Document:

<PAGE>

                          AMENDMENT TO PROMISSORY NOTES

THIS AMENDMENT TO PROMISSORY NOTES ("Amendment") made as of May 31, 2002, by and
between FEDERAL REALTY INVESTMENT TRUST ("Payee"), and STEVEN J. GUTTMAN, an
employee of Payee ("Maker")

                                   WITNESSETH

WHEREAS, in connection with the exercise of employee stock options, Payee has
extended loans to Maker, and Maker has made four promissory notes payable to the
order of Payee, as follows:

     Amended and Restated Promissory Note dated October 21, 1987, in the
     principal amount of $100,007.25;
     Promissory Note dated November 6, 1996, in the principal amount of
$180,937.50; and
     Promissory Note dated December 31, 1992, in the principal amount of
$99,990; (collectively, as such notes may have been amended, the "Early Notes");
and
     Promissory Note dated January 2, 2002, in the principal amount of $205,000
(as such note may have been amended, the "2002 Note");

(the Early Notes and the 2002 Note being collectively referred to hereinafter as
the "Promissory Notes"); the principal amounts of which remain unpaid; and

WHEREAS, the Promissory Notes by their terms are repayable in full by Maker
within a certain amount of time after the termination of Maker's employment with
Payee; and

WHEREAS, the parties desire to amend the Promissory Notes to provide for a fixed
repayment date of May 31, 2007, irrespective of any termination of employment of
Maker;

NOW, THEREFORE, in consideration of the foregoing, of the mutual promises herein
contained and of other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound
hereby, the parties hereby agree as follows:

1.   The second paragraph of each of the Early Notes, and the third paragraph of
the 2002 Note, is hereby amended to read, in its entirety, as follows: "The
entire principal and any accrued interest shall all be due and payable on or
before May 31, 2007."

2.   Except as specifically modified hereby, each of the Promissory Notes
remains in full force and effect, and Maker hereby ratifies and reaffirms each
and all of the terms and provisions of the Promissory Notes as modified hereby.

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the
date first above written.

WITNESS:                            FEDERAL REALTY INVESTMENT TRUST

____________________________        By:___________________________________
                                    Title:
WITNESS:

____________________________        ______________________________________
                                    Steven J. Guttman<PAGE>

                      AMENDMENT TO STOCK OPTION AGREEMENTS

     This Amendment to Stock Option Agreements ("Amendment") is made and entered
into as of the 15/th/ day of August, 2002, by and between FEDERAL REALTY
INVESTMENT TRUST, a Maryland real estate investment trust ("Trust"), and Dawn M.
Becker ("Executive").

     WHEREAS, Executive and the Trust have entered into the following stock
option agreements:

     Combined Incentive and Non-Qualified Stock Option Agreement for Employees
     dated April 17, 1998, setting forth the terms of the award of 7,500 options
     at the exercise price of $25.1875, expiring January 26, 2008;

     Combined Incentive and Non-Qualified Stock Option Agreement for Employees
     dated February 22, 1999, setting forth the terms of the award of 10,000
     options at the exercise price of $21.0625, expiring February 22, 2009; and

     Combined Incentive and Non-Qualified Stock Option Agreement for Employees
     dated July 27, 2000, setting forth the terms of the award of 20,000 options
     at the exercise price of $20.9375, expiring July 27, 2010;

(collectively referred to hereinafter as the "Stock Option Agreements"); and

     WHEREAS, Executive is now an executive officer of the Trust, and Executive
and the Trust wish to amend the Stock Option Agreements;

     NOW THEREFORE, in consideration of the foregoing, of the mutual promises
herein contained and of other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto, intending to be
legally bound, agree as follows:

     1.   The Stock Option Agreements are hereby amended as follows:

          1.1  In Section 4, subparagraph (a)(i) is amended by deleting the
               phrase "within three months" and replacing it with the phrase
               "within one year."

          1.2  Section 5 is hereby amended by deleting all references therein to
               payment of the option exercise price in the form of a promissory
               note.

     2.   Capitalized terms used in this Amendment, unless otherwise defined
herein, have the respective meanings given to such terms in the Stock Option
Agreements.

<PAGE>

     3.   Except as specifically modified hereby, the Stock Option Agreements
remain in full force and effect, and the Trust and Executive hereby ratify and
reaffirm each and all of the terms and provisions of the Stock Option Agreements
as modified hereby.

IN WITNESS WHEREOF, the parties have executed and delivered this Amendment to be
effective as of the day and year indicated above.

                                            FEDERAL REALTY INVESTMENT TRUST

                                            By:_________________________________
                                            Name:
                                            Title:

WITNESS:                                    EXECUTIVE

____________________________________        ____________________________________
                                            Dawn M. Becker<PAGE>

                       AMENDMENT TO STOCK OPTION AGREEMENT

     This Amendment to Stock Option Agreement ("Amendment") is made and entered
into as of the 15/th/ day of August, 2002, by and between FEDERAL REALTY
INVESTMENT TRUST, a Maryland real estate investment trust ("Trust"), and Jeffrey
S. Berkes ("Executive").

     WHEREAS, Executive and the Trust have entered into that certain Combined
Incentive and Non-Qualified Stock Option Agreement for Employees dated February
15, 2000, setting forth the terms of the award of 30,000 options at the exercise
price of $18.00, expiring February 15, 2010 (the "Stock Option Agreement"); and

     WHEREAS, Executive is now an executive officer of the Trust, and Executive
and the Trust wish to amend the above-referenced stock option agreement;

     NOW THEREFORE, in consideration of the foregoing, of the mutual promises
herein contained and of other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto, intending to be
legally bound, agree as follows:

     1.   The Stock Option Agreement is amended as follows:

          1.1  In Section 4, subparagraph (a)(i) is amended by deleting the
               phrase "within three months" and replacing it with the phrase
               "within one year."

          1.2  Section 5 is hereby amended by deleting all references therein to
               payment of the option exercise price in the form of a promissory
               note.

     2.   Capitalized terms used in this Amendment, unless otherwise defined
herein, have the respective meanings given to such terms in the Stock Option
Agreement.

     3.   Except as specifically modified hereby, the Stock Option Agreement
remains in full force and effect, and the Trust and Executive hereby ratify and
reaffirm each and all of the terms and provisions of the Stock Option Agreement
as modified hereby.

IN WITNESS WHEREOF, the parties have executed and delivered this Amendment to be
effective as of the day and year indicated above.

                                            FEDERAL REALTY INVESTMENT TRUST

                                            By:_________________________________
                                            Name:
                                            Title:

WITNESS:                                    EXECUTIVE

____________________________________        ____________________________________
                                            Jeffrey S. BerkesAMENDED AND RESTATED EMPLOYMENT AGREEMENT
                  MR. WILLIAM P. CROWELL And CYLINK CORPORATION

         This  Employment  Agreement,  initially  made  as of  the  18th  day of
December,  1997 (the "Effective  Date"),  by and between Cylink  Corporation,  a
California  corporation with its principal place of business at 3131 Jay Street,
Santa Clara, CA 95404 (the  "Company"),  and William P. Crowell residing at 5932
Country Club Parkway, San Jose, CA 95138 (the "Executive") is hereby restated in
its entirety as of September  1, 2001,  to  incorporate  all  amendments  agreed
between the parties since the Effective Date.

                              W I T N E S S E T H :

         WHEREAS,  the Company desires to employ  Executive,  initially,  as its
Vice President of Strategy and Product Management;

         WHEREAS,  commencing  as of  November 4, 1998,  the Company  desires to
employ Executive as its President and Chief Executive Officer,  and Executive is
willing to serve in such capacity; and

         WHEREAS,  the Company and  Executive  desire to set forth the terms and
conditions of such employment.

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the Company and Executive agree as follows:

1. Employment.

         1.1.  The Company  hereby  agrees to employ  Executive,  and  Executive
agrees  to be  employed  by the  Company,  on the terms  and  conditions  herein
contained, as of the

                                       1

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

Effective  Date,  initially  as its  Vice  President  of  Strategy  and  Product
Management,  and, as of November 4, 1998, as its  President and Chief  Executive
Officer,  and in such other executive  capacities assigned by the Chairman which
are not inconsistent with Executive's duties.  Executive's duties, authority and
responsibilities  shall be  commensurate  with those of a similar  position  for
another  company  similar in size and business.  During the term of  Executive's
employment,  he  shall be based at the  Company's  principal  office;  provided,
however,  that Executive shall be required to travel as reasonably  necessary in
connection with the official  business of the Company.  Executive shall maintain
his permanent residence within the surrounding community. If so requested by the
Chairman,  Executive shall also serve as an officer of the Company's  affiliated
entities without additional compensation.

         1.2. The Executive shall devote substantially all of his business time,
energy,  skill and efforts to the performance of his duties and shall faithfully
serve the  Company  to the best of his  abilities  in a  diligent,  trustworthy,
businesslike  and efficient  manner.  The foregoing shall not prevent  Executive
from  participating  in  not-for-profit  activities or from managing his passive
personal  investments,  from sitting on Boards of Directors  provided that these
activities do not materially interfere with Executive's  obligations  hereunder.
In addition,  Executive may accept  positions or assignments  of  responsibility
from other  organizations,  provided:  (i) they do not interfere with his duties
and

                                       2

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

obligations  hereunder,  (ii) he  gives  the  Company  written  notice  prior to
accepting such  positions,  and (iii) the Company does not object.  Furthermore,
regardless of whether the Company has given its consent,  Executive  will advise
Company  immediately  in the event such  positions  create the  appearance  of a
conflict of interest  between  Executive's  activities  and his  obligations  to
Company,  and take such action  which the Company may deem  necessary to prevent
any such conflict from  occurring,  including but not limited to resigning  from
such outside position.

2. Term of Employment.

         Executive's  employment  under this Agreement  shall be for a term (the
"Employment  Term")  commencing  on  January  1,  1998 and  terminating,  unless
otherwise terminated earlier as provided in this Agreement, on December 31, 2004
(the "Original  Employment  Term"),  provided that the Employment  Term shall be
extended  (subject to earlier  termination  as provided in this  Agreement)  for
additional  one (1) year  periods (the  "Additional  Terms"),  unless,  at least
ninety  (90)  days  prior  to the  end of the  Original  Employment  Term or any
Additional  Term, the Company or the Executive has notified the other in writing
that the Employment Term shall terminate at the end of the then current term. If
and when this Agreement is so extended,  the term "Employment Term" used in this
Agreement  shall  include  all  such  extensions.  The  Executive's  obligations
concerning the Company's Inventions, Confidential Information, not to

                                       3

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

compete or solicit the  Company's  customers  or  employees,  and the  Company's
obligations to provide indemnification, as provided elsewhere in this Agreement,
shall  survive  and  remain in effect  notwithstanding  the  termination  of the
Employment  Term or a breach of this  Agreement  by either  the  Company  or the
Executive.

3. Compensation.

         3.1. As compensation for his services under this Agreement, the Company
shall pay  Executive an annual  salary of $300,000  ("Base  Salary").  Such Base
Salary shall be payable in equal installments (not less frequently than monthly)
and subject to  withholding  in  accordance  with the Company's  normal  payroll
practices.

         3.2.  Executive's Base Salary may be increased from time to time by the
Compensation  Committee,  but solely in their  discretion  and not as an implied
obligation of this Agreement. Executive's Base Salary may also be decreased from
time to time by the Board of Directors upon  recommendation  of the Compensation
Committee based on their assessment of the Executive's performance or changes in
the scope of Executive's responsibilities, provided that Executive will be given
written  notice  and a minimum of ninety  (90) days to cure any such  assessment
which, in the Chief Executive Officer's discretion, warrants such a reduction.

         3.3. In addition to the Base Salary,  for each calendar year  completed
during the

                                       4

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

Employment  Term,  the Company shall pay to Executive a minimum  annual bonus of
$100,000,  payable  semiannually,  based on performance  milestones  which shall
incorporate  quantifiable objectives  ("Performance Goals") to be agreed upon by
the  Executive and Chairman  each year.  The Executive  shall be eligible for an
increase in his annual bonus by an amount which the Chairman reasonably believes
is commensurate with Executive's actual performance in excess of his Performance
Goals. In making this determination, the Compensation Committee of the Company's
Board of Directors agree to consider the Executive's  waiver of his past bonuses
for the Company's  fiscal year 2000 and the first half of fiscal 2001 as part of
the Company's fiscal austerity plan. An increase in Executive's bonus in any one
year shall not affect the minimum annual bonus in any subsequent  years.  At the
Company's  option,  any bonus paid in excess of the annual  minimum bonus may be
applied, after deduction of all taxes owed by Executive, against the outstanding
amount of the Loan.

         3.4. The Company shall reimburse  Executive for all reasonable expenses
incurred  by him in the course of  performing  his duties  under this  Agreement
which are consistent  with the Company's  then current  policies with respect to
travel,  entertainment  and other  business  expenses,  subject to the Company's
requirements concerning reporting and documentation of such expenses.

4. Benefits.

                                       5

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

         4.1. During the Employment Term, Executive shall be entitled to (i) all
benefits,  if any, which are generally provided from time to time by the Company
to its senior executive officers,  including,  without limitation, (i) any life,
medical and disability insurance plans, (ii) incentive, profit-sharing, deferred
compensation   and  similar  such  plans,   subject  to:  (A)  the   Executive's
satisfaction  of the eligibility  requirements,  if any, and (B) with due credit
for the minimum annual bonus already  provided under this  Agreement,  and (iii)
all other benefits provided under this Agreement.

         4.2.  During the first year of the  employment  Term,  the Company will
contribute  an  additional  $30,000  (the  "Retirement  Bonus")  to  Executive's
retirement plans, as follows:

         4.2.1.   In the event the Company initiates matching  contributions for
                  its employee 401(k) plan, the maximum amount allowable will be
                  contributed from the Retirement Bonus into Executive's  401(k)
                  account;

         4.2.2.   the Retirement  Bonus will then be applied,  up to the maximum
                  amount  allowable,   as  a  contribution  to  a  non-qualified
                  retirement  plan,  if any such plan is exists or is created by
                  the Company for its officers; and

         4.2.3.   the balance of the Retirement  Bonus (or all of said amount in
                  the event the  Company's  benefit  plans do not  authorize any
                  further  tax  deferred  contributions)  shall be paid  into an
                  annuity or any other fund created by Executive  for receipt of
                  taxable  contributions,  after deduction of any

                                       6

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

                  withholding or other taxes which may be required by law.

         4.3.  The  Company  will  reimburse  the travel  expenses  incurred  by
Executive's  spouse when she  accompanies  Executive on overseas  trips,  not to
exceed two per year. The maximum number of trips entitled to reimbursement under
this paragraph may not be accumulated from year to year.

         4.4.  The Company  agrees to  reimburse  Executive  for all  reasonable
expenses incurred by Executive for (i) personal transportation,  (ii) moving any
items of personal  property  owned by Executive  and his family from his current
place of residence to the vicinity of the Company's principal place of business,
and (iii) customary closing costs for the purchase of a new principal  residence
in Northern California.  The Company shall also reimburse Executive for (iv) the
cost of property  taxes and  insurance,  including  earthquake  insurance on his
principal residence in Northern California.

         4.5. The Company will  reimburse  Executive for the cost of leasing and
insuring an automobile  commensurate with his position to provide transportation
for Company business in Northern California.

         4.6. [Section intentionally deleted]

         4.7. In connection with the transfer of Executive's  principal place of
employment from Maryland,  the Company shall provide  Executive with a five year
interest-free  loan

                                       7

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

in the  amount of up to  $750,000  (the  "Loan")  for  purposes  of  Executive's
acquisition of a new principal residence in Northern California.  The Loan shall
not be for  more  than  the  purchase  price  of the  residence,  including  any
improvements  which may be required as a condition of ownership  under the CC&Rs
of the local  community.  As of November 4, 1998, the total amount due and owing
by Executive on the relocation Loan equals  $748,526.34.  The amount outstanding
on this  relocation  Loan shall be increased by the amount  required to complete
Executive's financing of his new principal residence  ($362,597),  and the total
amount  of  the  relocation  Loan  shall  then  be  fixed  at the  total  amount
outstanding,  which is equal to  $1,111,123.34.  The  relocation  Loan  shall be
interest  free,  and shall be due and owing on December 31, 2004,  unless sooner
terminated as provided in this Agreement, as Amended.

         4.8. [Section intentionally deleted]

         4.9.  The Loan shall be  subject  to,  and  governed  by, the terms and
conditions of one or more loan  agreements  and first Deeds of Trust between the
Executive and the Company in a form satisfactory to the Company's counsel, which
the  parties  shall  enter  into at the time  the  Executive  purchases  the new
residence. The Company shall retain the Deeds of Trust as a security interest in
the residence  during the term of the Loan.  The Loan is intended to satisfy the
requirements of Temporary Treasury  Regulation Section  1.7872-5T(c)(1)  and the
parties  hereto  agree to execute  such  documents  as

                                       8

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

are necessary to comply  therewith.  The  Executive  shall enter into an Amended
First Deed of Trust and loan agreement,  in a form satisfactory to the Company's
counsel, for the amount of the Loan as of November 4, 1998.

         4.10.  Executive's salary shall be "grossed up" by the amount of income
taxes owed for the portion of income  imputed,  if any, due to the Loan, and the
Company's  payment of property  taxes and all property  insurance on Executive's
principal residence. All gross ups hereunder shall be determined by agreement of
the Company's,  and  Executive's  accountants.  The Executive  shall provide the
Company's  accountants with such information as they reasonably request in order
to  make  the  necessary  determination  as to  Executive's  tax  rates  and the
deductibility of various items. In calculating the gross up, the Company's gross
up items when combined with Executive's  other deductions shall receive the most
favored  treatment and the Company shall get the full benefits of any deductions
available.  Gross ups shall be paid as soon as reasonably possible after payment
of the  respective  item  (and  shall  generally  be  withheld  and  paid to the
applicable taxing authorities), subject to adjustment at year end (including, if
applicable, repayment).

         4.11.  Without  prejudice  to the other  provisions  of this  Agreement
concerning  acceleration  of the Loan,  the Loan shall become due and payable in
full upon the earliest of (i) sale or other  transfer of the residence  securing
the Loan,  (ii) uncured

                                       9

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

breach of any term of the Loan or Deeds of Trust.

         4.12.  In the event the Loan becomes due and payable,  Executive  shall
owe  interest at a market rate for  comparable  loans,  but not less than 8% per
annum,  on the unpaid  principal  from the date the Loan  became due until fully
repaid, together with all costs, expenses and attorneys fees incurred by Company
in seeking repayment, without prejudice to all of the Company's other rights and
remedies.  Executive  agrees that  Company may accept late or partial  payments,
even if marked  "payment in full",  or otherwise  delay in enforcing its rights,
without waiving or affecting any of Executive's  obligations or the terms of the
Loan.  Executive  further  waives  any  requirement  of  presentment,  notice of
dishonor or protest. The Company's claim for non-payment shall not be subject to
setoff  or  deduction  for any  counterclaims,  and  the  Company  may  allocate
Executive's  partial  payments to  outstanding  interest and costs of collection
before crediting outstanding principal. In the event of any claim by Company for
non-payment,  Executive waives any right to trial by jury and hereby consents to
whatever summary  proceedings may be available by law for the collection of this
obligation.

5. Stock Options.

         5.1. On December 8, 1997 the  Compensation  Committee of the Board (the
"Compensation  Committee"),  or its  delegee,  authorized  granting to Executive
options to purchase  350,000 shares of Company common stock at an exercise price
equal  to the

                                       10

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

market value of the Company  stock at the close of market  immediately  prior to
the Effective  Date,  pursuant and subject to the Company's  1994 Flexible Stock
Incentive Plan (the "Plan").  Such Options shall be  non-qualified  or incentive
stock   options,   or  a  combination   thereof  as  determined  by  the  Plan's
Administrator.  The terms of the Options,  as more fully set forth in the Option
agreement  annexed  hereto as  Attachment  A and  specifically  modified by this
Section 5,  provide  that the  Options  (i) shall be for a maximum ten (10) year
term, and (iii) shall vest and become  exercisable  ratably over a five (5) year
period on the last day of each  month  during  such  period,  provided:  (A) the
Executive is employed by the Company on each vesting date, and provided further,
that  (B)  the  initial  twenty  percent  (20%)  of  the  Options  shall  not be
exercisable  unless and until the Executive  remains  employed by the Company on
the first anniversary of the Effective Date.

         5.2. In addition to the Options previously granted under the Agreement,
the  Compensation  Committee of the Company's Board of Directors  authorized the
following  grants to  purchase  the  Company's  common  stock  (the  "Additional
Options"):

         5.2.1.   grants on December 11, 1998,  and December 14, 1998,  totaling
                  500,000  options,  with twenty percent of the grants vested as
                  of the date of grant, and the balance vesting monthly, as long
                  as the  Executive  remains  employed by the Company,  over the
                  next four years, pro rata; and

                                       11

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

         5.2.2.   grant on January 29, 1999, of 150,000 options, vesting monthly
                  over the next four years, pro rata.

         5.2.3.   The Additional options shall be non-qualified,  with a term of
                  six  years  from the date of  grant  or until  termination  of
                  Executive's  employment,  whichever  occurs first, and have an
                  exercise  price equal to the market value of the Company stock
                  on the date of grant.  The Additional  Options shall be issued
                  pursuant to the Company's 1994 Flexible  Stock  Incentive Plan
                  (the  "Plan")  and  the  Option  Agreements  annexed  to  this
                  Amendment, subject to the provisions of this subparagraph 5.2.

         5.3. On August 28th, 2001, the Compensation  Committee of the Company's
Board of  Directors  authorized  a grant of  non-qualified  options to  purchase
500,000 shares of the Company's common stock (the "2001  Options"),  with a term
of six  years  from  the date of  grant,  or until  termination  of  Executive's
employment, whichever occurs first, vesting monthly over the next two years, pro
rata,  at an  exercise  price of $0.54  per  share.  The 2001  Options  shall be
non-qualified,  for a period  of six years  from the date of grant,  and have an
exercise  price equal to the market  value of the  Company  stock on the date of
grant.  The 2001 Options shall be issued  pursuant to the  Company's  2001 Stock
Incentive Plan (the "2001 Plan") and the 2001 Option Agreements  annexed to this
Amended and Restated  Agreement,  subject to the provisions of this subparagraph
5.3.

                                       12

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

         5.4. In the event of a "Corporate  Transaction"  all of the Executive's
outstanding  options shall fully vest  immediately  prior to closing  unless the
Company's successor in interest, or its parent, offers to:

         5.4.1.   (i) assume the Executive's unvested options in accordance with
                  Section 11 of the Plan or (ii)  replace  them with  equivalent
                  options to purchase  publicly  traded  shares in the successor
                  corporation or its Parent by exchanging  them at the same rate
                  of  conversion  offered to the Company's  shareholders  in the
                  Corporate Transaction, and

         5.4.2.   provided further that the successor in interest agrees to vest
                  all such assumed or  exchanged  options on the earlier of: (i)
                  the first  anniversary of his continued  employment  following
                  such Corporate  Transaction,  or (ii) upon  termination of the
                  Agreement by the Company or its  successor in interest if such
                  termination  occurs  either  without  good  Cause  or  by  the
                  Executive for Good Reason.

         5.5. In the event of a Change In Control,  all unvested  options  shall
vest on the  earlier  of: (i) the first  anniversary  of  Executive's  continued
employment  following  such Change In Control,  or (ii) upon  termination of the
Agreement by the Company or its successor in interest if such termination occurs
either  without good Cause or by the

                                       13

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

Executive for Good Reason. For purposes of the Agreement and this Amendment, the
terms "Corporate Transaction" and "Change in Control" shall have the definitions
of the Plan,  except  that a  "Corporate  Transaction"  shall also  include  the
acquisition  of more than 50% of the  Company's  outstanding  securities  by any
person or  related  group of persons  as  defined  in  Section  13(d)(3)  of the
Securities Act of 1934, other than the entities and  transactions  identified on
Attachment "B".

         5.6.  Nothing  stated  in  this  Article  5  shall  be  interpreted  as
eliminating  the ninety (90) day grace period for  exercising all vested options
under all of the foregoing  option  agreements  following the effective  date of
termination.

6. Vacation.

         During the  Employment  Term,  Executive  shall be entitled to four (4)
weeks paid vacation in each full calendar year (prorated for any partial year).

7. Termination.

         7.1. Executive's  employment under this Agreement shall terminate prior
to expiration of the Employment Term  (including any Additional  Terms which may
be in effect) upon the occurrence of any of the following events:

         7.1.1.   Automatically on the date of Executive's death.

         7.1.2.   Upon  written  notice by the  Chairman  to the  Executive  for
                  Cause. "Cause"

                                       14

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

                  shall mean (A) the Executive  being  convicted of (or pleading
                  nolo  contendere  to) a felony  (other than a  traffic-related
                  offense);  (B) the barring of the Executive by any  regulatory
                  authority  from  holding  his  positions  or  any  limitations
                  imposed  on  the  Company  by  any  regulatory  agency  if the
                  Executive continued to hold his positions; (C) willful refusal
                  by the  Executive to attempt to properly  perform his material
                  obligations  under  this  Agreement,  or attempt to follow any
                  direction  of the  Chairman  consistent  with this  Agreement,
                  provided the refusal to follow a direction  shall not be Cause
                  if the Executive in good faith believes that such direction is
                  not legal and promptly  notifies the Company's General Counsel
                  in  writing  of  such  belief;  (D)  the  Executive's  willful
                  misconduct  or material  gross  negligence  with regard to the
                  business, assets or employees of the Company or its affiliated
                  entities (including as willful misconduct, without limitation,
                  the  Executive's  willful  breach of any fiduciary duty he may
                  owe to the Company or its affiliates  under  applicable law or
                  this  agreement  but not de  minimis  personal  use of Company
                  assets or reasonable good faith expense account disputes), (E)
                  the Executive's theft,  dishonesty or fraud with regard to the
                  Company  or its  affiliates  which is  intended  to enrich the
                  Executive  or  another  person  or

                                       15

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

                  entity but not de minimis  personal  use of Company  assets or
                  reasonable  good  faith  expense  account  disputes,  (F)  the
                  Executive's  inability  to  competently  perform his  assigned
                  duties, provided Executive shall first have been given written
                  notice of his  performance  deficiency  and a period of ninety
                  (90) days to effect its correction,  or (G) any other material
                  breach by the Executive of this Agreement that remains uncured
                  for twenty (20) days after written  notice thereof is given to
                  the  Executive.  During any period in which the  Executive  is
                  charged  with  committing  a crime  covered by (A) above,  the
                  Company may  suspend  Executive  from his  titles,  duties and
                  authority  herein  pending  resolution  of  his  status  under
                  applicable  law; such  suspension  shall be with pay for up to
                  six (6) months and  thereafter  shall be without  pay.  In the
                  event  of a  Corporate  Transaction  or a Change  in  Control,
                  sections 7.1.2 (F) and (G) of the Agreement shall no longer be
                  the basis for good "Cause" for termination.

         7.1.3.   Upon written notice by the Chairman to the  Executive,  if the
                  Executive (as  determined by the Chairman in good faith) fails
                  to regularly  perform the material duties  hereunder by reason
                  of mental or physical  illness or incapacity  for an aggregate
                  period  of more  than 180 days  during  any 365

                                       16

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

                  day  period  (a  "Disability"),   provided  that,  during  the
                  Employment  Term  prior  to such  termination,  the  Company's
                  obligations  hereunder  shall be reduced by any payments being
                  received by Executive under any long-term disability program.

         7.1.4.   Upon written  notice by the Executive to the Chairman for Good
                  Reason  stating  with  specificity  the  details  of the  Good
                  Reason,  if the stated Good Reason is not cured within  twenty
                  (20) days of the giving of such notice.  "Good  Reason"  shall
                  mean  (i)  any  material  breach  of  any  provision  of  this
                  Agreement by the Company,  (ii) any  reduction in  Executive's
                  duties or  responsibilities  as Chief  Executive  Officer  and
                  President,  other  than  those  duties  which may no longer be
                  required  if  the  Company  ceases  to  be a  publicly  traded
                  company,  without his consent,  or (iii) notice by the Company
                  in accordance with Section 2 ("Term of  Employment")  that the
                  Agreement will not be extended upon  expiration of the current
                  Employment  Term.  In addition,  the  Executive  may terminate
                  employment by written  notice given to the Company (iv) within
                  the thirty (30) day period following the first  anniversary of
                  a Corporate Transaction or a Change in Control of the Company,
                  or (v) upon any decrease in Executive's Base Salary or minimum
                  annual bonus following a Corporate  Transaction or a

                                       17

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

                  Change of  Control,  and have such  termination  treated  as a
                  termination for Good Reason.  Any notice for Good Reason shall
                  be  given  within  ninety  (90)  days of the  later of (i) the
                  occurrence  of the  triggering  event,  or (ii) the date  upon
                  which Executive  could be reasonably  expected to know of such
                  event.

         7.1.5.   Immediately  upon  written  notice  to  the  Executive  by the
                  Chairman without Cause.  Notice by the Company of its decision
                  not to renew the Agreement upon expiration of the current Term
                  in  accordance  with  Article  2 shall be  deemed  termination
                  without Cause.

         7.1.6.   Upon the voluntary  termination by the Executive  without Good
                  Reason  upon  thirty  (30) days  prior  written  notice to the
                  Company (which the Company may, in its sole  discretion,  make
                  effective  earlier).  A notice by Executive of  non-renewal of
                  the Employment Term shall be deemed a voluntary termination by
                  Executive.

         7.2.  Upon  such  earlier  termination  of  the  Employment  Term,  the
Executive  shall be promptly  paid (i) any unpaid  salary and  accrued  vacation
through his date of  termination,  (ii) a prorated  portion of his unpaid annual
bonus, as determined by the Chairman in accordance with this Agreement,  for the
calendar year of his termination,  (iii) reimbursed for any expenses incurred in
connection  with the  business of the

                                       18

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

Company prior to his date of termination which he would be otherwise entitled to
in  accordance  with the  Company's  policies on the  reimbursement  of business
expenses,  and (iv)  receive  any  benefits  or fringes due under any benefit or
fringe  plan or  arrangement  in  accordance  with  the  terms  of said  plan or
arrangement due for the period prior to such termination.

         7.3. In addition,  if the  termination is by the Company without Cause,
or by the  Executive for Good Reason,  as provided  above,  the Executive  shall
receive in full settlement of all amounts owed him,  provided he signs a release
running to the Company and its related entities and their  respective  officers,
directors and employees of all claims relating to his employment and termination
thereof (other than any right to indemnification under the Company's Articles of
Incorporation or By-Laws or the Indemnification  Agreement annexed as Attachment
C hereto,  which shall  survive)  in such form as  reasonably  requested  by the
Company:

         7.3.1.   twelve (12) monthly  installments  of severance pay each in an
                  amount equal to one-twelfth of the then sum of his Base Salary
                  and annual bonus,  based on the amount paid for service during
                  the prior twelve month  period,  pro rated if  necessary,  and
                  subject to the offset of any amounts due, and

                                       19

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

         7.3.2.   payment by the Company of the premiums for Executive's and his
                  dependents'  COBRA coverage for the Company's health insurance
                  plan that  generally  applies to executives  for the period in
                  which  Executive  is  receiving  severance  pursuant  to  this
                  Agreement or, if earlier,  until  Executive and his dependents
                  cease to be eligible for such COBRA  coverage.  The  Company's
                  payment  obligations  under this Section  (other than those in
                  the  first  sentence)  shall  immediately  cease in the  event
                  Executive  materially  breaches any of his  obligations  under
                  this   Agreement   concerning   the   Company's    Inventions,
                  Confidential  Information,  and not to compete or solicit  the
                  Company's customers or employees.

         7.4. In the event of termination of Executive's  employment within less
than one year  following  a Change in Control or a  Corporate  Transaction,  the
Company agrees to engage Executive as independent consultant under the Company's
standard form of consulting  agreement,  for a period of not less than one year,
for a minimum  of twenty  days per year at a rate of $3,000  per day.  Executive
shall not be required to provide  services in excess of the minimum  twenty days
per year, and Executive may terminate this  consulting  agreement at any time on
thirty (30) days notice.

                                       20

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

         7.5. If the Employment  Term ends early on account of  Disability,  and
Executive  executes  the  release of claim set forth in Section  7.3 above,  the
Company shall pay to Executive monthly, until the second anniversary of the date
of the termination for  Disability,  the amount of $7,700,  less any payments to
which Executive is entitled for such month under any disability  benefit plan or
the like  sponsored,  or  contributed  to, by the  Company  (including,  without
limitation,   Social  Security);   provided,  however,  that  in  the  event  of
Executive's death during the payment period,  the Company shall not be obligated
to pay any  such  amounts  subsequent  to the  date of  Executive's  death.  The
Company's payment  obligations under this Section 7.4 shall immediately cease in
the event Executive  materially  breaches any of his obligations under Section 9
("Inventions  and  Other  Intellectual  Property"),  Section  10  ("Confidential
Information"),   or  Section  11  ("Non-Compete,   Non-Solicitation")   of  this
Agreement.  After the end of such two (2) year period,  Executive  shall only be
entitled to receive amounts as he may be entitled to under any disability policy
specified in Section 4.1 hereof or otherwise sponsored by the Company.

         7.6. If the  Employment  Term ends early pursuant to this Section 7 for
any other reason,  Executive shall cease to have any rights to salary,  bonus or
benefits  other than:  (i) salary or bonus which has accrued but is unpaid as of
the end of the Employment  Term, and (ii) to the limited extent  provided in any
benefit or equity plan or arrangement

                                       21

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

in which Executive has participated as an employee of the Company,  any benefits
or rights which by their specific terms extend beyond termination of Executive's
employment.

         7.7. All aforesaid amounts in this Section shall be subject to required
withholding, if any. The Company and its affiliated entities shall have no other
obligations to the Executive upon a termination except as specifically  provided
in this Agreement.

         7.8. In the event of termination of the Employment  Term, the following
provisions shall apply to the Loan:

         7.8.1.   In the event of  termination  by the  Company  for Cause,  the
                  Loans shall become due and payable on December  31,  2004,  or
                  eighteen months from the date of termination,  whichever shall
                  occur  first,  provided  further that  Executive  shall have a
                  minimum of 120 days from the date of  termination to repay the
                  Loan;

         7.8.2.   In the event of the Executive's  death, the Loans shall become
                  due and payable on December 31, 2004, or eighteen  months from
                  the date of death, whichever shall occur last

         7.8.3.   In the event of voluntary  termination by the Executive  other
                  than  for Good  Reason,  or in the  event  of the  Executive's
                  death, the Loans shall become

                                       22

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

                  due  and   payable   in  full  120  days  after  the  date  of
                  termination.

         7.8.4.   In the event of  termination  for  Disability,  by the Company
                  without Cause or by the  Executive  for Good Reason,  the Loan
                  shall become due and payable in full three (3) years after the
                  date of  Termination,  or at the  expiration  of the  Original
                  Employment Term, whichever shall occur first.

         7.8.5.   In the event the Loan is not due upon the  termination  of the
                  employment  Term,  interest  shall be owed on the  outstanding
                  amount of the  Loans for the  period  commencing  ninety  days
                  after  termination until the date repayment is due at the rate
                  of 8% per annum.

         7.8.6.   In consideration  of Executive's  entering into and compliance
                  with   the    provisions   in   Article   11    ("Non-Compete,
                  Non-Solicitation")   the  outstanding   balance  of  the  Loan
                  ($1,111,123.34)  shall be  forgiven in its  entirety  upon the
                  closing of a Corporate Transaction unanimously approved by the
                  Board of Directors (without  consideration of abstentions,  if
                  any),   except  that  the  Company  shall  not  be  liable  or
                  responsible for any "gross up" of the tax consequences of such
                  forgiveness.  To the  extent  that  Executive  previously  has
                  repaid  any  portion  of the  outstanding  balance of the Loan
                  ($1,111,123.34),  the Company  shall pay to  Executive at such
                  closing  an  amount  equal  to all  such  Loan  repayments  in
                  consideration  of  Executive's

                                       23

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

                  entering into and continued  compliance with the provisions in
                  Article 11 ("Non-Compete, Non-Solicitation").

8. No Duty to Mitigate/Set-Off.

         Except  as  specifically  stated  in  this  Agreement,   the  Company's
obligation  to make any payments to the  Executive  shall not be affected by any
set-off,  counterclaim,  recoupment,  defense,  or other claim,  right or action
which the Company may have against the Executive or others.  The Company  agrees
that if  Executive's  employment  with the  Company  is  terminated  during  the
Employment Term,  Executive shall not be required to seek other employment or to
attempt in any way to reduce any  amounts  payable to  Executive  by the Company
pursuant  to this  Agreement.  Further,  the  amount of any  payment  or benefit
provided for in this Agreement shall not be reduced by any  compensation  earned
by Executive or benefit  provided to  Executive as the result of  employment  by
another  employer or otherwise.  Any amounts due under Section 7 are  inclusive,
and in lieu of, any amounts payable under any other salary  continuation or cash
severance  arrangement of the Company.  To the extent any such payments are made
to Executive under any other salary continuation or cash severance  arrangement,
such payments shall be offset from the amount due Executive under Section 7.

                                       24

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

9. Inventions and Other Intellectual Property.

         The Company and  Executive  agree to promptly  execute the  Proprietary
Information  and Invention  Agreement,  annexed  hereto as Attachment D, and any
revised  versions  which are  subsequently  issued by the Company as part of its
standard terms of employment.

10. Confidential Information.

         Executive   acknowledges   that  the  trade  secrets,   know  how,  and
proprietary  information and observations  concerning the business or affairs of
the Company, or any of its subsidiaries or affiliates or any predecessor thereof
(collectively "Confidential Information"), obtained by him while employed by the
Company  pursuant  to this  Agreement  are the  property  of the Company or such
subsidiary  or  affiliate.  Executive  agrees that he shall not  disclose to any
unauthorized  person or use for his own  account  any  Confidential  Information
without  the prior  written  consent  of the  Chairman  unless and except to the
extent that the  aforementioned  matters become generally known to and available
for use by the public other than as a result of Executive's acts or omissions to
act. If  Executive  receives  legal  process,  he may comply with it provided he
promptly  notifies  the Company and  diligently  cooperates  with the Company in
obtaining a  protective  order.  Executive  shall  deliver to the Company at the
termination  of the  Employment  Term,  or at any  other  time the  Company  may
request,  all memoranda,  notes,  plans,  records,  reports,  computer tapes and
software  and other

                                       25

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

documents and data (and copies thereof) relating to the Confidential Information
or business of the Company or any of its subsidiaries or affiliates which he may
then possess or have under his control.

11. Non-Compete, Non-Solicitation.

         11.1. Executive  acknowledges that in the course of his employment with
the  Company  pursuant  to this  Agreement  he will  become  familiar  with  the
Company's  Confidential  Information  and that his services  will be of special,
unique and extraordinary value to the Company.

         11.2.  During  the  Employment  Term and for two (2) years  thereafter,
Executive shall not enter into Competition with the Company or its affiliates to
the  extent  such  Competition  requires  Executive  to  divulge,   disclose  or
communicate  to any  third  party,  or make  use of,  any  Company  Confidential
Information.   For  purposes  of  this  Agreement,   "Competition"   shall  mean
participating,  directly or indirectly,  as an individual  proprietor,  partner,
stockholder,  officer,  employee,  director, joint venturer,  investor,  lender,
consultant  or in any capacity  whatsoever  (within the United  States or in any
foreign  country where the Company or its  affiliates do business) in a business
which develops or markets high speed commercial encryption equipment, software

                                       26

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

management systems for encryption equipment or public key infrastructure ("PKI")
systems;  provided,  however,  that such participation shall not include (i) the
mere ownership of not more than two percent (2%) of the total  outstanding stock
of a publicly held company,  (ii) the performance of services for any enterprise
to the extent such services are not  performed,  directly or  indirectly,  for a
business in the aforesaid  competition,  (iii) any activity  engaged in with the
prior written  approval of the Chairman,  (iv)  Executive's  employment by a non
Competitive  division  (or  other  business  unit)  of a  company  which  is  in
Competition  with the  Company so long as  Executive  is not  involved  with the
competitive  division (or other business  unit),  and,  provided  further,  that
Competition  shall not include any line of encryption or PKI products  which the
Company  divests  or  otherwise  ceases to engage in  developing  or  marketing.
Notwithstanding anything else in this Section to the contrary, subsequent to the
termination  of  Executive's  employment  hereunder,  Executive may, in his sole
discretion, passively invest in any entity, provided Executive does not divulge,
disclose or communicate any Company Confidential  Information to such company or
its  affiliates,  employees,  officers,  consultants,   directors,  lenders,  or
investors  and  further  provided  Executive  does not render  services  to such
company or otherwise  violates  this Section  (other than by making such passive
investments).

         11.3.  During  the  Employment  Term and for two (2) years  thereafter,
Executive shall

                                       27

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

not  directly  or  indirectly  solicit  for  Competitive  products or induce any
customer of the Company or its  affiliates to terminate,  or otherwise to cease,
reduce, or diminish in any way its business relationship with the Company or its
affiliates.

         11.4. During the Employment Term and one (1) year thereafter, Executive
shall not recruit, solicit or induce any nonclerical employees of the Company or
its affiliates to terminate  their  employment or otherwise cease their business
relationship  with the  Company  or its  affiliates,  or hire or assist  another
person  or  entity  to hire  any  nonclerical  employee  of the  Company  or its
affiliates.  Executive  agrees not to circumvent this  prohibition by hiring any
such employee within six (6) months after the employee terminates his employment
with the Company or its affiliates.  Notwithstanding the foregoing, if requested
by any entity with which Executive is not  affiliated,  Executive may serve as a
reference  for any person who at the time of the  request is not an  employee of
the Company or any of its affiliates.

         11.5.  If, at the time of  enforcement  of this Section,  a court holds
that the restrictions  stated herein are unreasonable  under  circumstances then
existing,  the parties agree that the maximum period, scope or geographical area
reasonable under such circumstances  shall be substituted for the stated period,
scope or area and that the court  shall be allowed  to revise  the  restrictions
contained herein to cover the maximum period, scope and area permitted by law.

                                       28

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

12. Refund Of Benefits.

         In the  event  Executive  is in  breach of  Section  11  ("Non-Compete,
Non-Solicitation"),  or such modified  version as may be required by law,  after
first (i) being  provided by the Company with written  notice that describes the
breach and grants  Executive  no less than thirty (30) days to cease all conduct
giving rise to such breach,  and (ii) Executive having failed to comply with the
Company's notice, Executive will then relinquish to the Company:

         12.1. all stock options and other  benefits  under any stock  incentive
plan,  including the Options  granted under this Agreement and  Attachment  "A",
which vested in the  Executive's  interest  during the six months  preceding the
last day of Executive's  employment by the Company. In the event Executive sells
or otherwise  transfers any such Options,  Executive  will refund to the Company
the amount of the gross economic value realized by Executive.

         12.2. all bonus payments, or any pro rata portions thereof,  which were
paid or otherwise  owed to Executive  for his services  rendered  during the six
months preceding the last day of Executive's employment by the Company.

         12.3. all severance payments  calculated on the basis of salary,  bonus
or both.

         12.4. in the event the Loan has been  previously  forgiven  following a
Corporate

                                       29

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

Transaction in accordance with Section 7.8.6, the Loan shall be reinstated as if
the  Corporate  Transaction  had  not  occurred,  including  all of  Executive's
obligations  for  repayment  of the Loan under this  Agreement  and all  related
documents.

         12.5. The  relinquishment of the foregoing  benefits in accordance with
this Section shall not limit or otherwise preclude all other rights and remedies
of the Company due to the Executive's breach of this Agreement.

13. Enforcement.

         Because  Executive's  services  are unique and  because  Executive  has
access to  Confidential  Information  of the  Company  and its  affiliates,  the
parties  hereto  agree  that  money  damages,  while  not  waived,  would  be an
inadequate  remedy for any breach of this Agreement.  Therefore,  in the event a
breach or threatened breach of this Agreement,  the Company or its successors or
assigns may, in addition to other  rights and remedies  existing in their favor,
including  the  award  of  money  damages,  apply  to  any  court  of  competent
jurisdiction for specific performance and/or injunctive or other relief in order
to enforce, or prevent any violations of, the provisions hereof (without posting
a bond or other security).

14. Indemnification.

         Executive  shall be entitled to be indemnified for his activities as an
officer to the full extent provided in the Articles of Incorporation and By-Laws
of the Company and in

                                       30

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

accordance with the  Indemnification  Agreement  annexed as Attachment C hereto,
which the Company and  Executive  agree to promptly  execute.  In addition,  the
Company shall cover Executive under Directors and Officers  Liability  Insurance
during the  Employment  Term in the same  amount  and to the same  extent as the
Company covers its other officers.

15. Executive Representations.

         Executive   represents  and  warrants  to  the  Company  that  (i)  the
execution,  delivery and performance of this Agreement by Executive does not and
will not conflict with,  breach,  violate or cause a default under any contract,
agreement,  instrument,  order, judgment or decree to which Executive is a party
or by which he is bound,  (ii) except with respect to agreements which have been
furnished to the Company and relate primarily to  confidentiality,  intellectual
properties  and/or ethical conduct entered into between Executive and his former
employer(s),  Executive is not a party to or bound by any employment  agreement,
change in control agreement,  non-compete agreement or confidentiality agreement
with any other person or entity,  (iii) upon the  execution and delivery of this
Agreement  by the  Company,  this  Agreement  shall  be the  valid  and  binding
obligation  of  Executive,  enforceable  in  accordance  with  its  terms,  (iv)
Executive is a United States  citizen or a lawfully  resident  alien entitled to
work within the United  States,  and (v) Executive will in performing his duties
not utilize any confidential information of any other person or entity.

                                       31

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

16. Entire Agreement; Modification.

         This Agreement, and all documents incorporated herein,  constitutes the
full and complete  understanding  of the parties  hereto and will  supersede all
prior  agreements  and  understandings,  oral or  written,  with  respect to the
subject  matter  hereof.  Each  party  to this  Agreement  acknowledges  that no
representations,  inducements,  promises or agreements,  oral or otherwise, have
been made by either party, or anyone acting on behalf of either party, which are
not  embodied  in this  Agreement,  and that no other  agreement,  statement  or
promise  not  contained  in this  Agreement  shall  be valid  or  binding.  This
Agreement  may not be modified  or amended  except by an  instrument  in writing
signed by the party against whom or which enforcement may be sought.

17. Survival.

         The   provisions  of  this   agreement   which  by  their  terms  imply
continuation beyond the end of the Employment Term shall survive notwithstanding
any termination of the Employment Term.

18. Severability.

         Any  term  or  provision  of  this   Agreement   which  is  invalid  or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such invalidity or  unenforceability  without rendering invalid
or  unenforceable  the  remaining  terms and

                                       32

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

provisions of this Agreement or affecting the validity or  enforceability of any
of the terms of provisions of this Agreement in any other jurisdiction.

19. Waiver of Breach.

         The  waiver  by any  party  of a  breach  of  any  provisions  of  this
Agreement, which waiver must be in writing to be effective, shall not operate or
be construed as a waiver of any subsequent breach.

20. Notices.

         All notices  hereunder  shall be in writing and shall be deemed to have
been duly given when  delivered by hand, or one (1) day after sending by express
mail or other  "overnight  mail  service,"  or three (3) days  after  sending by
certified or registered mail, postage prepaid, return receipt requested.  Notice
shall be sent as follows: if to Executive, to the last known address provided by
the  Executive in the Company's  records and, if to the Company,  at the address
set forth on the first page of this Agreement, attention of the General Counsel.
Either  party may change the notice  address by notice in  accordance  with this
Section.

21. Assignability; Binding Effect.

         This  Agreement  shall be  binding  upon and  inure to the  benefit  of
Executive and Executive's legal  representatives,  heirs and  distributees,  and
shall be binding  upon and inure to the benefit of the Company,  its  successors
and assigns. This Agreement may

                                       33

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

not be  assigned by the  Executive.  This  Agreement  may not be assigned by the
Company,  except in connection  with a merger or a sale by the Company of all or
substantially  all of its assets and, in such event,  only on the condition that
the assignee  specifically  assumes in writing all of the Company's  obligations
under this Agreement.

22. Governing Law.

         All issues  pertaining  to the  validity,  construction,  execution and
performance of this Agreement shall be construed and governed in accordance with
the laws of the State of  California,  without  giving effect to the conflict or
choice of law provisions thereof.

23. Arbitration.

         23.1.  In the event of any dispute of any kind  whatsoever  between the
parties,  arising  out of or related in any way to this  Agreement,  the parties
agree to submit all such  disputes to binding  arbitration.  Each party shall be
entitled  to appoint one  arbitrator,  who shall not be an  affiliate,  officer,
director,  employee,  agent,  vendor or contractor of that party.  The appointed
arbitrators shall then appoint a neutral arbitrator who shall serve as Chairman,
and the  arbitration  shall be  conducted  by the  arbitrators  so  chosen.  The
parties' arbitrators shall be experienced executives in the technology industry,
and the  Chairman  shall be an attorney  practicing  litigation  in the field of
employment  law.  The  arbitration  shall be  conducted  in Santa Clara  County,
California.

                                       34

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

Demand for  arbitration  shall be made in writing  and shall be served  upon the
party or parties to whom the demand is addressed in the manner  provided for the
tender of  notices  in this  Agreement.  If the party  receiving  the demand for
arbitration does not appoint its arbitrator  within 30 days after receiving such
notice, the arbitrator appointed by the party serving the demand for arbitration
shall be further empowered to serve as the sole arbitrator, notwithstanding that
he fails to meet the qualifications for the Chairman set forth in this Section.

         23.2.  The  arbitrators  are  authorized to award any remedy,  legal or
equitable,  as well as any  interim  relief  as they deem  appropriate  in their
discretion.  However,  notwithstanding the foregoing, the arbitrators shall have
no power to add to,  subtract  from, or modify any of the terms or conditions of
this Agreement.

         23.3. Subject to the arbitration  agreement stated in this Article, the
federal and state courts  located in Santa Clara County,  California  shall have
exclusive  jurisdiction  over all other legal  proceedings  between the parties.
Executive agrees to the personal  jurisdiction of said courts and to the receipt
of service of process in the same form as other  notices  under this  Agreement.
Application  may be  made  to any  such  court  to  assist  the  arbitrators  in
performing their arbitral duties, to confirm their award and to enforce any such
award as a judgment of said court.

                                       35

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

24. Special Tax Provision.

         Anything in this  Agreement  to the  contrary  notwithstanding,  in the
event that any amount or benefit paid,  payable,  or to be paid, or distributed,
distributable,  or to be  distributed  to or with respect to Executive  (whether
pursuant  to the terms of this  Agreement  or any  other  plan,  arrangement  or
agreement  with the  Company,  any person  whose  actions  result in a change of
ownership or effective control covered by Section  280G(b)(2) of the Code or any
person  affiliated  with the Company or such  person) as a result of a change in
ownership  or  effective  control of the Company or a direct or indirect  parent
(within the meaning of Section  280G of the Code)  thereof (or the assets of any
of the foregoing) covered by Code Section 280G(b)(2) (collectively, the "Covered
Payments")  is or becomes  subject to the excise tax imposed by or under Section
4999 of the Code (or any similar tax that may hereafter be imposed),  and/or any
interest or penalties with respect to such excise tax (such excise tax, together
with such interest and penalties, is hereinafter collectively referred to as the
"Excise Tax"), the Company shall pay to Executive an additional amount (the "Tax
Reimbursement  Payment")  such that  after  payment  by  Executive  of all taxes
(including,  without  limitation,  any interest or penalties  and any Excise Tax
imposed on or attributable to the Tax Reimbursement  Payment itself),  Executive
retains an amount of the Tax  Reimbursement  Payment equal to the sum of (i) the
amount of the Excise Tax imposed  upon the Covered  Payments,  and (ii)  without
duplication, an amount equal to the

                                       36

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

product of (A) any deductions disallowed for federal,  state or local income tax
purposes  because  of  the  inclusion  of  the  Tax  Reimbursement   Payment  in
Executive's  adjusted gross income, and (B) the highest applicable marginal rate
of federal, state or local income taxation,  respectively, for the calendar year
in which the Tax  Reimbursement  Payment is made or is to be made. The intent of
this Section is that after  Executive  pays federal,  state and local income tax
and any payroll  taxes,  Executive  will be in the same position as if Executive
were not  subject to the Excise Tax under  Section  4999 of the Code and did not
receive the extra payments  pursuant to this Section,  and this Section shall be
interpreted accordingly.

         Except  as  otherwise   provided  in  this  Section  24  ("Special  Tax
Provision"),  for purposes of  determining  whether any of the Covered  Payments
will be  subject  to the Excise  Tax and the  amount of such  Excise  Tax,  such
Covered Payments will be treated as "parachute  payments" (within the meaning of
Section  280G(b)(2) of the Code) and such payments in excess of the Code Section
280G(b)(3)  "base amount" shall be treated as subject to the Excise Tax, unless,
and  except to the extent  that,  the  Company's  independent  certified  public
accountants  appointed prior to the change in ownership  covered by Code Section
280G(b)(2) or legal counsel  (reasonably  acceptable to Executive)  appointed by
such public accountants (or, if the public accountants  decline such appointment
and decline  appointing such legal counsel,  such

                                       37

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

independent  certified public accountants as promptly mutually agreed on in good
faith by the  Company  and  Executive)  (the  "Accountant"),  deliver  a written
opinion to Executive,  reasonably  satisfactory  to  Executive's  legal counsel,
that, in the event such reporting  position is contested by the Internal Revenue
Service,  there will be a more likely than not chance of success with respect to
a claim  that the  Covered  Payments  (in  whole  or in part) do not  constitute
"parachute  payments," represent  reasonable  compensation for services actually
rendered (within the meaning of Section 280G(b)(4) of the Code) in excess of the
"base amount"  allocable to such  reasonable  compensation,  or such  "parachute
payments" are otherwise not subject to such Excise Tax (with  appropriate  legal
authority,   detailed   analysis  and  explanation   provided   therein  by  the
Accountant);  and the value of any Covered Payments which are non-cash  benefits
or deferred  payments or  benefits  shall be  determined  by the  Accountant  in
accordance with the principles of Section 280G of the Code.

         For  purposes  of  determining  the  amount  of the  Tax  Reimbursement
Payment,  Executive shall be deemed:  to pay federal,  state and/or local income
taxes  at the  highest  applicable  marginal  rate of  income  taxation  for the
calendar year in which the Tax  Reimbursement  Payment is made or is to be made,
and to have otherwise allowable  deductions for federal,  state and local income
tax purposes at least equal to those  disallowed due to the inclusion of the Tax
Reimbursement Payment in Executive's adjusted gross income.

                                       38

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

         In the  event  that  prior  to the  time  Executive  has  filed  any of
Executive's  tax returns for the calendar  year in which the change in ownership
event covered by Code Section 280G(b)(2)  occurred,  the Accountant  determines,
for any reason whatsoever,  the correct amount of the Tax Reimbursement  Payment
to be less than the amount determined at the time the Tax Reimbursement  Payment
was made,  Executive shall repay to the Company,  at the time that the amount of
such reduction in Tax Reimbursement Payment is determined by the Accountant, the
portion of the prior Tax  Reimbursement  Payment  attributable to such reduction
(including  the portion of the Tax  Reimbursement  Payment  attributable  to the
Excise Tax and federal, state and local income tax imposed on the portion of the
Tax Reimbursement  Payment being repaid by Executive,  using the assumptions and
methodology  utilized  to  calculate  the  Tax  Reimbursement   Payment  (unless
manifestly  erroneous)),  plus  interest on the amount of such  repayment at the
rate  provided  in  Section  1274(b)(2)(B)  of the Code.  In the event  that the
foregoing  determination is made by the Accountant after the filing by Executive
of any of  Executive's  tax returns for the calendar year in which the change in
ownership event covered by Code Section  280G(b)(2)  occurred,  but prior to one
(1) year after the occurrence of such change in ownership,  Executive shall file
at the  request  of the  Company an amended  tax return in  accordance  with the
Accountant's  determination,

                                       39

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

but no portion of the Tax Reimbursement Payment shall be required to be refunded
to the Company  until  actual  refund or credit of such portion has been made to
Executive,  and  interest  payable to the Company  shall not exceed the interest
received or credited to Executive by such tax  authority  for the period it held
such  portion  (less  any tax  Executive  must pay on such  interest  and  which
Executive  is unable to deduct as a result of  payment  of the  refund).  In the
event  Executive  receives  such a refund and repays such amount to the Company,
Executive  shall  thereafter  file for any refunds or credits that may be due to
Executive by reason of the repayments to the Company.  Executive and the Company
shall  mutually  agree upon the course of action,  if any, to be pursued  (which
shall be at the expense of the Company) if Executive's  claim for such refund or
credit is denied.

         In the event that the Excise Tax is later  determined by the Accountant
or the  Internal  Revenue  Service  to exceed  the  amount  taken  into  account
hereunder at the time the Tax Reimbursement Payment is made (including by reason
of any payment the existence or amount of which cannot be determined at the time
of the Tax  Reimbursement  Payment),  the Company shall make an  additional  Tax
Reimbursement  Payment in respect of such excess (plus any interest or penalties
payable  with  respect to such excess) once the amount of such excess is finally
determined.

         In the event of any controversy  with the Internal  Revenue Service (or
other

                                       40

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

taxing  authority)  under this Section,  Executive and the Company shall in good
faith cooperate so as not to jeopardize  resolution of said controversy.  In the
event of any  conference  with any  taxing  authority  as to the  Excise  Tax or
associated  income  taxes,  Executive  shall  permit the  representative  of the
Company to accompany  Executive,  and  Executive  and his  representative  shall
cooperate with the Company and its representative.

         With  regard to any  initial  filing  for a refund or any other  action
required  pursuant to this Section  (other than by mutual  agreement) or, if not
required,  agreed to by the Company and  Executive,  Executive  shall  cooperate
fully with the Company.

         Executive  and the  Company  shall  mutually  agree  on and  promulgate
further  guidelines  in  accordance  with this  Section to the  extent,  if any,
necessary to effect the reversal of  excessive  or shortfall  Tax  Reimbursement
Payments.

25. Headings.

         The headings in this Agreement are intended  solely for  convenience or
reference and shall be given no effect in the construction or  interpretation of
this Agreement.

26. Counterparts.

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

                                       41

<PAGE>

Contract of Employment
William P. Crowell
Restated September 1, 2001

         IN WITNESS  WHEREOF,  the Company has caused this  Agreement to be duly
executed and  Executive has hereunto set his hand as of the date first set forth
above.

CYLINK CORPORATION

By: ________________________________

Name: ______________________________

Title: _____________________________

EXECUTIVE

________________________________
William P.  Crowell

                                       42

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