Document:

<PAGE>

Note: Portions of this exhibit indicated by "[*]" are subject to a confidential
treatment request, and have been omitted from this exhibit. Complete, unredacted
copies of this exhibit have been filed with the Securities and Exchange
Commission as part of this Company's confidential treatment request.

                                                                   Exhibit 10.28

                              EBV ELEKTRONIK GmbH
                      Trinity 2 ASIC DEVELOPMENT AGREEMENT
                            (Agreement Number AS011)

This ASIC DEVELOPMENT AGREEMENT referred to, together with all exhibits hereto,
and any agreed separate writings, as the "Agreement" entered in to by and
between EBV Elektronik GmbH ("EBV') and Airspan Communications Ltd ("Customer")
with a place of business at Cambridge House, Oxford Road, Uxbridge, Middlesec
UK, shall be effectives as the 6th July 2000 ("Effective Date").  The parties
hereby agree as follows:

1. Scope

This Agreement sets forth the terms and conditions by which EBV ELEKTRONIK GmbH
("EBV") and Customer agree to engage in the design and development of one or
more application specific integrated circuit ASIC Products ("ASIC") as defined
below, to be manufactured solely by LSI Logic Corporation of 1551 McCarthy Blvd
Milpitas California USA (`LSI").  Furthermore, this Agreement governs the terms
and conditions by which the Customer will be licensed with certain intellectual
property of LSI defined below as LSI IP, in connection with the design and
development of the ASIC.  As agreed herein, EBV will provide Customer with
engineering support and assistance, and Customer with co-operate in regard to
protection of the LSI IP.  EBV will act as a distributor of LSI in all
manufacturing work to be undertaken pursuant to this Agreement.

2. Definitions

2.1 "Customer Specifications" means the information including, without
    -------------------------
limitation, software, schematics, netlist, micro code, designs, or techniques
supplied by Customer to EBV for use in the Program.

2.2 "ASIC" mans the device(s) described in Exhibit A hereto, or otherwise agreed
    ------
in writing, to be manufactured solely by LSI, including prototypes, risk pre-
production, and production units.

2.3 "LSI IP" means all LSI intellectual propery including but not limited to,
    --------
design tools, the LSI Logic Flexstream(TM) Design Solution Tool Set, design and
verification methodology, library elements and models, Core Ware(R) and IP
Cores, and process technology e.g. Mask Works and Base Layers.  LSI IP also
includes documentation that is the proprietary property of LSI and which is
released to the Customer solely for the purpose of designing, developing, and/or
testing the ASIC.  LSI IP also includes updated and enhanced versions of the
foregoing , in addition to any portions thereof.

2.4 "NRE" means the standard Non-Recurring Engineering services provided by EBV
    -----
to support and assist the Customer in connection with development of the ASIC
and provided Prototypes pursuant to the associated SOW.

2.5 "Engineering Services" means the extra Engineering services provided by EBV
    ----------------------
to support and assist the Customer in conncection with development of the ASIC
pursuant to the associated SOW.  Detailed in Exhibit C Engineering Schedule.

2.6 "Program" means the design, development, testing, verification, prototyping,
    ---------
and manufacture of the ASIC in accordance with Customer Specifications.

2.7 "SOW" means the Statement of Work, described in Exhibit B hereto, or
    -----
separately agreed in writing by the parties, that identifies the engineering
actives, assignment of responsibility, milestones, and the schedule for the
program.
<PAGE>

2.8  "APO" means Acceptance of Development Purchase Order.  APO is used to
     -----
designate the initial billing milestone for NRE services occurring at order
placement.

2.9 "DKR" means Design Kick-Off Review, which is an in-depth review of the
    -----
project including current project status, technical  requirements, design flow,
design tools, tool installation, support requirements, Statement of Work
agreement and training requirements.

2.10 "INR" means Initial Netlist Review, which is held when Customer has
     -----
released the initial gate-level netlish to EBC Elekronik for evaluation.  The
netlist will be used to initiate the package bonding, floor planning and Design
Rule Checking (DRC) activites.

2.11 "TLR" means Trial Layout Review,  which is held once EBV Elekronik has
     ------
completed the trail layout on the design.  The trial layout is used to establish
the die-size and specific layout requirements, clocking, power routing, cell
placement etc to ensure that routing and timing closure can be achieved during
final layout.  TLR sign-off is sued to designate an NRE billing milestone.

2.12 "PTR" means Placement timing Review, which is held once final cell
     -----
placement and clock insertion has been completed using a functionally complete
netlist from customer, with all system simulations complete.  After checking to
timing margins the completion of PTR releases design for final layout.  All test
vectors must be complete and verified at PTR.

2.13 "FDR" means Final Design Review, which is held once post-layout timing and
     -----
routing closure is completed.  All test vectors have been re-verified and DRC,
NVL and EBEAM have been completed on the layout database.  FDR complete releases
EBEAM data for mask manufacture.  FDR sign-off is used to designate an NRE
billing milestone.

2.14 "TPR" means Test Program Release, which releases the test program to
     -----
production and shipment of 20 tested prototypes to Customer.

2.15  "PAR" means Prototype Approval Review, which is completed after customer
      -----
evaluation of prototype and design is ready to release to production
fabrication.

3. ASIC Development Terms and Operating Rules

3.1 EBV will exercise reasonable diligence to perform the NRE and Engineering
Services task as set out in Exhibit C and the SOW, and will use best endeavors
to procure that LSI exercises reasonable diligence to perform all activities
undertaken by LSI in relation to this Agreement whether or not set out in the
SOW.

All time-scales quoted are best estimates but are not guaranteed.  Customer will
fully assist and co-operate with EBV pursuant to the obligations set forth in
the SOW.  EBV shall not be responsible for the successful completion of
activities designated in the SOW to the extent these are contingent upon the
timely fulfillment by Customer of its own obligations in the SOW.

3.2 Any data relating to the ASIC design that Customer furnishes to EBV must be
compatible wit the design tools (insofar as EBV makes them know to Customer) by
which EBV will verify all design and engineering work.  Customer agrees and
acknowledges that all engineering milestone time scales, Prototype, RISK/PRE
product delivery schedules are best estimates only.  EBV confirms that it will
exercise reasonable diligence in setting such engineering milestones and
prototype deliver schedules.  The sign-off of the Final Design Review ("FDR")
and of the Trial Layout Review ("TLR") and all other milestones throughout the
design phase by Customer's responsible managing engineer, or by any other
authorized employee of Customer, shall serve as conclusive evidence of
Customer's acknowledgement of successful completion of those respective
development milestones.

3.3 As consideration for the NRE and Engineering Services as described in the
SOW Exhibit B and Engineering Schedule Exhibit C hereto, or described in an
agreed separate writing, customer shall pay EBV the agreed NRE and Engineering
Services Charges as stated.  Invoices are to be raised at the stated billing
TLR, FDR and TPR milestones after successful completion and sign-off of the
applicable development stage.
<PAGE>

NRE and Engineering Services charges under this Agreement will be adjusted in
accordance with changes to the SOW requested by Customer in the course of the
Program.

3.4 Customer may submit written requests to EBV for changes to the SOW Exhibit
B, the Engineering Schedule Exhibit C or as ASIC design change during the course
of the Program.  Upon receipt thereof, EBV shall inform Customer of the effect
on the SOW, the estimated date for completion of the development work in
incorporate any requested changes, and the change, if any, in the NRE and
Engineering Services charge and adjustments in the piece price for the ASIC,
Any additional NRE or Engineering Services charges will be payable in accordance
with an adjusted milestone schedule or on a time and material basis per written
agreement of the parties.  EBV may, however, continue work without regard to the
requested change until EBV and Customer agree in writing to terms for an
adjusted price and estimated completion date, unless Customer notifies EBV in
writing to cease work.

3.5 Upon successful completion of FDR and TPR sign-off, EBV shall deliver within
the state time-scale 20 fully test Prototypes of each ASIC. Customer may order
Additional Prototypes (PRAs) for a fee, as set forth in Exhibit C hereto or
otherwise agreed in writing, provided such order is received not later than for
(4) days prior to FDR sign-off EBV shall make reasonable efforts to ship
Additional Prototypes within the stated time-scale from the Prototype shipment
date and in any event as soon as reasonably practicable.  Customer accepts 100%
financial liability for all Additional Prototypes ordered whether they function
or not in the Customers system, for product that confirms to the agreed FDR
sign-off and is free from manufacturing defects.

4. Risk/Pre-Production Units (RSK/PRE Product) Terms

Customer acknowledges that the standard procedure recommended by EBV is to
supply ASIC products only after the design has been successfully prototyped and
approved in writing by Customer as document in the Prototype Approval Form and
released to production.  Nevertheless upon request of the customer and subject
to these RSK/PRE product terms and conditions sale stared herein, RSK/PRE
product can be ordered.  "RSK/PRE" product means product ordered by Customer for
which manufacture is commenced prior to receipt of written Customer approval of
the Prototypes.  RSK product refers to silicon manufacture and PRE product
refers to final assembly and test.

RSK/PRE must be ordered not later than four (4) days prior to FDR sign-off.
RSK/PRE product orders placed after this cut off date shall be subject to the
same lead times as production ASIC product.  RSK line items must be booked with
a  PRE line item and must be booked released.  PRE line items must be booked
with a RSK line item.  PRE line items can be booked released (fully manufactured
and shipped) or unreleased (silicon held prior to metallisation). PRE line items
will be booked released unless Customer indicates PRE product is unreleased on
the purchase order.  To release product previously ordered as unreleased the
Customer must notify EBV in writing.

The agreed price and quantity is set forth in Exhibit C hereto or other wise
agreed in writing, and is subject to technology, die size and quantity
limitations.

Invoices will be raised: 1) for fully released product 100% of agreed price on
shipment of RISK (RSK/PRE) product or 20 70% of agreed RSK/PRE price at Silicon
ready and held at Die Bank then 30% at shipment to Customer of RS/PRE product.

Customer understands and accepts the inherent risk in building ASIC product
prior to prototype approval and accepts the EBV cannot warrant RSK/PRE product
will conform to certain specification and/or will function as expected by the
Customer.  Customer accepts the full financial obligation to pay EBV in full the
agreed RSK/PRE purchase price for all ordered RSK/PRE product that conforms to
the agreed FDR sign-off and is free from manufacturing defects.

Customer further acknowledges and accepts the risk that RSK/PRE product may be
subject to lower than expected manufacturing yields.  If as a result of lower
than expected yields, Customer requires additional RSK/PRE product, production
restarts will only be made upon mutual agreement of the parties with respect to
quantities and delivery times based on a review of product faults and yields.

EBV shall have the right without liability to Customer, to dispose of any
RSK/PRE Product that remains unaccepted by Customer six months after manufacture
of such RSK/PRE Product
<PAGE>

5. Orders

5.1 Customer shall provide a written purchase order to cover the NRE
Development, Engineering Services, additional Prototypes and RISK/PRE product as
required state in Exhibited C, or otherwise agreed in writing,  Such order shall
be deemed accepted only if acknowledge in writing by EBV.  Except as otherwise
expressly provided herein, no term or condition of any purchase order or order
acknowledgement or other form shall be binding on the parties.

5.2 EBV shall have obligation to consider supply of production units unless and
until Customer has delivered to EBV completed Prototype Approval and Production
Release Authorization forms for ASIC signed by an authorized representative of
Customer.

6. Payment Terms

6.1 As Agreed between the parties Customer shall pay the first NRE billing mile
stone APO ($*) plus any ordered Engineering Services (synthesis $* and or test
Insertion $*) on the terms "cash with order."  Customer also agrees to supply
EBV Elektronik GmbH with a binding Parental payment Guarantee from Airspan
Network Inc. USA to cover the balance of payments accruing under this Agreement.
If this Parental Payment Guarantee is not put in place then EBV reserves the
right to suspend all engineering works until an alternative payment method has
been agreed.

6.2 Based on the Parental Payment Guarantee being in place, Customer agrees to
pay all further accrued invoices within 30 days from the invoice date (further
to item 6.1).  Disputed invoices shall be resolved in good faith by both parties
and Customer agrees to pay resolved invoices within 14 days of resolution.
EBV's  Credit Department may request different payment terms at it discretion.
Customer agrees to provide EBV's Credit Department with financial information
required in connection with the reassessment of credit terms.  EBV reserves the
right to charge late payment on all sums overdue at a rate of 4% over the bank
of England's base rate from time to time in force.

6.3 Unless specifically stated other wise, any prices or charges detailed or
referred to in this Agreement are exclusive or VAT or other applicable sales
taxes

7. Shipment

Delivery of Prototypes, RISK/PRE product will be ex-works and good will be
packed to EBV's normal specification in non-returnable packing.  Carriage will
be arranged at the Customers request and expense.  Time of deliver shall not be
of the essence and any delivery period quoted is an estimate only. Provided EBV
take all reasonable steps to deliver the goods at the time stated, and gives the
Customer reasonable notice if it is unable to meet any delivery date quoted,
(which shall in any event be give as soon as EBV is aware of any delay ) then
EBV shall be under no liability for any delay or failure in delivery. The
Parties shall act in good faith to negotiate a mutually acceptable revised
delivery date.  All contracts for export from Germany shall be in accordance
with INCOTERMS 1990 Edition or any amendment or re-publication thereof for the
time being in force at the date of the contract.  EBV reserves the right to
deliver in more than one consignment and to invoice each consignment separately.

8. Title

Legal title goods shall remain with EBV until such time as EBV has received
payment for the price of the goods whereupon such title shall pass to the
Customer.

Notwithstanding the retention by EBV of the legal title to the goods (i) risk in
goods shall pass to the Customer on shipment ex-works and the Customer shall
arrange for EBV's interest in the same to be noted on all relevant insurance
policies, (ii) EBV shall be entitled to maintain an action against the Customer
for the price of the goods or any part thereof.

[*] Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.
<PAGE>

9. Cancellation

Prior to the delivery of Prototypes, Customer may cancel the NRE and Engineering
Services work under the applicable SOW for the ASIC by giving written notice to
EBV.  Whereupon EBV shall cease work in connection with ASIC.  EBV will invoice
the Customer a cancellation charge of i) 100% of Ordered Engineering Services
ii) NRE charges through the next billing milestone as listed in Exhibit C
hereto, NRE Schedule otherwise agreed in writing.  Customer agrees to pay the
invoiced amount within 30 days of the invoice date.  Customer may cancel work on
any single ASIC without consequence for the work performed for any other ASIC.

10. Intellectual Property

10.1 LSI Shall retain sole rights; title, ownership and interest in and to all
LSI IP furnished by LSI to Customer.  Customer shall acquire no rights or
interests in or such intellectual property by any means.

10.2 For the sole purpose of facilitating the program with EBV, Customer may be
granted, directly by the licensee (LSI), a revocable, non-exclusive, non-
transferable, personal license to use certain LSI IP subject to the terms and
conditions of the then current LSI IP license agreements.

10.3 EBV acknowledge that all Customer Specifications regarding ASIC are the
property of Customer.  EBV agrees that the Customer Specification or any
customized ASIC netlist, database, test vectors, or tooling generated
exclusively for ASIC in the course of development will not be used other than
for the manufacture of ASIC on behalf of Customer.  The rights of Customer in
ASIC shall be strictly limited to the customized configuration of ASIC created
by the interconnections of such LSI IP library elements and Customer
Specification information as such appear in the ASIC manufactured for Customer.

10.4 Customer acknowledges and agrees that place and route data, database tapes,
mask sets, and other customized data relating to ASIC contain proprietary
information of both LSI and Customer, and such materials shall remain in the
custody of LSI at all times.  Upon Customer request such materials produced for
Customers shall be destroyed and certification provided.  The resulting mask set
is specific to LSI Logic Technology Only and is compatible with use in one of
the of here LSI logic water fabrication plants (two of the USA one in Japan)
with a second source always  in place for die assembly and final test.  In the
event of the failure of one manufacturing facility, LSI shall utilize its other
manufacturing facilities as required to provide continuity of supply of ASIC

10.5 Customer shall own invention discovered in the course of performing this
Agreement of solely discovered by Customer.  The Customer shall then
automatically grant a nonexclusive fully paid, royalty free, perpetual,
worldwide license to use such invention in connection with manufacture and
supply of the ASIC.  The parties shall be deemed joint owners of any invention
that is jointly discovered in the course of performing this Agreement.

10.6 All LSI IP is the exclusive property of LSI and shall be treated as
Confidential Information.

11. Warranty

LSI warrants the ASIC on behalf of EBV Elektronik and its customers in
accordance with it standard warranty as set forth in this clause below.  EBV
Elektronik is authorized to pass this warranty through to EBV's customers

DISCLAIMER
----------

ALL WARRANTIES, STATUTORY, EXPRESS, OR IMPLIED, WITH RESPECT TO ANY PRODUCT OR
OTHER ITEMS DELIVERED HEREUNDER, INCLUDING THE IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, ARE HEREBY DISCLAIMED.
THE REMEDIES SET FORTH HEREIN ARE EXCLUSIVE. NO COURSE OF DEALING AND NO PRODUCT
DESCRIPTION OR SPECIFICATION SHALL BE DEEMED A WARRANTY WITH RESPECT TO ANY
GOODS OR INFORMATION DELIVERABLE BY EBV or LSI.  NO INDIVIDUAL IS AUTHORIZED TO
GIVE ANY OTHER WARRANTY ON BEHALF OR EBV or LSI.
<PAGE>

INDEMNIFICATION

Subject to the conditions and limitations stated herein, LSI agrees to defend
Customer from and against any and all claims, demands and actions ("Claim")
brought against Customer based upon any alleged infringement of U.S. patent,
U.S. copyrights or U.S. mask work rights owned by third parties by any ASIC
purchased by Customer from EBV, or upon any alleged disclosure or misuse by LSI
of trade secrets of a third party in connection with the design of production of
any ASIC.  In addition, LSI agrees to pay all reasonable money damages awarded
against Customer attributable solely to any such infringement, disclosure, or
misuse and to pay all costs and expenses associate with such claims (including
attorney's fees).  As a conditions  of such defense and indemnification,
Customer shall give EBV/LSI prompt written notice of any such Claims, grant full
authority to defend and settle such Claims, and make its best effort to assist
LSI (at LSI's expense) upon request from LSI.  If, as a result of Claim,
Customer is enjoined from selling, using, or otherwise disposing of ASIC
purchased from EBV, LSI shall, at its election (i) procure for Customer the
right to sell and use the ASIC, (ii) provide Customer with replacement ASIC that
is non-infringing and meets the same functional specifications as the ASIC, or
(iii) if LSI cannot procure such rights or furnish such replacement ASIC on
commercially reasonable terms, arrange for a refund to Customer for the price
paid for such ASIC.

THIS SECTION STATE THE ENTIRE LIABILITY OF LSI AND THE EXCLUSIVE REMEDY OF
CUSTOMER WITH RESPECT TO INFRINGEMENT.  EXCEPT AS EXPRESSLY STATE I N THIS
SECTION, ALL WARRANTIES AGAINST INFRINGEMENT OF ANY INTELLECTUAL PROPERTY
RIGHTS, STATUTORY, EXPRESS, OR IMPLIED ARE HEREBY DISCLAIMED.

INDEMNIFICATION EXCLUSION
-------------------------

EBV or LSI shall have no obligation to indemnify or hold Customer harmless with
respect to any Claim or infringement, disclosure, or misuse of any intellectual
property rights arising out of or relating to (i) the combination of one or more
LSI library elements with any other circuitry in the design of any ASIC (ii) the
combination or incorporation of any ASIC or of elements of any library supplied
by LSI with any other product, end item, or subassembly, (iii) use or
incorporation in any ASIC of any design, technique, or specification furnished
by Customer, or (iv) any infringement based on protocols (including MPEG2)
established by standards bodies. Customer will defend at its own expense and
indemnify EBV and LSI from and against any liability, damages, cost or expense
(including attorney's fees) arising out of any such Claim asserted against EBV
or LSI in connection with any act or condition described in clauses (i), (ii),
(iii) or (iv) in the preceding sentence.  EBV and LSI agree to promptly notify
Customer in writing of any such Claims.  Grant full authority to defend and
settle such Claims, and offer all reasonable assistance to Customer (at
Customer's expense) upon request from Customer.

12. Confidential Information

Each party acknowledges that materials received from the other party may be
considered confidential and proprietary ("Confidential Information"). Each party
agrees to maintain in confidence such information which, if disclosed in
writing, is identified and marked as confidential ( or with words of similar
import) at the time of its disclosure or which, if disclosed verbally, is
designate confidential at the time of disclosure and is summarized and
identified as confidential in writing delivered to the receiving part on or
before 30 days after the disclosure.  Neither party shall disclosed such
information to any third part without the prior written consent of the other
party.  Each part shall protect such information from disclosure to theirs with
at least the same degree of care as such party exercises to protect its own
information of similar type and importance.  The obligations of confidentiality
and protection required by this Section 10 shall survive the expiration,
termination, or cancellation of this Agreement for a period of five years.

The obligation of confidentiality shall not apply, or shall cease to apply, to
any information which:
(a) was known to receiving par prior to its receipt hereunder
(b) is or becomes publicly available without breach of this Agreement;
(c) is receive from another party without an obligation of confidentiality of
the disclosing party and without breach of this Agreement.
(d) is disclosed by the disclosing party to another party without an obligation
of confidentiality
(e) is developed independently by employees of the receiving party not having
access to such information; or
<PAGE>

(f) is disclosed by the receiving part pursuant to court order provided that the
originally disclosing party is given a reasonable opportunity to object to or
restrict such disclosure requirement to the extent practicable, and then such
disclosure shall be permitted only subject to the terms and conditions of such
order.

Notwithstanding the requirements for Confidential Information stipulated in this
section, Customer acknowledges that all LSI IP in any form whatsoever is
Confidential Information and shall be treated accordingly.

13. Limitation on Damages

IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER FOR PAYMENT OF ANY
INCIDENTAL, CONSEQUENTIAL OR SPECIAL DAMAGES OF ANY KIND (INCLUDING, BUT NOT
LIMITED TO, LOST PROFITS, LOSS OF BUSINESS OR OTHER ECONOMIC DAMAGE) RESULTING
FROM ANY BREACH OF THEIR RESPECTIVE OBLIGATIONS HEREUNDER, REGARDLESS OF WHETHER
THE PARTY LIABLE OR ALLEGEDLY LIABLE WAS ADVISED, HAD OTHER REASON TO KNOW, OR
IN FACT KNEW OF THE POSSIBILITY THEREOF.

14. High Risk Applications.

CUSTOMER WARRANTS THAT IT WILL NOT USE, OR KNOWINGLY PERMIT ANY OF ITS DIRECT OR
INDIRECT CUSTOMERS TO USE, ANY ASIC IN ANY HIGH RISK APPLICATION WHERE THE
FAILURE OF THE PRODUCT COULD CAUSE A LIFE-THREATENING SITUATION, INCLUDING BUT
NOT LIMITED TO MEDICAL, NUCLEAR, AVIATION, NAVIGATION OR MILITARY APPLICATIONS,
CUSTOMER AGREES TO DEFEND, INDEMNIFY, AND HOLD BY EBV HARMLESS AGAINST ANY LOSS,
LIABILITY, OR DAMAGE OF ANY KIND THAT EBV INCURS IN CONNECTION WITH A BREACH O
SAID WARRANTY.

15. Termination and Discontinuance

15.1 If either party breaches or defaults on a material provision of this
Agreement and fails to remedy such breach or default with 60 days after written
notice from the other party, the other party shall have the right to (a) suspend
performance or payment, in whole or in part, until such breach or default has
been  remedied, (b) terminate the Agreement or purchase orders placed under the
Agreement, in whole or in part, or (c) employ a combination of (a) and (b).
Notwithstanding the foregoing, EBV may suspend this Agreement at any time on the
account of monetary default of Customer with respect to any amounts owed by
Customer to EBV under this Agreement, provided that prior to such suspension for
monetary default EBV shall first notify the Customer in writing of the default
and allow the Customer a period of 14 days to rectify such default.  The parties
hereby agree to negotiate in good faith to resolved any such dispute.

15.2 If either party: (a) becomes insolvent; (b) makes an assignment for the
benefit of creditors; (c) files or has filed against it a petition in bankruptcy
or seeking reorganization; (d) has a receiver appointed; or (e) institutes any
proceedings for liquidation winding -up (f) assigns or transfers either
voluntary or by operation of the law any or all rights or obligations under this
agreement without having prior written consent form the other part;  Then the
other part may be written notice, in addition to other rights and remedies it
may possess, immediately terminate the Agreement or any purchase orders placed
here under.

16. General

16.1 Assignment. Except for EBV's right to payment accruing hereunder, neither
     -----------
party shall assign any of its rights or privileges hereunder without the prior
written consent of the other party other than to successor in ownership of all
or substantially all of the assets of the assigning party, which successor
expressly assumes in writing the  assignor's obligation hereunder.

16.2 Governing Law.  This Agreement shall be governed and construed in
     --------------
accordance with the laws of England and the parties submit to the exclusive
jurisdiction of the English Courts to determine any dispute arising hereunder.
<PAGE>

16.3  Waiver.  No failure or delay on the part of either part in the exercise of
      -------
any right or privilege hereunder shall operate as a waiver thereof or of the
exercise of any other right or privilege hereunder nor shall any single or
partial exercise of any such right or privilege preclude other or further
exercise thereof or of any other right or privilege.

16.4 Severability.  If any provision of this Agreement is held to be
     -------------
ineffective, unenforceable or illegal for any reason, such decision shall not
affect the validity or enforcement of any of the remaining portions hereof.  If
more than one product is covered by this Agreement, then the rights  and
obligations of the parties wit respect to each such product shall be several and
independent from those with respect to any other product.

16.5 Survivorship.  All obligations and duties hereunder which shall by their
     ------------
nature extend beyond the expiration or termination of this Agreement, shall
survive and remain in effect beyond any expiration or termination hereof.

16.6 Other Rights.  Nothing contained in this Agreement shall be construed as
     -------------
conferring by implication, estoppel or otherwise upon either part or any third
party any license or other right except, solely as to the parities hereto, the
rights expressly granted hereunder.

16.7 Force Majeure. Neither party shall be liable for damages resulting from a
     -------------
default in the performance of its obligations under this Agreement when caused
by an act or occurrence that is beyond the reasonable control of such part,
including but not limited to fire, flood, earthquake or other natural disaster,
labor disputes, war or civil disturbance, shortage of materials, disruption of
normal production, yield failures, carrier strike or an interruption of electric
power, utility services, or means of transportation.

16.8 Notice.  Any notice of claim provided for herein shall be in writing and
     -------
shall be given (i) by personal deliver, effective upon delivery, (ii) by first
class mail, postage, addressed to the address state below for the recipient,
effective one (1) business day after proper deposit in the mail, or  (iii) by
facsimile directed to the facsimile number indicated below for the recipient,
but only if accompanied by mailing of a copy in accordance with (ii) above,
effective as of the date of facsimile transmission.  The addresses for notice
are as follows:

Address for notice to EBV:       EBV Elektronik GmbH           Tel: 01793 859507
                                 12 Interface Business Park    Fax: 01793 859555
                                 Wootton Bassett
                                 Wiltshire SN4 8SY
                                 England
                                 Attn: Phil Lakin

Address for notice to Customer   Airspan Communications Ltd    Tel:____________
                                 Cambridge House               Fax:____________
                                 Oxford Road
                                 Uxbridge
                                 Middlesex UB8 1UN
                                 England
                                 Attn:______________

16.9 US Export Control.  EBV shall in no circumstances be liable for any
     -----------------
damages, loss, or claim howsoever occasioned by an act or omission on the part
of the Customer in Contravention of any regulations issued by the United States.

Government concerning the export of goods, services or technology.  Customer
shall be responsible for ensuring compliance with all export laws and regulation
of the United States Government.

16.10 Publicity.  Neither party shall advertise or otherwise disseminated, by
written or oral publication, the existence of this agreement or its terms or use
the name of the other part in any pres release, public announcement ,
advertisement, or other form of publicity without the other party's written
consent.

16.11 Conflicting Terms. The parties agree that the terms and conditions of this
agreement shall prevail, notwithstanding contrary or additional terms in any
purchase order, sales acknowledgement, confirmation or any to the document
issued by either party effecting the purchase and/or sale of ASIC NRE,
Engineering Services, or ASIC
<PAGE>

Products. In the event of any conflict between the terms of this Agreement and
any Exhibit or agreed separate writing attached to this Agreement, the
provisions of this Agreement shall control. In the event of any conflict between
or among Exhibits or agreed separate writings, the Exhibit or agreed separate
writing of the latest date shall control.

16.12 Entire Agreement.  This Agreement with Exhibits hereto and agreed separate
writings together with any Non-Disclosure Document signed between the parties,
embodies the final, complete understanding and exclusive statement of the terms
upon by the parties with respect to the subject matter hereof and supersedes any
prior or contemporaneous representations, descriptions, courses of dealing, or
agreements in regard to such subject matter.  No amendment or modification of
this agreement or any Exhibit, or agreed separate writing hereto shall be valid
or binding upon the parties unless sin writing an signed by an authorized
representative of each party.

NO EBV EMPLOYEE OR REPRESENTATIVE HAS ANY AUTHORITY OR OTHERWISE TO BIND EBV TO
ANY OBLIGATION OR LIABILITY NOT EXPRESSLY STATED HEREIN

16.13 Relationship of the Parties.  The relationship of the parties is that of
independent contractors.  Neither party, nor its agents or employees, shall be
deemed to be the agent, employee, joint venture partner, partner or fiduciary of
the other party,  Neither party shall have the right to bind the other party,
transact any business on behalf of or in the name of the other party, or incur
any liability for or on behalf of the other party.

16.14 Exhibits.  The following Exhibits are attached hereto and incorporated
herein by this reference:

Exhibit A - Description of ASIC
Exhibit B - Statement of Work
Exhibit C - NRE and Engineering Services Schedule

16.5 Term. The Term of this agreement shall last throughout the Program until
delivery of any ordered Extra Prototypes or RISK pre-production devices.  The
Agreement may be extended by agreement of the parties to include further ASIC
Development work.

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
effective Date.

EBV ELETRONIK GmbH                    Customer

By:______________________             By:_________________________

Name: P. Lakin                        Name: J. Paget

Title: ASIC Manager                   Title: Chief Operations Officer

Date: 19/7/00                         Date: 13/7/00
<PAGE>

                                   EXHIBIT A

Preliminary ASIC Description

Name: Trinity 2
-----
Estimated Die Size: 8.2mm/side
------------------
Package: 272PBGA
--------
Part No: L5A9545
-------

Preliminary details as per quote PLAIRSPAN 9600A

Final details to be confirmed at TLR or FDR sign-off milestones
---------------------------------------------------------------
<PAGE>

                                    Exhibit B

                                   Preliminary
                                Statement of Work

                                       For

                                 Trinity 2 ASIC

Customer Address:     Airspan Communications Limited
                      Cambridge House
                      Oxford Road, Uxbridge
                      Middlesex, UB8 1UN
                      United Kingdom
<PAGE>

Introduction

This Statement of Work (SOW) describes the activities and key development
milestones of the Trinity 2 ASIC for Airspan Communications Limited.  The key
deliverables and responsibilities are defined (X denotes primary
responsibility). Any item not explicitly state in this SOW is not an implied
service.

This SOW assumes Airspan will order the Engineering Services for Synthesis and
Test Insertion as detailed in Exhibit C.

Acceptance of the work done at each relevant milestone is also defined in this
SOW as 'Checklist Sign-off".  Every time a Sign-off milestone is reached, the
two parties review the work done at that specific date, approve all relevant key
deliverables, and agree on proceeding to the next phase of the project.

This SOW will be updated and complimented by a Project Plan document, which is
released at the Design Kick-Off Review Milestone, and is updated and approved at
every milestone mentioned in this SOW.

Agreement to SOW

EBV       Technical Project Leader:

          Signature:                          Date:

          Program Manager: P. Lakin           Date: 17/7/00

          Signature:

Airspan   Technical Project Leader: Jeremy Cohen

          Signature:                          Date: 13/7/00

          Program Manager

          Signature                           Date: 13/7/00
<PAGE>

<TABLE>
<CAPTION>

RESPONSIBILITY
DESIGN   DESCRIPTION OF WORK                                                   EBV          AIRSPAN
STAGE
<C>               <S>
1                 Place an order with EBV Elektronik (PO Milestone)                              X
                  Purpose: Allows EBV to allocate resources
                           and start Project activities.

2                 Design Kick-off Review (DKR Milestone)                        X                X
                  Purpose: Allows the Airspan and EBV to review
                   the system design for partitioning, discuss
                           the design flow and review the project plan.
                  Deliverables:  1.  Design Specification to include;
                           a) Electrical and environmental specification.                        X
                           b) Overall system definition and higher level                         X
                              block diagram.
                           c) List of ASIC I/O pins.                            X                X
                           d) Chip level diagram of the clock distribution.                      X
                           e) Synthesis strategy.                               X                X
                           f) Chip test strategy.                               X                X
                                 2. Design Flow to include tools and
                                    deliverables e.g. RAM models.
                                 3. An agreed SOW that EBV will
                                    undertake.
                                 4. An agreed project plan to include resources
                                    and time scales.
                                 5. Design review process
                  Checklist:  Complete DKR Checklist Sign-off                   X                X

3                 Intermediate Design Review (IDR Sign-Off Milestone)           X                X
                  Purpose:  Review block design coding at RTL level
                                  prior to chip level integration/synthesis
                  Deliverables:   1.  EBV presents RTL guidelines and           X
                                      detailed RTL coding methodology
                                      documentation.
                                  2.  Vega analysis reports reviewed            X                X
                  Checklist:  Block level Checklist Sign-off                    X                X

4.                Top Level Integration and Verification                                         X
                  Purpose:  To produce a chip level RTL description
                  and to fully simulate the design using Airspan generated
                  test benches.
                  Deliverables:    1.  Preliminary RTL code release for                          X
                                       preliminary synthesis and trial layout
                                       to "prepare netlist for layout".
                                   2.  Final (frozen) RTL code that has been                     X
                                       fully verified to Airspan generated test benches.
                                   3.  Chip level test bench.                                    X

</TABLE>
<PAGE>

<TABLE>
<CAPTION>
                                                                                RESPONSIBILITY
DESIGN   DESCRIPTION OF WORK                                                    EBV         AIRSPAN
STAGE
<C>               <S>
5.                Synthesis Review and RTL Chip Level Code Check                X                X
                  Purpose:  Risk management by finalizing systhesis strategy
                                  and EBV performing a detailed RTL code check
                                  to ensure EBV's RTL coding methodology have
                                  been followed. Objective is to ensure RTL code
                                  is systhesisisable.
                  Deliverables:   1.   Finalize synthesis strategy.             X                X
                                  2.   EBV performs a detailed RTL codeX
                                       analysis.
                                  3 .  Final (frozen) RTL code that has been                     X
                                       fully verified to AIRSPAN generated test benches
                                       and has been reviewed against EBV's
                                       coding guide lines.

   6.                             Chip Level Synthesis and Test Insertion       X                X
                  Purpose:        To produce a netlist with test insertion for final
                                  layout. As part of a risk management strategy
                                  preliminary code shall be used for preliminary
                                  synthesis and trial layout in order to prepare
                                  the final netlist for final layout.
                  Deliverables:   1.   Gate Level netlist                       X
                                  2.   Bondout/floor planning/clocking.         X
                                  3.   Gate level verification.                                  X
                                  4.   Test insertion (RAM BIST,                X
                                        (JTAG and Scan Logic).
                                  5.   Spare gates insertion.                                    X
                                  6.   Static Timing, margin analysis           X                X

7.                Initial Netlist Review (INR Milestone)                        X                X
                  Purpose:  The initial gate level netlist will be used to initiate
                            the package bonding and design floorplan.  Netlist
                            DRC checking programs will also be un and
                            results will be reviewed.
                  Checklist: Complete INR Checklist Sign-off                    X                X

8.                Trial Layout Review (TLR Milestone)                           X                X
                  Purpose:  The TLR is performed once EBV completes
                            a trial layout. The trial layout is used to
                            establish the die size needed as well as any
                            specific layout related requirements (e.g., clock
                            tree synthesis, power routing, special cell
                            placement). The TRR is recognized as the NRE
                            billing.
                  Deliverables:  Trial layout
                  Checklist:  TLR Checklist Sign-off
</TABLE>
<PAGE>

<TABLE>
<CAPTION>

                                                                               RESPONSIBILITY
DESIGN   DESCRIPTION OF WORK                                                   EBV         AIRSPAN
STAGE
<C>               <S>
9.                Test Vector Generation and                                    X                X
                  Placement Timing Review (PTR Milestone)
                  Purpose:  The PTR is performed once EBV has completed
                            the final cell placement, placement timing
                            optimization and clock tree synthesis using the
                            final froze functional Airspan netlist.
                  Deliverables:     1.     Back-annotation files from cell      X
                                   placement.
                                    2.     Test vectors;                        X
                                        a) Functional vectors.                                   X
                                    Note: Vectors are only required to achieve
                                           100% toggle of all outputs and bi-directs
                                        b) Scan ATPG, IDDQ, JTAG,               X                X
                                           RAM BIST, PLL, VIL/VIH, Static IDD
                                           (Y), High-Z (Z).
                  Checklist:  PTR Checklist Sign-off                            X                X

10.               Final Design Review (FDR Milestone)                           X                X
                  Purpose:  The Final Design Review is performed once
                  post-layout timing closure is completed.  It is expected
                  that all layout drc and netlist verification steps have been
                  performed and all test vectors have been checked and
                  finalized for release.  FDR is recognized as the NRE
                  billing milestone previously known as CDR.
                  Deliverables:     1.     Post-route timing verified and approved               X
                                    2.     All post-route test vector timing verified            X
                                    3.     Timing margin report for core and I/O for             X
                                           each clock domain
                                    4.     Prototype package marking requirements                X
                                    5.     All proto delivery orders submitted to Sales          X
                                    6.     Review PVT (Process, Voltage, Temp)                   X
                                            conditions                                           X
                                    7.     Final run of Isidrc                                   X
                                    8.     Signal integrity checks complete     X
                                    9.     Formal verification complete         X
                                    10.    Full-timing test vector checks
                                            complete                            X
                                    11.    Test Program extracted from test     X
                                           vectors
                                    12.    Test readme file complete            X
                                    13.    Layout QA, DRC, NVI, and EBEAM       X
                                             Complete
                  Checklist: FDR Checklist Sign-off

11.               Prototype Manufacture                                         X
                                                                                --
                  Purpose: Manufacture of prototype silicon.
                  Deliverables: Prototype silicon to test floor.
</TABLE>
<PAGE>

<TABLE>
<CAPTION>
                                                                                        RESPONSIBILITY
DESIGN   DESCRIPTION OF WORK                                                            EBV         AIRSPAN
STAGE
<C>               <S>
12.               Test Program & Proto Ship (TPR Milestone)                              X
                                                                                        ---
                  Prupose: TPR is Performed once all prototype testing has been
                  Completed and parts have been shipped to Airspan.  Proto-ship
                  Occurs when a prototype passes all test per sign-off
                  Requirements and all prototype units are delivered to Airspan
                  Deliverables: Prototypes to Airspan.

13.               Prototype Approval (PAR Mileestone)                                                  X
                                                                                                      ---
                  missing text
                  evaluated prototype units and has authorized production
                  fabrication.  Test Program Release is performed to support
                  production testing.
                  Deliverables:     1. Prototype Approval Form                                         X
                                    2. Production Release Agreement and                                X
                         Airspan Marking Specification.
</TABLE>
<PAGE>

                                   EXHIBIT C

                     NRE and Engineering Services Schedule

NRE SERVICES
NRE                  *
NRE Biling Stages

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------
<S>                          <C>            <C>               <C>           <C>                 <C>           <C>
DEVELOPMENT                   APO              DKR              TLR              FDR              TPR           Total NRE
SIGN-OFF Milestone                                                                                               Charge
----------------------------------------------------------------------------------------------------------------------------
                            20% NRE                           40% NRE          30% NRE          10% NRE         100% NRE
----------------------------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------------------------

Billing Amount                $*                                $*               $*               $*               $*
----------------------------------------------------------------------------------------------------------------------------
</TABLE>

NRE to include full application support throughout the design phase (EBV/LSI's 7
stage design flow), ARM9E and HM_cx4000 Hard Macro Integration support,
Floorplanning, Timing Closure, Layout, Test Program Development, Masks, LSI
Logic FlexStream Design Tools and 20 fully tested prototypes.

Prototype delivery 40-45 days after FDR and EBEAM complete

The design flow is to be RTL interface with EBV performing synthesis suns and
timing closure but Airspan performing final verification and sign-off using UNIX
Modelsim.

Detailed in the SOW Exhibit B.

ENGINEERING SERVICES

Synthesis                  $*
Test Insertion and ATPG    $*

Billing 100% on order entry

The Synthesis option activities are details in the SOW Exhibit B, which include;
a pipe cleaning exercise on individual modules, trial synthesis run(s) and final
synthesis.

The Synthesis charge above includes up to man months of activity.  If the
Synthesis activities are seen to be exceeding this budgeted time then EBV
reserves the option of charging extra work on an agreed (in writing) time and
materials basis.

Estimated elapsed time to cover the synthesis tasks is 2 months dependant on
Airspan following RTL coding guidelines, Airspan providing correct achievable
synthesis constraints, and on Airspan completing task in a timely manner.

Estimated elapsed time for Test Insertion activities is 1 month dependent on
timely completion of Airspan tasks.

It is understood by all parties that Airspan agree to use the Hm_cx4000 hard
macro as currently developed with the performance stated in the G12 HM_cx4000
Specification and Implementation document version 1.4 dated April 29, 1999
(attached) and the Characterization Report version 1.1 dated January 18, 2000
without any modification.

RISK (RSK/PRE) Device Planning
Number of Risk Devices: Minimum 1000pcs
LSI Part no: L5A9545
Price each $*
Shipment 4-6 weeks after prototype shipment

Additional Prototypes
Number of Additional Prototypes (PRAs): 100
LSI Part No: L5A9545
Price each $*
Shipment: 2-3 weeks after prototype shipment

[*] Certain information on this page has been omitted and filed separately with
the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.Exhibit 10.7.1 12/31/2000 10-KSB

EXHIBIT
10.7.1

AVERT, INC.

NON-EMPLOYEE
DIRECTORS’ STOCK OPTION PLAN, AS AMENDED

SECTION 1

Purpose

        Avert,
Inc. Non-Employee Directors’ Stock Option Plan (the “Plan”)
provides for the grant of Stock Options to Non-Employee Directors of Avert, Inc.
(the “Company”) and of any subsidiary corporation of the Company in
order to encourage and provide incentives for high level performance by the
Non-Employee Directors of the Company. 

SECTION 2

Non-Incentive
Stock Options

        The
Stock Options granted under the Plan shall be nonstatutory stock options which
are intended to be options that do not qualify as “incentive stock
options” under Section 422 of the Internal Revenue Code of 1986, as amended
(the “Code”). 

SECTION 3

Administration

        3.1
Committee. The Plan shall be administered by the Board of Directors of the
Company (the “Board”) or by a committee consisting of one or more
employee members of the Board (the “Committee”). The Committee or the
Board, as the case may be, shall have full authority to administer the Plan,
including authority to interpret and construe any provision of the Plan and any
Stock Option granted thereunder, and to adopt such rules and regulations for
administering the Plan as it may deem necessary in order to comply with the
requirements of the Code or in order to conform to any regulation or to any
change in any law or regulation applicable thereto. However, the Committee shall
have no authority, discretion or power to select the Non-Employee Directors who
will receive any Stock Option, determine the number of shares to be issued
hereunder or the time at which such Stock Options are to be granted, establish
the duration of the Stock Options or alter any other terms or conditions
specified in the Plan, except in the course of administering the Plan pursuant
to the provisions of the Plan. The Board of Directors may reserve to itself any
of the authority granted to the Committee as set forth herein, and it may
perform and discharge all of the functions and responsibilities of the Committee
at any time that a duly constituted Committee is not appointed and serving. All
references in this Plan to the “Committee” shall be deemed to refer to
the board whenever the Board is discharging the powers and responsibilities of
the Committee. 

        3.2
Actions of Committee. All actions taken and all interpretations and
determinations made by the Committee in good faith (including determination of
Fair Market Value) shall be final and binding upon all Option Holders, the
Company and all other interested persons. No member of the Committee shall be
personally liable for any action, determination or interpretation made in good
faith with respect to the Plan, and all members of the Committee shall, in
addition to their rights as directors, be fully protected by the Company with
respect to any such action, determination or interpretation. 

SECTION 4

Definitions

        4.1
“Subsidiary Corporation.” For purposes of the Plan, a "subsidiary
corporation" consists of any corporation at least fifty percent (50%) of the
stock of which is directly or indirectly owned or controlled by the Company.

        4.2
“Common Stock.” A share of Common Stock means a share of authorized
but unissued or reacquired Common Stock, No Par Value, of the Company.

        4.3
“Fair Market Value.” If the Common Stock is not traded publicly, the
Fair Market Value of a share of Common Stock on any date shall be determined, in
good faith, by the Board or the Committee after such consultation with outside
accounting and other experts as the Board or the Committee may deem advisable,
and the Board or the Committee shall maintain a written record of its method of
determining such value. If the Common Stock is traded publicly, the Fair Market
Value of a share of Common Stock on any date shall be the average of the
representative closing bid and asked prices, as quoted by the National
Association of Securities Dealers through NASDAQ (its automated system for
reporting quotes), for the date in question or, if the Common Stock is listed on
the NASDAQ National Market System or is listed on a national stock exchange, the
officially quoted closing price on NASDAQ or such exchange, as the case may be,
on the date in question. 

        4.4
“Non-Employee Director.” A Non-Employee Director is a member of the
Board of Directors of the Company who is not also an employee or officer of the
Company.

        4.5
“Option Holder.” An Option Holder is a Non-Employee Director to whom
a Stock Option is granted.

        4.6
“Stock Option.” A Stock Option is the right granted under the Plan to
a Non-Employee Director to purchase, at such time or times and at such price or
prices (“Option Price”) as are determined pursuant to the Plan, the
number of shares of Common Stock determined pursuant to the Plan. 

SECTION 5

Option Grants

        5.1
Number of Shares. Upon the effective date of this Plan as provided in Section 15
hereof or, if later, upon the initial election or appointment of a Non-Employee
Director to the Company’s Board of Directors, each Non-Employee Director
shall be granted a Stock Option to purchase 1,000 shares of Common Stock
(subject to adjustment pursuant to Section 6.2 hereof) effective as of the
effective date of this Plan or, if later, the date such person is elected or
appointed to the Board of Directors. In addition, each Non-Employee Director
shall be granted a Stock Option to purchase 1,000 shares of Common Stock
(subject to adjustment pursuant to Section 6.2 hereof) effective as of each
anniversary date of the initial grant of a Stock Option to such Director under
the preceding sentence 

2

        5.2
Vesting of Stock Options. Except as provided in Sections 7 and 11, each Stock
Option granted under this Plan shall be vested as to one hundred percent (100%)
of the number of shares subject to such Stock Option upon the first anniversary
date the Stock Option is granted. No Stock Option shall be exercisable if not
vested. 

        5.3
Price. The purchase price per share of Common Stock for the shares to be
purchased pursuant to the exercise of any Stock Option shall be 100% of the Fair
Market Value of a share of Common Stock on the date on which the Non-Employee
Director is granted the Stock Option. 

        5.4
Other Terms. Except for the limitations set forth in Sections 5.1, 5.2, 5.3 and
7.1, the terms and provisions of Stock Options shall be as determined from time
to time by the Committee, and each Stock Option issued may contain terms and
provisions different from other Stock Options granted to the same or other Stock
Option recipients. Each Stock Option shall be evidenced by a written agreement
(“Option Agreement”) containing such terms and provisions as the
Committee may determine, subject to the provisions of the Plan. 

SECTION 6

Shares of
Common Stock Subject to the Plan

        6.1
Maximum Number. Initially, the maximum aggregate number of shares of Common
Stock that may be made subject to Stock Options shall be 80,000 authorized but
unissued shares of Common Stock. If any shares of Common Stock subject to Stock
Options are not purchased or otherwise paid for before such Stock Options
expire, such shares again may be made subject to Stock Options. 

        6.2
Adjustments for Stock Split; Stock Dividend, Etc. If, at any time subsequent to
the effective date of the Plan as provided in Section 15 hereof, the number of
shares of Common Stock is increased or decreased, or changed into or exchanged
for a different number or kind of shares of stock or other securities of the
Company or of another corporation (whether as a result of a stock split, stock
dividend, combination or exchange of shares, exchange for other securities,
reclassification, reorganization, redesignation, merger, consolidation,
recapitalization or otherwise): (i) there shall automatically be substituted for
each share subject to an unexercised Stock Option (in whole or in part) granted
under the Plan, the number and kind of shares of stock or other securities into
which each outstanding share shall be changed or for which each such share shall
be exchanged; and (ii) the option price per share or unit of securities shall be
increased or decreased proportionately so that the aggregate purchase price for
the securities subject to a Stock Option shall remain the same as immediately
prior to such event. In addition to the foregoing, the Committee shall be
entitled in the event of any such increase, decrease or exchange of shares to
make other adjustments to the securities subject to a Stock Option, the
provisions of the Plan, and to any related Stock Option agreements (including
adjustments which may provide for the elimination of fractional shares), where
necessary to preserve the terms and conditions of any grants hereunder. 

3

        6.3
Determination by the Committee. Adjustments under this Section 6 shall be made
by the Committee, whose determinations with regard thereto shall be final and
binding upon all parties thereto. 

SECTION 7

Exercise of
Stock Options

        7.1
Time of Exercise. A Stock Option shall become exercisable in accordance with
this Section 7 subject to Section 11. Such times shall be set forth in the
Option Agreement evidencing such Stock Option. A Stock Option shall expire, to
the extent not exercised, five years after the date on which it was granted. 

        7.2
Termination of Director Status Before Exercise. If an Option Holder’s term
as a director of the Company shall terminate for any reason other than the
Option Holder’s death or disability, any Stock Option then held by the
Option Holder, to the extent then exercisable under the terms of this Plan and
the applicable Option Agreement(s), shall remain exercisable after the
termination of his director status for a period of three months (but in no event
beyond five years from the date of grant of the Stock Option). If the Option
Holder’s director status is terminated because the Option Holder dies or
becomes disabled within the meaning of Section 22(e)(3) of the Code, any Stock
Option then held by the Option Holder, shall become immediately exercisable in
full and the applicable Option Agreement(s), shall remain exercisable after the
termination of his directorship for a period of twelve months (but in no event
beyond five years from the date of grant of the Stock Option). If the Stock
Option is not exercised during the applicable period, it shall be deemed to have
been forfeited and of no further force or effect. 

        7.3
Disposition of Forfeited Stock Options. Any shares of Common Stock subject to
Stock Options forfeited by an Option Holder shall not thereafter be eligible for
purchase by the Option Holder but may be made subject to Stock Options granted
to other Option Holders. 

SECTION 8

No Effect
Upon Shareholder Rights

        Nothing
in this Plan shall interfere in any way with the right of the shareholders of
the Company to remove the Option Holder from the Board of Directors pursuant to
applicable state laws and the Company’s Articles of Incorporation and
Bylaws. 

SECTION 9

No Rights as
a Shareholder

        Except
as expressly provided in this Plan, an Option Holder shall have no rights as a
shareholder with respect to any shares of Common Stock subject to a Stock Option
prior to the exercise of such Stock Option and the transfer of Common Stock to
the Option Holder. Except as provided in Section 6.2, no adjustment shall be
made in the number of shares of Common Stock issued to an Option Holder, or in
any other rights of the Option Holder upon exercise of a Stock Option by reason
of any dividend, distribution or other right granted to shareholders for which
the record date is prior to the date of exercise of the Option Holder’s
Stock Option. 

4

SECTION 10

Assignability

        No
Stock Option granted under this Plan, nor any other rights acquired by an Option
Holder under this Plan, shall be assignable or transferable by an Option Holder,
other than by will or the laws of descent and distribution. In the event of the
Option Holder’s death while serving as a director, the Stock Option may be
exercised to the extent then exercisable under the applicable Option Agreement
by the personal representative of the Option Holder’s estate or, if no
personal representative has been appointed, by the successor or successors in
interest determined under the Option Holder’s will or under the applicable
laws of descent and distribution. 

SECTION 11

Change in
Control

        11.1
Options. Upon the occurrence of a Change of Control (as defined below),
notwithstanding any other provisions hereof or of any agreement to the contrary,
all Stock Options granted under this Plan shall become immediately exercisable
in full and remain exercisable under the terms of the applicable Option
Agreement(s). 

        For
purposes of this Plan, a Change of Control shall be deemed to have occurred if:
(i) a tender offer shall be made and consummated for the ownership of 50% or
more of the outstanding voting securities of the Company; (ii) the Company shall
be merged or consolidated with another corporation and, as a result of such
merger or consolidation, less than 50% of the outstanding voting securities of
the surviving or resulting corporation shall be owned in the aggregate by the
former shareholders of the Company as the same shall have existed immediately
prior to such merger or consolidation; or (iii) the Company shall sell
substantially all of its assets to another corporation which is not a wholly
owned subsidiary; or (iv) a person, within the meaning of Section 3(a)(9) or of
Section 13(d)(3) (as in effect on the date hereof) of the Securities Exchange
Act of 1934 (the “Exchange Act”), shall acquire, other than by reason
of inheritance, 50% or more of the outstanding voting securities of the Company
(whether directly, indirectly, beneficially or of record). In making any such
determination, transfers made by a person to an affiliate of such person (as
determined by the Board of Directors of the Company), whether by gift, devise or
otherwise, shall not be taken into account. For purposes of this Plan, ownership
of voting securities shall take into account and shall include ownership as
determined by applying the provisions of Rule 13d-3(d)(1)(i) as in effect on the
date hereof pursuant to the Exchange Act. 

        Notwithstanding
the provisions of subparagraph (iv) of this Section 11, “person” is
used in that subparagraph shall not include any holder who was the beneficial
owner of more than ten percent (10%) of the voting securities of the Company on
the date this Plan is approved by the Board of Directors. 

5

SECTION 12

Amendment

        The
Board may from time to time alter, amend, suspend or discontinue the Plan,
including, where applicable, any modifications or amendments as it shall deem
advisable in order to conform to any regulation or to any change in any law or
regulation applicable thereto; provided, however, that no such action shall
adversely affect the rights and obligations with respect to Stock Options at any
time outstanding under the Plan; and provided further that no such action shall,
without the approval of the shareholders of the Company, (i) materially increase
the maximum number of shares of Common Stock that may be made subject to Stock
Options (unless necessary to effect the adjustments required by Section 6.2),
(ii) materially increase the benefits accruing to Option Holders under the Plan,
or (iii) materially modify the requirements as to eligibility for participation
in the Plan. Subject to the foregoing, the provision of Section 6 of the Plan
which sets forth the number of shares of Common Stock for which Stock Options
shall be granted, the timing of Stock Option grants and the Stock Option
exercise price shall not be amended more than once every six (6) months other
than to comport with changes in the Code, ERISA or the rules thereunder. 

SECTION 13

Registration
of Optioned Shares

        The
Stock Options shall not be exercisable unless the purchase of such optioned
shares is pursuant to an applicable effective registration statement under the
Securities Act of 1933, as amended (the “Act”), or unless, in the
opinion of counsel to the Company, the proposed purchase of such optioned shares
would be exempt from the registration requirements of the Act and from the
registration or qualification requirements of applicable state securities laws. 

SECTION 14

Nonexclusivity
of the Plan

        Neither
the adoption of the Plan by the Board nor the submission of the Plan to
shareholders of the Company for approval shall be construed as creating any
limitations on the power or authority of the Board to adopt such other or
additional compensation arrangements of whatever nature as the Board may deem
necessary or desirable or precluded or limit the continuation of any other plan,
practice or arrangement for the payment of compensation or fringe benefits to
Non-Employee Directors, which the Company now has lawfully put into effect. 

SECTION 15

Effective
Date

        This
Plan was adopted by the Board of Directors of the Company on April 21, 1994 and
will become effective, if at all, on the effective date of the Company’s
Registration Statement on Form SB-2 filed with the Securities and Exchange
Commission on March 21, 1994. 

6

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