, which, in each case, Grantor believes in its reasonable business
judgment are in the best business interests of Grantor. Grantor believes that
none of the Patents (other than those listed on Schedule B-1) has been abandoned
or dedicated and Grantor will not do any act, or omit to do any act, nor permit
any licensee thereof to do any act whereby any Patent may become abandoned or
dedicated and shall notify Foothill immediately if it knows or has reason to
believe that any material Patent may become abandoned or dedicated, provided,
however, that Grantor may abandon any Patent if Grantor believes in its
reasonable business judgment that such abandonment is in the best interest of
Grantor's business, provided, further, that (i) Grantor gives Agent prompt
written notice of Grantor's intent to abandon any Patent at least 30 days prior
to abandonment, and (ii) such abandonment will not, itself or in conjunction
with any other event, materially decrease the value of the IP Collateral.

          (d) Grantor (either itself or through its licensees) will place
appropriate notice of copyright on all copies embodying copyrighted works which
are publicly distributed and Grantor will not (and will not permit any licensee
thereof to) do any act or knowingly omit to do any act whereby any Copyright may
become invalidated or dedicated to the public domain.

          (e) Grantor will promptly perform all acts and execute all documents,
including, without limitation, grants of security in forms acceptable to Agent
and suitable for recording with (i) the United States Patent and Trademark
Office and the United States Register of Copyrights, and (ii) the appropriate
offices and agencies of foreign jurisdictions reasonably requested by Agent at
any time to evidence, perfect, maintain, record

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or enforce the Agent's interest, for the benefit of the Lender Group, in the IP
Collateral or otherwise in furtherance of the provisions of this Agreement.
Grantor hereby authorizes Agent to execute and file one or more financing
statements (and any similar documents) or copies thereof or of this Agreement
with respect to the IP Collateral signed only by Agent (with a copy sent to
Grantor).

          (f) In the event that Grantor, either itself or through any
subsidiary, affiliate, agent, employee, licensee or designee, shall file an
application for the issuance of any Patent or registration of any Trademark with
the United States Patent and Trademark Office, or any similar office of the
United States or in any office of the Secretary of State (or equivalent) of any
state thereof, or for the registration of any Copyright with the United States
Register of Copyrights, or for the registration of any Patent, Trademark or
Copyright in any similar office or agency of any country or political
subdivision thereof throughout the world, or shall obtain issuance of any Patent
or registration of any Trademark or Copyright previously applied for, or shall
adopt, acquire or obtain rights to any new trademark, patent application or work
for which a copyright application has been or is expected to be filed, or become
entitled to the benefit of any patent application or any patent or any part
thereof for reissue, re-examination, continuation, continuation-in-part,
division, improvement or extension, Grantor shall (i) inform Agent of any such
event or action in monthly reports which Grantor is required to deliver to Agent
pursuant to the Loan Agreement, and (ii) execute and deliver any and all
assignments, agreements, instruments, documents and papers as are necessary or
appropriate or as Agent may reasonably request to evidence Agent's interest, for
the benefit of the Lender Group, in such Trademark, Patent or Copyright and the
goodwill and general intangibles of Grantor relating thereto or represented
thereby. Grantor hereby constitutes Agent, or its agent, its attorney-in-fact to
execute and file all such writings for the foregoing purposes, all acts of such
attorney being hereby ratified and confirmed; such power being coupled with an
interest is irrevocable until the Obligations are paid in full. Grantor
authorizes the amendment of the schedules hereto to include any future
Trademark, Patent or Copyright registrations or applications which may be
acquired or made by Grantor.

          (g) Grantor has the authority, right and power to enter into this
Agreement and to perform its terms and to grant the security interest herein
granted, and has not entered and will not enter into any oral or written
agreements which would prevent Grantor from complying with the terms hereof,
provided, however, Grantor may enter into or maintain in effect such license
agreements (including, without limitation, those set forth on Schedules A, B and
C hereto) with respect to the IP Collateral as Grantor believes in its
reasonable business judgment are in the best interest of Grantor's business, so
long as any such license agreement permits the assignment thereof to Agent for
the benefit of the Lender Group. The IP Collateral is not, to Grantor's
knowledge, now, and at all times will not be, subject to any liens, charges,
mortgages, assignments, security interests, licenses, claims, shop rights,
covenants not to sue third persons, or encumbrances of any nature whatsoever,
except in favor of Agent for the benefit of the Lender Group; provided, however,
Grantor may enter into such license agreements with respect to the IP Collateral
as Grantor believes in its reasonable business judgment are in the best interest
of Grantor's business, so long as any such license agreement

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permits the assignment thereof to Agent for the benefit of the Lender Group. To
the best knowledge of Grantor, none of the IP Collateral is subject to any
claims of any other party, except as may be indicated on Schedules A, B and C to
this Agreement.

          (h) Except for Permitted Liens and to the extent that Agent and the
Lenders, upon prior written notice from Grantor, shall consent, Grantor will not
assign, sell, mortgage, lease, transfer, pledge, hypothecate, grant a security
interest in or lien upon, encumber, grant an exclusive license, or otherwise
dispose of any of the IP Collateral, and nothing in this Agreement shall be
deemed a consent by Agent or any Lender to any such action except as expressly
permitted herein.

          (i) As of the date hereof Grantor has no Trademarks, Patents or
Copyrights registered, or which are the subject of any pending application, in
the United States Patent and Trademark Office, or any similar office of the
United States or in any office of the Secretary of State (or equivalent) of any
state thereof, or the United States Register of Copyrights, or in any similar
office or agency of any country or political subdivision thereof throughout the
world, other than those identified in Schedules A, B and C hereto.

          (j) Grantor will take all commercially reasonable steps in any
proceeding before the United States Patent and Trademark Office, United States
Register of Copyrights or similar office or agency of the United States or any
office of the Secretary of State (or equivalent) of any state thereof, or in any
similar office or agency of any country or political subdivision thereof
throughout the world, to maintain each application and registration of the IP
Collateral, including, without limitation, filing of renewals, extensions,
affidavits of use and incontestability, and opposition, interference and
cancellation proceedings (except to the extent that dedication, abandonment or
invalidation is permitted under paragraphs 1(b) and 1(c) hereof). Grantor shall
notify Agent promptly in writing if any application or registration relating to
any IP Collateral may become abandoned or dedicated or subject to an adverse
final determination in any proceeding in the United States Patent and Trademark
Office or United States Register of Copyrights or in any similar office or
agency of any country or political subdivision thereof throughout the world or
in any court regarding Grantor's ownership of such Patent or Trademark, its
right to register same, or to keep or maintain the validity of same.

          (k) In the event that Grantor acquires actual knowledge that any
Trademark, Patent or Copyright is infringed, misappropriated or diluted by a
third party, Grantor shall promptly sue for infringement, misappropriation
and/or dilution and to obtain injunctive relief and recover damages therefor,
unless Grantor shall determine in its reasonable business judgment that such
suit is not in the best interest of Grantor's business, and Grantor shall take
such other actions reasonably required to protect such Trademark, Patent or
Copyright as Grantor shall deem appropriate in its reasonable business judgment
under the circumstances. Upon and during the continuance of an Event of Default,
Agent shall have the right, but in no way shall be obligated, to bring suit in
its own name to enforce the Trademarks, Patents and Copyrights and any licenses
thereunder, in which event Grantor shall,

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at the request of Agent, do any and all lawful acts requested by Agent and
execute any and all documents required by to aid such enforcement, and Grantor
shall, upon demand, promptly reimburse and indemnify Agent for all costs and
expenses incurred in such enforcement.

     2.   Upon and during the continuation of an Event of Default, the Required
Lenders (at their election but without notice of their election and without
demand) may, except to the extent otherwise expressly provided or required
below, authorize and instruct Agent to do any one or more of the following on
behalf of the Lender Group (and Agent, acting upon the instructions of the
Required Lenders, shall do the same on behalf of the Lender Group), all of which
are authorized by Grantor, in addition to all other rights and remedies provided
for in the Loan Documents, all such rights and remedies being cumulative, not
exclusive, and enforceable alternatively, successively or concurrently, without
(except as provided herein or in the other Loan Documents) notice to, or consent
by, Grantor:

          (a) Agent may (without assuming any obligations or liability
thereunder), at any time, enforce (and shall have the exclusive right to
enforce) against any licensee or sublicensee all rights and remedies of Grantor
in, to and under any one or more license agreements with respect to the IP
Collateral, and take or refrain from taking any action under any thereof, and
Grantor hereby releases each member of the Lender Group from, and agrees to hold
each member of the Lender Group free and harmless from and against any claims
arising out of, any action taken or omitted to be taken with respect to any such
license agreement;

          (b) Agent may, at any time and from time to time, upon ten (10) days'
prior notice to Grantor, assign, sell, or otherwise dispose of the IP Collateral
or any of it, either with or without special or other conditions or
stipulations, with power to buy the IP Collateral or any part of it, and do all
other acts and things for completing the assignment, sale or disposition which
Agent shall, in its sole discretion, deem appropriate or proper;

          (c) In addition to the foregoing, in order to implement the
assignment, sale, license or other disposal of any of the IP Collateral pursuant
to subparagraphs 2(a) and (b) hereof, Agent may, at any time and from time to
time, pursuant to the authority granted in the Power of Attorney described in
paragraph 3 hereof (such authority becoming effective upon an Event of Default),
execute and deliver on behalf of Grantor one or more instruments of assignment,
sale, license or other disposition of the IP Collateral. Grantor agrees to pay
when due all reasonable costs incurred in any such transfer of the IP
Collateral, including any taxes, fees and reasonable attorneys' fees, and all
such costs shall be added to the Obligations. Agent may apply the proceeds
actually received from any such license, assignment, sale or other disposition
in accordance with paragraph (d) of this Section 2; and Grantor shall remain
liable and will pay Agent on demand any deficiency remaining, together with
interest thereon at a rate equal to the rate then payable on the Obligations and
the balance of any expenses unpaid. Nothing herein contained shall be construed
as requiring Agent to take any such action at any time; and

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          (d) Except as otherwise herein expressly provided, the proceeds of any
collection, sale or other realization of all or any part of the IP Collateral
pursuant hereto, shall be applied to the Obligations in such order as Agent
shall determine consistent with Section 2.4(b) of the Loan Agreement until the
Obligations shall have been paid in full in cash.

     3. Concurrently with the execution and delivery hereof, Grantor is
executing and delivering to Agent, in the form of Exhibit A hereto,
respectively, three originals of a Power of Attorney for the implementation of
any assignment, sale or other disposition of the Trademarks, Patents or
Copyrights or any of them pursuant to paragraphs 2(a), (b) and (c) hereof.

     4. No provision hereof shall be modified, altered or limited except by a
written instrument expressly referring to this Agreement and executed by the
party to be charged. The execution and delivery of this Agreement has been
properly authorized by the board of directors of Grantor and by any necessary
vote or consent of stockholders thereof. This Agreement shall be binding upon
the successors, permitted assigns or other legal representatives of Grantor, and
shall inure to the benefit of the Lender Group, their successors, permitted
assigns or other legal representatives. This Agreement, the Obligations and the
IP Collateral shall be governed in all respects by the laws of the United States
and the laws of the State of New York. If any term of this Agreement shall be
held to be invalid, illegal or unenforceable, the validity of all other terms
hereof shall in no way be affected thereby. In the event of any inconsistency
between the terms of this Agreement and the terms of the Loan Agreement, the
terms of the Loan Agreement shall control.

     5. This Agreement shall continue to be effective and shall be reinstated in
the event that at any time after the Obligations have been paid in full, any
payment of the Obligations is rescinded or must otherwise be restored or
returned by any of the Lender Group.

     6. Upon payment in full in cash and performance by Grantor of all of the
Obligations (other than indemnification obligations for which no claim has been
made) and upon the termination of the Loan Agreement, this Agreement shall
terminate and Agent shall execute, file and record in each office in which any
financing statement or assignment relative to the IP Collateral, or any part
thereof, shall have been filed, a termination statement, assignment or other
appropriate instrument releasing its interest therein, all without recourse to
or warranty by any of the Lender Group and at the sole cost and expense of
Grantor.

     7. This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument and any of the
parties hereto may execute this Agreement by signing any such counterpart.

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     IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly
executed and delivered on the day and year first above written.

COMMUNICATIONS & POWER INDUSTRIES, INC.

By:
   -------------------------------------

Name:
     -----------------------------------

Title:
      ----------------------------------

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                                   SCHEDULE A
                                   TRADEMARKS

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                                  SCHEDULE A-1
                              ABANDONED TRADEMARKS

<PAGE>   12

                                   SCHEDULE B
                                     PATENTS

<PAGE>   13

                                  SCHEDULE B-1
                                ABANDONED PATENTS

<PAGE>   14

                                   SCHEDULE C
                                   COPYRIGHTS

                                     [None]

<PAGE>   15

                                    EXHIBIT A

                                POWER OF ATTORNEY

     Pursuant to the terms of that certain Loan and Security Agreement (the
"Loan Agreement") among the Company, Agent (as defined below), the Lenders named
therein, and the other Obligors named therein and that certain Intellectual
Property Security Agreement by the undersigned (the "Company") in favor of
Agent, both of even date herewith, as each may be amended, restated, modified or
supplemented and in effect from time to time, the Company hereby grants to
Foothill Capital Corporation, a California corporation, as agent for the Lenders
(in such capacity, "Agent") a power of attorney, for use solely upon the
occurrence and during the continuation of an Event of Default (as defined in the
Loan Agreement):

        (i)     to offer to sell, to sell, to assign, to license, or to
                otherwise transfer (collectively, "transfer") any or all of the
                Company's right, title and interest around the world in and to
                the trademarks listed on SCHEDULE A attached hereto, including
                the registrations and applications to register such trademarks
                and all goodwill associated with such trademarks;

        (ii)    to offer to sell, to sell, to assign, to license, or to
                otherwise transfer (collectively, "transfer") any or all of the
                Company's right, title and interest around the world in and to
                the patents listed on SCHEDULE B attached hereto, including the
                registrations and applications to register such patents and all
                goodwill associated with such patents;

        (iii)   to offer to sell, to sell, to assign, to license, or to
                otherwise transfer (collectively, "transfer") any or all of the
                Company's right, title and interest around the world in and to
                the copyrights listed on SCHEDULE C attached hereto, including
                the registrations and applications to register such copyrights;

        (iv)    to execute all documents on its behalf and do all acts necessary
                or desirable to effect the above stated transfers of right, as
                if Agent were the Company at all appropriate times;

        (v)     to receive and retain consideration, including money, in
                connection with and in payment for any such transfer.

        (vi)    to endorse Company's name on all applications, documents, papers
                and instruments necessary for Agent in the use or maintenance of
                the IP Collateral.

        (vii)   to ask for, demand, collect, sue for, recover, compound, receive
                and give acquittance and receipts for moneys due and to become
                due under or in respect of any of the IP Collateral;

        (viii)  to receive, endorse and collect any drafts or other instruments,
                documents and chattel paper in connection with clause (vii)
                above;

<PAGE>   16

        (ix)    to file any claims or take any action or institute any
                proceedings that Agent may deem necessary or desirable for the
                collection of any of the IP Collateral or otherwise to enforce
                the rights of Agent with respect to any of the IP Collateral;
                and

        (x)     to pay or discharge taxes or Liens (other than Liens permitted
                under the Intellectual Property Security Agreement or the Loan
                Agreement) levied or placed upon or threatened against the IP
                Collateral, the legality or validity thereof and the amounts
                necessary to discharge the same to be determined by the Agent to
                become Obligations of the Company to Agent, due and payable
                immediately without demand; provided, however, that unless an
                Event of Default shall have occurred and be continuing, Agent
                may not pay or discharge any such tax or lien which is being
                contested in good faith by appropriate proceedings promptly
                instituted and diligently conducted and for which such reserve
                or other appropriate provision, if any, as shall be required in
                conformity with GAAP shall have been made.

     All transfers and such acts as described above are hereby ratified and
confirmed by the Company.

     This Power of Attorney is coupled with an interest and is irrevocable
except with the consent of Foothill.

     Capitalized terms, which are used herein but not defined herein, shall have
the meanings ascribed to them in the Loan Agreement and the Intellectual
Property Security Agreement.

            [The remainder of this page is intentionally left blank.]

<PAGE>   17

Dated December   , 2000.
               --

COMMUNICATIONS & POWER INDUSTRIES, INC.

By:
   -------------------------------------

Name:
     -----------------------------------

Title:
      ----------------------------------

SUBSCRIBED AND SWORN TO
before me this    day of December, 2000.
               --

----------------------------------------
Notary Public [Seal]<PAGE>   1

                                                                    EXHIBIT 10.3

                       STOCK PLEDGE AND SECURITY AGREEMENT
                    [Communications & Power Industries, Inc.]

     This Stock Pledge and Security Agreement (this "Pledge Agreement") is
executed and delivered as of the 15th day of December, 2000, by the party set
forth on the signature page hereof ("Pledgor"), to and in favor of FOOTHILL
CAPITAL CORPORATION, a California corporation, as Agent for itself and the other
Lenders ("Agent"), with respect to the following facts:

     A.   Pledgor, Agent, the Lenders named therein, and other Obligors named
therein, have entered into that certain Loan and Security Agreement, dated as of
December 15, 2000 (the same as it may be amended, restated, modified, and
supplemented, and in effect from time to time, the "Loan Agreement"), and
certain other Loan Documents, pursuant to which Loan Documents the Lender Group
has agreed to extend credit to or for the account of Pledgor.

     B.   In order to induce the Lender Group to enter into the Loan Agreement
and to accept all of the Loan Documents, and to make advances and otherwise
extend credit to Borrower thereunder, Pledgor has agreed to secure the payment
and performance of the Obligations and to accomplish same by (i) executing and
delivering to Agent this Pledge Agreement for the benefit of the Lender Group,
(ii) delivering to Agent the Pledged Securities owned by Pledgor (hereinafter
defined), together with appropriate powers and/or endorsements duly executed in
blank by Pledgor, and (iii) delivering to Agent any and all other documents
which Agent deems necessary to protect Agent's interests hereunder or with
respect to the Obligations.

     C.   This Pledge Agreement is one of the Stock Pledge Agreements as defined
and described in the Loan Agreement. Capitalized terms, which are used herein
but not defined herein, shall have the meanings ascribed to them in the Loan
Agreement.

     NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, receipt of which is hereby acknowledged, Pledgor hereby
agrees as follows:

     1.   Definitions.

          (a)  "Issuer" shall mean and include each of the corporations
identified in Exhibit "A" hereto, which is incorporated herein by this
reference, individually and collectively.

          (b)  "Pledge Agreement" shall mean and include this Pledge and
Security Agreement, as amended, modified or supplemented from time to time.

          (c)  "Pledged Property" shall mean and include (i) the Pledged
Securities, the certificates or other instruments representing the Pledged
Securities, any interest of Pledgor in the entries on the books of any financial
intermediary pertaining to the Pledged Shares, together with all cash dividends,
stock dividends, interest, profits, redemptions, warrants, subscription rights,

<PAGE>   2

stock, securities, options, substitutions, exchanges and other distributions now
or hereafter paid, delivered or distributed by Issuer or which may hereafter be
acquired by or delivered with respect to or in exchange for the Pledged
Property, (ii) Pledgor's records with respect to the foregoing and (iii) all
proceeds of all of the foregoing, regardless of form.

          (d)  "Pledged Securities" shall mean the shares of stock described in
Exhibit "A".

          (e)  All other terms hereinbefore or hereinafter defined in this
Pledge Agreement shall have the meanings herein assigned to such terms.

          (f)  All terms not specifically defined herein which are defined in
the New York Uniform Commercial Code shall be construed in accordance with the
definitions set forth therein. All references herein to the "UCC" shall mean the
Uniform Commercial Code adopted by the New York as in effect from time to time.

     2.   Grant of Security Interest

               As collateral security for the prompt and unconditional payment
and performance when due of each and every one of the Obligations, Pledgor
hereby assigns, mortgages, pledges, hypothecates, transfers, sets over and
grants to Agent, for the benefit of the Lender Group, a security interest in and
lien upon all of the Pledged Property.

        3.     Representations, Warranties, Covenants and Waivers

               Pledgor hereby covenants, represents and warrants with and to
Agent that (all of such covenants, representations and warranties being
continuing in nature so long as any of the Obligations are outstanding):

          (a)  The Pledged Securities of Pledgor are duly authorized, validly
issued, fully paid and nonassessable securities of each Issuer; and are not
registered, nor has Pledgor or Issuer authorized the registration thereof, in
the name of any person or entity other than such Pledgor or Agent; and, except
as otherwise shown in Exhibit "A" hereto, constitute all issued and outstanding
shares of such Issuer.

          (b)  The Pledged Property of Pledgor is directly, legally and
beneficially owned by Pledgor free and clear of all claims, liens, pledges and
encumbrances of any kind, nature or description except for the first and prior
pledge and security interest with respect thereto in favor of Agent and
restrictions under applicable securities law.

          (c)  The Pledged Property is not subject to any restrictions relative
to the pledge or transfer thereof, except as noted on the certificates
evidencing the Pledged Securities, and Pledgor has the right to transfer and
hypothecate the Pledged Property of Pledgor free and clear

                                      -2-
<PAGE>   3

of any liens, encumbrances or restrictions except as otherwise provided herein
and restrictions under applicable securities law.

          (d)  The Pledged Property is duly and validly pledged to Agent and no
consent or approval of any governmental or regulatory authority or of any
securities exchange or the like, nor any consent or approval of any other third
party, was or is necessary to the validity and enforceability of this Pledge
Agreement.

          (e) Pledgor authorizes Agent to (i) control the Pledged Property, (ii)
perform any and all other acts which Agent in good faith deems reasonable and/or
necessary for the protection and preservation of the Pledged Property or its
value or Agent's security interest therein, including, without limitation, but
only upon and during the continuation of an Event of Default, transferring,
registering or arranging for the transfer or registration of the Pledged
Property to or in Agent's own name and receiving the income therefrom as
additional collateral for the Obligations and (iii) pay any charges or expenses
which Agent deems necessary for the foregoing purposes, but without any
obligation to do so. Any obligation of Agent for reasonable care for the Pledged
Property in Agent's possession shall be limited to the same degree of care
required by Section 9207 of the UCC (or any comparable successor statute).

          (f) Pledgor will not exercise any right under any Pledged Property
which might constitute the exercise of such control by Agent so as to make the
Issuer of such Pledged Property an Affiliate of Agent until after occurrence of
and during the continuation of an Event of Default.

          (g) Pledgor will pay all charges and assessments of any nature against
the Pledged Property or with respect hereto prior to said charges and/or
assessments being delinquent.

          (h) Pledgor shall promptly reimburse Agent on demand, together with
interest at the rate provided in the Loan Documents, for any charges,
assessments, fees, and reasonable and documented out-of-pocket costs or expenses
paid or incurred by Agent in its Permitted Discretion for the protection,
preservation and maintenance of the Pledged Property and the enforcement of
Agent's rights hereunder, including, without limitation, reasonable and
documented out-of-pocket costs, attorneys fees and other expenses incurred by
Agent in seeking to protect, collect or enforce its rights in the Pledged
Property or otherwise hereunder.

          (i) Pledgor shall furnish Agent with such information concerning
Issuer and the Pledged Property as Agent may from time to time request,
including, without limitation, current financial statements.

          (j) During the term of this Pledge Agreement, if Pledgor shall
receive, have registered in its name or become entitled to receive or acquire or
have registered in its name any stock certificate, option or warrant with
respect to the securities of Issuer (including, without limitation, any
certificate representing a dividend on or a distribution or exchange of or in
connection with any reclassification of the Pledged Securities) whether as an
addition to, in substitution of, or in exchange for any of the Pledged Property
or otherwise, Pledgor agrees to accept same as Agent's agent, to hold same in
trust for Agent and to deliver same forthwith to

                                      -3-
<PAGE>   4

Agent or Agent's agent or bailee in the form received, with the endorsement(s)
of Pledgor where necessary or duly executed appropriate powers and/or
assignments, to be held by Agent or Agent's agent or bailee If any of the
foregoing is at any time in uncertificated form, Pledgor shall register same
with Agent's security interest noted therein, as further security for the
Obligations, and take such other actions as are necessary to create a valid and
perfected first priority security interest in favor of Agent in the Pledged
Securities or other Pledged Property.

          (k) During the term of this Pledge Agreement, Pledgor shall not
directly or indirectly sell, assign, transfer, or otherwise dispose of, or grant
any option with respect to the Pledged Property, nor shall Pledgor create, incur
or permit any further pledge, hypothecation, encumbrance, lien, mortgage or
security interest with respect to the Pledged Property except as permitted by
the Loan Agreement.

          (l) So long as no Event of Default has occurred and is continuing,
Pledgor: (i) shall have the right to vote and exercise all corporate rights with
respect to its Pledged Securities; and (ii) shall have the right to receive and
collect all dividends and distributions (other than of additional securities of
the Issuer, or any options or warrants with respect to the securities of the
Issuer) with respect to the Pledged Securities.

          (m) Agent may notify each Issuer or the appropriate transfer agent of
the Pledged Securities to register the security interest and pledge granted
herein in the name of Agent and honor the rights of Agent with respect to the
Pledged Securities and other Pledged Property.

          (n) Pledgor shall perform such further acts and execute such
additional instruments as are reasonably required by Agent to effectuate and
implement this Pledge Agreement and the provisions hereof.

          (o) No action has been taken or is being taken by or is currently
planned by Pledgor, or any agent acting on its behalf, which would cause this
Pledge Agreement, the Obligations or the Loan Documents to violate any
regulation of the Securities Exchange Act of 1934 or any other applicable law or
regulation, in each case as now in effect or as the same may hereafter be
amended or supplemented. Pledgor is not in the business of extending credit for
the purpose of purchasing or carrying margin stocks or other securities. The
Pledged Property does not compose margin stock.

               (p) Pledgor waives (i) all rights to require Agent to proceed
against any other person, entity or collateral or to exercise any remedy, or
(ii) the defense of the statute of limitations in any action upon any of the
Obligations or other collateral. Agent is entitled to all of the benefits of a
secured party set forth in Section 9207 of the UCC (or any comparable successor
statute).

     4.   Remedies After Event of Default

                                      -4-
<PAGE>   5

          Upon the occurrence and during the continuation of an Event of Default
and subject to any restrictions set forth in the Loan Documents:

          (a) Agent, at its option, shall be empowered to exercise its right to
instruct each Issuer of the Pledged Securities (or the appropriate transfer
agent of the Pledged Securities) to register any or all of the Pledged
Securities and/or other Pledged Property in the name of Agent or in the name of
Agent's nominee, and Agent may complete, in any manner Agent may deem expedient,
any and all stock powers, assignments or other documents heretofore or hereafter
executed in blank by Pledgor and delivered to Agent. After said instruction, and
without further notice, Agent in its sole and absolute discretion, shall have
the exclusive right to exercise all voting and corporate rights with respect to
the Pledged Securities and other Pledged Property and exercise any and all
rights of conversion, redemption, exchange, subscription or any other rights,
privileges, or options pertaining to any shares of the Pledged Securities or the
other Pledged Property as if Agent were the absolute owner thereof, including,
without limitation, the right to exchange, in its discretion, any and all of the
Pledged Securities and other Pledged Property upon any merger, consolidation,
reorganization, recapitalization or other readjustment with respect to Issuer.
Upon the exercise of any such rights, privileges or options by Agent, Agent
shall have the right to deposit and deliver any and all of the Pledged
Securities and other pledged property to any committee, depository, transfer
agent, registrar or other designated agency upon such terms and conditions as
Agent may determine, all without liability to Pledgor, except to account for
property actually received by Agent. However, Agent shall have no duty to
exercise any of the aforesaid rights, privileges or options (all of which are
exercisable in the sole discretion of Agent) and shall not be responsible for
any failure to do so or delay in doing so.

          (b) In addition to all the rights and remedies of a secured party
under the UCC, Agent shall have the right, at any time and without demand of
performance or other demand, advertisement or notice of any kind (except the
notice specified below of time and place of public or private sale) to or upon
Pledgor or any other Person, to proceed forthwith to collect, redeem, receive,
appropriate, sell, or otherwise dispose of and deliver the Pledged Property or
any part thereof in one or more lots at public or private sale or sales at any
exchange, brokers board or at any of Agent's offices or elsewhere at such prices
and on such terms as Agent may deem commercially reasonable. The foregoing
disposition(s) may be for cash or on credit or for future delivery without
assumption of any credit risk by Agent. The proceeds of any such collection,
redemption, recovery, receipt, appropriation, realization, sale or other
disposition, after deducting all costs and expenses of every kind incurred
relative thereto or incidental to the care, safekeeping, maintenance, or
disposition of any and all Pledged Property or in any way relating to the rights
of Agent hereunder (including, without limitation, reasonable and documented
out-of-pocket attorneys' fees and legal expenses) shall be applied first to the
satisfaction of the Obligations (in such order as Agent may elect and whether or
not due) and then to the payment of any amounts required by applicable law,
including Section 9504(l)(c) of the UCC. Pledgor shall be liable to Agent for
the payment on demand of all such reasonable and documented out-of-pocket costs
and expenses of any such sale, collection or other realizations, together with
interest at the rate set forth in the Loan Documents, together with any
reasonable attorneys' fees if placed with an attorney for collection or
enforcement. Pledgor agrees that notice given to it in the same manner

                                      -5-
<PAGE>   6

given to Pledgor pursuant to Section 12 of the Loan Agreement is reasonable
notification of such matters.

          (c) To the fullest extent permitted by law, Agent or any Lender may be
the purchaser of any or all of the Pledged Collateral at any such sale and
Agent, as agent for and representative of the Lenders (but not any Lender or
Lenders in its or their respective individual capacities unless Required Lenders
shall otherwise agree in writing), shall be entitled, for the purpose of bidding
and making settlement or payment of the purchase price for all or any portion of
the Pledged Property sold at any such public sale, to use and apply any of the
Obligations as a credit on account of the purchase price for any Pledged
Property payable by Agent at such sale. Each purchaser at any such sale shall
hold the property sold absolutely free from any claim or right on the part of
Pledgor, and Pledgor hereby waives (to the extent permitted by applicable law)
all rights of redemption, stay and/or appraisal which it now has or may at any
time in the future have under any rule of law or statute now existing or
hereafter enacted. Pledgor agrees that, to the extent notice of sale shall be
required by law at least ten days' notice to Pledgor of the time and place of
any public sale or the time after which any private sale is to be made shall
constitute reasonable notification. Agent shall not be obligated to make any
sale of Pledged Property regardless of notice of sale having been given. Agent
may adjourn any public or private sale from time to time by announcement at the
time and place fixed therefor, and such sale may, without further notice, be
made at the time and place to which it was adjourned. To the fullest extent
permitted by law, Pledgor hereby waives any claims against Agent or any other
member of the Lender Group arising by reason of the fact that the price at which
any Pledged Property may have been sold at such a private sale was less than the
price which might have been obtained at a public sale, even if Agent accepts the
first offer received and does not offer such Pledged Property to more than one
offeree. If the proceeds of any sale or other disposition of the Pledged
Property are insufficient to pay all the Obligations, Pledgor shall be liable
for the deficiency and the fees of any attorneys employed by Agent to collect
such deficiency.

          (d) Pledgor recognizes that Agent may be unable to effect a public
sale of all or part of the Pledged Property by reason of certain prohibitions
contained in the Securities Act of 1933, as amended, as now or hereafter in
effect; or contained in applicable Blue Sky or other state securities law, as
now or hereafter in effect, but may be compelled to resort to one or more
private sales to a restricted group of purchasers who will be obliged to agree,
among other things, to acquire Pledged Property for their own account for
investment and not with a view to the further distribution or resale thereof. If
at the time of any sale of the Pledged Property or any part thereof, the same
shall not, for any reason whatsoever, be effectively registered (if required)
under the Securities Act of 1933 (or other applicable federal or state
securities law), as then in effect, Agent in its sole and absolute discretion is
authorized to sell the Pledged Property or any part thereof by private sale in
such matter and under such circumstances as Agent or its counsel may deem
necessary or advisable in order that such sale may legally be effected without
registration under applicable securities laws. Pledgor acknowledges that private
sales so made may be at prices and other terms less favorable to the seller than
if the Pledged Property were sold at public sale, and that Agent has no
obligation to delay the sale of any such Pledged Property for the period of time
necessary to permit the Issuer of such Pledged Property, even if such Issuer
would agree,

                                      -6-
<PAGE>   7

to register such Pledged Property for public sale under such applicable
securities laws. Pledgor agrees that any private sales made under the foregoing
circumstances shall not be deemed to have been in a commercially unreasonable
manner for the sole reason that it is a private sale.

          (e) Pledgor hereby agrees that if at any time all or any part of any
payment theretofore paid by Pledgor and applied by Agent to any of the
Obligations is returned by Agent for any reason whatsoever (including, without
limitation, the insolvency, bankruptcy, reorganization or assignment for the
benefit of creditors of Pledgor), such Obligations, for the purpose of this
Agreement, to the extent that such payment is returned, shall be deemed to have
continued in existence, notwithstanding such application by Agent, and this
Agreement shall continue to be effective or be reinstated, as the case may be,
as to such Obligations, all as though such application by Agent had not been
made.

          (f) All of Lender Group's rights and remedies, including but not
limited to those arising under this Pledge Agreement, the other Loan Documents,
the instruments and securities comprising the Pledged Property, applicable law
or otherwise, shall be cumulative and not exclusive and shall be enforceable
alternatively, successively or concurrently as Agent may deem expedient. No
failure or delay on the part of Agent in exercising any of its options, powers
or rights or partial or single exercise thereof shall constitute a waiver of
such option, power or right.

     5.   Further Assurances

          Pledgor agrees that at any time and from time to time upon the request
of Agent, to execute and deliver such further documents, including but not
limited to irrevocable proxies or stock powers, in form satisfactory to counsel
for Agent, and will take or cause to be taken such further acts as Agent may
request in order to effect the purposes of this Pledge Agreement and perfect or
continue the perfection of the security interest in the Pledged Property granted
to Agent hereunder.

     6.   Miscellaneous

          (a) Beyond the exercise of reasonable care to assure the safe custody
of the Pledged Property while held by Agent hereunder, as provided in Section
3(e) hereof, neither Agent, nor agent or bailee, nor any other member of the
Lender Group shall have no duty or liability to protect or preserve any rights
pertaining thereto. Agent shall be obligated to return or release its security
interest in the Pledged Property, at the sole expense of Pledgor, after all
Obligations are indefeasibly paid and performed in full in cash and neither
Agent nor any other member of the Lender Group is under any further obligation
to extend credit under the Loan Agreement.

          (b) No course of dealing between Pledgor and Agent, nor any failure or
delay by Agent or any other member of the Lender Group to exercise any right,
power or privilege under this Pledge Agreement, the other Loan Documents or
under any other agreements,

                                      -7-
<PAGE>   8

instruments and documents executed and delivered in connection therewith shall
operate as a waiver hereof or thereof; nor shall any single or partial exercise
of any right, power or privilege hereunder or thereunder preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
No waiver of any provision of this Pledge Agreement shall be effective unless
the same shall be in writing and signed by Agent, and then such waiver shall be
effective only in the specific instance and for the purpose for which given.

          (c) This Pledge Agreement may not be changed, modified or amended, in
whole or in part, except by a writing signed by Pledgor and Agent.

          (d) The provisions of this Pledge Agreement and the Loan Documents are
severable, and if any clause or provision hereof or thereof shall be held
invalid or unenforceable in whole or in part in any jurisdiction, then such
invalidity or unenforceability shall attach only to such clause or provision or
part hereof in any such jurisdiction and shall not in any manner affect any
other clause or provision in this Pledge Agreement or the Loan Documents in any
jurisdiction or such clause or provision in any other jurisdiction. In the event
of any inconsistency between the terms of this Pledge Agreement and the terms of
the Loan Agreement, the terms of the Loan Agreement shall control.

          (e) This Pledge Agreement shall inure to the benefit of each member of
the Lender Group and their respective successors and assigns and shall be
binding upon Pledgor and its successors and assigns until all of the Obligations
have been indefeasibly paid and performed in full in cash.

          (f) Pledgor agrees to indemnify Agent from and against any and all
claims, losses and liabilities in any way relating to, growing out of or
resulting from this Agreement and the transactions contemplated hereby
(including, without limitation, enforcement of this Pledge Agreement), except to
the extent such claims, losses or liabilities result solely from Agent's gross
negligence or willful misconduct as finally determined by a court of competent
jurisdiction.

          (g) Pledgor shall pay to Agent upon demand the amount of any and all
reasonable and documented out-of-pocket costs and expenses, including the
reasonable and documented fees and out-of-pocket costs and expenses of its
counsel and of any experts and agents, that Agent may incur in connection with
(i) the administration of this Pledge Agreement, (ii) the custody or
preservation of, or the sale of, collection from, or other realization upon, any
of the Pledged Property, (iii) the exercise or enforcement of any of the rights
of Agent hereunder, or (iv) the failure by Pledgor to perform or observe any of
the provisions hereof.

     7.   Continuing Security Interest; Transfer of Loans.

     This Pledge Agreement shall create a continuing security interest in the
Pledged Property and shall (a) remain in full force and effect until the payment
in full of all Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all outstanding L/C's, (b) be binding upon
Pledgor, its successors and assigns, and (c) inure, together

                                      -8-
<PAGE>   9

with the rights and remedies of the Lender Group hereunder, to the benefit of
the Lender Group and its successors, transferees and assigns. Without limiting
the generality of the foregoing clause (c), but subject to the provisions of
Section 14 of the Loan Agreement, any Lender may assign or otherwise transfer
any of the Obligations, the Commitments and the other rights and obligations
held by it under the Loan Agreement and the other Loan Documents to any other
Person, and such other Person shall thereupon become vested with all the
benefits in respect thereof granted to Lenders herein or otherwise. Upon the
payment in full in cash of all Obligations (other than inchoate indemnification
obligations with respect to claims, losses or liabilities which have not yet
arisen), the cancellation or termination of the Commitments and the cancellation
or expiration of all outstanding L/C's, the security interest granted hereby
shall terminate and all rights to the Pledged Property shall revert to Pledgor.
Upon any such termination Agent will, at Pledgor's expense, execute and deliver
to Pledgor such documents as Pledgor shall reasonably request to evidence such
termination and Pledgor shall be entitled to the return, upon its request and at
its expense, against receipt and without recourse to Agent, of such of the
Pledged Property as shall not have been sold or otherwise applied pursuant to
the terms hereof.

     8.   CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.

          THE VALIDITY OF THIS PLEDGE AGREEMENT, THE CONSTRUCTION,
INTERPRETATION, AND ENFORCEMENT HEREOF AND THE RIGHTS OF THE PARTIES HERETO WITH
RESPECT TO ALL MATTERS ARISING HEREUNDER OR RELATED HERETO SHALL BE DETERMINED
UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK (EXCEPT AS OTHERWISE PROVIDED BY THE UCC). THE PARTIES AGREE THAT ALL
ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS PLEDGE AGREEMENT AND THE
OTHER LOAN DOCUMENTS SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND FEDERAL
COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK, OR, IF SUCH COURTS
DO NOT HAVE SUBJECT MATTER JURISDICTION, THEN, AT THE SOLE OPTION OF AGENT, IN
ANY OTHER COURT IN WHICH FOOTHILL SHALL INITIATE LEGAL OR EQUITABLE PROCEEDINGS
PERTAINING TO THE COLLATERAL AND WHICH HAS SUBJECT MATTER JURISDICTION OVER THE
MATTER IN CONTROVERSY. PLEDGOR AND AGENT WAIVE, TO THE EXTENT PERMITTED UNDER
APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON
CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN
ACCORDANCE WITH THIS SECTION 8. PLEDGOR AND AGENT HEREBY WAIVE ITS RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT
OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN,
INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER
COMMON LAW OR STATUTORY CLAIMS. PLEDGOR AND AGENT REPRESENT THAT IT HAS REVIEWED
THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS
FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY

                                      -9-
<PAGE>   10

OF THIS PLEDGE AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE
COURT.

                                      -10-
<PAGE>   11

IN WITNESS WHEREOF, the undersigned has caused this Pledge Agreement to be duly
executed and delivered on the day and year first above written.

COMMUNICATIONS & POWER
INDUSTRIES, INC.

By:
   ------------------------------------

Name:
     ----------------------------------

Title:
      ---------------------------------

Address:
c/o Communications & Power Industries, Inc.
607 Hansen Way,
Palo Alto, California 94303
Attention: Lynn E. Harvey, Chief Financial Officer

                                      -11-
<PAGE>   12

                                   EXHIBIT "A"

                               PLEDGED SECURITIES

<TABLE>
<CAPTION>
                                                  Type of          Number of
       Issued to               Issuer            Securities          Shares        Par Value
       ---------               ------            ----------        ---------       ---------
<S>                            <C>               <C>               <C>             <C>

</TABLE>

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