Document:

EXHIBIT 10.3

                               SECURITY AGREEMENT

         SECURITY  AGREEMENT (as amended,  restated,  supplemented  or otherwise
modified from time to time in accordance herewith and including all attachments,
exhibits and schedules hereto, the "AGREEMENT"),  dated as of May 28, 2003, made
by P-COM, INC., a Delaware corporation (the "GRANTOR"),  in favor of North Sound
Legacy Institutional Fund LLC (the "AGENT"), as collateral agent for each of the
Secured Parties whose names are set forth on Exhibit A hereto (collectively, the
"SECURED PARTIES").

         WHEREAS, the Grantor has issued separate secured convertible promissory
notes to the Secured Parties (THE "NOTES") in the aggregate  principal amount of
$300,000  pursuant to a Securities  Purchase  Agreement by and among the Grantor
and the Secured Parties dated the date hereof (the "PURCHASE AGREEMENT"); and

         WHEREAS,  it is a condition precedent to the Secured Parties making the
loan evidenced by the Notes to the Grantor that the Grantor  execute and deliver
to the  Secured  Parties a  security  agreement  providing  for the grant to the
Secured Parties of a continuing  security  interest in all personal property and
assets of the  Grantor,  all in  substantially  the form  hereof  to secure  all
Obligations (hereinafter defined); and

         WHEREAS,  all rights,  remedies and  obligations of the parties to this
Agreement  are  subject  to (i) the  provisions  of that  certain  Subordination
Agreement by and among the Secured  Parties and Silicon  Valley Bank dated as of
May 28,  2003,  and (ii) the  rights of Silicon  Valley  Bank under the SVB Loan
Agreements.

         NOW, THEREFORE, the parties agree as follows:

                             ARTICLE I. DEFINITIONS

Section 1.1.  DEFINITION OF TERMS USED HEREIN. All capitalized terms used herein
and not defined herein have the  respective  meanings  provided  therefor in the
Purchase   Agreement.   All  terms  defined  in  the  Uniform   Commercial  Code
(hereinafter  defined)  as in effect  from time to time and used  herein and not
otherwise  defined herein (whether or not such terms are  capitalized)  have the
same definitions herein as specified therein.

Section  1.2.  DEFINITION  OF CERTAIN  TERMS USED HEREIN.  As used  herein,  the
following terms have the following meanings:

         "COLLATERAL"  means all  accounts  receivable  of the  Grantor  and all
personal  and  fixture  property of every kind and  nature,  including,  without
limitation,  all furniture,  fixtures,  equipment, raw materials,  inventory, or
other  goods,  accounts,  contract  rights,  rights  to the  payment  of  money,
insurance  refund  claims  and all other  insurance  claims and  proceeds,  tort
claims, chattel paper, documents,  instruments,  securities and other investment
property,  deposit  accounts,  rights to  proceeds  of letters of credit and all
general  intangibles  including,  without  limitation,  all tax  refund  claims,
license  fees,  patents,  patent  licenses,  patent  applications,   trademarks,
trademark licenses, trademark applications,  trade names, copyrights,  copyright
licenses,   copyright   applications,   rights  to  sue  and  recover  for  past
infringement of patents,

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trademarks and copyrights,  computer programs,  computer  software,  engineering
drawings,  service marks, customer lists, goodwill,  and all licenses,  permits,
agreements of any kind or nature pursuant to which the Grantor  possesses,  uses
or has authority to possess or use property  (whether tangible or intangible) of
others or others  possess,  use or have  authority  to possess  or use  property
(whether  tangible or intangible)  of the Grantor,  and all recorded data of any
kind or  nature,  regardless  of the  medium  of  recording  including,  without
limitation, all books and records, software, writings, plans, specifications and
schematics; and all proceeds and products of each of the foregoing.

         "DEFAULT"  means any event or  circumstance  which,  with the giving of
notice,  the lapse of time, or both, would (if not cured,  waived,  or otherwise
remedied during such time) constitute an Event of Default.

         "EVENT OF DEFAULT" has the meaning specified in the Notes.

         "INDEMNITEES" has the meaning specified in Section 7.5(b).

         "LIEN" means: (i) any interest in property  securing an obligation owed
to, or a claim by, a Person other than the owner of the  property,  whether such
interest is based on the common  law,  statute,  or  contract,  and  including a
security  interest,  charge,  claim,  or lien arising  from a mortgage,  deed of
trust,  encumbrance,  pledge,  hypothecation,  assignment,  deposit arrangement,
agreement,  security  agreement,  conditional  sale or trust receipt or a lease,
consignment or bailment for security  purposes;  (ii) to the extent not included
under  CLAUSE  (I),  any   reservation,   exception,   encroachment,   easement,
right-of-way,  covenant, condition,  restriction, lease or other title exception
or encumbrance  affecting property;  and (iii) any contingent or other agreement
to provide any of the foregoing.

         "NOTES" has the meaning  assigned to such term in the first  recital of
this Agreement.

         "PERMITTED  LIEN" has the meaning set forth in the SVB Loan  Agreements
(as in effect on the date hereof),  except that,  with respect to clause (iv) of
such  definition,  such  additional  security  interests  and liens must also be
consented to in writing by the Collateral  Agent,  which consent may be withheld
in its good faith business judgment.

         "OBLIGATIONS"   means  all  indebtedness,   liabilities,   obligations,
covenants and duties of the Grantor to the Secured Parties of every kind, nature
and  description,  direct or indirect,  absolute or contingent,  due or not due,
contractual or tortious, liquidated or unliquidated, arising by operation of law
or otherwise,  now existing of hereafter arising under or in connection with the
Notes,  the  Purchase  Agreement,   this  Agreement  or  the  other  Transaction
Documents.

         "SECURITY  INTEREST"  has the meaning  specified in Section 2.1 of this
Agreement.

         "SVB LOAN AGREEMENTS" means that certain Loan and Security Agreement by
and among the Grantor,  P-Com Network  Services,  Inc. and Silicon  Valley Bank,
dated  September 20, 2002,  and that certain Loan and Security  Agreement  (EXIM
Program) by and among the  Grantor,  P-Com  Network  Services,  Inc. and Silicon
Valley Bank, dated September 20, 2002.

         "UNIFORM  COMMERCIAL CODE" means the Uniform  Commercial Code from time
to time in effect in the State of Delaware.

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                         ARTICLE II. SECURITY INTEREST

Section 2.1. SECURITY INTEREST. As security for the payment and performance,  in
full  of  the  Obligations,  and  any  extensions,  renewals,  modifications  or
refinancings of the Obligations,  the Grantor hereby bargains,  sells,  conveys,
assigns,  sets over,  mortgages,  pledges,  hypothecates  and  transfers  to the
Secured Parties, and hereby grants to the Secured Parties,  their successors and
assigns, a security interest in, all of such Grantor's right, title and interest
in, to and under the Collateral (the "SECURITY INTEREST").

Section 2.2. NO  ASSUMPTION OF  LIABILITY.  The Security  Interest is granted as
security only and shall not subject the Secured  Parties to, or in any way alter
or modify, any obligation or liability of the Grantor with respect to or arising
out of the Collateral.

                  ARTICLE III. REPRESENTATIONS AND WARRANTIES

         The Grantor represents and warrants to the Secured Parties that:

Section 3.1. TITLE AND  AUTHORITY.  The Grantor has good and valid rights in and
title to the  Collateral  with  respect  to which  it has  purported  to grant a
security  interest  hereunder  and has full power and  authority to grant to the
Secured  Parties the Security  Interest and to execute,  deliver and perform its
obligations in accordance with the terms of this Agreement,  without the consent
or approval  of any other  Person  other than any consent or approval  which has
been obtained.

Section 3.2. FILINGS; ACTIONS TO ACHIEVE PERFECTION.  Upon filing in each United
States governmental, municipal or other office specified in Schedule A, properly
completed  Uniform  Commercial  Code  financing  statements  (including  fixture
filings,  as applicable)  containing a description of the Collateral are all the
filings,  recordings and  registrations  that are necessary to publish notice of
and  protect  the  validity of and to  establish  a legal,  valid and  perfected
security  interest in favor of the Secured  Parties in respect of all Collateral
in which  the  Security  Interest  may be  perfected  by  filing,  recording  or
registration in the United States (or any political subdivision thereof) and its
territories  and  possessions,  and no further or subsequent  filing,  refiling,
recording, rerecording,  registration or reregistration is necessary in any such
jurisdiction, except as provided under applicable law with respect to the filing
of  continuation  statements  or with respect to the filing of amendments or new
filings to reflect  the change of the  Grantor's  name,  location,  identity  or
corporate  structure.  The  Grantor's  name is  listed in the  preamble  of this
Agreement  identically to how it appears on its certificate of  incorporation or
other organizational documents.

Section 3.3. VALIDITY AND PRIORITY OF SECURITY  INTEREST.  The Security Interest
constitutes  (a) a legal  and  valid  security  interest  in all the  Collateral
securing the payment and performance of the Obligations, (b) subject only to the
filings described in Section 3.2 above and other previously  perfected  security
interests in the Collateral listed on Schedule 3.3 to this Agreement  ("EXISTING
LIENS") and Permitted Liens, a perfected  security interest in all Collateral in
which a security interest may be perfected by filing,  recording or registration
in the United States pursuant to the Uniform Commercial Code or other applicable
law in the  United  States  (or  any  political  subdivision  thereof)  and  its
territories  and  possessions  or any other  country,  state or  nation  (or any
political  subdivision   thereof).   The  Security  Interest  is  and  shall  be
subordinate to any other Existing Lien on any of the Collateral.

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Section 3.4. ABSENCE OF OTHER LIENS. The Collateral is owned by the Grantor free
and clear of any Lien other than  Existing  Liens and Permitted  Liens.  Without
limiting  the  foregoing  and  except  as set  forth  on  Schedule  3.4 to  this
Agreement,  the Grantor has not filed or  consented  to any filing  described in
Section 3.2 in favor of any Person other than the Secured Parties, nor permitted
the granting or assignment of a security interest or permitted perfection of any
security  interest  in the  Collateral  in favor of any  Person  other  than the
Secured Parties.  The Secured Parties' having  possession of all instruments and
cash  constituting  Collateral  from time to time and the  filing  of  financing
statements  in the  offices  referred  to in  Schedule  A hereto  results in the
perfection of such security interest.  Such security interest is, or in the case
of Collateral in which the Grantor obtain rights after the date hereof, will be,
a perfected  security  interest.  Such  notices,  filings  and all other  action
necessary or desirable to perfect and protect such  security  interest have been
duly taken.

Section 3.5. VALID AND BINDING OBLIGATION. This Agreement constitutes the legal,
valid and binding obligation of the Grantor,  enforceable against the Grantor in
accordance  with its terms,  except (i) as  limited  by  applicable  bankruptcy,
insolvency,  reorganization,  moratorium,  and other laws of general application
affecting  enforcement of creditors' rights  generally,  (ii) as limited by laws
relating to the  availability of specific  performance,  injunctive  relief,  or
other equitable remedies, (iii) as limited by the Subordination Agreement by and
between the Secured  Party and Silicon  Valley Bank,  and (iv) to the extent the
indemnification  provisions  contained  in  this  Agreement  may be  limited  by
applicable federal or state securities laws.

                             ARTICLE IV. COVENANTS

     Section 4.1.  Change of Name;  Location of  Collateral;  Place of Business,
State of Formation or Organization.

               (a) The Grantor shall notify the Agent in writing promptly of any
          change (i) in its corporate name or in any trade name used to identify
          it in  the  conduct  of  its  business  or in  the  ownership  of  its
          properties,  (ii) in the location of its chief executive  office,  its
          principal place of business, any office in which it maintains books or
          records   relating  to   Collateral   owned  by  it   (including   the
          establishment  of any  such  new  office  or  facility),  (iii) in its
          identity or  corporate  structure  such that a filed filing made under
          the Uniform  Commercial Code becomes misleading or (iv) in its Federal
          Taxpayer  Identification  Number.  In extension of the foregoing,  the
          Grantor  shall not  effect or permit  any  change  referred  to in the
          preceding sentence unless all filings have been made under the Uniform
          Commercial  Code or  otherwise  that are  required  in  order  for the
          Secured Parties to continue at all times following such change to have
          a valid, legal and perfected security interest in all the Collateral.

               (b) Without  limiting  Section 4.1(a),  without the prior written
          consent of the Agent in each  instance,  the Grantor  shall not change
          its state of incorporation, formation or organization.

     Section  4.2.  RECORDS.  The Grantor  shall  maintain,  at its own cost and
expense, such complete and accurate records with respect to the Collateral owned
by it as is consistent  with its current  practices and in accordance  with such
prudent  and  standard  practices  used in  industries  that  are the same as or
similar to those in which the  Grantor is  engaged,  but in any event to include
complete  accounting  records indicating all payments and proceeds received with
respect

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to any part of the  Collateral,  and,  at such  time or times as the  Agent  may
reasonably  request,  promptly  to  prepare  and  deliver  to the  Agent  a duly
certified  schedule or  schedules in form and detail  satisfactory  to the Agent
showing the identity, amount and location of any and all Collateral.

Section  4.3.  PERIODIC  CERTIFICATION;  NOTICE OF  CHANGES.  In the event there
should at any time be any change in the  information  represented  and warranted
herein or in the documents and instruments  executed and delivered in connection
herewith,  the  Grantor  shall  immediately  notify the Agent in writing of such
change (this notice  requirement shall be in extension of and shall not limit or
relieve the Grantor of any other covenants hereunder).

Section 4.4.  PROTECTION  OF SECURITY.  The Grantor  shall,  at its own cost and
expense,  take any and all actions  necessary to defend title to the  Collateral
against all persons and to defend the Security  Interest of the Secured  Parties
in the Collateral and the priority  thereof against any Lien other than Existing
Liens and Permitted Liens.

Section  4.5.  INSPECTION  AND  VERIFICATION.  The Agent and such persons as the
Agent may reasonably  designate  shall have the right to inspect the Collateral,
all records  related thereto (and to make extracts and copies from such records)
and the premises  upon which any of the  Collateral  is located,  to discuss the
Grantor's  affairs  with  the  officers  of  the  Grantor  and  its  independent
accountants  and to verify under  reasonable  procedures  the validity,  amount,
quality,  quantity, value, condition and status of, or any other matter relating
to, the  Collateral,  including,  in the case of collateral in the possession of
any third Person and upon an Event of Default,  by contacting any account debtor
or third  Person  possessing  such  Collateral  for the purpose of making such a
verification.  Out-of-pocket  expenses in  connection  with any  inspections  by
representatives  of the Agent shall be (a) the  obligations  of the Grantor with
respect to any inspection after the Secured Parties' demand payment of the Notes
or (b) the obligation of the Secured Parties in any other case.

Section 4.6. TAXES;  ENCUMBRANCES.  At its option, the Agent (for the benefit of
the  Secured  Parties)  may  discharge  Liens,  other  than  Existing  Liens and
Permitted  Liens, at any time levied or placed on the Collateral and may pay for
the  maintenance  and  preservation  of the Collateral to the extent the Grantor
fails to do so and the Grantor  shall  reimburse the Agent Parties on demand for
any payment made or any expense  incurred by the Agent pursuant to the foregoing
authorization;  provided,  however,  that  nothing  in  this  Section  shall  be
interpreted  as excusing  the Grantor from the  performance  of, or imposing any
obligation on the Agent to cure or perform, any covenants or other obligation of
the  Grantor  with  respect  to any  Lien  or  maintenance  or  preservation  of
Collateral as set forth herein.

Section 4.7. USE AND  DISPOSITION OF  COLLATERAL.  The Grantor shall not make or
permit to be made an assignment,  pledge or  hypothecation  of any Collateral or
shall  grant any other  Lien in respect of the  Collateral  other than  Existing
Liens and  Permitted  Liens  without  the prior  written  consent of the Secured
Parties.  The  Grantor  shall not make or permit to be made any  transfer of any
Collateral  and the  Grantor  shall  remain  at all times in  possession  of the
Collateral  owned by it,  other than with  respect to  Existing  Liens and other
liens approved by the Secured Parties.

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Section  4.8.  INSURANCE/NOTICE  OF LOSS.  Within a  reasonable  period  of time
following  the  date of this  Agreement,  Grantor,  at its  own  expense,  shall
maintain or cause to be maintained insurance covering physical loss or damage to
the  Collateral.  In  extension of the  foregoing  and without  limitation,  the
Secured Parties shall be listed as an "additional  insured" on Grantor's general
liability  insurance.  Such insurance shall not be terminated,  cancelled or not
renewed for any reason, including non-payment of insurance premiums,  unless the
insurer shall have  provided the Secured  Parties at least 30 days prior written
notice. Grantor irrevocably makes,  constitutes and appoints the Secured Parties
(and all officers, employees or agents designated by the Secured Parties) as its
true  and  lawful  agent  and  attorney-in-fact  for the  purpose,  at any  time
following  the  Secured  Parties'  demand for  payment of the Notes,  of making,
settling  and  adjusting  claims in  respect of  Collateral  under  policies  of
insurance,  endorsing  the name of Grantor on any check,  draft,  instrument  or
other item of payment for the  proceeds of such  policies of  insurance  and for
making all determinations and decisions with respect thereto.  In the event that
Grantor  at any  time or times  shall  fail to  obtain  or  maintain  any of the
policies  of  insurance  required  hereby or to pay any premium in whole or part
relating  thereto,  the Secured  Parties may,  without  waiving or releasing any
obligation or liability of Grantor hereunder,  in their sole discretion,  obtain
and maintain  such policies of insurance and pay such premium and take any other
actions with respect  thereto as the Secured  Parties deem  advisable.  All sums
disbursed  by the Secured  Parties in  connection  and in  accordance  with this
Section,  including reasonable  attorneys' fees, court costs, expenses and other
charges  relating  thereto,  shall be  payable  upon  demand,  by Grantor to the
Secured  Parties and shall be additional  Obligations  secured  hereby.  Grantor
shall  promptly  notify  the  Secured  Parties  if any  material  portion of the
Collateral owned or held by Grantor is damaged or destroyed. The proceeds of any
casualty  insurance  in respect of any  casualty  loss of any of the  Collateral
shall (i) so long as the Secured Parties have not demanded payment of the Notes,
be disbursed to Grantor for direct  application  by Grantor solely to the repair
or  replacement of Grantor's  property so damaged or destroyed,  and (ii) in all
other  circumstances,  be held by the Secured Parties as cash collateral for the
Obligations.  The Secured Parties may, at their sole option,  disburse from time
to time all or any part of such proceeds so held as cash  collateral,  upon such
terms and conditions as the Secured Parties may reasonably prescribe, for direct
application  by the  Secured  Parties  solely to the  repair or  replacement  of
Grantor's property so damaged or destroyed, or Grantor may apply all or any part
of such proceeds to the Obligations.

Section 4.9. LEGEND.  Grantor shall legend,  in form and manner  satisfactory to
the  Secured  Parties,  its  accounts  and  its  books,  records  and  documents
evidencing or pertaining thereto with an appropriate  reference to the fact that
such  accounts  have been  assigned to the Secured  Parties and that the Secured
Parties have a security interest therein.

                ARTICLE V. FURTHER ASSURANCES; POWER OF ATTORNEY

Section 5.1. FURTHER ASSURANCES.  The Agent is hereby authorized to file Uniform
Commercial  Code  financing  statements  and/or any other  appropriate  filings,
recording or  registrations  evidencing the security  interests  granted herein.
Grantor shall, at its own expense, execute, acknowledge, deliver and cause to be
duly filed all such further  instruments and documents and take all such actions
as the  Secured  Parties  may from  time to time  reasonably  request  to better
assure,  preserve,  protect and perfect the Security Interest and the rights and
remedies created hereby, including the payment of any fees and taxes required in
connection  with the execution and delivery of this  Agreement,  the granting of
the Security  Interest  and the filing of any  financing  statements  (including
fixture filings) or other documents in connection herewith or therewith.  If any
amount  payable under or in connection  with any of the  Collateral  shall be or
become  evidenced  by any  promissory  note or other  instrument,  such  note or
instrument  shall be immediately  pledged and delivered to the Secured  Parties,
duly endorsed in a manner satisfactory to the Secured Parties.

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     Section 5.2. Power of Attorney.

     (a)  Grantor  hereby  irrevocably  (as a power  coupled  with an  interest)
constitutes  and  appoints  the Agent  (and all  officers,  employees  or agents
designated by the Agent), its attorney-in-fact  with full power of substitution,
for the  benefit of the  Secured  Parties,  at any time  following  the  Secured
Parties' demand for payment of the Notes (i) to receive,  endorse, assign and/or
deliver any and all notes,  acceptances,  checks,  drafts, money orders or other
evidences of payment  relating to the  Collateral or any part  thereof;  (ii) to
demand,  collect,  receive  payment of, give receipt for and give discharges and
releases of all or any of the  Collateral;  (iii) to sign the name of Grantor on
any invoice or bill of lading  relating to any of the  Collateral;  (iv) to send
verifications  of accounts to any account  debtor or any other Person liable for
an  account;  (v) to  commence  and  prosecute  any and all  suits,  actions  or
proceedings  at law or in  equity  in any  court of  competent  jurisdiction  to
collect or otherwise  realize on all or any of the  Collateral or to enforce any
rights in  respect of any  Collateral;  (vi) to  settle,  compromise,  compound,
adjust or defend any actions,  suits or proceeding relating to all or any of the
Collateral; and (vii) to use, sell, assign, transfer, pledge, make any agreement
with respect to or otherwise deal with all or any of the  Collateral,  and to do
all other acts and things necessary to carry out the purposes of this Agreement,
as fully and completely as though the Secured Parties were the absolute owner of
the  Collateral  for  all  purposes;  PROVIDED,  HOWEVER,  that  nothing  herein
contained  shall be construed as requiring or obligating the Secured  Parties to
make any  commitment or to make any inquiry as to the nature or  sufficiency  of
any payment received by the Secured Parties,  or to present or file any claim or
notice, or to take any action with respect to the Collateral or any part thereof
or the moneys due or to become due in respect  thereof or any  property  covered
thereby,  and no action taken or omitted to be taken by the Secured Parties with
respect to the  Collateral  or any part thereof  shall give rise to any defense,
counterclaim or offset in favor of Grantor or to any claim or action against the
Secured Parties.

     (b) The provisions of this Article shall in no event relieve Grantor of any
of its obligations  hereunder with respect to the Collateral or any part thereof
or impose any  obligation  on the Secured  Parties to proceed in any  particular
manner with respect to the  Collateral or any part thereof,  or in any way limit
the exercise by the Secured  Parties of any other or further  right which it may
have on the date of this Agreement or hereafter,  whether  hereunder,  by law or
otherwise.

                              ARTICLE VI. REMEDIES

     Section 6.1. Remedies upon Default.

     (a) Upon the occurrence and during the  continuance of an Event of Default,
Grantor agrees to deliver each item of its Collateral to the Secured  Parties on
demand,  and it is agreed that the Secured  Parties shall have the right to take
any of or all the following  actions at the same or different  times (but at all
times subject to any Existing Liens):  with or without legal process and with or
without  prior  notice or demand  for  performance,  to take  possession  of

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the  Collateral  and without  liability for trespass to enter any premises where
the  Collateral  may be  located  for the  purpose  of taking  possession  of or
removing the  Collateral,  exercise  Grantor's right to bill and receive payment
for completed work and, generally,  to exercise any and all rights afforded to a
secured party under the Uniform Commercial Code or other applicable law. Without
limiting  the  generality  of the  foregoing,  Grantor  agrees  that the Secured
Parties  shall  have  the  right,  subject  to  the  mandatory  requirements  of
applicable  law,  to  sell  or  otherwise  dispose  of all or  any  part  of the
Collateral,  at  public  or  private  sale or at any  broker's  board  or on any
securities exchange, for cash, upon credit or for future delivery as the Secured
Parties shall deem  appropriate.  The Secured Parties shall be authorized at any
such  sale (if it deems  it  advisable  to do so) to  restrict  the  prospective
bidders or  purchasers  to persons  who will  represent  and agree that they are
purchasing  the  Collateral  for their own account for investment and not with a
view to the distribution or sale thereof, and upon consummation of any such sale
the Secured Parties shall have the right to assign,  transfer and deliver to the
purchaser or purchasers  thereof the Collateral so sold.  Each such purchaser at
any such sale shall hold the property  sold  absolutely,  free from any claim or
right on the part of Grantor, and Grantor hereby waives (to the extent permitted
by law) all rights of  redemption,  stay and appraisal  which Grantor now has or
may at any time in the future have under any rule of law or statute now existing
or hereafter enacted.

     (b) The Secured  Parties shall give Grantor ten (10) days'  written  notice
(which  Grantor  agrees is  reasonable  notice  within  the  meaning  of Section
9-504(3) of the Uniform  Commercial Code) of the Secured  Parties'  intention to
make any sale of Collateral.  Such notice,  in the case of a public sale,  shall
state the time and place for such sale and,  in the case of a sale at a broker's
board or on a  securities  exchange,  shall state the board or exchange at which
such sale is to be made and the day on which the Collateral, or portion thereof,
will first be offered for sale at such board or  exchange.  Any such public sale
shall be held at such time or times within  ordinary  business hours and at such
place or places as the Secured  Parties may fix and state in the notice (if any)
of such sale. At any such sale, the Collateral,  or portion thereof,  to be sold
may be sold in one lot as an  entirety or in  separate  parcels,  as the Secured
Parties  may (in their sole and  absolute  discretion)  determine.  The  Secured
Parties  shall not be obligated to make any sale of any  Collateral  if it shall
determine  not to do so,  regardless  of the fact  that  notice  of sale of such
Collateral  shall have been given.  The Secured  Parties may,  without notice or
publication,  adjourn  any  public  or  private  sale or  cause  the  same to be
adjourned  from time to time by  announcement  at the time and  place  fixed for
sale, and such sale may,  without

                                       8

<PAGE>

further  notice,  be made at the  time  and  place  to  which  the  same  was so
adjourned.  In case  any sale of all or any  part of the  Collateral  is made on
credit or for future  delivery,  the  Collateral  so sold may be retained by the
Secured  Parties  until the sale price is paid by the  purchaser  or  purchasers
thereof,  but the Secured Parties shall not incur any liability in case any such
purchaser or purchasers shall fail to take up and pay for the Collateral so sold
and, in case of any such failure,  such  Collateral  may be sold again upon like
notice.  At any public (or, to the extent  permitted by law,  private) sale made
pursuant to this Section, the Secured Parties may bid for or purchase,  free (to
the extent  permitted by law) from any right of redemption,  stay,  valuation or
appraisal on the part of Grantor  (all said rights being also hereby  waived and
released to the extent  permitted by law),  the  Collateral  or any part thereof
offered for sale and may make payment on account thereof by using any claim then
due and  payable to the Secured  Parties  from  Grantor as a credit  against the
purchase  price,  and the Secured Parties may, upon compliance with the terms of
sale, hold,  retain and dispose of such property without further  accountability
to Grantor  therefor.  For purposes hereof, a written  agreement to purchase the
Collateral  or any  portion  thereof  shall be  treated as a sale  thereof;  the
Secured  Parties shall be free to carry out such sale pursuant to such agreement
and Grantor shall not be entitled to the return of the Collateral or any portion
thereof subject thereto, notwithstanding the fact that after the Secured Parties
shall have  entered  into such an agreement  all  Obligations  have been paid in
full. As an alternative  to exercising  the power of sale herein  conferred upon
it, the  Secured  Parties  may proceed by a suit or suits at law or in equity to
foreclose  this  Agreement  and to sell the  Collateral  or any portion  thereof
pursuant  to a  judgment  or  decree  of a  court  or  courts  having  competent
jurisdiction or pursuant to a proceeding by a court-appointed receiver.

     Section 6.2.  APPLICATION OF PROCEEDS.  The Secured Parties shall apply the
proceeds of any collection or sale of the Collateral,  as well as any Collateral
consisting of cash, as follows:

     (a) FIRST, to the payment of all costs and expenses incurred by the Secured
Parties in  connection  with such  collection or sale or otherwise in connection
with this Agreement or any of the Obligations, including all court costs and the
fees and  expenses  of its  agents  and legal  counsel,  and any other  costs or
expenses  incurred  in  connection  with the  exercise  of any  right or  remedy
hereunder,  under the Purchase  Agreement,  the Notes and the other  Transaction
Documents;

     (b) SECOND, to the payment in full of the Obligations; and

     (c) THIRD, to Grantor,  its successors or assigns,  or to whomsoever may be
lawfully  entitled to receive the same, or as a court of competent  jurisdiction
may otherwise direct.

         Subject to the  foregoing,  the  Secured  Parties  shall have  absolute
discretion as to the time of application of such proceeds, moneys or balances in
accordance with this  Agreement.  Upon any sale of the Collateral by the Secured
Parties  (including  pursuant  to a power of sale  granted by statute or under a
judicial  proceeding),  the receipt of any such proceeds,  moneys or balances by
the  Secured  Parties or of the  officer  making the sale shall be a  sufficient
discharge to the  purchaser or  purchasers  of the  Collateral  so sold and such
purchaser or purchasers  shall not be obligated to see to the application of any
part of the purchase  money paid over to the Secured  Parties or such officer or
be answerable in any way for the misapplication thereof.

Section 6.3. GRANT OF LICENSE TO USE INTELLECTUAL  PROPERTY.  For the purpose of
enabling the Secured  Parties to exercise rights and remedies under this Article
at such time as the Secured Parties shall be lawfully  entitled to exercise such
rights and remedies,  to the extent not prohibited by any intellectual  property
license,   Grantor  hereby  grants  to  the  Secured   Parties  an  irrevocable,
non-exclusive   license   (exercisable  without  payment  of  royalty  or  other
compensation  to Grantor) to use,  license or sub-license  any of the Collateral
consisting of intellectual  property now owned or hereafter acquired by Grantor,
and wherever the same may be located,  and including in such license  reasonable
access to all media in which any of the licensed items may be recorded or stored
and to all computer  software and programs used for the  compilation or printout
thereof. The use of such license by the Secured Parties may be exercised, at the
option of the Secured  Parties,  only following the Secured  Parties' demand for
payment of the Notes.

                                       9
<PAGE>

                           ARTICLE VII. MISCELLANEOUS

     Section  7.1.  NOTICES.  All  communications  and notices  hereunder to the
Grantor  and to  the  Secured  Parties  shall  (except  as  otherwise  expressly
permitted  herein) be in writing  and  delivered  to the  Grantor or the Secured
Parties, as the case may be, as provided in the Purchase Agreement.

     Section 7.2. SECURITY INTEREST ABSOLUTE.  All rights of the Secured Parties
hereunder,  the Security Interest and all obligations of Grantor hereunder shall
be  absolute  and  unconditional  irrespective  of (a) any lack of  validity  or
enforceability  of the Purchase  Agreement,  the Notes, any Loan Document or any
agreement  with  respect to any of the  Obligations  or any other  agreement  or
instrument relating to any of the foregoing,  (b) any change in the time, manner
or place of payment of, or in any other term of, all or any of the  Obligations,
or any other  amendment  or waiver of or any consent to any  departure  from the
Purchase  Agreement,  the Notes,  any Loan  Document or any other  agreement  or
instrument,  (c) any exchange,  release or  non-perfection  of any Lien on other
collateral,  or any  release  or  amendment  or  waiver of or  consent  under or
departure  from  any  guarantee,  securing  or  guaranteeing  all  or any of the
Obligations,  or (d) any other  circumstance  that might otherwise  constitute a
defense  available to, or a discharge of, Grantor in respect of the  Obligations
or this Agreement.

     Section   7.3.   SURVIVAL  OF   AGREEMENT.   All   covenants,   agreements,
representations and warranties made by Grantor herein and in the certificates or
other  instruments  prepared or delivered in connection with or pursuant to this
Agreement  shall be considered  to have been relied upon by the Secured  Parties
and shall  survive the making of the loan and the  execution and delivery to the
Secured  Parties  of the  Notes,  regardless  of any  investigation  made by the
Secured Parties or on their behalf;  and shall continue in full force and effect
until this Agreement shall terminate. The provisions of Section 7.5 hereof shall
survive termination of this Agreement.

     Section 7.4.  BINDING EFFECT;  SEVERAL  AGREEMENT;  SUCCESSORS AND ASSIGNS.
This Agreement  shall become  effective as to Grantor when a counterpart  hereof
executed on behalf of Grantor shall have been  delivered to the Secured  Parties
and a  counterpart  hereof  shall have been  executed  on behalf of the  Secured
Parties,  and thereafter  shall be binding upon Grantor and the Secured  Parties
and their respective  successors and assigns,  and shall inure to the benefit of
Grantor, the Secured Parties and their respective successors and assigns, except
that  Grantor  shall  not have the right to assign  or  transfer  its  rights or
obligations  hereunder or any interest herein or in the Collateral (and any such
assignment or transfer shall be void) except as expressly  contemplated  by this
Agreement, the Purchase Agreement, the Notes or the other Transaction Documents.

     Section 7.5. Secured Parties' Fees and Expense; Indemnification.

     (a) Grantor  agrees to pay upon  demand,  and to save the Agent and each of
the  Secured  Parties  harmless  from,  the  amount  of any and  all  reasonable
expenses,  including all reasonable fees, disbursements and other charges of its
counsel  and of any experts or agents,  which the  Secured  Parties may incur in
connection  with  (i)  the  administration  of  this  Agreement  (including  the
customary  fees and charges of the Secured  Parties for any audits  conducted by
them or on their  behalf  with  respect  to the  accounts  inventory),  (ii) the
custody or preservation of, or the sale of, collection from or other realization
upon any of the Collateral, (iii) the exercise, enforcement or protection of any
of the rights of

                                       10

<PAGE>

the  Secured  Parties  hereunder  or (iv) the  failure  of Grantor to perform or
observe any of the provisions hereof.

     (b) Grantor  agrees to indemnify the Agent and each of the Secured  Parties
and any agents,  contractors and employees of the Secured Parties (collectively,
the  "INDEMNITEES")  against,  and hold each of them harmless  from, any and all
losses, claims, damages,  liabilities and related expenses, including reasonable
fees,  disbursements  and other  charges of  counsel,  incurred  by or  asserted
against any of them arising out of, in any way  connected  with,  or as a result
of, the execution,  delivery,  or performance of this Agreement or any agreement
or instrument  contemplated  hereby or any claim,  litigation,  investigation or
proceeding  relating hereto or to the Collateral,  whether or not any Indemnitee
is a  party  thereto;  provided  that  such  indemnity  shall  not,  as  to  any
Indemnitee,  be  available  to the extent  that such  losses,  claims,  damages,
liabilities  or  related  expenses  are  determined  by  a  court  of  competent
jurisdiction by final and nonappealable judgment to have resulted from the gross
negligence or willful misconduct of such Indemnitee.

     (c) Any such  amounts  payable as provided  hereunder  shall be  additional
Obligations  secured  hereby.  The  provisions  of  this  Section  shall  remain
operative  and in full force and effect  regardless of the  termination  of this
Agreement, the Purchase Agreement, the Notes or the other Transaction Documents,
the consummation of the transactions  contemplated  hereby, the repayment of any
of the Obligations,  the invalidity or unenforceability of any term or provision
of this Agreement,  the Purchase  Agreement,  the Notes or the other Transaction
Documents, or any investigation made by or on behalf of the Secured Parties. All
amounts due under this Section shall be payable on written demand therefor.

     Section 7.6. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF DELAWARE.

     Section 7.7. Waivers; Amendment.

     (a) No failure or delay of the Secured  Parties in exercising  any power or
right  hereunder  shall  operate  as a waiver  thereof,  nor shall any single or
partial   exercise  of  any  such  right  or  power,   or  any   abandonment  or
discontinuance of steps to enforce such a right or power,  preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Secured Parties  hereunder and under the Purchase  Agreement
are  cumulative  and are not exclusive of any rights or remedies that they would
otherwise  have.  No waiver of any  provisions of this  Agreement,  the Purchase
Agreement,  the Notes or the  other  Transaction  Documents  or  consent  to any
departure by Grantor  therefrom shall in any event be effective  unless the same
shall be permitted by paragraph (b) below, and then such waiver or consent shall
be effective only in the specific  instance and for the purpose for which given.
No notice to or demand on Grantor in any case shall entitle Grantor to any other
or further notice or demand in similar or other circumstances.

     (b) Neither this Agreement nor any provision hereof may be waived,  amended
or modified  except  pursuant to an agreement or agreements,  in writing entered
into by the Secured Parties and Grantor.

                                       11
<PAGE>

     Section 7.8. WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT  PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION  DIRECTLY OR INDIRECTLY  ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT,  THE PURCHASE AGREEMENT OR THE NOTES. EACH
PARTY  HERETO (A)  CERTIFIES  THAT NO  REPRESENTATIVE,  AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF  LITIGATION,  SEEK TO ENFORCE THE FOREGOING  WAIVER AND (B)
ACKNOWLEDGES  THAT IT AND THE OTHER  PARTIES  HERETO HAVE BEEN  INDUCED TO ENTER
INTO THIS AGREEMENT,  THE PURCHASE  AGREEMENT AND THE NOTES, AS APPLICABLE,  BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

     Section 7.9.  SEVERABILITY.  In the event any one or more of the provisions
contained in this Agreement should be held invalid,  illegal or unenforceable in
any  respect,  the  validity,  legality  and  enforceability  of  the  remaining
provisions contained herein shall not in any way be affected or impaired thereby
(it  being  understood  that  the  invalidity  of a  particular  provision  in a
particular  jurisdiction  shall not in and of itself affect the validity of such
provision in any other  jurisdiction).  The parties shall endeavor in good-faith
negotiations to replace the invalid,  illegal or  unenforceable  provisions with
valid provisions the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions.

     Section 7.10.  COUNTERPARTS.  This Agreement may be executed in two or more
counterparts,  each of which shall  constitute an original but all of which when
taken together shall  constitute but one contract.  Each party shall be entitled
to rely on a facsimile  signature of any other party  hereunder as if it were an
original.

     Section 7.11. Jurisdiction; Consent to Service of Process.

          (a) Grantor hereby irrevocably and unconditionally submits, for itself
     and its property,  to the  nonexclusive  jurisdiction of any Delaware State
     court or Federal court of the United States of America sitting in Delaware,
     and any  appellate  court from any  thereof,  in any  action or  proceeding
     arising out of or relating to this Agreement, the Purchase Agreement or the
     Notes, or for  recognition or enforcement of any judgment,  and each of the
     parties  hereto  hereby  irrevocably  and  unconditionally  agrees that all
     claims  in  respect  of any such  action  or  proceeding  may be heard  and
     determined  in such Delaware  State or, to the extent  permitted by law, in
     such Federal court. Each of the parties hereto agrees that a final judgment
     in any such action or proceeding shall be conclusive and may be enforced in
     other jurisdictions by suit on the judgment or in any other manner provided
     by law.  Nothing in this Agreement  shall affect any right that the Secured
     Parties may otherwise  have to bring any action or  proceeding  relating to
     this Agreement,  the Purchase Agreement, the Notes or the other Transaction
     Documents   against  Grantor  or  its  properties  in  the  courts  of  any
     jurisdiction.

          (b) Grantor hereby  irrevocably  and  unconditionally  waives,  to the
     fullest extent it may legally and effectively do so, any objection which it
     may now or  hereafter  have to the  laying of venue of any suit,  action or
     proceeding  arising  out of or  relating to this  Agreement,  the  Purchase
     Agreement,  the Notes or the other  Transaction  Documents  in any Delaware
     State or Federal  court.  Each of the  parties  hereto  hereby  irrevocably
     waives,  to  the  fullest  extent  permitted  by  law,  the  defense  of an
     inconvenient  forum to the  maintenance of such action or proceeding in any
     such court.

                                       12
<PAGE>

          (c) Each party to this  Agreement  irrevocably  consents to service of
     process in the manner provided for notices in Section 7.1.  Nothing in this
     Agreement  will affect the right of any party to this  Agreement to process
     in any other manner permitted by law.

     Section 7.12.  TERMINATION.  This Agreement and the Security Interest shall
terminate  when all the  Obligations  have been paid in full,  at which time the
Secured Parties shall execute and deliver to Grantor, at Grantor's expense,  all
Uniform  Commercial  Code  termination  statements and similar  documents  which
Grantor shall reasonably request to evidence such termination. Any execution and
delivery of termination  statements or documents  pursuant to this Section shall
be without recourse to or warranty by the Secured Parties.

     Section 7.13.  PREJUDGMENT  REMEDY WAIVER.  Grantor  acknowledges that this
Agreement, the Purchase Agreement, the Notes and the other Transaction Documents
evidence a commercial transaction and that it could, under certain circumstances
have the right,  to notice of and hearing on the right of the Secured Parties to
obtain a prejudgment  remedy,  such as attachment,  garnishment and/or replevin,
upon commencing any litigation against Grantor. Notwithstanding,  Grantor hereby
waives all rights to notice,  judicial  hearing or prior court order to which it
might   otherwise  have  the  right  under  any  state  or  federal  statute  or
constitution  in  connection  with the  obtaining by the Secured  Parties of any
prejudgment  remedy by reason of this  Agreement,  the Purchase  Agreement,  the
Notes,  the other  Transaction  Documents or by reason of the Obligations or any
renewals or  extensions  of the same.  Grantor also waives any and all objection
which it might otherwise assert, now or in the future, to the exercise or use by
the  Secured  Parties of any right of setoff,  repossession  or self help as may
presently exist under statute or common law.

                            [SIGNATURE PAGE FOLLOWS]

                                       13

<PAGE>

         IN WITNESS  WHEREOF,  the  parties  have duly  executed  this  Security
Agreement as of the day and year first written above.

                                   P-COM, INC.

                                   By:  /s/ DANIEL W. RUMSEY
                                   -------------------------------
                                         Name: Daniel W. Rumsey
                                         Title: Vice President

NORTH SOUND LEGACY INSTITUTIONAL FUND LLC, as Agent

By: /S/ ANDREW WILDER
Name:  Andrew Wilder
Title:  Chief Financial Officer

<PAGE>

                                    EXHIBIT A
                                 SECURED PARTIES

North Sound Legacy Fund LLC
53 Forest Avenue, Second Floor
Old Greenwich, CT 06870
Attention: Andrew Wilder
Fax No.: (203) 967-5851

North Sound Legacy Institutional Fund LLC
53 Forest Avenue, Second Floor
Old Greenwich, CT 06870
Attention: Andrew Wilder
Fax No.: (203) 967-5851

North Sound Legacy International Ltd.
53 Forest Avenue, Second Floor
Old Greenwich, CT 06870
Attention: Andrew Wilder
Fax No.: (203) 967-5851

<PAGE>

                                   SCHEDULE A

          PLACES OF BUSINESS; CHIEF EXECUTIVE OFFICE; FILING LOCATIONS

STATE OF INCORPORATION:
Delaware

CHIEF EXECUTIVE OFFICE:
3175 South Winchester Blvd.
Campbell, CA 95008

FILING LOCATIONS:
Secretary of State of the State of Delaware

<PAGE>

                                  SCHEDULE 3.3
                                 EXISTING LIENS

Silicon  Valley Bank holds a blanket  security  interest in all of the Grantor's
assets  pursuant to that certain  Loan and  Security  Agreement by and among the
Grantor,  P-Com Network Services,  Inc. and Silicon Valley Bank, dated September
20, 2002,  and that certain Loan and Security  Agreement  (EXIM  Program) by and
among the Grantor,  P-Com Network Services,  Inc. and Silicon Valley Bank, dated
September 20, 2002.

<PAGE>

                                  SCHEDULE 3.4
                             ABSENCE OF OTHER LIENS

Silicon  Valley Bank holds a blanket  security  interest in all of the Grantor's
assets  pursuant to that certain  Loan and  Security  Agreement by and among the
Grantor,  P-Com Network Services,  Inc. and Silicon Valley Bank, dated September
20, 2002,  and that certain Loan and Security  Agreement  (EXIM  Program) by and
among the Grantor,  P-Com Network Services,  Inc. and Silicon Valley Bank, dated
September 20, 2002.

The Grantor has executed and delivered that certain Senior Subordinated  Secured
Promissory Note, dated November 1, 2002, in favor of BBT Fund LP in the original
principal amount $201,875.<PAGE>

                                                                   Exhibit 10.10

                          INVESTMENT BANKING AGREEMENT

This Agreement is made as of this day April 1, 2003, by and between CytRx
Corporation; having its business office at 11726 San Vicente Boulevard, Suite
650 , Los Angeles, California 90049 (the "Company") and Rockwell Asset
Management Inc., with its principal office located at 175 Pinelawn Road, Suite
100, Melville, New York, 11747 (the "Consultant").

WHEREAS, the Company desires to retain the Consultant and the Consultant desires
to be retained by the Company, all pursuant to the terms and conditions
hereinafter set forth: NOW THEREFORE, in consideration of the foregoing and the
mutual promises and covenants herein contained, it is agreed as follows:

1.   RETENTION - The Company hereby retains the Consultant to perform
     non-exclusive consulting services related to corporate finance and other
     matters, and the Consultant hereby accepts such retention and shall perform
     for the Company the duties described herein, faithfully and to the best of
     its ability. In this regard, subject to paragraph 7 hereof, the Consultant
     shall devote such time and attention to the business of the Company, as
     shall be determined by the Consultant, subject to the direction of the
     Chief Executive Officer of the Company.

     a)   The Consultant agrees, to the extent reasonably required in the
          conduct of the business of the Company, and at the Company's request,
          to place at the disposal of the Company its judgement and experience
          and to provide business development services to the Company including
          the following:

          (i)    Review business plans and projections.
          (ii)   Review financial data as it relates to financing.
          (iii)  Advise on the Company's capital structure and on alternatives
                 for raising capital
          (iv)   Review and advise on prospective mergers and acquisitions, and
                 on any financing required to complete such transactions.
          (v)    Advise on issues relating to public offerings
          (vi)   Review managerial needs.
          (vii)  Advise on issues relating to public relations.
          (viii) Expose the Company to potential institutional and private
                 investors.

2.   TERM - The Consultant's retention hereunder shall be for a term of twelve
     months commencing on the date of this Agreement.

3.   COMPENSATION - The Consultant shall be compensated in accordance with the
     following schedule:

          (a)  The Company shall pay to the Consultant a one-time fee of
               $25,000, payable at the signing of this Agreement.

                                       1

<PAGE>

          (b)  The Company shall pay to the Consultant a monthly fee of $7,500
               per month. The first three (3) months will be paid at the signing
               of this Agreement with monthly payments commencing July 15, 2003.

          (c)  The Company shall grant to the Consultant a warrant (the
               "Warrant"); to purchase 400,000 shares of the common stock of the
               Company for a period of forty-eight (48) months according to the
               following schedule; 100,000 at an exercise price of $.75 per
               share, 100,000 at an exercise price of $.90 per share and 200,000
               at an exercise price of $1.05 per share. The holder of the
               Warrant may exercise all or any part of the Warrant in a cashless
               exercise. Rockwell Asset Management retains the right to assign
               these warrants to a different entity or individual.

4.   EXPENSES - The Company agrees to reimburse the Consultant for reasonable
     expenses incurred by the Consultant in connection with the services
     rendered hereunder, including but not limited to the Consultant's due
     diligence activities with respect to the Company. Any such expenses shall
     require the prior written approval of the Company.

5.   INDEMNIFICATION - Since the Consultant will be acting on behalf of the
     Company in connection with its engagement hereunder, the Company and
     Consultant have entered into a separate indemnification agreement
     substantially in the form attached hereto as Exhibit A and dated the date
     hereof, providing for the indemnification of Consultant by the Company. The
     Consultant has entered into this Agreement in reliance on the indemnities
     set forth in such indemnification agreement.

6.   STATUS OF CONSULTANT - The Consultant shall be deemed to be an independent
     contractor and, except as expressly provided or authorized in this
     Agreement, shall have no authority to act for or represent the Company.
     Rockwell Asset Management is not a registered Broker/Dealer.

7.   OTHER ACTIVITIES OF CONSULTANT - The Company recognizes that the Consultant
     now renders and may continue to render financial consulting and other
     investment banking services to other companies, which may or may not
     conduct business and activities similar to those of the Company. The
     Consultant shall not be required to devote its full time and attention to
     the performance of its duties under this Agreement, but shall devote only
     so much of its time and attention as it deems reasonable or necessary for
     such purposes. The Consultant shall give written notice to the Company upon
     acceptance of any investment banking agreement with other companies in
     similar industries and businesses. The Consultant agrees to maintain as
     confidential any information it procures in rendering consulting services
     hereunder regarding the Company that is not generally known to the public,
     and agrees to not transmit any of such information to: (i.) any employees
     of Consultant engaged in the trading of the Company's securities; or (ii)
     any competitors of the Company for whom Consultant performs consulting
     services.

8.   CONTROL - Nothing contained herein shall be deemed to require the Company
     to take any action contrary to its Certificate of Incorporation or By-Laws,
     or any applicable

                                       2

<PAGE>

     statute or regulation, or to deprive its Board of Directors of their
     responsibility for any control of the conduct of the affairs of the
     Company.

9.   NOTICES - Any notices hereunder shall be sent to the Company and the
     Consultant at their respective addresses above set forth. Any notice shall
     be given by registered or certified mail, postage prepaid, or overnight
     receipted delivery service (such as Federal Express) and shall be deemed to
     have been given when deposited in the United States mail. Either party may
     designate any other address to which notice shall be given, by giving
     written notice to the other of such change in address in the manner herein
     provided.

10.  GOVERNING LAW - This Agreement has been made in the State of California and
     shall be construed and governed in accordance with the laws thereof without
     regard to conflicts of laws.

11.  ENTIRE AGREEMENT - This Agreement contains the entire agreement between the
     parties, may not be altered or modified, except in writing and signed by
     the party to be charged thereby and supersedes any and all previous
     agreements between the parties.

12.  BINDING EFFECT - This Agreement shall be binding upon the parties hereto
     and their respective heirs, administrators, successors, and assigns.

13.  TERMINATION - Either party may terminate this Agreement for cause, in
     writing. If the Agreement is terminated, the Consultant keeps all cash paid
     to date, and the warrants will have vested on the basis of 1/12 per month.

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day
     and year first above written.

CYTRX CORPORATION                                    ROCKWELL ASSET MANAGEMENT

 /s/ Steven Kriegsman                                  /s/ Bruce Guarino
----------------------------                         --------------------------
Steven Kriegsman                                     Bruce Guarino
Chief Executive Officer                              Chief Executive Officer

                                       3

<PAGE>

                                   EXHIBIT A

                                                                   April 1, 2003

Rockwell Asset Management
175 Pinelawn Road
Suite 100
Melville New York 1174

Gentlemen:

In connection with our engagement of Rockwell Asset Management Inc. (the
"Consultant") as our financial advisor and investment banker, we hereby agree to
indemnify and hold the Consultant and its affiliates, and the directors,
officers, partners, shareholders, agents and employees of the Consultant
(collectively the "Indemnified Person"), harmless from and against any and all
claims, actions, suits, proceedings, (including those of shareholders), damages,
liabilities and expenses incurred by any of them (including but not limited to,
reasonable fees and expenses of counsel) which are (A) related to or arise out
of (i) any actions taken or omitted to be taken (including any untrue statements
made or any statements omitted to be made) by, or (ii) any actions taken or
omitted to be taken by any Indemnified Person in connection with our engagement
of the Consultant pursuant to the Investment Banking Agreement, of even date
herewith, between the Consultant and us (the "Investment Banking Agreement"), or
(B) otherwise related to or arise out of the Consultant `s activities on our
behalf pursuant to the Consultant's engagement under the Investment Banking
Agreement, and we shall reimburse any Indemnified Person for all reasonable
expenses (including, but not limited to, fees and expenses of counsel) incurred
by such Indemnified Person in connection with investigating, preparing or
defending any such claim, action, suit, or proceeding (collectively a "Claim"),
whether or not in connection with pending or threatened litigation in which any
Indemnified Person is a party. We will not, however, be responsible for any
claim which is finally lawfully determined to have resulted exclusively from the
gross negligence or willful misconduct of any person seeking indemnification
hereunder. We further agree that no Indemnified Person shall have any liability
to us for or in connection with the Consultants engagement under the Investment
Banking Agreement except for any Claim incurred by us solely as a direct result
of any Indemnified Person's gross negligence or willful misconduct.

We further agree that we will not, without the prior written consent of the
Consultant, settle, compromise or consent to the entry of any judgment in any
pending or threatened Claim in respect of which indemnification may be sought
hereunder (whether or not any Indemnified Person is an actual or potential party
to such Claim), unless such settlement, compromise, or consent includes a
legally binding, unconditional, and irrevocable release of each Indemnified
Person hereunder from any and all liability arising out of such Claim.

Promptly upon receipt by an Indemnified Person of notice of any complaint or the
assertion or institution of any Claim with respect to which indemnification is
being sought hereunder, such Indemnified Person shall notify us in writing of
such complaint or of such assertion or institution, but failure to so notify us
shall not relieve us from any obligation we have hereunder,

<PAGE>

unless, and only to the extent that, such failure results in the forfeiture by
us of substantial rights and defenses, and such failure to so notify us will in
any event relieve us from any other obligation or liability we may have to any
Indemnified Person other than under this agreement. If we so elect or are
requested by such Indemnified Person, we will assume the defense of such Claim,
including the employment of counsel reasonable satisfactory to such Indemnified
Person and the payment of the fees and expenses of such counsel. In the event,
however, that such Indemnified Person reasonably determined in its sole judgment
that having common counsel would present such counsel with a conflict of
interest or such Indemnified Person concluded that there may be legal defenses
available to it or other Indemnified Persons that are different from or in
addition to those available to us, then such Indemnified Person may employ its
own separate counsel to represent or defend it in any such Claim and we shall
pay the reasonable fees and expenses of such counsel. Notwithstanding anything
herein to the contrary, if we fail timely or diligently to defend, contest or
otherwise protect against any Claim, the relevant Indemnified Party shall have
the right, but not the obligation, to defend, contest, compromise, settle,
assert cross claims or counterclaims, or otherwise protect against the same, and
shall be fully indemnified by us, including, but not limited to, the reasonable
fees and expenses of its counsel and all amounts paid as a result of such Claim
or the compromise or the settlement thereof. In any Claim in which we assume the
defense, the Indemnified Person shall have the right to participate in such
defense and to retain its own counsel therefor at its own expense.

It is understood that, in connection with the Consultant's engagement under the
Investment Banking Agreement, the Consultant may be engaged to act in one or
more additional capacities and that the terms of the original engagement or any
such additional engagement may be embodied in one or more separate written
agreements. The provisions of this Agreement shall apply to the original
engagement and any such additional engagement and shall remain in full force and
effect following the completion or termination of the Consultant's
engagement(s).

                                            Very truly yours,

                                            CYTRX CORPORATION

                                            By:  /s/ Steven Kriegsman
                                               ------------------------
                                                     Steven Kriegsman
                                                     Chief Executive Officer

CONFIRMED AND AGREED TO:

ROCKWELL ASSET MANAGEMENT

By:   /s/ Bruce Guarino
   ------------------------------
         Bruce Guarino
         Chief Executive Officer

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